Western Mines Group (ASX:WMG) is heading to market to undertake a brokered capital raising in place of a previously secured $6 million funding facility.
In mid-July this year, the company locked in an ‘at-the-market’ (ATM) facility with Alpha Investment Partners to provide funding flexibility and capacity to expand and accelerate exploration at the Mulga Tank Project.
Activation of the funding facility required the issue of 3.5 million in collateral shares, which was approved by shareholders at Western Mines’ extraordinary general meeting on 21 August 2024.
The junior explorer, which has a market capitalisation of $14.9 million, says it is now planning a broker-led capital raising and as a condition of that is required to cancel the ATM facility.
This is being done at no cost to Western Mines and the 3.5 million collateral shares will be returned to the company to be utilised as part of the planned capital raise.
Managing Director Caedmon Marriott tells Mining.com.au the company is doing a small raising of $1 million, which will be announced to market next Monday when it exits the trading halt.
“The ATM facility requires liquidity in your stock to be able to sell shares on market in order to raise money,” he explains.
“This is hard to do and/or raise significant amounts as a microcap without driving down share prices.”
Mulga Tank is the company’s flagship asset located 190km east-northeast of Kalgoorlie in the Duketon Domain of the Burtville Terrane, in the Eastern Goldfields Province of the Yilgarn Craton, Western Australia.
Western Mines describes it as a “belt scale opportunity” spanning 425km2 of the “significantly underexplored” Minigwal Greenstone Belt.
The company says drilling has uncovered an extensive magmatic nickel sulphide mineral system, with the majority of holes drilled through sand cover intersecting visible nickel sulphide mineralisation including Mt Keith-style disseminated nickel sulphide mineralisation.
BHP’s (ASX:BHP) Mt Keith Mine, located 85km from Wiluna, hosts 643.7 million tonnes @ 0.58% nickel. It is a major komatiite-hosted nickel deposit.
Mulga Tank contains a 15km trend of interpreted komatiite flow channels emanating from the Mulga Tank intrusion that have received little to no exploration focus to date.
Write to Angela East at Mining.com.au
Images: Western Mines Group
