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Thursday, 25 October 2012
Patagonia raises £6.5 million to further projects
South America-focused Patagonia Gold (LON:PGD, TSE:PAT) has raised £6.5 million in a financing to further develop its projects.
The funds will be used on the Lomada de Leiva gold production project, continuing development expenditure on the Cap-Oeste and COSE projects in Argentina and to provide working capital.
The firm placed around 16.6 million shares and 12.39 million as part of a subscription - each at a price of 22.5 pence.
The firm's shares closed yesterday at 23 pence each.
Managing director Bill Humphries said: "This financing, together with the gold sales revenue derived from the successful Lomada heap leach trial, will provide the company with the financial resources to construct and commission the Lomada main heap leach facility, expected to be fully operational in March 2013, subject to receiving all required permitting during Q4 2012."
It will also allow for the continuation of the drilling program on the company's flagship Cap-Oeste development and to commence the construction of our Bonanza COSE project early in 2013, he added.
"We expect that incremental cash flow from the operation of the Lomada main heap leach facility will be adequate to continue funding COSE to production by Q3 2013.
"The board was particularly gratified by the continued support of its existing shareholders."