TIDMMILA
RNS Number : 2668O
Mila Resources PLC
02 October 2023
Certain information contained within this Announcement is deemed
by the Company to constitute inside information as stipulated under
the Market Abuse Regulation (EU) No. 596/2014 ("MAR") as applied in
the United Kingdom. Upon publication of this Announcement, this
information is now considered to be in the public domain.
2 October 2023
Mila Resources Plc
("Mila" or the "Company")
Placing to Raise GBP2m & Appointment of Joint Broker
Mila Resources Plc (LSE:MILA), is delighted to announce that it
has raised GBP2,000,000 before expenses, through a conditional
placing by its existing broker SI Capital, and Shard Capital, which
has been appointed as joint broker with immediate effect, (the
"Placing"), of 200,000,000 new ordinary shares ("Placing Shares")
at the closing offer price of 1 pence per ordinary share ("Placing
Price"). The Placing Shares shall have one warrant attached with an
exercise price of 2 pence for a period of two years from the date
of admission ("Placing Warrants").
The Placing has not been underwritten and is conditional on,
amongst other things:
i) the publication of a Prospectus by the Company to be approved
by the Financial Conduct Authority of the United Kingdom ("FCA").
The Company and its advisers have been working on obtaining such
approvals from the FCA in recent weeks and anticipate being able to
publish the Prospectus in the next 10 days; and
ii) approval by Shareholders of resolutions, inter alia,
granting authority for the Directors to issue ordinary shares at a
General Meeting ("GM") expected to be held before the end of
October 2023.
The Placing Shares, when issued, will be credited as fully paid
and will be issued subject to the Articles of Association of the
Company and rank pari passu in all respects with the Ordinary
Shares currently in issue, including the right to receive all
dividends and other distributions declared, made or paid on or in
respect of the Ordinary Shares after the date of issue of the
Placing Shares and will, on issue, be free of all claims, liens,
charges and encumbrances.
Use of Proceeds
Further to the announcement of 27 July 2023 relating to the
option agreement with Liontown Resources Limited (ASX: LTR)
('Liontown'), the Liontown team are on the ground on the Mila's
Kathleen Valley licence area, and management expects that a lithium
work programme will commence shortly to identify drill targets, to
validate the theory that spodumene-bearing pegmatites occur within
the substantial pegmatite swarms already identified at surface. As
previously announced, Liontown will fund all lithium exploration
activities on Mila's Kathleen Valley licence area.
The Company intends to utilise the placing funds to conduct
further gold exploration work alongside Liontown's lithium
exploration in the northern part of the Kathleen Valley licence
area. By capitalising on work permits and heritage surveys that the
Company expects to be granted in the near future, drilling costs
will be significantly reduced, maximising drill metres and funds
into the ground at this exciting gold project.
Finally, the Company has received several proposals to partner
on other projects and funds will be applied to reviewing business
development opportunities. Alastair Goodship, an exploration
geologist, has joined the team as noted below to assist the board
and provide technical oversight on the current portfolio and new
opportunities.
Appointment of Exploration Geologist
The Company has appointed Alastair Goodship, an exploration
geologist with over 14 years of industry experience of leading
discovery-focussed exploration teams in a diverse range of
environments and jurisdictions globally.
Alastair has worked across the exploration spectrum from
greenfield and brownfield exploration to resource definition and
feasibility studies. Alistair most recently worked as a Senior
Exploration Consultant with RSCMME Ltd and technical advisor to
Trinity Metals Group.
Background to the Placing
Mila's principal activity is to develop mining projects
following initial exploration through to development with the aim
of creating value as the assets are de-risked and capable of
economic development.
The Company's portfolio currently consists of one project, being
a 30% interest in the Kathleen Valley gold project ("Kathleen
Valley Project" or the "Project") and the exploration licence
E36/876 in the Kathleen Valley ("Kathleen Valley Licence") located
in the +40Moz Wiluna Jundee gold belt which hosts some of
Australia's largest gold mines.
In December 2021, the Company commenced drilling at the Coffey
deposit ("Coffey") which already hosts an existing JORC Inferred
Resource of 21koz gold. Mila subsequently committed to a more
extensive drilling programme between February and April 2022
("First Stage"). With a total of 31 holes that encountered gold
mineralisation, the First Stage drilling results were considered a
success, reporting wide intersections of mineralisation and some
very high gold grades including 6.6m at 14.86g/t Au and 21.79g/t Ag
from 209.4m (reported 25/4/2022).
In October 2022, the Company followed up with the second stage
("Second Stage") of drilling at Coffey designed to test the mineral
deposit at further depths than those conducted in the First Stage.
Despite intersecting promising alteration and limited low grade
gold mineralisation, the drilling did not intersect the anticipated
high-grade gold mineralisation at this target depth. However, with
reference to the style of mineralisation at other major Western
Australian gold deposits such as Bellevue Gold's 3.1Moz Bellevue
project (contiguous to Mila's licence area), the Company believes
that these results could provide evidence of a 'ladder system',
commonly found in Western Australia, which is strongly encouraging
for further discovery potential at the project.
Since the beginning of 2023, the Company has been reviewing a
range of geological tools and data to build a more precise
geological model of the Coffey Deposit and enhance targeting in
order to mitigate risk ahead of its next exploration phase. Whilst
the Company awaits the results of six drill holes, designed to test
the thinner section of mineralisation, where it expects to find
narrower widths of mineralisation, progress has been made to
explore the target zones in the North, exploring the favoured part
of the acreage based on magnetic survey results.
Alongside this, on 27 July 2023 the Company announced that,
together with the other owners of the Kathleen Valley Licence, it
had entered into an option agreement with LBM (Aust) Pty Limited, a
subsidiary of Liontown, a A$6bn business currently subject to a
takeover bid by Albemarle. Liontown is developing the significant
Kathleen Valley lithium project nearby that is due to commence
production in 2024 and currently has offtake agreements signed with
Ford, Tesla and LG. The agreement grants Liontown the option to
explore for lithium on Mila's Kathleen Valley Licence area where,
despite being proximal to Liontown's project and having numerous
pegmatite swarms identified, the licence has not been
systematically explored for lithium.
Importantly this gives Mila a A$2.2m free carry over initial
exploration. If successful and all option agreements are taken up,
Mila will retain a 16% stake in the lithium rights, which could
prove significantly more valuable than the Company's current market
capitalisation.
Following the decision to grant the option to Liontown, the
Company has determined to continue exploration for gold by
completing a drill programme to the north of the Coffey deposit. By
capitalising on work permits and heritage surveys that it expects
to be granted in the near future, drilling costs will be
significantly reduced, maximising drill metres. The initial drill
programme will consist of up to eight holes to determine the
geological continuity of mineralisation. To date, the drilling has
focused on the Coffey deposit, and so it will be the first time
that a drilling programme has been conducted in the preferred
target zone which remains highly prospective based on geophysical
results.
Appointment of Joint Broker
The Company is pleased to announce the appointment of Shard
Capital Partners LLP as joint broker, alongside SI Capital, with
immediate effect. Tavira Financial Limited remains the Company's
financial adviser.
Admission
An application will be made for the Placing Shares to be
admitted to trading on the Official List and the London Stock
Exchange ("Admission") within two business days of the GM.
In accordance with the FCA's Disclosure Guidance and
Transparency Rules, the Company confirms that following Admission,
the Company's enlarged issued ordinary share capital will comprise
526,817,108 Ordinary Shares. The Company does not hold any Ordinary
Shares in Treasury. Therefore, following Admission, the above
figure may be used by shareholders in the Company as the
denominator for the calculations to determine if they are required
to notify their interest in, or a change to their interest in the
Company, under the FCA's Disclosure Guidance and Transparency
Rules.
Mark Stephenson, Chairman of Mila, commented:
"I am delighted with the strong level of support we've received
in this fundraising from both existing and new investors,
particularly given the difficult market conditions, and we are
grateful for the enthusiastic support from the market to continue
advancing our post-discovery exploration accelerator model.
"Our gold exploration activities at Kathleen Valley have been
encouraging, and, in tandem with the option agreement with Liontown
to explore and fund the lithium exploration at the project, our
initial asset has the potential to deliver significant value for
Mila.
"Our immediate objective now is to push forward with our gold
exploration work, specifically to fully understand the
mineralisation dynamics, particularly along the unexplored
north-western stretch. In addition, we will prioritise the
assessment of deeper mineralisation layers, which, investors will
remember, have already illuminated the presence of high-grade
mineralisation, and the continuation of a mineralising system at
significant depths, exemplified by instances like 1 metre @ 27.60
g/t Au and 47.50 g/t Ag down to a depth of 211 metres.
"Furthermore, this fundraising provides the Mila team with the
ability to evaluate and capitalise on new opportunities during what
remains a difficult market for junior exploration businesses. We
now have a strong balance sheet behind us, and a team of industry
experts to review and benefit from new value accretive business
development opportunities.
"I would like to thank our shareholders, both new and existing,
as we look to a highly active phase of our journey at Mila and I
look forward to reporting further news in the coming weeks."
A further announcement will be made on the publication of the
Company's prospectus.
**ENDS**
For more information visit www.milaresources.com or contact:
Mark Stephenson info@milaresources.com
Mila Resources Plc
Jonathan Evans
Tavira Financial Limited +44 (0) 20 7100 5100
Nick Emerson
SI Capital +44 (0) 20 3143 0600
Damon Heath
Shard Capital Partners LLP +44 (0) 20 3971 7000
Susie Geliher
St Brides Partners Limited +44 (0) 20 7236 1177
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