Emerging Goldfields explorer NTM Gold (ASX: NTM) has added $1.5 million to its coffers as it eyes another big exploration push at the highly prospective Redcliffe gold project near Leonora. The cash was received from the Ed Eshuys-run DGO Gold (ASX: DGO) in line with a deal struck between the two companies late last year. The DGO placement was priced at 4c a share, a significant premium to NTM’s prevailing price of 3.4c. The funds will be used by NTM to accelerate exploration at Redcliffe, where diamond drilling is underway. Redcliffe already hosts a 538,000oz resource, not including new discovery Hub and other prospects due to be drill-tested this year.
NTM Gold Ltd (ASX: NTM) has announced the completion of Tranche 2 of the equity issue to DGO Gold Limited (ASX: DGO) as part of DGO’s alliance with the Company. The funds will be used to accelerate exploration at NTM’s 100%-owned Redcliffe Gold Project, located near Leonora, Western Australia.
· DGO Gold has subscribed for 37.5m shares at $0.04 per share under Tranche 2 of its investment in NTM.
· This has raised $1.5M, ahead of the 31 March 2019 due date.
· Funding will be used by to accelerate exploration at the Redcliffe Gold Project, targeting current resource expansions and the discovery of new deposits.
· The Share and option issue was approved by shareholders on February 15 2019 and includes options of:
· 47.5m options exercisable at $0.05 by 31 March 2020; and
· 47.5m options exercisable at $0.10 by 31 March 2022.
· Diamond drilling is underway on a number of deposits.
As announced to ASX on 20 November 2018, NTM executed a subscription agreement with DGO to contribute up to $2,000,000 by 31 March 2019, with additional funding of up to $9M if all attaching options are exercised. The Tranche 1 placement of $0.5M of this agreement was settled in November 2018.
Tranche 2 for the remaining $1.5M has now been settled with the issuance of a further 37.5m shares at $0.04 per share. The second tranche was subject to shareholder approval, which was received on 15 February 2019. On completion of Tranche 2, DGO now holds 50m ordinary NTM shares, 60m $0.05 31 March 2020 options, and 60m $0.10 31 March 2022 options.
The shares equate to a shareholding in NTM of approximately 12% (undiluted). Rights within the Subscription Agreement include DGO being entitled to a nominate a director following acquiring a 10% shareholding in NTM, anti-dilution provisions and a 12-month voluntary escrow period applying to all shares issued under the Agreement.
NTM Gold Managing Director Andrew Muir commented: “NTM is pleased to confirm DGO’s commitment to the second tranche. These funds will help us deliver on our Redcliffe Project objectives. The RC program has recently been completed, with diamond drilling now underway.
“Both programs are testing down-dip extensions on a number of existing deposits, as well as the new Hub prospect. “The alignment between NTM and DGO reflects both companies’ strong belief in the potential of Redcliffe. We are committed to fast-track exploration at Redcliffe to grow the resource base and value of the Company.”