A HEAVILY oversubscribed share placement is set to net emerging Ghana gold producer Adamus Resources $A31.3 million as it works towards finalising construction of its Nzema project.
Led by Helmsec Global Capital and Patersons Securities, the placement of 29 million fully paid 55c shares to raise $15.9 million and a 1 for 15 renounceable rights issue at 55c a share to raise up to $15.4 million, is subject only to standard Toronto Stock Exchange Venture Exchange regulatory approval.
However, it said firm commitments for the placement were keenly sought by existing shareholders and sophisticated investors in Australia, Asia and Europe. The placement is scheduled for completion on Friday.
Adamus’ Nzema property, located 280 kilometres west of Accra, comprises the Salman-Akanko and Anwia-Bokazo deposits and is scheduled to produce 100,000 ounces per annum over a 10-year mine life.
Of the funds raised, $4.5 million has been allocated to construction activities and the resettlement of a local village within the project area, $15 million has been budgeted for exploration and other contingencies, $4.5 million in contingency for an unsigned fiscal stability agreement (FSA), $2.3 million on the immediate development of Salman South and $5 million on working capital.
Adamus is currently paying non-concessional rates on import duties, VAT and withholding taxes until such time as its FSA is granted by the Ghanaian government.
Part of the proceeds will be applied to these changes until the FSA is signed and given effect.
Surplus funds will be directed at further exploration for oxide and sulfide resource opportunities, specifically targeting the 9km Salman trend, areas between the existing Nugget Hill and Teberru pits and new areas including Hotopo.
“The strong support for Adamus from our institutional shareholders is testament to the quality of the Nzema project and its potential to increase resources,” incoming Adamus managing director Mark Connelly said.
“The on-ground team has done a great job to date in ensuring the project’s first gold pour remains on
schedule for the first quarter of 2011.”
Shares in Adamus were down 6.98% in morning trade to 60c