How Zenith’s A$3.5m Raise Could Transform Dulcie Gold Project
Zenith Minerals has launched a fully underwritten A$3.5 million entitlement offer to fund an aggressive drilling campaign at its newly consolidated Dulcie Gold Project and advance exploration at Red Mountain. The capital raise aims to expand resources and push towards commercial gold production.
- Fully underwritten A$3.5 million entitlement offer at A$0.03 per share
- Aggressive 9,000–12,000m drilling campaign planned at Dulcie Gold Project
- Strategic acquisition expands Dulcie tenure by 3km with active heap-leach mining
- Performance rights package proposed to incentivize board and management
- Exploration funding also supports deep diamond drilling at Red Mountain Gold Project
Capital Raising to Fuel Growth
Zenith Minerals Limited (ASX, ZNC) has announced a fully underwritten entitlement offer to raise approximately A$3.5 million, priced at A$0.03 per new share. This capital injection is designed to accelerate exploration and resource expansion at the company’s recently consolidated Dulcie Gold Project in Western Australia, alongside advancing drilling activities at the Red Mountain Gold Project in Queensland.
The entitlement offer, conducted on a 2-for-7 basis, includes free attaching options exercisable at A$0.077, expiring in July 2027. Strong support from Zenith’s board and management, including underwriting commitments from key directors, underscores confidence in the company’s growth strategy.
Strategic Acquisition Enhances Dulcie Project
Central to Zenith’s expansion plans is a recent strategic acquisition that adds approximately 3 kilometres of highly prospective strike to the Dulcie Gold Project tenure. This acquisition secures exclusive subsurface rights below 8 metres depth, directly south of the existing Dulcie Far North resource area, which currently holds a JORC Inferred Mineral Resource Estimate of 5.1 million tonnes at 1.3 grams per tonne gold for 210,000 ounces.
The acquired tenements host active heap-leach mining operations, significantly reducing exploration and permitting risks. Previous drilling in this area revealed substantial gold mineralisation, including a standout intercept of 32 metres at 9.4 grams per tonne gold, highlighting the potential for near-term resource growth and development.
Aggressive Exploration Campaigns
Zenith plans to undertake a substantial drilling program of between 9,000 and 12,000 metres at Dulcie, targeting resource expansion and aiming to establish a maiden JORC Mineral Resource Estimate on the newly acquired ground. Concurrently, a deep diamond drilling campaign comprising four holes is scheduled at the Red Mountain Gold Project to test for intrusion-related gold and copper porphyry-style mineralisation.
These exploration efforts are expected to deliver critical updates on resource delineation, with milestones including an imminent JORC Mineral Resource update following a successful 37-hole drilling campaign at Dulcie Far North.
Incentivising Growth Through Performance Rights
To align management and board interests with shareholder value creation, Zenith proposes issuing performance rights equivalent to 10% of the post-offer issued capital. These rights will vest upon achieving key milestones such as delineating indicated mineral resources exceeding 500,000 and 700,000 ounces of gold, reaching market capitalisations of A$50 million and A$100 million, and commencing commercial production at Dulcie.
This incentive structure signals Zenith’s commitment to delivering tangible progress and value from its exploration programs.
Looking Ahead
With the entitlement offer fully underwritten by Leeuwin Wealth and supported by co-manager Cumulus Wealth, Zenith is well-positioned to execute its exploration strategy. The company’s focus on expanding its gold resource base and advancing towards commercial production reflects a clear pathway to unlocking shareholder value in a competitive gold exploration landscape.
Bottom Line?
Zenith’s capital raise and strategic acquisition set the stage for a pivotal year of exploration and resource growth at Dulcie.
Questions in the middle?
- Will the upcoming drilling campaigns significantly increase Dulcie’s gold resource estimates?
- How will the market respond to the dilution and discount inherent in the entitlement offer?
- What are the prospects and timelines for transitioning Dulcie towards commercial gold production?