Fremont wants to raise 1 million to drill Nevada gold projects
Fremont Gold (TSX.V: FRE) is in need of funds to undertake further drilling at its Gold Bar and Gold Canyon projects in Eureka County, Nevada. The Vancouver-based company intends to complete a non-brokered private placement of up to 7,200,000 units at a price of $0.14 per unit for gross proceeds of up to $1 million.
In a media statement, the miner said each unit will be comprised of a common share of the company and one half of one share purchase warrant. At the same time, each whole share purchase warrant will entitle the holder to purchase one common share at a price of $0.20 per for a period of 24 months following the closing of the private placement.
The Gold Bar and Gold Canyon projects are both former mines in the Gold Bar District, an active mining area within the Battle Mountain-Eureka Trend. The district contains several Carlin-style sediment-hosted gold deposits, including McEwen Mining's Gold Bar project, which is scheduled to produce 62,800 ounces of gold per year at $770/oz, starting in early 2019.
The Gold Bar project comprises the historic Gold Bar mine, which produced 286,354 ounces of gold from 1986 to 1994, and the Millsite deposit, which hosts a historic resource of 147,000 ounces of gold (1.62 Mt @ 2.57 g/t gold). Millsite is believed to be a faulted offset of the historic Gold Bar mine and is located to the northwest of the open pit.
Fremont recently completed a soil sampling program based on a new structural interpretation and the data obtained suggest that gold mineralization related to the historic Gold Bar mine may extend to the southeast. This is why part of the recently announced private placement proceeds will be used to drill test these anomalies. Drilling is expected to commence in early 2019 upon completion of permitting.
Gold Canyon, on the other hand, is adjacent to and directly northwest of McEwen's project. It produced approximately 41,000 ounces of gold from 1990-1994 and a stockpile of previously mined ore still exists at the site. Drilling undertaken by Fremont earlier this year intercepted a previously unrecognized mineralized zone 60 metres below the pit floor. Therefore, more drilling is needed to further define this zone and the rest of the funds raised will be used for this, as well as a general working capital.