Vancouver – San Gold‘s (SGR-V, SGRCF-O) coffers will get a healthy top-up with a $20 million bought-deal private placement. On the news its shares jumped 8 to close at $1.35.
San Gold, which operates the Rice Lake Mine 230 km northeast of Winnipeg, Manitoba, says proceeds from the private placement arranged with Dundee Securities will fund further exploration of recently discovered high-grade gold in the Hinge zone at the Rice Lake Mine and the development of the Cartwright and Gabrielle zones.
Among a series of underwriters San Gold reached the deal with Dundee Securities. By issuing 13.35 million flow-through common shares at $1.50, San Gold will raise just over $20 million dollars.
San Gold says the private placement is set to close Oct. 15, 2008, and that there will be a four month hold on the shares issued.
The Rice Lake Mine contains 894,000 proven and probable tonnes grading 7.37 grams gold per tonne, with a further 875,000 tonnes grading 8.22 grams gold in the measured and indicated categories.
Recently the company discovered the Hinge zone outside its resource and reserve about 1,300 metres below surface and accessible from the mine’s underground workings. Some of the best results included 6.4 metres grading 27.84 grams gold per tonne in hole 12.
San Gold has about 222 million shares issued.
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