Great Southern Copper plc (LON: GSCU) has raised £2 million through a private placing to accelerate exploration at its Mostaza copper-silver discovery in Chile and advance the project towards a maiden mineral resource.
The company will issue 133.3 million new shares at 1.5p each, representing a 6% discount to the previous day’s closing price.
The new shares will account for approximately 15% of the enlarged issued share capital.
Directors also intend to subscribe for 4.67 million shares, contributing a total of £70,000.
The fundraising remains conditional on admission of the new shares to the FCA’s Equity Shares (Transition) category and trading on the London Stock Exchange Main Market.
Most of the proceeds will be directed towards Mostaza and the nearby Monolith target within the wider Especularita Project.
The planned Phase IV programme includes up to 5,000 metres of diamond drilling at Mostaza and Monolith, plus up to 2,000 metres of reverse-circulation drilling along the Mostaza Fault trend.
The objective is to test the extent and continuity of the mineralised system and generate sufficient data to move Mostaza towards a maiden Mineral Resource Estimate.
Great Southern Copper said recent drilling has demonstrated continuity of high-grade copper-silver mineralisation along strike and at depth, while exploration at Monolith has increased confidence in the broader scale of the Cerro Negro system.
The company will also undertake Phase II metallurgical test work, building on earlier results that showed encouraging copper and silver recoveries using conventional flotation.
A further 1,000 metres of RC drilling is planned at the Artemisa porphyry prospect, while part of the funds will also be used for corporate costs and general working capital.
Chief executive Sam Garrett said Mostaza remains the company’s principal priority, with the new funding allowing it to expand drilling, test Monolith and improve understanding of the deposit ahead of resource definition.
For investors, the key positive is that GSC now has funding to move beyond early discovery work into a more intensive resource-definition phase.
The trade-off is dilution from the new equity issue, while the value of the raise will ultimately depend on whether the additional drilling can demonstrate sufficient scale, continuity and grade to support a maiden resource.
The next major catalysts are Phase IV drilling results, further metallurgical data and progress towards a formal Mineral Resource Estimate at Mostaza.
