Juniors pull in US$188mn to advance LatAm mining projects

Junior mining companies progressed financings worth US$188mn to advance Latin American projects in September – with the two biggest deals targeting Brazilian assets.

Exploration firms announced, advanced or closed at least 13 financings aimed solely or partly at LatAm projects in the month, comprising share offerings, convertible debentures, royalty agreements and loans. Transactions worth less than US$1.6mn are excluded.

The US$188mn total is up marginally from US$183mn in August.

Deal volumes were US$555mn in July, US$133mn in June and US$111mn in May.

BRAZIL, GOLD FOCUS

The majority of the September total (US$134mn) was earmarked for Brazilian projects, spread over two deals.

Chilean assets were the target of four deals worth a total of US$34.4mn, with two aimed at Mexican projects totaling US$8.9mn.

The remaining deals were spread across Colombia, Ecuador, Argentina and Peru.

The bulk of the US$188mn total was aimed at primary gold assets (three deals totaling US$130mn), followed by copper (six deals, US$28.4mn), lithium (two deals, US$20.2mn) and silver (two deals, US$9.8mn).

TOP SEPTEMBER DEALS

1. G Mining Ventures: US$116mn

Target: Brazil, gold

G Mining closed the final tranche of a non-brokered private placement financing on September 7, raising aggregate gross proceeds of US$116mn, which will be used for development and construction of the Tocantinzinho gold project in Brazil (in picture).

The financing forms part of a US$481mn package to advance the Pará state project reported in July.

G Mining announced a positive construction decision on September 12.

First construction is targeted in 2H24, CEO Louis-Pierra Gignac said in a release.

The company has committed US$136mn to date, with detailed engineering 30% complete as of September 12.

A 2022 feasibility study showed a US$427mn initial capex project producing 175,000oz/y gold over a 10.5-year mine life.

Post-tax IRR is put at 24.2% at US$1,600/oz gold.

2. Lithium Ionic: Cdn$25mn (US$18.2mn)

Target: Brazil, lithium

Lithium Ionic plans to raise Cdn$25mn through a private placement, to fund exploration and development work on its mineral properties and for general corporate working capital purposes.

Clarus Securities is lead agent in the placement.

Lithium Ionic owns the Itinga lithium project in Brazil’s Minas Gerais state and the neighboring Galvani claims licenses, acquired in September.

Drilling results from the Galvani claims last month included 1.71% lithium oxide over 22m and 1.53% over 46m.

3. Marimaca Copper: US$15.5mn

Target: Chile, copper

Marimaca Copper announced a US$15.5mn investment from Osisko Gold Royalties for a 1.0% net smelter return royalty on certain claims covering the Marimaca oxide deposit (MOD) at the Marimaca copper project in Chile, and some adjacent claims.

Proceeds will be used to advance permitting and a definitive feasibility study for the MOD and for general corporate and administrative expenses, the company said in a September release.

“Given the current challenging equity market conditions, we believe this financing also delivers meaningful value to our existing investors, lowering overall dilution while providing us with a strong balance sheet to continue with the development of the project,” CEO Hayden Locke said.

A 2020 PEA showed production at 35,600t/y copper over a 12-year mine life, with pre-production capex of US$285mn.

Post-tax IRR is put at 33.5% at US$3.15/lb copper prices.

4. Torq Resources: Cdn$15.0mn (US$10.9mn)

Target: Chile, gold

Torq closed a Cdn$15.0mn non-brokered private placement in September, in which South Africa-based Gold Fields acquired 15mn Torq shares, giving it a 15.05% stake in the company.

Funds will be used to advance Torq’s Chilean portfolio, primarily the Santa Cecilia gold-copper asset where a maiden drill program is planned for early 2023.