Arizona Sonoran Copper closes $35M private placement

US-based copper developer Arizona Sonoran (TSX:ASCU; OTC:ASCUF) has closed a non-brokered private placement of 17.5 million common shares priced at $2.00 each for gross proceeds of $35 million. This financing was first announced by the company on April 28, and was later upsized from $30.5 million to $35 million on the same day.

As previously agreed, both Rio Tinto Technology Holdings and Tembo Capital Elim Co-Investment participated in the placement, subscribing for 6.4 million and 3.91 million shares respectively. Other institutional investors subscribed for the remaining 7.19 million shares.

Rio Tinto now holds 7.2% of Arizona Sonoran's outstanding share capital. Tembo, on the other hand, saw its stake decrease from 37.6% to 34.6% despite participating in the offering.

In connection with the offering, Arizona Sonoran also entered into a strategic partnership with Rio's Nuton venture, which holds a portfolio of proprietary copper leach related technologies. The company also plans to collaborate with Rio on other technical and operational aspects of the Cactus mine project, its principal asset.

"We are thrilled to be starting our strategic collaboration with one of the largest global diversified metals miners, which speaks volumes about the merits of the Cactus mine and our management team," Arizona Sonoran's president and CEO George Ogilvie commented. The net proceeds from this offering will be used to fund additional drilling, exploration and study work related to the Cactus project.

Cactus is a brownfields project located 64 km southeast of the Phoenix metropolitan area, on private land in Pinal county. It sits at the intersection of Arizona's three major copper porphyry belts, which hosts several large-scale regional copper mines and processing facilities.

A preliminary economic assessment (PEA) on the project dated August 2021 contemplates a simple heap leach and SX/EW operation over an 18-year mine life, producing an average of 56 million lb. of LME Grade A copper cathode annually.

Production is based on estimated resources of 151.8 million tonnes at 0.531% copper (1.61 billion lb. copper) in the indicated category and 228.9 million tonnes at 0.384% copper (1.76 billion lb. copper) in the inferred category.

In addition to Cactus, the company is also exploring on its 100%-owned Park Salyer property that could allow for a phased expansion of the Cactus mine once it becomes a producing asset.

More information on the company's Arizona copper projects can be found at www.arizonasonoran.com.