A private placement in Hycroft Resources & Development (TSE) totalling $2.5 million by Granges will bring that company’s stake in Hycroft up from 59% to a maximum of 67%. The pricing formula for the placement will take the greater of the average price for the 10 trading days prior to Aug. 22, or 76.29 cents.
Hycroft intends to use $2 million of the funds for working capital, and the remainder for the company’s deep drilling program near its Crofoot/Lewis mine, 60 miles west of Winnemucca, Nev.
Hycroft initiated a deep drilling program earlier this year to test for high-grade feeder mineralization below the existing operations.
Fred Felder, vice-president of exploration for Hycroft, said that the program indicated that the structures were not directly underneath the pit.
He noted the upcoming program will investigate geophysical evidence that suggests the feeder zones are outside the present mining area.
Unlike the earlier program, which used reverse circulation drilling, this program will use diamond drilling to obtain more structural information.
Felder expects the program to begin within the next month.
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