Pure Gold may also issue an additional 66.7 million units, taking the gross proceeds up to $40 million if there is a demand for them.
The largest shareholder of Pure Gold is AngloGold Ashanti, which has the right to maintain its pro rata ownership interest. AngloGold invested $16 million for 30.2 million Pure Gold shares at $0.53 each in January 2022, boosting its stake to 19.9% of Pure Gold.
Also in January, Pure Gold offered 17 million shares at the same price in a brokered offering. That offering was worth about $9 million, and the underwriters had an overallotment of another 9.4 million shares which would raise an additional $5 million.
The PureGold mine is one of the highest grade gold producers in the world. The mine has probable reserves of 3.5 million tonnes grading 8.97 g/t gold, containing just over 1.0 million oz. Reserves are included in the indicated resource of 7.2 million tonnes at 8.9 g/t gold (2.1 million oz.). There is also an inferred resource of 1.9 million tonnes at 7.7 g/t gold (467,000 oz.)
In March, The Northern Miner reported that the owner needed to raise $50 million this year to continue operating. Gold production fell short of expectations last year due to continued shortages of high-grade ore from the underground mine. That lead to blending ore with low-grade development material and stockpiles, reducing the overall feed grade to the 800 t/d mill.
“We have all the ingredients we need to turn around the operation including a strong geological understanding of the asset, a newly established lower cost base, and a talented team that can deliver,” said Pure Gold COO Terry Smith. “We are excited to get to Q3 when we’ll be operating a stable, cash-flowing operation, with a new technical report coming soon thereafter.”
Pure Gold has stated a goal of reducing operating and sustaining costs by 30%. Based on preliminary results for April, those costs had already come down 27%, compared to the average monthly costs in the first quarter this year.
The company continues to receive assays from the 60,000-metre definition drilling program completed last November. It has identified new mining areas in the upper McVeigh (above 1 level) and upper Austin (just beneath McVeigh). Both areas have primary development access in place and will be integrated into an updated six-month mining plan.
To aid in achieving its goals, Pure Gold has appointed Tony Makuch a technical advisor.
Details of the PureGold project are posted on www.PureGoldMining.ca.
