Today, West Red Lake Gold Mines (WRLG.v WRLGF) announced the upsizing of its previously announced private placement to US$23M from US$20M due to strong demand.
The net proceeds of the offering are expected to be allocated toward continuing to advance the development of a restart plan for the Madsen Gold Mine, as well as for working capital and general corporate purposes.
Notably, Frank Giustra, who already holds 11.07% of the outstanding Common Shares, indicated his intent to participate in the Offering by subscribing to 3,700 Units, representing US$3.7M in gross proceeds.
Shane Williams, CEO of West Red Lake Gold, commented, “The Offering marks another key step in the financing process as we focus our efforts on the development of a derisked and robust restart plan for the Madsen Gold Mine while minimizing dilution to our shareholders”.
With an indicated resource of 1.65M oz of gold at 7.4g/t and 0.37M oz of gold at 6.3g/t inferred, the Madsen Mine is WRLG's flagship and is a fully permitted gold mine that sits on top of highly prospective exploration targets in the Red Lake District, a world-class gold district.
Deep Value Opportunity: Over C$350 million invested to date; significant and expandable surface and underground infrastructure; potentially transferable tax assets to further underpin valuation
Boasting a robust, data-rich technical foundation, over C$350 million has been invested in the Mine to date with significant and expandable surface and underground infrastructure creating a deep value opportunity.
Recently, a new area of high-grade mineralization extending the current resource to the northeast was discovered amid ongoing drilling at the North Austin Zone with intercepts including 9.15g/t Au over 3.3m and 10.66 g/t Au over 2.6m. Notably, the intersection of 8.12 g/t Au over 2m suggests the vertical continuity of almost two full mine levels, ~50m, below any workings in the east portal.
WLRG believes these intercepts are indicative of the resource growth potential that still exists at the Madsen Mine asset with the North Austin Zone sitting adjacent to existing underground development, marking it as a high calibre target that could potentially be developed early during future mine restart and production.
Since underground drilling resumed in early January 2024, WRLG has completed 1,651m of Expansion drilling and 689m of Definition drilling, with a total of 23 diamond drill holes for 2,340m having been completed so far in 2024.
Furthermore, the Mine is debt-free and fully permitted with a brand-new 800+ tonne per day mill as well as a tailings and water treatment facility.
Despite the asset being previously valued at one billion dollars, WRLG acquired Madsen for pennies on the dollar due to previous mismanagement, with all the infrastructure in place as well as tailings and permitting.
Posted on Behalf of West Red Lake Gold Mines Ltd.