Focus to raise $40m for Treasure Island

Perth-based gold miner Focus Minerals says it will raise $40 million to accelerate production at its greenfields Treasure Island gold project near Kalgoorlie, through an institutional placement and share purchase plan.

Focus said today that its $32.3 million share placement was strongly supported at 7.6 cents per share.

It said the share purchase plan would raise $7 million, at the same price as the placement.

Funds will also be used to expand production and development work at Focus' underground gold mine, The Mount, and bring forward plans to increase the company's reserves at its Greater Coolgardie gold projects.

The company expects its development programs to increase its production to 130,000 ounces of gold during calendar 2012.

Focus chief executive Campbell Baird said the raising would underpin the company's three-year growth plan to become one of the Goldfields' largest gold producers.

"We have a wealth of organic growth opportunities which can be highly value-accretive for shareholders and, in the current strong gold price environment, we see a clear window of opportunity to accelerate our growth and build significant long-term value for shareholders by extracting the maximum value from these assets," Mr Baird said.

"We have put together a major exploration and development programme that will see us aggressively expand our business into a rising gold price.

"These activities see us well down the road to delivering 130,000oz of gold in calendar 2012, but it is in 2013 where we are targeting our production output to rise significantly as we look to advancing both the Greater Coolgardie projects, where we already have one million tonnes worth of mining in reserve, and also our highly prospective Treasure Island Gold Project at Lake Cowan."

Hartleys Limited is broker to both the placement and the share purchase plan.