Vertex to raise $3.28m via share rights issue, with $1.8m underwritten
Funds used for refurbishment of newly purchased modular Gekko plant
Plant to quadruple processing rate to 120,000tpa at flagship Reward gold mine
Special Report: Vertex Minerals is raising $3.28 million as part of a rights issue to be used for the refurbishment of a recently purchased Gekko plant at its 225,000oz Reward gold mine in the prolific Lachlan Fold Belt in NSW.
Gold developer Vertex Minerals (ASX:VTX) recently acquired the Gekko processing plant from the Morningstar gold mine in Victoria for $620,000+GST and is moving it to the Hill East area of the Hill End project – right next door to its flagship 225,200oz Reward gold mine.
Gekko plant refurbishment
Funds will be raised via a rights issue offering 46,039,999 shares to raise up to $3,683,200 at 8c per share, with three shares offered for every five shares owned and one free attaching option issued for every three shares subscribed for.
Substantial shareholders have already committed $400,000 in the form of convertible short-term loan funding. A further $1.8 million has been underwritten by CPS Capital.
The entitlement offer also represents a 12.1% discount to the VTX’s last closing price of 9.1c.
Proceeds will be used to fund the mobilisation, refurbishment and installation of the recently purchased Gekko gravity gold plant and advance steps to underground gold production at Reward.
The upgraded refurbished plant will be able to treat up to 120,000ktpa, four times the existing plant’s 30,000tpa run rate.
The recently purchased Gekko modular processing plant will be transported next to the Reward gold mine. Pic: Supplied (VTX)
Hill End’s reward
Hill End consists of 10 mining leases and three exploration licenses located in the core of the Hill End Trough on the eastern area of the prolific Lachlan Fold Belt gold mining district in NSW.
An update to the preliminary feasibility study (PFS) was recently completed for Reward and showed an 18% increase in NPV and a 43% IRR increase, while also flagging a capex of $17 million to restart the operation which will generate $150 million over the life of the mine.
The Reward gold mine hosts an extremely high-grade resource of 419,000t @ 16.72g/t – or 225,200oz of contained gold, with 70,500oz of that inventory classified in the higher confidence indicated category.
VTX says Reward is well-placed for a simple start-up as the existing mine development extends into the resource, so only stripping and refurbishment of the access is required.
“Some underground fleet and utility services are already in place and a mining license has been granted and in place for plant, stockpiles and the Reward underground mine,” the company says.
“All other necessary permits to support the commencement of mining and processing operations have been obtained.”
This article was developed in collaboration with Vertex Minerals, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.
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