AbraSilver Resource (TSX: ABRA, US-OTC: ABBRF) is raising $45 million (US$32 million) through a buyout share offering to fund early work on the Diablillos gold and silver project in Argentina as it moves toward a construction decision next year and production by the end of 2029.
The Toronto-based company agreed to sell 3.06 million common shares at $14.70 per share, according to a statement issued Thursday. AbraSilver shares fell 5.3% to $14.81 in Toronto on Thursday morning, valuing the company at $2.41 billion.
The new capital will be used for early business expected to start this quarter in Diablelus In the province of Salta and buy long lead equipment.
The funding follows a series of milestones including a final feasibility study released last month, final environmental approval, acceptance into Argentina’s Significant Investment Incentive (RIGI) scheme and continued exploration success beyond the current mining plan.
“The recently completed final feasibility study highlights the Diablillos project as a robust, high-margin, long-life precious metals project with significant production potential and significant exploration upside,” AbraSilver said.
holes
The underwriters, led by National Bank Financial, Beacon Securities and Raymond James, have an option to buy another 339,000 shares that could bring the total proceeds to nearly $50 million. The financing is expected to close around July 29. The project is located about 160 kilometers south of the city of Salta in northwestern Argentina.
On July 13, AbraSilver announced drilling operations indicating further resource growth beyond the limits of the Diablillos feasibility study. Hole DDH-26-036 in the Oculto West area traveled 109 meters grading 221.2 grams silver and 0.72 grams gold from a depth of 114 metres, including 14 meters grading 580 grams silver and 0.23 grams gold from a depth of 135 metres.
The results “highlight the continuity of high-grade gold-silver oxide mineralization in a previously untested area of Okulto West and outside the DFS mine plan,” Eric Winmill, a mining analyst at Scotia Capital, said at the time.
Resources
Diablillos hosts 232 million measured and marked tonnes grading 33 grams of silver and 0.34 grams of gold for 248.1 million ounces. It contains silver and 2.5 million oz. Contains gold. It also has 49.3 million inferred tonnes grading 12 grams of silver and 0.26 grams of gold for 18.4 million ounces. Silver and 420,000 oz. gold.
The feasibility study identified a 25-year open pit mine with an after-tax net present value of approximately US$3 billion, an internal rate of return of 42% and initial capital costs of US$722 million, including contingencies.
The mine is expected to produce an average of 20 million ounces of silver equivalent. annually during its first five years before averaging about 10 million ounces of silver equivalent. Over the course of her life.
The company is also developing The copitaa copper and gold marble project in Argentina’s San Juan mining district next to the Chilean border, in a joint venture with Teck Resources (TSX: TECK.A, TECK.B, NYSE: TECK). The Miocene thermoporphyry belt there hosts global deposits such as Velo del Sol, Los Azules, El Indio, Veladero, Pascua Lama, and El Pachón.
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