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Foran raising C$7M in nonbrokered financings to fund McIlvenna Bay

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Foran raising C$7M in nonbrokered financings to fund McIlvenna Bay

Foran Mining Corp. said June 11 that it aims to raise C$7 million through a pair of financings to help fund development of the McIlvenna Bay zinc-copper-gold-silver project in Saskatchewan.

Foran plans to issue 4,545,455 flow-through shares at 66 Canadian cents per share to raise C$3 million and 8,333,333 non-flow-through shares at 48 cents per share to raise C$4 million.

Foran said in late January that it would forge ahead with a feasibility study of McIlvenna with the help of Glencore PLC. Foran has turned to Glencore for technical expertise on the project in return for agreeing to give it exclusive rights to toll mill or buy McIlvenna production through an off-take agreement.

As part of work on the feasibility study, Foran said it drilled 32 holes, or 15,000 meters, in a 2018 winter drill program to better define and expand the project.

McIlvenna is a sizable polymetallic deposit that was discovered decades ago and hosts indicated resources of 13.9 million tonnes grading 1.28% copper, 2.67% zinc, 0.49 g/t of gold and 17.1 g/t of silver and inferred resources of 11.3 million tonnes grading 1.32% copper, 2.97% zinc, 0.43 g/t gold and 17.5 g/t silver.

The feasibility study builds on a 2014 preliminary economic assessment in which Foran outlined a mining scenario with potential production pegged at 58.9 million pounds of zinc, 37.6 million pounds of copper, 1.2 million pounds of lead, 16,000 ounces of gold and 398,000 ounces of silver per year, on average, over a 13.7-year mine life.

In the preliminary economic assessment, Foran estimated the project's posttax net present value at C$262.6 million using a 7% discount and its internal rate of return at 18.9%. It based the study on metals prices of US$3.08/lb copper, US$1.06/lb zinc, US$0.93/lb lead, US$1,238/oz gold and US$17/oz silver and a Canadian-to-U.S. dollar exchange rate of 0.89.