Flow-through share financings benefit Canuck juniors

Vancouver — Companies with Canadian projects are finding willing investors for flow-through share issues, which provide investors with tax deductions on exploration expenses.

– Canabrava Diamond (CNB-V) recently closed a second private placement of 750,000 Series B units priced at 40 each, for gross proceeds of $300,000. A unit consists of one flow-through share with a 4-month hold period and half a flow-through share purchase warrant. Each warrant will entitle the holder to buy one flow-through share for 50 within 12 months. Strand Securities will receive 60,000 Series B units as compensation for its assistance in the financing. A portion of the proceeds will be used for ongoing diamond exploration in Canada. Canabrava is 52.5%-owned by Southwestern Gold (SWG-T).

– Rubicon Minerals (RMX-V) intends to sell 500,000 flow-through units, priced at 40 each, to Contrarian Resource Fund 2000. Proceeds from the transaction are pegged at $200,000. Each unit will consist of one flow-through share and one non-transferable non-flow-through-share purchase warrant. The warrants are exercisable for 18 months at 55 per share. Rubicon will use the proceeds to explore gold and platinum group metals projects in Ontario and base metal projects in Newfoundland.

– Cumberland Resources (CBD-T) has extended, by one year, the placement of 1.5 million previously issued share purchase warrants. From now until the end of 2001, two warrants are exercisable for the purchase of one share at $1.90 per share. Cumberland holds interests in three gold projects in Nunavut: Meadowbank (wholly owned), Meliadine West (a 22% carried interest) and Meliadine East (50%).

– Wolfden Resources (YWO-V) and an arm’s-length party have completed a private placement of 1 million shares at 65 each, for gross proceeds of $682,500. Dundee Securities will receive 105,000 broker warrants for arranging the placement. The warrants are exercisable at 65 per share for 18 months from closing.

Proceeds will be used to explore the Wolfden’s High Lake project, which hosts a drill-indicated resource of 5.3 million tonnes averaging 4.05% copper and 2.36% zinc, plus 1.76 grams gold and 31.73 grams silver per tonne.

– PGM Ventures (YCE-V) (formerly Icelandic Gold Corporation), together with arm’s-length investors, completed a private placement of 784,762 flow-through shares priced at 52.5 each. Proceeds of $412,000 will be used primarily to fund exploration on the newly acquired Thierry Mine and Lavoie Lake properties in northern Ontario. As a result of the private placement, PGM Ventures has nearly 2 million shares outstanding.

– Champion Bear Resources (CBA-V) wrapped a public offering of 630,730 flow-through shares at $1.15 per share, raising proceeds of $725,340. The company plans to explore its Eagle Rock, Parkin, Iron Mask and Separation Rapids properties. Jennings Capital was the lead agent of the offering.

– Eastmain Resources (ER-T) raised gross proceeds of $245,000 via an offering of 700,000 flow-through shares. The company also sold 750,000 flow-through units to the Contrarian Resource Fund 2000 for net proceeds of $262,500. One unit comprises one flow-through share and half a non-transferable share purchase warrant. One warrant is exercisable for 18 months at 45 per share.

Eastmain will fund exploration of its half-owned Clearwater project in northwestern Quebec, where, together with partner Soquem, the company has discovered six more parallel gold-bearing quartz-tourmaline veins during stripping and drilling (T.N.M., Dec. 25/00). In 2001, the partners will carry out more stripping and drilling, and explore the largely untested Cannard and Natel prospects.

– Meanwhile, Ashton Mining of Canada (ACA-T) has raised $939,750 through the sale of 1.2 million units at 75 apiece. A unit comprises one flow-through share and half a purchase warrant. Each whole warrant entitles the holder to buy one non-flow-through share for 95 until June 29, 2002. The expiry date can be accelerated if Ashton’s shares trade above $2 for 15 consecutive days. Ashton will pay a 6% commission on $294,000 of the funds raised. Proceeds will be used to fund exploration in the winter and spring.

– Mustang Minerals (YMU-V) issued 1.6 million special warrants priced at 70 each, raising $1.1 million in proceeds. Jennings Capital received 164,268 share purchase warrants as part of the commission. Proceeds will be used to explore three platinum group metal joint ventures near Sudbury, Ont.: East Bull Lake, shared with Falconbridge (FL-T); River Valley, a partnership with Impala Platinum Holdings; and the Drury Township property, jointly held with Wallbridge Mining (WM-T).