Vatukoula Gold Mines (LON: VGM) has completed the £6 million placing it announced on 31 May.
The company issued 4.8 million new shares at a placing price of 125 pence each.
At the end of May, Vatukoula said it needed to carry out the fundraising in order to begin the development of the ’18 level’ decline at the Philip shaft at the Vatukoula mine on Fiji and also to the firm’s biomass project at Vatukoula.
The company expects to complete the decline at Vatukoula within two years. It believes that by bringing the mine forward in this area it should be able mine high-grade ore bodies, which in the medium term will increase the mine head grade.
The planned decline, between the 18 level and 21 level, is aimed at providing access to the lower level Prince Dolphin and Prince William ore bodies, which have mineral reserve grades of 11.5 grams per ton and 6.7 grams per tonne respectively.
The firm’s CEO, David Paxton, described this development programme as “a key part” of the firm’s long-term strategy.
The biomass project is expected to provide between 10 and 15 megawatts of energy to the Vatukoula mine. A feasibility study for this is targeted for the end of this month, and indications from Fiji Sugar Corporation are that the project will be commissioned in late 2012.
At 10.32am today, Vatukoula’s share price was down less than a penny at 109 pence.