Exploration and development company Vertex Minerals has announced an A$11-million capital raise to complete underground development work at the Hill End gold mine, in New South Wales, as well as fund exploration work and provide working capital.

The capital raising comprises a conditional placement of A$7.5-million through the issue of 35.7-million fully paid shares, subject to shareholders approval at an upcoming meeting, a share purchase plan to raise up to A$1-million on the same terms as the placement, and a A$3.5-million convertible loan issuance.

"This capital raising provides our remaining capital expenditure (less than A$1-million) and working capital over May and June ahead of underground mining in July. With over $25-million spent by previous owners on underground development and the ore sorter and processing plant in place and operating successfully, we believe Vertex is on the cusp of a period of significant cash generation from our uniquely high-grade gold operation,” said executive chairperson Roger Jackson.

He reported that the past few months had seen a substantial transformation at the Hill end site, with the successful installation and commissioning of the Tomra ore sorter and gravity gold plant.

“With the processing circuit already operating on historic stockpiles, it’s now only months before we commence underground mining. The team at Hill End is excited at the prospect of mining one of Australia’s highest grade gold mines, with our resource at a very high 16.7 g/t gold in situ. The Tomra ore sorter is very effective at separating our quartz-hosted gold ore from other rocks,” Jackson reported.

“It’s a compact, but critically fully approved, site. And given our high-grade resource and the adoption of mechanised underground mining as well as the Tomra ore sorting technology, we are targeting production of gold for less than A$2 000/oz. Finally, we believe Hill End will have one of the best ESG footprints of an Australian gold mine on account of our minimal grind requirements, low water usage, gravity plant with no chemicals or cyanide and the resultant production of benign tails.”