Wednesday 18 October 2017

Canadian explorer Hannan taps markets for €2m to fund drilling at Clare zinc prospect

Canadian-listed minerals explorer Hannan Metals has raised CA$3.4m (€2.3m) to fund drilling activity at a zinc prospect in Co Clare. Stock photo: Thinkstock
Canadian-listed minerals explorer Hannan Metals has raised CA$3.4m (€2.3m) to fund drilling activity at a zinc prospect in Co Clare. Stock photo: Thinkstock
Gavin McLoughlin

Gavin McLoughlin

Canadian-listed minerals explorer Hannan Metals has raised CA$3.4m (€2.3m) to fund drilling activity at a zinc prospect in Co Clare.

The company has 100pc ownership of the Kilbricken prospect, the site of an old lead and zinc mine that was worked for two decades in the 19th century.

The prospect Hannan is aiming to commercialise is located 400m below the old mine and was bought by Canadian multinational Lundin Mining for €20m a number of years ago.

Hannan paid US$1m for the prospect last year and has been drilling at the resource since May.

The fundraising will enable it to deploy a second drilling rig at the site as it seeks to discover how good the prospect is.

Initial results have been "substantial", according to Hannan Metals chief executive and chairman Michael Hudson. "Our aim is now to grow the initial zinc resource by drill testing the areas that lie open in all directions around the resource area," he said.

The company had initially planned to raise CA$42m but the fundraising - conducted via a private placement - was oversubscribed.

The money will be used to provide working capital and for general corporate purposes as well as advancing drilling activity at Kilbricken.

The price of zinc is at its highest for the best part of the decade, fuelling a sector-wide resurgence in activity in Irish zinc.

Glencore has restarted activity at its Pallas Green prospect in Limerick after putting the project on hold for a number of years, while Group Eleven Resources, an Irish-based explorer backed by former Davy corporate finance chief Hugh McCutcheon, is plotting a listing on the stock market later this year.

Group Eleven has recently agreed a deal to buy 60pc of a prospect which covers areas of Co Longford and Co Westmeath.

The seller was global mining giant Teck, and Group Eleven raised €2.6m to fund the deal - also via a private placement.

Group Eleven chief executive Bart Jaworski said the deal was a "transformational acquisition" that would strengthen the company's platform as it approaches its IPO.

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