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Tuesday, 25 September 2012
Homestake Resource to raise up to $1.8 mln in financing for Kinskuch exploration program
Homestake Resource Corp (CVE:HSR)(FRANKFURT:B6IH) announced Friday it will raise up to $1.8 million in a financing for its Kinskuch exploration program this year.
The proposed offering, on a non-brokered basis, will consist of flow-through common shares and non-flow-through units.
It will issue a maximum of 2.0 million flow through shares to Canadian resident investors, priced at 30 cents each for proceeds of up to $600,000.
These funds will be used for Canadian exploration expenses defined under the nation's Income Tax Act, related to the 2012-2013 exploration program at its Kinskuch project in British Columbia.
The company will also issue a maximum of 4.0 million units at 30 cents each for proceeds of up to $1.2 million. Each unit is comprised of one common share and one half share purchase warrant.
Each whole warrant gives the holder the right to buy another share of Homestake for 35 cents for a period of two years.
The funds raised from the units will be used for working capital, Homestake said.
The company's Kinskuch project is a large 623 square kilometre property located directly east of its Homestake Ridge project and extends south roughly 30 kilometres to tidewater at Alice Arm/Kitsault in Northwestern British Columbia.
Initial work at Kinskuch will follow-up on "encouraging 2011 results" along a 2.5 km strike of the Illiance trend, the company said, and will continue the surface evaluation of the epithermal vein and massive sulphide showings on the trend both to the north and south.
Other historical showings and several geophysical anomalies found in the 2011 airborne survey over the property will be tested with the aim of developing new targets for drill testing in 2013, Homestake said.
"Encouraging" results in the 2011 drilling included KN11-02, which intersected several mineralized zones with the strongest being 2.8 metres of 318 grams per tonne (g/t) silver, 2.2% lead and 6.5% zinc.
A 500-metre offset of that hole, KN11-03, also encountered multiple intercepts including 3.9 metres of 267 g/t silver, 1.3% lead and 6.5% zinc.
Homestake Resource Corporation owns a 100 per cent interest in the Homestake Ridge project and an option to earn a 100 percent interest in the Kinskuch project, both located in the emerging Kitsault mineral district in northwestern British Columbia.
The Homestake Ridge project 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 oz gold and 1,350,000 oz silver plus an inferred resource of 530,000 oz gold and 13,470,000 oz silver.
Two deposits have been delineated to date, with a third, South Reef, discovered late in 2011.