Lumina issues $24M in shares for Cangrejos gold-copper project, debt repayment

Lumina Gold (TSXV: LUM) has raised $19 million to advance its Cangrejos gold-copper project in Ecuador, where work is under way on a prefeasibility study. In addition to closing a private placement of 31.6 million common shares priced at $0.60 each, it also issued additional shares worth $5.2 million to Ross Beatty in exchange for retiring that amount of debt. He now has a 19.8% interest in the company.

The company will use the net proceeds of the offering for infill drilling, stepout drilling and prefeasibility work at Cangrejos. Lumina owns 100% of the project, located 40 km from the port of Puerto Bolivar.

A preliminary economic assessment (PEA) for Cangrejos was completed in June 2020. It included updated resource number for two deposits using a 0.3 g/t gold-equivalent cutoff.

The deposit hosts an indicated resource of 469.7 million tonnes grading 0.59 g/t gold and 0.12% copper (0.77 g/t gold-equivalent), for 8.9 million oz. of gold and 1.2 billion lb. of copper. The inferred resource is 254.9 million tonnes grading 0.43 g/t gold and 0.08% copper (0.55 g/t gold-equivalent), for 3.5 million oz. of gold and 472 million lb. of copper.

The Gran Bestia deposit has an indicated resource of 101.1 million tonnes grading 0.46 g/t gold and 0.1% copper (0.58 g/t gold-equivalent), for 1.5 million oz. of gold and 180 million lb. of copper. The inferred resource is 245.5 million tonnes grading 0.4 g/t gold and 0.1% copper (0.50 g/t gold-equivalent), for 3.1 million oz. of gold and 368 million lb. of copper.

The PEA examined a project with a 25-year mine life with average annual production of 366,000 oz. of gold and 46 million lb. of copper. An open pit mine and a 40,000-t/d mill would operate in the first five years of production, and capacity would be expanded to 80,000 t/d for the remaining years. All-in sustaining costs, net of byproducts, were estimated to be US$604 per oz. of gold.

The Cangrejos project has a net present value with a 5% discount of $1.6 billion and an internal rate of return of 16.2%. Initial capital costs, including working capital and refundable value added tax, is expected to be US$1 billion.

Read the relevant 43-101 technical reports at www.LuminaGold.com.