UXA Resources (ASX: UXA) will now be well funded to continue exploration activities at the company's three active projects, after entering into a funding agreement.
The agreements comprises the issue of A$2.5 million of convertible notes to US-based La Jolla Cove Investors Inc - with the group believing that the market is undervaluing UXA Resources.
Russell Penney, managing director of UXA Resources, commented “this funding agreement is an important component of UXA’s future exploration plans and is a very welcome investment in the company at a time of such uncertainty in the capital markets.
"It is a low cost way of funding our exploration program compared to alternative funding arrangements. The notes are unsecured with no restriction on further debt or capital raisings.”
La Jolla Cove provided some very positive insights into UXA Resources, with director Rob Lizt adding, “we’re highly impressed by UXA Resources’ experienced management, diverse portfolio including zinc, copper, gold and uranium, well-known JV partners, and international cash flow positive logging business.
"Given the current climate, we believe the market is undervaluing the assets of the company and see a great opportunity here.”
Exploration program - three diverse projects
1. At the Dome 5 lead-zinc-silver project in New South Wales, phase 2 exploration will include infill and step out drilling over eight holes for 2800 metres to test the potential MVT style mineralisation.
The exploration target is a 5Mt to 10Mt mineralised body at 10% lead plus zinc with silver credits.
2. Nabarlek North uranium project in Northern Territory, phase 2 exploration to follow up previous encouraging reverse circulation percussion drill results testing the potential strike length extension of the U40 prospect into Nabarlek North and radon cup sampling results pinpointing additional drill targets.
3. Myroodah and Mudjalla uranium projects in Western Australia, drill testing a large radiometric anomaly identified in a recent airborne geophysical survey.
The tenements are located in a highly prospective region for potential sandstone hosted uranium mineralisation amendable to low cost in-situ leach mining methods.
UXA Resources also has the rights to explore for coal on the Mudjalla and Myroodah West tenements.
Originally published at: http://www.proactiveinvestors.com.au/companies/news/20299/uxa-resources-boosts-exploration-funds-with-a25m-convertible-note-facility-with-la-jolla-cove-20299.html
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