Kincora Copper Ltd (CVE:KCC) is bullish on discovery through the drill bit in Mongolia.
The company announced Tuesday its plans to raise up to $6 million to fund drilling at five independent and large-scale targets in the Southern Gobi copper belt in Mongolia, where it is undertaking the first modern systematic exploration program at the Bronze Fox and East Tsagaan Suvarga projects.
Proceeds from the latest financing will support up to 18,000 metres of drilling and advance an early stage pipeline and exploration strategy, Kincora said in a statement.
READ: Kincora Copper issues 787,500 shares for services
Under the terms of the private placement, each unit is priced at $0.10, comprising of one share and one warrant that allows the holder to acquire a further share at a price of $0.25 during a two-year period following the closing date.
Kincora also announced that its largest shareholder, LIM Asia Special Situations Master Fund Limited (LASSMF) will subscribe for a 28% share of the offering.
"I am delighted that we have attracted a strong cornerstone position from our largest shareholder and such interest from other experienced institutional resource sector specialist and high net worth investors,” said Kincora chairman Cameron McRae. “The support and detailed due diligence processes provide validation of our drill targets, strategy and team.”
He added that the offering has been structured to align the immediate and medium term capital markets strategy to Kincora’s asset portfolio of 5 standalone, large and drill ready porphyry targets. “Success on any one of these targets would indicate a new globally significant copper discovery,” he said.
"The offering will provide a strong foundation for the drill bit to again drive Kincora's valuation going forward, ramping up our exploration and expansion activities,” said Kincora’s president and CEO Sam Spring.
Exploration plans
The Vancouver-based company plans to spend $2.2 million at Bronze Fox, where it is planning to drill up to 8,100 metres. A portion of the funds will also go towards a mining license application, according to Kincora.
At the East Tsagaan Suvarga project, Kincora will spend up to $1.3 million on Phase 2 drilling of up to 6,200 metres.
The junior exploration company will also spend up to US$1 million on project generation for up to 4,000 metres of drilling and around $600,000 for early stage project pipeline exploration work.
Shares of Kincora slipped 5.6% on Tuesday morning to sit at C$0.09 in Toronto.
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