McEwen Mining (TSX: MUX; NYSE: MUX) closed its offering of 14.5 million flow-through common shares priced at $1.325 each for total gross proceeds of $19.2 million. The sole bookrunner for the offering was Canto Fitzgerald Canada, and PearTree Canada structured the flow-through donation placement.
The company will use the proceeds for qualifying Canadian exploration expenditures on its Ontario properties and the Fox gold complex about 40 km east of Timmins, Ont.
McEwen is planning an expansion of the Fox complex that includes the Froome mines and 2,000 t/d Black Fox mill, which produced about 30,000 oz. of gold in 2021. Mining ceased at Black Fox as Froome reached commercial production in September.
The preliminary economic assessment for the expansion envisions producing 80,800 oz. per, for a total of 885,000 ounces. The average all-in sustaining cost is estimated at less than US$1,225 per oz. gold. With a gold price of US$1,246 and after taxes, the base case has a net present value with a 5% discount rate of US$175 million and an internal rate of return of 21%, with payback occurring after 5.9 years.
To support the expansion, McEwen has chosen several exploration targets – Stock West (where an initial resource estimate is underway), the green carbonate extension (CGR) to the footwall of the Stock mine, the sock mine and Grey Fox plunge extensions, and various other shallow extension. Some deep drilling is planned as well. The company did 77,700 metres of drilling at the Fox complex last year.
More information about McEwen’s exploration properties is available at www.McEwenMining.com.