P2 Gold raising $6.0 million ahead of Nevada PEA update
P2 Gold Inc. [PGLD-TSXV] said it intends to complete a non-brokered private placement of up to 30 million units priced at 20 cents per unit for gross proceeds of up to $6.0 million.
The announcement comes after P2 reported final gold, silver and copper recoveries from its 100%-owned Gabbs project on the Walker-Lane Trend in Nevada, which the company intends to use for a preliminary economic analysis (PEA) update, which is currently being finalized.
Under the terms of the financing, each unit will consist of one common share and one common share purchase warrant, each of which will entitle the holder to purchase one additional common share at an exercise price of 30 cents per common share for two years after the issue date, provided that the warrants shall not be exercisable for a period of 60 days after the date of issue. In addition, if after four months from the date of issue, the closing price of the common shares on the TSX Venture Exchange is equal to or greater than 50 cents for 10 consecutive trading days at any time prior to the expiry time, the company will have the right to accelerate the expiry time by giving notice to the warrant holders.
On Thursday, P2 Gold shares eased 9.3% or $0.02 to $19.5. The shares currently trade in a 52-week range of 28 cents and $0.05.
In a press release on May 22, 2024, P2 Gold reported results from a positive updated preliminary economic assessment (PEA) on the Gabbs gold-copper project located on the Walker-Lane Trend, Nevada.
The 2024 PEA envisaged total projected life-of-mine post-tax cash flow of US $1.7 billion at spot metal prices over a 14.2-year mine life. It also envisaged life of mine production of 1.47 million ounces of gold, 2.05 million ounces of silver and 190,000 tonnes of copper.
The PEA pegged the estimated pre-production capital cost, including contingencies, at US$365.5 million with payback of 1.7 years.
“The 2024 PEA contemplates heap leach processing at nine million tonnes per year as the first phase of operations for the initial five years to reduce upfront capital requirements and project risks,” said P2 Gold President and CEO Joe Ovsenek. “In year six, operations will switch to concurrent heap leach processing at four million tonnes per year and mill processing at five million tonnes per year,” he said. “Heap leach operations will pay for preproduction capital and a significant portion of mill capital prior to the commencement of mill processing in year six.”
The Gabbs Project consists of 355 unpatented lode mining claims and one patented lode mining claim covering four known zones of mineralization and spanning approximately 2,800 hectares. The gold-copper mineralization at three of the zones, Sullivan, Lucky Strike and Gold Ledge, is hosted within what are interpreted to be sills associated with an alkaline gold/copper porphyry.
The gold mineralization at the fourth zone, Car Body, is interpreted to be low sulphidation epithermal mineralization.
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