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Horizon set to break ground with $6m funding package

Horizon Minerals has picked up a very respectable $6M in a combined debt and equity funding package that looks like it will be enough to get the small capped ASX-listed company into production at its Boorara gold project east of Kalgoorlie. As part of the package, Horizon made a $2M placement before costs at A$0.08 per share - an astounding 8% premium to its share price before closing on the 10th of March of $0.074c a share and a 10% discount to its 15-day VWAP of $0.089c.

A working capital facility of $4M will also allow the stage one plan at Boorara to go ahead, which will involve the mining of three starter pits over six months and the toll treating of around 160,000 tonnes of ore that will produce 8,700 ounces of gold.

Horizon said that after all costs were covered, including debt and interest payments, it will net about $5.4M in cash from the deal.

Horizon’s debt facility sits with German investor, Sparta AG and is a first-ranking mining mortgage over its Boorara project.

With official Board approval just around the corner, the aspiring miner is nearing its moment of truth as it aims to lock away mining and haulage contracts within coming weeks.

The ASX listed company said it is aiming to break ground in the June quarter of this year, provided all goes smoothly with Governmental approvals.

Horizon Managing Director Mr Jon Price said: “A balance of debt and equity in these extremely volatile market conditions minimises dilution to our shareholders while enabling the Company to bring Boorara into production rapidly to capitalise on the high Australian dollar gold price, accelerate a resource growth and exploration drilling program and complete the Feasibility Study in 2020.”

The Boorara project is divided into three areas, the Royal, Crown Jewel and Regal deposits.

During 2016, a small 20-metre-deep trial pit was mined across the Royal deposit. The in-situ grade control resource estimate grade at the time was 1 gram of gold per tonne however once the ore was processed through the local Greenfields Mill, the head grade came out at a significantly more impressive 1.73 grams per tonne gold.

Given the upside in grade from the previous trial mining, Horizon will be taking a similar approach to de-risk the project’s global resource model before surging ahead with a full production profile.

The Boorara deposits have a total resource of 16.45 million tonnes grading 0.96g/t for 507,000 ounces of gold and once the stage one trial mining data is reconciled, the company said it will polish off a feasibility study towards the end of the year.

Horizon looks to be making the right moves in a bullish gold market, with the results of its successful raising seeming to demonstrate that investor appetite for gold developers is a real thing.

 

Is your ASX listed company doing something interesting ? Contact : matt.birney@businessnews.com.au

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Top 10 Shareholders

Substantial shareholders as published in the annual report.
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Total Shareholder Return as at 31/03/20

1 year TSR5 year TSR
488thElement 25-39%-9%
567thHorizon Minerals-50%1%
610thLithium Australia-54%-6%
756thBass Metals-75%2%
669 WA (and selected non WA) listed companies ranked by 1 year TSR relative to other companies with similar revenue
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Share Transactions

22/08/19
$29k Sold
22/08/19
$0 Other
08/08/19
$17k Sold
Total value as at the date of the transaction
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Revenue

74th↓Horizon Minerals$3.0m
87th↑Lithium Australia$2.0m
88th↑Gascoyne Resources$2.0m
90th↑Bass Metals$2.0m
91st↓Element 25$1.9m
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