Gold miner WPG Resources has raised $7.2 million for expansion of the mill at the Challenger operation in South Australia.
WPG reported that new shares for the placement were priced at $0.048 a share, a 24.5 per cent discount on the volume weighted average price (VWAP) in the 15 days leading up to it announcing the raising.
In addition to funding the mill expansion, WPG plans to use the funds for mine development, exploration and general working capital purposes.
WPG executive chairman Bob Duffin was grateful for the support from sophisticated and professional investors.
“The investment metrics are attractive,” Duffin said.
The share placement will be followed by an entitlement issue to eligible shareholders of the company, likely to be in the range of one for eight.
WPG acquired the Challenger gold mine in first quarter 2016, before pouring its first gold at the operation in May after production had been suspended.
The mine, about 150km southwest of Coober Pedy, has historically produced about 1.1 million ounces of gold.