Toubani Resources Inc. (ASX:TRE) has secured firm commitments in a fully subscribed placement, raising A$3.8 million before expenses, a significant step forward for the Company’s African gold exploration and development focus.
Placement Structure and Details
The Placement consisted of the issuance of 31,666,667 Chess Depositary Interests (CDIs) at an offer price of $0.12 per CDI. This issuance will occur across two tranches, with the first tranche utilising the Company’s existing placement capacity under ASX Listing Rule 7.1. The settlement is anticipated this year, with Tranche 1 on Wednesday, September 6, and the CDIs expected to be issued on September 7.
The second tranche, comprising 13,420,151 CDIs, will be subject to shareholder approval at an upcoming General Meeting. Notably, the Company’s directors have shown their confidence in the project by subscribing for 2,916,667 CDIs under Tranche 2, amounting to A$350,000. This subscription by directors will also be subject to shareholder approval.
The offer price of $0.12 per CDI was set at a 14.3% discount to the last closing price on 25 August and a 13.9% discount to the 5-day volume weighted average price.
Allocation of Funds and Future Prospects
The Placement follows Toubani’s recent update on the Mineral Resource Estimate (MRE) for its Kobada Gold Project in southern Mali, revealing an 87 million tonne resource with an average grade of 0.86g/t, amounting to 2.4 million ounces of gold. This development is a significant step forward in the Project’s evolution, positioning it as a low-risk, low-strip, bulk-tonnage, oxide-dominant open-pit venture of substantial scale.
The capital raised from this successful Placement will be strategically allocated to several key initiatives:
Optimised Definitive Feasibility Study: The Kobada Gold Project, a flagship oxide gold development endeavour, will benefit from the completion of an optimised Definitive Feasibility Study, with this study poised to refine the Project’s viability and potential.
Inferred Resource Conversion: A portion of the funds will be directed towards RC drilling at the Kobada Main deposit, with this initiative aiming to enhance the understanding of the resource potential, a pivotal step in driving the Project’s development.
Regional Exploration: The Company plans to undertake select regional explorational drilling, focusing on high-priority targets.
General Working Capital: A portion of the proceeds will be allocated to general working capital requirements, facilitating the Company’s day-to-day operations.
A Strong Show of Confidence
Toubani’s Chief Executive Officer, Phil Russo, expressed his enthusiasm for the Company’s progress, particularly highlighting the recent announcement of a substantial oxide gold resource.
“We are excited to be moving into this phase of Toubani’s evolution underpinned by the recently announced significant oxide gold resource and with a clear line of sight on the potential of Kobada as a gold project dominated by free dig, free milling and soft rock material of scale,” he said.
“We look forward to surfacing this value and showcasing the attractiveness of Kobada in the months ahead and thank our existing shareholders for their support, while we welcome a number of new shareholders to our register.”
TRE’s Australian Stock Exchange-listed share price is currently trading at 12 cents (9.50am UTC+ 8 hours).