Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
Great Basin Gold is cashing up to the tune of $75 million.
The B.C.-based gold company announced on Thursday it has entered into an agreement with a syndicate of underwriters led by RBC Capital Markets for the sale of 29,415,000 common sales at $2.55 per share. The underwriters have the option to buy another 15% of the offering, which is expected to close Feb. 23 pending approvals from the TSX.
The proceeds will be used as working capital towards the company’s Burnstone gold project in South Africa. A revised technical report estimates the property contains 12.1 million ounces of gold, graded at 6.5 g/t, in the measured and indicated category. Cash costs are $392 per ounce.
The mine completed its first gold pour last October and it is expected to produce 150,000 gold ounces in 2011. It has 192,000 tons of ore stockpiled.
Great Basin Gold reported revenues of $56.9 million and a loss of $35.6 million for the period ending September 30, 2010. Its share price closed at $2.65 on the TSX in Thursday’s trading.
