QMines Ltd (ASX:QML) has received significant support from new and existing shareholders for its $5 million placement. The company will use funds raised to accelerate exploration and development at its Mt Chalmers and Develin Creek projects, and to complete its acquisition of Develin Creek.
Initially aiming to raise $2 million the Placement received strong demand with total bids received well in excess of that amount, resulting in the $5 million raised.
Under the two-tranche placement, the company will issue up to 106,382,979 fully paid ordinary shares at $0.047 per share, with the second tranche subject to shareholder approval.
The placement included participation by the QMines executive chairman and CEO Andrew Sparke and general manager - operations James Anderson, who subscribed for a further $420,000 worth of shares.
Planned use of funds
Capital raised, after costs, will be used to fund the exploration and development plans at the Mt Chalmers and Develin Creek projects. It will also pay the remaining 49% interest in the Develin Creek project.
QMines previously signed a term sheet to acquire an initial interest of 51% of the Develin Creek project from Zenith and retained the right to acquire the remaining 49% interest within 12 months.
Strong support ahead of planned drilling
“It is pleasing to see such strong demand for the placement which demonstrates the quality of QMines copper and gold projects and the company’s aggressive growth strategy,” said Sparke.
"I want to sincerely thank new and existing shareholders for their support of our company as we continue to demonstrate the scale and development potential of the Mt Chalmers and Develin Creek projects. We wish to also thank our brokers, Whairo Capital and Wilsons Advisory, for their support.
"The submission of a Mining Lease application is a very exciting development for the Company. To get to this position within just over three years is a tremendous achievement by the QMines team.
"The recent pre-feasibility study results on the Mt Chalmers deposit demonstrates a long life, low cost and high margin mining operation. The project has immediate and known upside with five additional deposits at the Mt Chalmers and Develin Creek projects that fall outside of the mining plan.
"The company will shortly commence a large drilling program at its Develin Creek project where the Company has two high-grade copper-zinc deposits that has potential to grow the scale of a potential mining operation at Mt Chalmers."