Latin Resources Ltd (ASX:LRS) (FRA:XL5) is buoyed by the very strong support demonstrated for its recent share purchase plan (SPP) which has closed heavily oversubscribed to the tune of 83% above the target.
The SPP was announced last month and set up to raise $627,000, however applications received totalled more than $1.15 million.
This response is also a strong endorsement of the company’s recent move into the gold sector by way of an earn-in agreement covering the highly prospective Yarara Gold Project in the prolific Lachlan Fold Belt of NSW.
Shares jump 33%
The SPP response has also triggered a 33% increase in Latin Resources’ shares which are trading at 1.2 cents.
After receiving applications for a total of 230.16 million shares, the company will now complete a scale-back of applications equally on a pro-rata basis.
Managing director Chris Gale is highly encouraged by the response with he and fellow directors also thanking participating shareholders for their ongoing support.
Allotment of shares under the SPP is expected to occur on July 17, 2020, with holding statements expected to be dispatched on July 20, 2020.
Funds will be allocated for exploration, project development, working and other capital requirements.
Yarara Gold Project farm-in
Last month the company signed a binding farm-in terms sheet with Mining and Energy Group Pty Ltd (MEG) to earn up to a 75% interest in the Yarara project near Albury in southern NSW, which is also prospective for copper.
Entering this new chapter focused on gold exploration closer to home in the Lachlan Fold Belt follows the company funding its South American operations through new partnerships.
LRS recently announced a JV with Integra Capital in respect of its lithium project in Argentina and this supplements a JV with global copper major First Quantum Minerals Limited (TSE:FM) (OTCMKTS:FQVLF), in which First Quantum is sole funding exploration costs on the copper porphyry project in Peru.
At the time Gale said: “The Yarara project presents an excellent opportunity to secure a significant and highly prospective gold project which has not benefited from modern exploration techniques in an emerging area of the Lachlan Fold Belt which has an established reputation as a world-class mineral province.
“Now we have our South American projects fully funded in Peru and Argentina, we can move our focus onto a very exciting gold project in the Lachlan Fold Belt, an area that shows incredible promise to enable LRS to become an exciting Australian junior explorer.”