De Grey Mining is building confidence that its Hemi discovery in Western Australia is a Tier 1 gold project, having raised $100 million to develop the site.
The Hemi discovery, which is situated in the Mallina Basin, is extended over an area spanning 2.5 kilometres north-south and two kilometres east-west, with a depth of 400 metres in areas tested.
DeGrey said it had received positive endorsement for its assets, with the capital raising being more than three times overbid, led by participation by major shareholder DGO Gold.
Under the placement, Australian investing company, DGO Gold, has committed to investing $12 million, which will result in a holding of 15.8 per cent at completion.
Following the successful capital raising, the company intends to maintain a minimum of six drill rigs in the area well into the second half of 2021, allowing it to continue to generate strong results.
DeGrey has already calculated a 2.2-million-ounce mineral resource from its shear hosted deposits and expects to add a substantial mineral resource estimate from Hemi to this by the middle of next year.
“DeGrey has never been better placed to achieve our goal of realising a Tier-1 gold project at Hemi,” managing director Glenn Jardine said.
“This significant capital raising puts DeGrey in a position of financial strength to turn this potential into greater value.
“The support of most of our long-term shareholders together with some new shareholders allows the company to maintain its substantial drilling program whilst accelerating exploration in some areas.”
With the capital raising a success, DeGrey is turning its attention to ongoing extension and definition of the Hemi discovery, testing mineralised intrusions close to the site, including Scooby, Shaggy and Antwerp.
The company will also further exploration in the region, enhancing its on-site infrastructure and start early stage project de-risking studies.