Geopacific raises $40m to help fund PNG project

Geopacific Resources has completed a $40 million share placement, and aims to raise a further $5 million via a share purchase plan to fund its $198.5 million Woodlark gold project in Papua New Guinea.

Geopacific raised the funds via a share placement at 2.5 cents each, which represents a 10.9 per cent discount to its five-day volume-weighted average price.

The share purchase plan will be conducted at the same price, and Geopacific is also planning a one-for-25 share consolidation.

Petra Capital acted as lead manager to the placement.

Claremont-based Geopacific said the capital would specifically go towards front-end engineering design and early site works.

In November last year, Geopacific released its definitive feasibility study on the project, which detailed a capital expenditure of $198.5 million.

Development is set to commence in early 2020.

The project is set to produce 967,000 ounces of gold over a 13-year production life, with a payback period of 2.2 years.

The project is located on Woodlark Island, which is 600 kilometres east of Papua New Guinea’s capital of Port Moresby.

Last month, Geopacific appointed GR Engineering Services as the engineering, procurement and construction contractor for the processing plant at Woodlark.

The two parties signed a conditional letter of intent for GR to develop a 2.4 million tonnes per annum processing plant which includes a carbon in leach facility, tailings line and other supporting infrastructure.