ORACLE Mining Corp has secured a convertible loan facility of up to Can$10 million from Hong Kong-based Rich Stone Mining Investment. The funds will be used to advance the Oracle Ridge Copper Project in Arizona, USA, as well as for working capital and general corporate purposes.
An initial tranche of about Can$4 million was secured by the end of November with the remaining $6 million remaining subject to the satisfaction of customary conditions precedent, including without limitation, Rich Stone being satisfied of its due diligence review of the Oracle’s business and the assets, prospects and contracts and arrangements relating to the business on or before December 31, 2013.
Oracle intends to use the net proceeds from the initial tranche towards its underground drill program, completion of a feasibility study and NI 43-101-compliant reserve and resource study, for certain property payments and land transactions, permitting and other preliminary capital expenditures at Oracle Ridge, which is 24km northeast of Tucson.
Since acquiring the project in September 2010, Oracle has completed surface and underground drill programs, undertaken metallurgical, engineering and environmental studies, and secured a number of key permits that will be necessary to enable the project to advance.
While Oracle Ridge has a current mineral resource established, additional drilling will need to be undertaken with the goal of expanding and upgrading, if possible, the resources. The corporation has not made any production decision with respect to the project. A decision to proceed with production will be based upon the results of the feasibility study demonstrating economic and technical viability.
Indicated resources at a 1.0% copper cut-off are estimated to be 9.9 million short tons @ 1.64% copper. Inferred resources are estimated to be 6.9 million short tons @ 1.58%.
In concurrence with the initial closing of the loan transaction, Kevin Drover has been appointed Oracle’s CEO and director. He previously served as Oracle’s CEO before retiring in June 2011 following the successful completion of the Oracle Ridge acquisition. He has remained a significant individual shareholder and supporter of the project during the interim.
Rich Stone also has the right to designate one additional individual to be nominated and if elected, to serve as a member of Oracle’s board.
Subsequently, the board has appointed Xuanren (Joe) Wu as Rich Stone’s nominee to hold office until Oracle’s next annual general meeting. Joe Wu is in charge of all overseas mining investments made by Rich Stone and his focus includes discovering and developing mining opportunities globally. He has played a leading role in structuring all transactions that Rich Stone has participated in since 2009.