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Wednesday, 6 February 2013
Kilo Goldmines rises on plans to raise new funds for its Somituri gold project
Shares of Kilo Goldmines (CVE:KGL) have been rising this past week since the company announced it has filed a preliminary prospectus for at least a C$10 million financing to fund further exploration of its Somituri gold property in the Democratic Republic of Congo.
Its stock was up by 25%, or 2.5 cents, Wednesday morning, to trade at 12.5 cents as of 11:30am ET.
The "fully marketed" offering, co-led by agents GMP Securities and Clarus Securities, consists of common shares, with the price yet to be determined in the context of the market.
The agents will also have the option to buy up to another 15% of the number of shares issued under the offering, excercisable at any time for a period of 30 days following closing.
Kilo said it expects to use the funds for further exploration at Somituri, and for working capital and general corporate expenses. The deal still needs approval from the TSX Venture Exchange.
Late last month, Kilo unveiled results from the Kitenge prospect at its Somituri project, saying they provide some of the clearest evidence yet of the continuity of high grade gold values with depth.
Of the notable results, the company hit 3.75 metres grading 27.08 grams per tonne (g/t) gold in hole 35, with a depth below surface of only 125 metres, meaning drilling can stand to be much deeper. The intersection was 60 metres vertically below prior hole 21 that was announced in November, which returned 5.8 metres at 42.24 g/t gold.
Kilo said the Kitenge prospect is now defined over a 1500 metre strike length. Kitenge is one of several exploration areas on the company's Somituri project and is just 4km from Kilo's 1.87 million ounce Adumbi gold deposit.
Kilo owns a 71.25% interest in the Somituri project and holds mineral rights on eight non-contiguous exploitation licences valid until 2039 covering 606 sq km, which includes the Imbo licence, which is 122 sq km.