01/04/2008 - 10:21

Westgold to raise $5.1m to fund NT exploration

01/04/2008 - 10:21

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ASX-listed exploration company Westgold Resources has today announced a fully underwritten 1-for-4 pro-rata non-renounceable rights issue, at a price of 18 cents per share, to fund its Rover exploration program in the Northern Territory.

Westgold to raise $5.1m to fund NT exploration

ASX-listed exploration company Westgold Resources has today announced a fully underwritten 1-for-4 pro-rata non-renounceable rights issue, at a price of 18 cents per share, to fund its Rover exploration program in the Northern Territory.

The rights issue will be underwritten by Westgold's largest shareholder, Metals X Limited and Westgold will have 142.5 million shares on issue, and 3.1 million unlisted options, following completion of the Rights Issue.

In November 2006 Westgold's acquired Navarre Resources Pty Ltd, through which it obtained the Rover Project in the Northern Territory as well as a large portfolio of gold and uranium tenements in Western Australia.

Westgold's Rover Project in the Northern Territory was obtained in November 2006 through the acquisition of Navarre Resources Pty Ltd.

Following the acquisition of Navarre, Westgold undertook a major drilling programme to assess the most prospective targets at its new tenements, which led to its decision to substantially focus the Company's exploration efforts on the Rover Project and to spin-off the Western Australian assets into a separate company.

The IPO of this spin-off company, Aragon Resources Limited, raised $8.75m in mid-August 2007, with Westgold retaining a 42% share holding.

One week ago, the east Perth-based company announced diamond drilling had commenced at Rover Fields, 100kms south west of Tennant Creek in the Northern Territory to confirm and extend the previously defined high grade gold-copper-cobalt mineralisation.

 

The company announcement is pasted below:

 

Westgold Resources Limited announces a fully underwritten 1-for-4 pro-rata non-renounceable rights issue at a price of 18 cents per share ("Rights Issue") to raise approximately $5.1 million. The funds raised will be used to drive the Company's aggressive 2008 exploration programme at the Rover Project in the Northern Territory, including the current diamond drilling at the high priority Rover 1 (Au-Cu-Co) Prospect.

The Rights Issue will be offered to all eligible shareholders on the basis of one (1) new share for every four (4) shares held at the price of 18 cents per share. This represents a 12% discount to the closing price of Westgold shares on 31 March 2008 and a 24% discount to the 30 day volume weighted average price (VWAP).

The Rights Issue will be underwritten by Westgold's largest shareholder, Metals X Limited.

Westgold's Managing Director, Mr Andy Beckwith, said: "The Rights Issue provides all shareholders with the opportunity to further participate in the growth of the Company's high quality and exciting exploration assets within the Rover Field".

"The fact that Metals X has agreed to underwrite the Rights Issue represents a strong vote of confidence in the Company's assets, growth prospects and exploration team, and also assures us of raising the funds to support our current activities and timeframes during a period of considerable market uncertainty," he added.

"We have recently commenced the much anticipated diamond drilling programme at the Rover 1 (Au-Cu) Prospect, and we intend to remain focussed on this drilling with the aim of establishing a high-grade gold-copper-cobalt resource later this year," he said.

"In addition to Rover 1, we are commencing a Scoping Study on the Explorer 108 deposit, where we recently announced a significant maiden lead-zinc-silver resource, and we are building a strong pipeline of other high-priority gold, copper and base metal targets within this high prospective and under explored province," Mr Beckwith added.

The Company will shortly provide details of the Rights Issue timetable, including details of the Record Date and the date of dispatch of the Offer Document.

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