Snowline Gold shares rise on $16.5M bought deal financing

Shares of Snowline Gold (TSXV: SGD) surged on Wednesday following completion of its previously arranged bought deal private placement to fund its exploration campaigns in Yukon Territory.

In total, the company issued 2.2 million flow-through shares at $7.50 per share for total proceeds of $16.5 million. This includes the $15 million amount originally announced in mid-August and $1.5 million from the exercise of the underwriters' option.

Snowline's shares closed the trading session 3.4% higher at $5.16 apiece, ending in a market capitalization of $732.7 million. The stock has been skyrocketing over the past few months off the back of the exploration success at its flagship Rogue project.

The new Valley discovery at Rogue is being heralded by analysts as a "pumped-up version" of Kinross Gold’s (TSX: K; NYSE: KGC) Fort Knox mine in Alaska. Recent drilling uncovered a new high-grade zone of over 2 grams per tonne gold at depth, which, bolstered by the gold intersections reported to date, would rank it among the best in Yukon, Snowline said.

"We are encouraged by the strong support shown for this financing, both from existing shareholders including B2Gold and from a number of new, high-quality institutional shareholders," commented Scott Berdahl, CEO of Snowline.

According to Berdahl, the strengthened treasury would allow the company to advance exploration on the Rogue project's Valley discovery, as well as generative programs across its "highly prospective gold portfolio."

In total, Snowline has eight projects covering more than 3,330 km² of land in the Yukon, including the Rogue project which covers 940 km² of the underexplored Selwyn basin.

THIS ARTICLE WAS ORIGINALLY POSTED ON MINING.COM