Gold Terra Resource Corp assembles $4.4 million funding package, with support from Osisko Gold Royalties
Gold Terra Resource Corp has arranged a non-brokered financing of $2.4 million consisting of hard-dollar and charitable flow-through securities.
The company expects to raise gross proceeds of $1 million from the issuance of 20 million common shares at an issue price of $0.05 per share, and gross proceeds of $1.4 million from the issuance of 20 million charitable flow-through shares at an issue price of $0.07 per CFT share.
In addition, Osisko Gold Royalties has elected to exercise early the first tranche of its royalty option for a 2% net smelter return royalty on Gold Terra's Yellowknife property in exchange for a cash payment of $2 million.
Gold Terra's cash balance will accordingly increase to $4.4 million, less finders' fees.
The money raised will Gold Terra to continue its drilling program on the Con Mine option property. The former Con mine produced 5.1 million ounces of gold at an average grade of 16 grams per tonne, and was historically one of the richest high-grade gold mines in Canada.
"We are pleased to offer this opportunity to investors to participate in this proposed financing for a total of $2.4-million and thank the continued support of existing shareholders such as Eric Sprott and Ingalls Snyder, and many others,” said Gold Terra chief executive Gerald Panneton.
“Moreover, concurrent with this financing, the decision by Osisko Gold Royalties to early exercise its first 2% NSR is a huge endorsement of our strategy of advancing our high-grade gold assets in the Northwest Territories towards potential production. "
The current drill program at the Con mine is aimed at increasing the company's current indicated and inferred resource near surface and south of the Con mine, targeting the prolific Campbell shear structure. The drilling is targeting below the existing underground workings, where the potential exists to add significant free-milling high-grade ore.
The Con mine property has excellent infrastructure including the Robertson shaft, a 2015 water treatment plan, warehouse and offices.
View from Vox
The Con mine and Gold Terra’s Yellowknife project both lie on the prolific Yellowknife greenstone belt. The company's exploration programs have identified significant zones of gold mineralization and multiple targets that remain to be tested. The objective is to re-establish Yellowknife as one of the premier gold mining districts in Canada, and the new money will take Gold Terra one step closer to achieving that aim.
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