In this week’s Funding Friday, the Australian Securities Exchange (ASX) saw a number of sizable funding announcements flock in for explorers.
Capstone Copper (ASX:CSC) will receive a $360 million cash consideration from Orion Resource Partners to acquire a 25% stake in the Santo Domingo and Sierra Norte projects in Chile.
The investor will pay $225 million upon the return of a positive final investment decision, followed by another $75 million within six months, and up to $60 million as a contingent cash consideration after reaching certain milestones.
Concurrently, the parties have executed an equity subscription agreement.
Orion intends to subscribe for $10 million worth of shares in Capstone at an issue price representing a 5% premium to the five-day volume weighted average price (VWAP).
Funds attained in this agreement will be used to streamline an exploration program across both projects.
Capstone CEO Cashel Meagher says this transaction supports the company to unlock value in the Mantoverde-Santo Domingo district.
“Santo Domingo represents the next pillar of transformational growth in the world-class district we are building in the Atacama region of Chile,” Meagher says.
“Backed by industry-competitive capital intensity and first quartile cash costs, Santo Domingo is key to continuing our growth trajectory and leadership in the critical minerals industry, led by long-life, low-cost, responsible, and safe production.
“Our same team that successfully built and ramped-up Mantoverde will support construction and ramp-up of Santo Domingo, which is 35 kilometres away from Mantoverde.”
Orion CIO Istvan Zollei says this investment builds on the company’s existing relationship with Capstone.
“As proven mine builders and operators with a strong local presence and social licence, we are confident in Capstone’s ability to build and operate Santo Domingo as a high-quality, diversified copper operation, producing the metals the world needs for the clean energy transition,” Zollei says.
Dynasty investments
Titan Minerals (ASX:TTM) has welcomed Lingbao Gold International (HKG:3330) as a strategic investor in time for the company to accelerate resource drilling and derisk studies at the Dynasty Gold Project in southern Ecuador.
The subscription agreement requires Lingbao to subscribe for 25.81 million shares for US$10 million ($15.4 million), with shares issued at US$0.39 per share, representing a 31% premium to the last closing price and 33% premium to the 30-day VWAP.
The parties have also entered a process and exclusivity deed, under which Lingbao holds exclusivity rights to conduct due diligence investigations at the Dynasty Project over a 90-day period and a right of first refusal for a 180-day period in relation to the project’s disposal.
Titan CEO Melanie Leighton says the company believes there are significant synergies to be unlocked through this partnership for the project.
“Through their Hong Kong listing and mining operations, Lingbao have access to substantial capital along with a proven track record of developing and mining high-grade gold deposits,” Leighton says.
“These key attributes align with our aim to fast-track the development and mining of the Dynasty Gold Project in southern Ecuador.”
Lingbao Chairman Pinran Wang says the partnership will go beyond unlocking the value of the Dynasty Project and into Titan held assets in the future.
“Lingbao has a proven track record of successfully developing and operating gold mines,” Wang says.
“I appreciate Titan’s great effort in the past years to develop and grow the value of its assets, I believe the synergy between Lingbao and Titan will bring a fast-tracking stage of development and mining of the Dynasty Gold Project, which shall result in creating significant value for both of our shareholders.”
Greater Duchess cancels out debt
Meanwhile, Latitude 66 (ASX:LAT) has completed the sale of its 17.5% interest in the Greater Duchess joint venture in Queensland to Carnaby Resources (ASX:CNB) for $6 million.
The sale comprises an upfront cash payment of $2 million, with the remaining $4 million held in Carnaby shares at an issue price based on the 30-day VWAP, making Latitude debt-free to enable exploration across its portfolio of projects.
Latitude received 9.85 million shares in Carnaby.
Managing Director Grant Coyle says the sale boosted funding as well as offered the company a chance to repay its loan from Argonaut Partners in full.
“On the completion of the transaction, Latitude has become one of the major shareholders in Carnaby and we look forward to continued growth from this investment as the Carnaby team continue the development of the significant copper asset in Queensland,” Coyle says.
“This is an exciting time for Latitude, with the gold price at all-time highs and the funding received enabling us to advance our Finnish Projects towards development and continue to advance exploration and development activities across our Western Australian gold portfolio.”
The ABC Bullion reports the price of gold sits at US$4,245 as of 16 October, reaching new heights in the trading week ending 17 October.
Trading Economics marks the price jump at 6.49% over the week, as a part of a 61.29% increase year to date.
Write to Maddison Elliott at Mining.com.au
Images: Titan Minerals & Latitude 66
