Europa Metals raises £2m for Toral pre-feasibility study

The AIM-traded firm said the fundraising consisted of the issue of 15,686,274 new ordinary shares at a price of 12.75p each, to existing and new investors.

It comprised a placing of 15,529,412 new shares, and a subscription for a further 156,862 new shares by certain directors.

The fundraising remained conditional on admission to trading on AIM and, following that, the new shares would represent 31.9% of its enlarged issued share capital.

Europa Metals said the net proceeds would primarily be put towards completion of certain key components of a pre-feasibility study on its wholly-owned Toral lead-zinc-silver project in the Castilla y León region of northern Spain, as well as for its general working capital requirements.

The study workstreams would include hydrogeological studies to ascertain subsurface water conditions, drilling targeting increases in the confidence level of the overall mineable resource for Toral, and further metallurgical, geotechnical, waste management and environmental work components.

“The Toral project has been continually advanced by Europa Metals and last week we reported a resource update estimating a 3.8 million tonnes Indicated resource at 8.3% zinc equivalent, including lead credits, and 17 million tonnes total resource at 6.9% zinc equivalent, including lead credits, at a 4% cut-off,” said chief executive officer Laurence Read.

“With a total resource containing 720,000 tonnes of zinc, 510,000 tonnes of lead and 14 million ounces of silver, and testwork recoveries of 83.7% lead recovery to a 60% concentrate, 77% zinc recovery to a 59.1% concentrate and 87.1% silver recovery to 1,350 parts per million silver within lead concentrate, we have taken the decision to raise funds to complete certain key components of a pre-feasibility study.”

Read said the fundraising would enable the company to undertake key work items necessary for the eventual completion of a full pre-feasibility study, including advancing the resource categorisation of the block model.

“I look forward to announcing further updates shortly from work already in progress including metallurgical and ore sorting analysis and thereafter new preliminary economics for the Toral Project, updating the parameters in the 2018 Scoping Study to reflect the significant work completed since its publication.

“We continue to endeavour to advance Toral as a realisable, robust future source of lead, zinc and silver with excellent recoveries and grade, situated within a proven mining region of the European Union with well established road, rail and power infrastructure.”

At 0912 BST, shares in Europa Metals were down 15.52% at 13.94p.