Vancouver — Mongolian-focused explorer Entre Gold (ETG-T, EGI-X) is looking to sell at least $30-million worth of stock to bolster its treasury.
BMO Nesbitt Burns is underwriting the deal, which will offer 10 million shares at $3 apiece.
The financing could see an additional 4.4 million shares sold, should Ivanhoe Mines (IVN-T, IVN-N) and Rio Tinto (RTP-N, RIO-L) choose to exercise their right to participate in the financing and maintain their respective percentage ownership stakes in the junior.
Ivanhoe owns about 14.9% of Entre, while Rio Tinto holds about 16.3% of the company’s shares.
Entre is partnered on its Lookout Hill copper-gold project in southeastern Mongolia with Ivanhoe, which is developing its adjacent Oyu Tolgoi deposit.
Under an earn-in agreement inked in late 2004, Ivanhoe has recently acquired a 51% interest in Entre’s Shivee Tolgoi (Lookout Hill) property after spending US$20 million on the ground. Through further spending, bringing the total to US$35 million, Ivanhoe can boost its interest in Shivee Tolgoi to 70%, plus hold an 80% interest in minerals extracted from below 550 metres depth.
Drilling by Ivanhoe on Entre’s Copper Flats zone has encountered similar mineralization to its Hugo North deposit over at least 1,300 metres of strike. Copper Flats hosts an inferred resource of 190 million tonnes grading 1.57% copper and 0.53 gram gold per tonne based on a 0.6% copper-equivalent cutoff grade.
Entre shares have recently traded around $3.30 in a 52-week trading range of $1.50-3.67.
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