Canadian exploration company Homestake Resource (CVE:HSR) announced Tuesday a $4.5 million financing to fund a 2012 exploration program at its Homestake Ridge project.
The proposed non-brokered financing will consist of flow-through common shares and non-flow-through units.
The company will issue a maximum of 10 million flow through-shares to
Canadian resident investors, priced at 25 cents per share for gross
proceeds of up to $2.5 million.
These funds will be used for Canadian exploration expenses at the
company’s Homestake Ridge and Kinskuch projects in British Columbia,
related to exploration during 2012 to 2013.
Homestake also said a maximum of 10 million units priced at 20 cents
each will be issued for total proceeds of up to $2.0 million. Each unit
is made up of one common share and one share purchase warrant.
A whole warrant entitles the holder to purchase one common share at a price of 30 cents for 36 months.
The proceeds from the non-flow through units will be used for working capital.
Drilling on the Homestake Ridge project in 2012 will outline the
extent of mineralization discovered in 2011 at the South Reef deposit,
which is located roughly 800 metres to the southwest of the Homestake
The planned holes will offset three holes from the 2011 program that
tested a 75 metre strike-length of the mineralized trend to depths of
260 metres, and intersected more than 30 grams per tonne (g/t) gold in
each hole, including a 3.1 metre interval averaging 30.8 g/t gold and
3.3 g/t silver from drill hole HR11-232.
The company said drilling will target much of the 1.2 kilometre
strike length of this newly identified, mineralized zone, which
represents the third high-grade gold/silver deposit discovered in this
Mineralization remains open at depth and along the full strike-length
of the target horizon, the company said, which is equal to the
cumulative strike-length of the previously delineated Main Homestake and
Homestake Silver deposits.
The Homestake Ridge project in northwestern British Columbia is being
advanced as a potential high-grade underground mining operation with a
current NI 43-101 compliant indicated resource, at a 3.0 g/t gold
equivalent cut-off, of 191,000 ounces gold and 1.35 million ounces of
silver. It also has an inferred resource of 530,000 ounces gold and
13.47 million ounces of silver.
Two deposits have been delineated to date, with a third, South Reef, discovered late in 2011.
Homestake also holds an option to acquire the 623-square-kilometre
Kinskuch project located adjacent to, and to the southeast of the
company’s Homestake Ridge project.
A defined resource at South Reef and possibly at Kinskuch, together
with any new discoveries, will add to the NI 43-101 compliant resources
at the two deposits already discovered and delineated the Homestake
In April, the TSX Venture Exchange approved the company’s share
consolidation as well as a corporate name change from Bravo Gold to Homestake Resource Corporation.
Shares traded at 24 cents Tuesday afternoon.