EMED Mining to raise £8.775m through institutional placing in UK and Canada

EMED Mining (AIM: EMED) has conditionally placed approximately 83.5 million new shares at 10.5p each, raising gross proceeds of £8.775 million. The new shares were placed with existing and new institutional investors principally in the UK and Canada. The proceeds will help fund the company’s two key projects the Rio Tinto project (Proyecto Rio Tinto, PRT) in Andalucía and the Biely Vrch gold project in Slovakia.
"We are delighted with the support for EMED Mining from existing and new international institutional investors ... The placing serves to prepare for the company's dual-listing on a major international mining exchange later in the year”, EMED Mining MD Harry Anagnostaras-Adams commented.
The net proceeds will fund the maintenance, planning and permitting process in relation to the PRT in Andalucía, Spain. A proportion of the new capital will also go towards funding the mine-development feasibility, planning and permitting being carrying out in Slovakia, and for general working capital purposes.
"This financing underpins the carefully planned process for restarting the Rio Tinto Mine in 2011 and transforming it into an efficient 21st century operation”. Anagnostaras-Adams stated. “It also allows the company to trigger planning for the drilling and other initiatives to extend mine life and expand base case annual production".
The placing was facilitated by Fox-Davies Capital, and the new shares will be issued, and admitted to trading on AIM, subject to shareholder approval at a general meeting on the 3rd May. Accordingly the company said it has dispatched a circular to investors.
Anagnostaras-Adams highlighted the fact that many of EMED's shareholders are the same companies that funded the start-up of recently permitted base metal mine start-ups near the Rio Tinto Mine - Portugal's Neves Corvo and Andalucia's Aguablanca, Aguas Tenidas and Las Cruces.
The PRT mine and plant site is adjacent to the town of Rio Tinto, 65 km (kilometres) northwest of Seville in Andalucia. The mine was placed on care and maintenance, by a previous owner, in 2000 due to low copper prices - which were below $US1.00/lb at the time. In May 2007, EMED Mining was granted an option to acquire the PRT, and subsequently in October 2008, EMED’s Tartessus SL subsidiary acquired 100% ownership of the property.
EMED plans to commence production from the Rio Tinto mine in 2011, having timetabled the regulatory and permitting process over the course of the next twelve months. Public consultations, further regulatory reviews and administrative approvals are expected to be completed from the second quarter of the 2010 calendar year onwards, while the company plans to seek shareholder approval and commence start-up activities at the mine through the third and fourth quarter of 2010.
The PRT has an independently verified, by AMC Consultants, JORC-Compliant Mineral Resources and Ore Reserves. The mineral resources total 205.2 Mt (million tonnes) at 0.46% copper - equating to 0.94 Mt of contained copper, at a cut-off grade of 0.20% copper. The ore reserves total 123 Mt at 0.48% copper - 0.58 million tonnes of contained copper, at a cut-off grade of 0.20% copper.
In Slovakia, EMED is advancing its Biely Vrch gold project towards production. In March, the company commissioned a refinement to an existing scoping study, to adjust the siting of infrastructure, and improve the project economics by adjusting the slopes of the planned open pit. The study will also evaluate the potential for additional revenues from selling waste rock mined from the open pit for use in building roads. The original scoping study envisaged a mining operation of 3 Mt of ore per annum and a recovered grade of 0.6 to 0.7 g/t (grams per tonne) of gold to produce some 60,000 oz (ounces) per annum.
Annual expenditure in the region is expected to total US$36 million, while operating costs are estimated at US$500 to US$600 per oz compared to the current gold price of US$1,100/oz.
Biely Vrch has additional drill-confirmed potential below the current mineral resource of 41.7 Mt at 0.79g/t gold, containing 1.1 Moz (million ounces). This potential will be further evaluated after the open-cut mine progresses towards development.
“Our goal for 2010 is to advance the project design and permitting process for Biely Vrch and justify triggering a Final Feasibility Study, which will hopefully lead to development and production. In parallel, we will explore our large licence area in central Slovakia for porphyry and other mineralisation styles in an area that historically yielded over 120 million ounces of silver and 3 million ounces of gold,” Harry Anagostaras-Adams stated in March.

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