Orinoco Gold Ltd. raised A$12.1 million to fund the start of production from its Cascavel gold mine in Brazil and to start drilling at the Cascavel, Sertao and Tintiero deposits in the second quarter.
The company placed 115,891,876 common shares, with a 1-for-3 attached option, exercisable at 11 Australian cents until Jan. 31, 2020.
Cascavel's 30% joint venture partners took part in the placement for A$3.6 million, in lieu of a US$2.85 million payment due from the company Sept. 1, as part of its Back to Basics approach.
The company will use the funds to start a A$5 million investment program at Cascavel targeting monthly production of 5,000 ounces by year-end, and going forward, Orinoco will start taking 100% of all gold output from Cascavel, according to a March 23 release.
Orinoco added that it will restart "a long overdue focus back on" exploration and start a A$3 million drilling program at the Cascavel, Sertão and Tintiero deposits in the second quarter.
The company is conducting drilling at the Antena deposit and a rock chip sampling program at the Tintiero deposit. Results from the new field work will be reported in April.