Junior miners raise US$155mn for LatAm assets

Junior mining companies advanced financing deals totaling US$155mn for Latin American projects in August – a sharp decline from the previous month.

The figure is the lowest so far in 2021, down from US$282mn in July and June’s previous low of US$176mn, according to industry data compiled by BNamericas.

February’s peak had seen 26 deals advance a combined US$480mn.

The announced or closed financings are by junior exploration companies and small producers, with those worth less than Cdn$2mn (US$1.7mn) excluded.

August’s total comprise private placements, a gold pre-payment facility and the exercise of share purchase warrants raising funds for LatAm assets.

GOLD FOCUS

Of the nine deals last month, seven worth US$113mn were aimed at advancing primary gold assets in the region, with one each targeting copper and silver projects.

Chile and Mexico were each the target of two deals, worth US$29.9mn and US$15.4mn, respectively, with the remaining financings spread over Brazil, Ecuador, Argentina, Peru and the Dominican Republic.

TOP AUGUST FINANCING DEALS

1. G Mining Ventures, US$55.6mn

Target: Brazil, gold

G Mining Ventures plans to raise Cdn$70mn in a bought deal private placement, led by Sprott Capital Partners and BMO Nesbitt Burns.

The placement was confirmed in a press release on August 19, 10 days after G Mining signaled its intention to pursue an equity offering as part of its planned acquisition of the Tocantinzinho construction-ready gold project in Brazil from Eldorado Gold.

The private placement was planned to help finance the US$110mn acquisition and fund various work programs at Tocantinzinho.

2. McEwen Copper, US$40mn

Target: Argentina, copper

McEwen Copper, a subsidiary of McEwen Mining, closed the first US$40mn tranche of a US$80mn private placement offering in August.

Proceeds will be used to advance the US$2.36bn Los Azules copper project in Argentina to a pre-feasibility study, along with construction of a new year-round access road and infill and exploration drilling.

McEwen Copper was formed by McEwen Mining in July with the aim of advancing Los Azules, and the subsidiary plans to pursue an initial public listing within 12 months of the closing of the offering.

McEwen Mining CEO Rob McEwen’s investment corporation Evanachan Limited purchased all McEwen Copper shares issued in the first tranche of the offering.

3. Rio2, US$27.9mn

Target: Chile, gold

Rio2 closed a public offering and private placement of shares for combined gross proceeds of Cdn$35.1mn on August 10.

At least US$20mn of the funds will be used for development of the company’s Fenix gold project and associated mine and camp infrastructure, with the remainder earmarked for general working capital purposes.

Rio2’s focus is on taking Fenix to production as soon as possible, as part of a staged development.

Proceeds from the public offering, led by Scotiabank, CIBC Capital Markets and Raymond James, were Cdn$28.8mn, with the private placement of shares to Wheaton Precious Metals raising Cdn$6.37mn.

4. Inca One Gold, US$9mn

Target: Peru, gold

Inca One arranged a pre-payment facility of up to US$9mn with OCIM Precious Metals.

The deal, announced on August 9 and which involves an immediate drawdown of US$6mn, is aimed at funding an increase of production at its mineral processing facilities in Peru to 225t/d from 175t/d.

5. Magna Gold, US$7.9mn

Target: Mexico, gold

Magna Gold closed a Cdn$10mn private placement on August 20, with all convertible debentures issued to Delbrook Capital Advisors.

Net proceeds will be used for mobilization and exploration activities across Magna’s portfolio, which includes the San Francisco gold mine along with projects in Sonora and Chihuahua states.