Argonaut raising $23M in flow-through bought deal

Magino project Credit: Argonaut Gold

Argonaut Gold has announced a $23-million bought deal offering of flow-through shares. The gold producer has entered into an agreement with a syndicate led by Cormark, with the underwriters agreeing to purchase 8.2 milion common shares on a bought deal basis – these shares will be issued as flow-through shares, at $2.82 per share, for gross proceeds of approximately $23 million.

The underwriters also have the option to purchase an additional 15% of the number of flow through shares sold, at the offering price, for a period expiring 30 days after closing, which is expected around Feb. 11.

Proceeds are expected to be used for development at Magino, as permitted by the Tax Act.

Last week, Argonaut announced that the province of Ontario had filed the closure plan for Magino, which, according to president and CEO Pete Dougherty “is a significant milestone and allows us to begin site preparation activities for construction of the Magino mine and processing facility.”

On Jan. 20, the company also reported drill results from the South zone at Magino, with drill highlights of 10 metres at 19 g/t gold and 3.1 metres of 47.1 g/t gold. This zone has been traced from the border between Alamos Gold’s Island Gold mine, over 1.5 km of strike, and remains open. Argonaut sees potential for this system to extend both at depth and west of the Magino ore body.

This year, Argonaut expects to produce 210,000 to 250,000 gold-equivalent oz. at all-in sustaining costs of US$1,250 to US$1,350 per oz.

Magino is forecast to come on-line in the first half of 2023.

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