EnviroGold closes $16m capital raising oversubscribed

West Perth-based mineral explorer EnviroGold Ltd has closed its $16 million capital raising oversubscribed and two weeks ahead of schedule, the company has announced.

The full text of a company announcement is pasted below

Emerging Australian resources development company EnviroGold Limited (ASX: EVG) ("the Company", "EnviroGold") advises that its A$16 million share offer to fund the development of the Company's Las Lagunas Gold Tailings Project in the Dominican Republic has closed today, more than two weeks early and heavily oversubscribed.

The offer was scheduled to close on November 16 but due to the overwhelming demand from institutional investors and sophistication investors from Australia and overseas, closed today two-and-half-times oversubscribed.

Leading London-based fund manager RAB Capital has taken a position in the placement, as has Credit Suisse.

The offer was for 100 million shares at 16 cents each. The shares also have one free attaching option for every two shares issued. The options will be listed and are exercisable at 25 cents each on or before 31 December 2009.

Perth-based broking house Indian Ocean Capital was lead manager to the highly successful offer.

EnviroGold executive chairman Mr Brian Johnson said he was delighted at the strong response to the offer and also the market's support of EnviroGold's current projects and growth strategy.

"Completing the capital raising in such a short timeframe with such strong backing from the market is a sign of the confidence the market has in our business model to reprocess refractory ores and tailings, and our growth strategy to increase our resource base in Latin America and China," Mr Johnson said.

"We can now move ahead with the development timeline for the Las Lagunas project, and are on schedule to begin construction in the fourth quarter this year and commission the project before the end of 2008."

A bankable feasibility study for the project has been completed and EnviroGold has received environmental and construction permits necessary to commence development.

The Company is currently also engaged in predevelopment work for its Trujillo Gold Project in Peru (50% joint venture with Peruvian gold mining company Manuel San Minera). It plans to commission Trujillo by the end of 2009, and believes the project has the capacity to double annual profit to around $20 million per year in 2010. EnviroGold's third current project, the Shandong Gold Project in China is due to be commissioned by mid 2010.