Xanadu Mines Ltd (ASX:XAM) has raised $12.2 million through a placement of shares at $0.20 to continue developing the Kharmagtai copper-gold project and Oyut Ulaan gold project in Mongolia.
The raising received strong support investors and saw new well-regarded institutional investors join the register.
Dr Andrew Stewart, CEO commented: "Xanadu is in a privileged position with a growing JORC-compliant gold-rich copper resource and new bonanza gold grades.
"The yield from our counter-cyclic approach highlights that now is the time to be leveraged to exploration upside and our discoveries are ready for the next boom."
Kharmagtai porphyry copper-gold project
The 79.5% owned Kharmagtai project is located in south Gobi, Mongolia.
It is an advanced exploration project with a 66 square kilometre mining licence.
Kharmagtai contains a 203 million tonne JORC compliant resource containing 680,000 tonnes of copper and 2.2 million ounces of gold with significant exploration upside.
It is a large porphyry style deposit with multiple near-surface, gold-rich zones and mineralisation outcropping at surface.
The resource represents only a small portion of a potentially large mineral system.
Exploration is targeting a fourth shallow gold-porphyry centre to support at least a 5 million tonnes per annum operation for 10 years at 0.6% to 1.0% copper equivalent.
Oyut Ulaan gold project
The 90% owned Oyut Ulaan project is located within the South Gobi Copper Belt, which hosts the world class Oyu Tolgoi copper-gold project, and is 260 kilometres east of Kharmagtai.
Drilling is underway testing trenched targets, which identified gold assays of up to 589.96 g/t and confirmed the existence of a continuous zone of shallow high grade gold mineralisation.
Exploration has now discovered at least four zones of gold mineralisation within a prospective area - Stockwork, Bavuu, Diorite and Hulan.
The ongoing exploration at Oyut Ulaan represents an opportunity for Xanadu to define a shallow gold resource capable of being economically mined.
By drilling targets identified through previous trenching, which found bonanza gold grades, Xanadu is able to understand the depth of the mineralised zones.
Xanadu has received commitments for 60.83 million shares at a price of $0.20 to raise $12.17 million. This will give the company a healthy cash position going forward.
Xanadu maintains broker support from Bell Potter who recently upgraded their price target to $0.51 per share.
Bell Potter maintain a Speculative Buy rating and see Oyut Ulaan as having potential to host viable near surface epithermal gold mineralisation that could potentially represent a separate, modest scale starter project.
The share price is up circa 100% year to date currently trading at $0.22, which is a premium to the placement price.
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