Shares in Calidus Resources jumped this morning after it announced Alkane Resources would take a 10 per cent stake in the company for $3.7 million.
As foreshadowed in today’s WestBusiness, the placement at a premium 2.95¢ a share will help Calidus develop its 712,000-ounce Warrawoona gold project 25km south-east of Marble Bar.
Calidus said the cash would allow it to complete the upcoming resource update and pre-feasibility study for Warrawoona.
The Mark Connelly-chaired explorer said the issue of 70 million free-attaching unquoted options to Alkane, exercisable at 3.5¢ on or before November 1 next year also had the potential to bring another $2.45 million into the company.
Calidus managing director Dave Reeves welcomed Alkane, not just as a shareholder, but as an operating gold producer with a wealth of knowledge and skills that the company could tap as part of a technical alliance between the two parties.
“A pre-feasibility study is expected to commence on completion of the resource upgrade that is anticipated to occur when all results are received from the current drill program that has four to six weeks to run.”
Alkane said Calidus met its investment criteria given its strong exploration potential at Warrawoona and requirement for development funding.
Calidus has a 363sqkm footprint across the so-called Warrawoona Greenstone Belt where mineralisation outcrops at surface and all deposits are open along strike and down dip with many untested drill targets.
Alkane operates the Tomingley gold mine in NSW and also holds the Dubbo zirconium and rare earths project.
Calidus shares were up 0.4¢, or 15.4 per cent, to 3¢ at 9.40am.