Galileo Resources hopes to use its funds raised through a share placing to begin mining its Star Zinc project in mid-2020, as well as commencing an exploration study at its other Zambian location, Kashitu
The United Kingdom based miner has raised £500 000 through the placing of 100-million new shares at a price of 0.5p a share.
The AIM-listed miner issued 125mln shares to institutional and retail investors at a price of 0.4p, compared to 0.45p at market close on Thursday.
The proceeds will be used for general working capital, as well as for advancing its Star Zinc project, in Zambia. Specifically, the company plans to use the proceeds to produce an independent ore resource estimate for the project, complete a preliminary pit design and apply for a small-scale mining permit.
Galileo said that it hopes to start preparing an application for a small-scale mining permit at its 95%-owned Star Zinc project, and begin mining in the second quarter next year.
An exploration study will also begin at Kashitu, which is thought to hold similar levels of zinc mineralisation to Star.
“Following the positive drill results and significant conceptual grade tonnage estimate for Star Zinc, the company has completed a placing to enable it to do all things necessary to advance and add further value to what is undoubtedly a significant project with potential for early production. The directors believe the potential ore at Star Zinc lends itself to a simple trucking operation for parties looking to enhance their feedstock with high-grade zinc ore and early-stage discussions have started with potential offtake partners,” Chairperson Colin Bird said on Wednesday.
As part of the placing, Bird has subscribed for six-million placing shares. He will hold 13.07% of Galileo’s enlarged issued share capital following the placing.
Elsewhere, the company holds a 38% stake in the Glenover rare earth project, and wholly owns the Ferber gold project in Nevada, USA.
Chairman Colin Bird and non-executive director Richard Wollenberg took part in the placing for 5mln and 0.5mln shares respectively