Moho Resources Ltd (ASX:MOH) has completed a bookbuild for a strongly supported $1.51 million capital raising to fund its acquisition of a granted exploration licence and technical information pertaining to six project areas in Western Australia from Whistlepipe Exploration Pty Ltd.
Funds raised will also go towards exploration activities at Silver Swan North Project, Burracoppin, Empress Springs and working capital.
The company understands the tenement and project areas under the Whistlepipe acquisition agreement may be prospective for nickel and associated battery and precious metals.
Unique exploration opportunity
Moho managing director Shane Sadleir said: “This is a unique exploration opportunity for Moho. The track record of the principals of Whistlepipe speaks for itself, given their involvement in the discovery of a number of significant mineral deposits, including the exceptional PGE-nickel-copper-cobalt-gold discovery at Julimar near Perth.
“Moho is looking forward to commencing this exciting phase of exploration for nickel and associated battery and precious metals in these prospective and relatively untested provinces in Western Australia.”
Whistlepipe tenements
The Whistlepipe tenement and project areas are in sparsely and under-explored ground within the prospective western and southwestern margins of the Yilgarn craton and the Albany-Fraser orogen of Western Australia.
Based on information provided by Whistlepipe, the tenement and project areas may be prospective for nickel and associated battery and precious metals.
They were identified using similar concepts and targeting parameters that led to the discovery of the Gonneville PGE-nickel-copper-cobalt-gold mineralisation within the Julimar mafic-ultramafic intrusive complex on the western margin of the Yilgarn Craton.
Technical consultancy agreement
Moho has also entered into a technical consultancy agreement with Whistlepipe to provide geological and geophysical services as required by the company across its project portfolio and all prospective areas and tenements introduced to Moho by Whistlepipe.
Subject to further investigations and due diligence under Moho’s agreement with Whistlepipe, Moho intends to promptly commence exploration on the granted tenement and apply for one or more exploration tenements within the areas of the projects.
Agreement details
Subject to satisfaction of a number of conditions precedent including completion of due diligence by Moho within 60 days and receipt of any necessary statutory, regulatory and ASX approvals, Moho has agreed to pay Whistlepipe Exploration or its nominee the following consideration:
➢ $20,000 worth of fully paid ordinary shares in Moho for the tenement and $10,000 worth of fully paid ordinary shares in Moho for each project, at a deemed issue price based on the volume-weighted average price for the shares on the 10 trading days on which sales in shares were recorded before the date the agreement is signed;
➢ $10,000 cash for each project area within 10 business days of the date on which the tenement relating directly to each project is granted or, in the case of a project comprising multiple tenements, when the last of those tenements is granted;
➢ Within 10 business days after the announcement of a maiden JORC-compliant mineral resource (as defined in the JORC Code 2012 Edition) delineated by Moho on any of the projects or the tenement, $1.50 cash per ounce of gold (or metal equivalent) comprising that resource announced in respect of the respective project or tenement;
➢ Within 10 business days of an announcement, in respect of a project or tenement of a final investment decision (FID) to commence commercial mining, $1.50 cash per ounce of contained gold (or metal equivalent) within the JORC compliant mineral reserve of the feasibility study, which was the basis to make that FID; and
➢ Entitlement to a 1% net smelter return royalty on all minerals, mineral products and concentrates, produced, recovered and sold from the tenement or projects.
Positive endorsement
On the capital raising, Sadleir said: “Moho is delighted with the strong demand for shares in this placement.
“The market response is a positive endorsement of the company’s decision to expand its nickel exploration activities both at Silver Swan North and into new target areas generated by the highly credible principals of Whistlepipe Exploration.
“We are looking forward to drill testing the recently identified nickel sulphide targets at Silver Swan North, as well as initiating exploration on tenement applications adjacent to Poseidon’s Black Swan Nickel Plant.
"We remain committed to advancing our promising gold projects at Empress Spring and Burracoppin and progressing the East Sampson Gold Project into production as soon as practicable.”
Capital raising
The bookbuild was oversubscribed with strong demand from sophisticated and professional investors.
The capital raising comprises:
➢ 22.5 million new shares at an issue price of A$0.06 per share to raise up to A$1.35 million pursuant to its ASX Listing Rule 7.1 (12,194,235 shares) and 7.1A capacity (10,305,765 shares); and
➢ 2.67 million new shares at an issue price of A$0.06 per share to raise up to A$160,000 from directors and related parties of the company, subject to shareholder approval with a shareholders meeting expected to be held in December 2021.
Investors will receive one free attaching option for every one share issued in the placement, with each option having an exercise price of $0.085 and expiry date of three years from the date of issue.
The attaching options will be unlisted and will be issued subject to approval.
Use of funds
Proceeds from both the placements will go towards:
➢ Acquisition deal: Whistlepipe Exploration Agreements (nickel, battery & precious metals):
- Tenement applications over six targeted areas;
- Technical consultancy agreement with principals of Whistlepipe, who contributed to discovery at Julimar;
- Gravity and first-pass soil geochemistry surveys across a granted tenement in December 2021 to quickly identify targets for follow-up drilling in 2022; and
- Non-ground disturbing exploration prior to grant of tenement applications in project areas anticipated in around 12- 18 months.
➢ Exploration activities: Silver Swan North Project (nickel, gold):
- Reverse circulation (RC), diamond and aircore drilling over nickel targets at Omrah, Wise and Duke prospects;
- Gravity and first-pass soil geochemistry surveys on tenement applications adjacent and to the south and east of Poseidon’s Black Swan Nickel plant anticipated to be granted by the end of 2021, to quickly identify gold and nickel targets for follow up drilling; and
- Ongoing mining studies at East Sampson Dam gold deposit to advance the project to mining.
➢ Burracoppin (gold):
- Gravity and first-pass soil geochemistry surveys over E70/5739 to delineate targets for follow-up aircore drilling.
➢ Empress Springs (gold):
- Aircore and/or slimline RC drilling and groundwater sampling to follow-up seven of the most promising and diverse multi-element hydrogeochemical anomalies.
➢ Working capital.