Crater Gold Mining is in advanced discussions to acquire a drill rig for use at its Crater Mountain Gold Project in Papua New Guinea. This forms part of the company’s recently announced strategy to re-invigorate exploration focused on Crater Mountain.
As part of the strategy Crater Gold outlined plans to acquire two drill rigs and the rig in question will be the first of these.
The quick action regarding the rig is an indication that the newly installed management and board will deliver on their intentions in a timely fashion.
The strategy announced last week also outlines an 11:2 renounceable rights issue targeting to raise up to $15 million. A total of 1.496 billion shares will be offered under the issue and the offer is subject to a minimum subscription of 1.3 billion shares or $13 million.
Proceeds will be used to pay down debt, resume exploration in PNG and progress commercial gold production at the Nevera Gold Mine within the Crater Mountain project.
The flagship Crater Mountain Project is highly prospective and contains two separate existing epithermal gold inferred resources which combined exceed 800,000 ounces of gold.
This resource was formulated from just 14,500 cumulative linear metres of drilling that mainly took place in 2010-2013.
A re-invigorated Crater Gold aims for a transformational increase in resources, which will be assisted by the purchase of two drill rigs. This is expected to deliver over 10,000 cumulative linear metres per year.
The project has commercial gold production potential through the Nevera Gold Mine which is a fully permitted mine together with an existing gravity separation plant and access to its high-grade ore body known as the High Grade Zone (HGZ).