By: Mining.com.au

Sierra Nevada Gold (ASX:SNX) has secured firm commitments for a $12.85 million capital raising to advance its As Safra Copper-Gold Project in Saudi Arabia.

The company completed a $12.3 million single-tranche placement at $0.10 per CHESS depositary interest (CDI), representing a 13.0% discount to its last traded price of $0.115.

Sierra Nevada says directors and management intend to participate for an additional $550,000, subject to shareholder approval at an extraordinary general meeting expected in late October.

The capital raising reportedly attracted ‘strong’ support from existing institutional and sophisticated shareholders alongside new institutional funds and family offices.

Under the terms, the placement comprises approximately 123 million new CDIs, utilising available placement capacity under ASX listing rules 7.1 and 7.1A. The offer price represents a 4.4% discount to the 10-day volume weighted average price (VWAP) of $0.105 and a 0.5% discount to the 15-day VWAP of $0.101.

CEO Adam Oehlman says the company plans to build momentum at As Safra by directing resources to advance the project “as quickly as possible”.

“Early exploration and drilling results from As Safra have established it as our core strategic focus, with strong results from our phase one drilling program, and a phase two program of over 25,000m of drilling expected to commence within six weeks,” Oehlman says.

Phase one drilling confirmed a coherent copper mineralised system across the 800m-plus Central Copper Zone, with a second copper system identified at As Safra Southeast. The broader 5.5km mineralised corridor remains largely untested.

Sierra Nevada says it intends to use the funds for rapid exploration and drilling activities at As Safra, including drilling, geophysics, and associated technical programs.

The company will also evaluate additional business development opportunities in Saudi Arabia and continue general working capital requirements.

Phase two drilling is expected to comprise more than 25,000m of reverse circulation and diamond drilling plus approximately 10.5km of trenching. The program will combine definition, expansion, and exploration drilling to systematically test across and beyond the Central Copper Zone.

The company is currently progressing a strategic review and commercialisation process across its portfolio of five wholly owned precious and base metal projects in Nevada, US.

Settlement of the new CDIs under the placement is expected on 1 September, with ASX quotation anticipated the following day.

Foster Stockbroking and Argonaut Securities acted as joint lead managers to the placement.

Sierra Nevada Gold is an explorer focused on building a copper-gold exploration platform in the Kingdom of Saudi Arabia.