06/11/2009 - 09:09

Azumah raises $4.24m for gold project

06/11/2009 - 09:09

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Azumah Resources has raised more than $4 million through an oversubscribed share placement as part of its push to fast-track exploration and development at its Wa gold project in Ghana.

Azumah Resources has raised more than $4 million through an oversubscribed share placement as part of its push to fast-track exploration and development at its Wa gold project in Ghana.

 

The announcement is below:

 

West African gold company Azumah Resources Ltd (ASX: AZM) is pleased to announce that it
has successfully raised A$4.24 million (before expenses) through an oversubscribed share
placement as part of its push to fast-track exploration and development of its 100%-owned Wa
Gold Project in north-west Ghana.

The share placement, comprising 21.2 million shares at 20 cents per share, has been made to
Australian and overseas institutional and sophisticated investor clients of Perth-based Blackswan
Equities Limited and Melbourne / Sydney-based BGF Securities. Pursuant to the 15% allowance
under ASX Listing Rules the placement does not require shareholder approval.

Azumah's largest shareholder, Macquarie Bank Limited, is participating in the placement to
maintain its 15% holding in the Company.

The funds raised will bolster Azumah's working capital to over A$9 million ahead of a largescale,
41,000m drilling programme aimed at increasing the Company's previously outlined
750,000oz Indicated and Inferred Mineral Resource.

This drilling programme is scheduled to commence shortly and will as a priority test for
extensions to the Kunche and Bepkong discoveries. It will also test for new mineralisation in the
immediate vicinity of these deposits, investigate priority targets along the Kunche-Bepkong
mineralised structural corridor and delineate maiden resources at the Julie and Collette
prospects.

First results are expected in early December and news flow will continue well into 2010. Maiden
JORC Code mineral resource estimates for Julie and Colette are expected to be available early
in the next Quarter.

Preliminary open pit optimisation and mine design studies based on the mining of the Kunche
and Bepkong deposits over an initial 4.5 years indicate that the Wa Gold Project is already
capable of generating robust cash operating margins and a healthy overall cash operating
surplus (ASX announcement 21st August 2009).

Azumah's immediate objective is to delineate sufficient additional resources during the
forthcoming and subsequent drilling programmes to underpin a decision in 2010 to develop a
mining operation.

Azumah's licences encompass over 150 strike kilometres of prospective Birimian aged
greenstone terrain, the same rocks that host many of the world-class gold deposits in West
Africa and Ghana. Reconnaissance soil sampling has returned very widespread gold anomalism
within Azumah's 3,200km2 tenure but only a relatively limited area has ever been drilled.

"This capital raising comes at a pivotal time in the Company's development as we embark on a
major new drilling programme designed to help us reach the critical mass resource base required
to establish the first stand-alone commercial mining operation in the emerging north-west Ghana
gold province and to ramp-up development studies at our Wa Gold Project," said Mr Stone.

"Based on our current resources, Azumah has an Enterprise Value (EV) of just A$41 per
resource ounce of gold and, while this has been increasing of late, the Company is still
fundamentally and relatively undervalued against its West African explorer peers," Mr Stone
added.

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