Gammon Lake raises funds (August 25, 2003)

Gammon Lake Resources (GAM-T) has raised $17.25 million in a private placement, with proceeds earmarked for the Northeast Ocampo gold-silver project in Mexico.

The Dartmouth, N.S.-based company issued just under 5.4 million shares at $3.20 apiece. The amount includes 703,125 shares granted to brokerage house BMO Nesbitt Burns for arranging the deal.

An independent scoping study of Northeast Ocampo has outlined enough resources to support a 1,400-tonne-per-day underground mine. Annual production is projected at 92,400 oz. gold and 4.6 million oz. silver, with cash costs pegged at US$84.93 per oz. gold-equivalent (T.N.M., June 23/03).

Northeast Ocampo is separate from the Ocampo surface deposit, in which Australian-listed Bolnisi can earn a 60% stake. To do so, Bolnisi must finance and construct an open-pit mine capable of treating at least 1.25 million tonnes per year.

A final feasibility study is pending, though Bolnisi has already begun negotiations for debt-financing.