Alderan Resources (ASX: AL8) is banking just over $2.1 million after a successful share placement and sale of convertible notes to advance its copper and gold projects in the US state of Utah.
Alderan is earning up to 70% of the copper-gold Valley-Crossroads and Detroit gold projects.
These projects have seen little modern exploration and have been underexplored for gold. At Valley-Crossroads, less than 5% of historic drill cores were assayed for gold, the company has noted previously.
Alderan is raising $900,000 via a placement of 18 million shares at $0.05 per share to professional and sophisticated investors.
The company will also issue convertible notes with a face value of $1.215 million, these notes automatically converting to shares once shareholder approval has been obtained.
The money will be used for its 2020 exploration program at the two project areas where it is earning a 70% interest from Tamra Mining, a Utah-based mining claims company. Alderan has an obligation to demonstrate that it had the US$1.25 million (A$1.8 million) to complete the initial program.
The Perth-based company is also exploring the White Mountain gold project in Utah.
Previous exploration “piecemeal and opportunistic”
Alderan said these projects have seen little modern exploration due to previous fragmented ownership, and the company considers they have been underexplored for gold.
Freeport had tried to consolidate what is now the Detroit project, but those efforts were rebuffed. Records show that about 120,000 ounces of gold was produced there in the 1870s.
Managing director Peter Williams said the company’s understanding of the geology of its project portfolio was continuing to evolve.
The plan is to define drill targets over the next one to two months, with drilling to begin within three months.
Mr Williams described previous exploration over the past century as “piecemeal and opportunistic”.
“We now have the opportunity to apply modern exploration techniques to this ground and we are excited to be moving forward with our plans to uncover the potential the projects hold,” he added.
The projects lie south of the famed Bingham Canyon mine, which produces 400,000oz of gold per annum, along with 275,000t of refined copper, 4Moz of silver and 25Mlbs of molybdenum.
Meanwhile, Rio Tinto subsidiary Kennecott Copper can earn a 70% interest in Alderan’s other Utah project, Frisco, by spending US$30 million. Kennecott last month began a four-hole, 2,000m drill program there.