Wiluna Mining Corporation is edging closer to executing its expansion plans at its Wiluna mine. Firm commitments to raise $7.5m have been received as major shareholders and Wiluna’s Executive Chairman, Milan Jerkovic, line up to plough in another $14m. The money will be used to lift the mine’s production to 120,000 a year and study the potential for it to move to 250,000 ounces per annum.
Located in the world-class Goldfields mining region of WA, the company’s Wiluna Mining Complex covers 20 open pit and 3 underground mines within 20 kilometres of the company’s Wiluna processing facility. More than 4 million ounces of gold have previously been mined at Wiluna and today the company boasts over 6 million ounces in existing resources.
Current mining operations produce around 60,000 ounces of gold a year and Wiluna has a plan to move to about double that on the way to its ultimate goal of producing 250,000 ounces a year.
The $7.5m in commitments already received will come in courtesy of a placement at $1 per share, a slight discount to the last closing share price of $1.085.
A further $31.5m is anticipated to be raised through a one-for-four non-renounceable entitlement issue, also at $1 per share. Included in the $31.5m is about $14m worth of commitments from major shareholders and Executive Chairman Milan Jerkovic who has largely been responsible for the company’s turnaround and expansion planning.
In total, the company is aiming to raise around $80m as part of the funding package.
Wiluna already holds a financing facility with Mercuria Energy Trading and will look to generate a further $40m from this facility to put into the expansion plans. A signed, indicative and non-binding term sheet is being progressed now with formal completion anticipated once mandatory approvals and relevant conditions are met.
The new money will fund the construction and commissioning of the Stage 1 concentrator and mine that should see Wiluna bump up gold production to around 120,000 ounces a year.
It will also fund feasibility work as part of the staged expansion including drilling and reserve updates for Stage 2, which ultimately, the company says should lead to a production output of about 250,000 ounces a year.
This money will also be used for general working capital purposes and to support the Mercuria debt funding completion.
The expansion plans for Wiluna are now well underway and stage one looks like happening sometime soon.
And it’s always nice to see those in the know like executive management and even major shareholders hitting their kick to support a company’s strategy.
Is your ASX-listed company doing something interesting? Contact: matt.birney@businessnews.com.au
By Matt Birney
