Blackham Resources Ltd (ASX:BLK) has outlined plans to raise $25.8 million in a fully underwritten five-for-four rights issue priced at 1.5 cents.
Notably, Blackham’s executive chairman Milan Jerkovic has sub-underwritten $1.0 million of the issue in addition to committing to take up his rights of around $160,000.
An interim step to 250,000 ounces annual production
The funds will be invested in the company’s flagship 100% owned Matilda-Wiluna Gold Operation in Western Australia.
This includes:
• Operational improvements to existing operations;
• Completion of the expansion definitive feasibility study (DFS) during the September quarter;
• A material drill program targeting high-grade underground reserve expansion; and
• Paying down debt and ongoing working capital.
The Expansion DFS includes Stage 1 and Stage 2
Stage 1 is the proposed simple low capital addition of a flotation circuit to increase production to 100,000-120,000 ounces per annum.
Stage 1 will also allow gold production from Blackham’s large sulphide Reserves and provide flexibility to process both free milling or sulphide ores.
Stage 2 is the proposed new comminution, flotation cells and leach circuits and a refurbished BIOX® Plant to increase ore processing throughput to 2.2-3.3 million tonnes per annum.
This is expected to increase gold production to ~250,000 ounces per annum with significantly lower operating costs.