Variscan Mines Raises $587K to Fuel Zinc Project Growth in Spain

• First tranche of $2.5M placement raises $587,143
• 117 million shares issued at $0.005 each
• Attaching unlisted options subject to shareholder approval
• Funds to support exploration and development at Novales-Udias project
• Project hosts significant zinc-lead mineral resource with near-term production potential

Capital Raise Progress

Variscan Mines Limited (ASX – VAR) has announced the successful completion of the first tranche of its $2.5 million placement, raising approximately $587,143 through the issuance of over 117 million ordinary shares priced at $0.005 each. This initial tranche attracted strong support from new sophisticated and professional investors, signaling confidence in the company’s strategic direction.

The placement includes an incentive for investors in the form of attaching unlisted options, offering the right to acquire additional shares at $0.008 each within three years. However, these options are contingent on shareholder approval at an upcoming general meeting, introducing a degree of uncertainty until that vote is concluded.

Backing the Novales-Udias Zinc-Lead Project

The capital raised is earmarked to advance exploration and development activities at Variscan’s flagship Novales-Udias Project, located in Spain’s Basque-Cantabrian Basin. This project centers on the former San Jose underground mine and encompasses a substantial mineralised trend with promising zinc and lead grades. An updated JORC-compliant mineral resource estimate released in December 2024 reported 3.4 million tonnes at 7.6% zinc and 0.9% lead, underscoring the project’s potential.

Strategically, the project benefits from proximity to the world-class Reocin Mine, one of the richest deposits of its kind, and is within trucking distance of a major zinc smelter operated by Glencore. These factors enhance the feasibility of near-term production, subject to successful exploration and development outcomes.

Investor Implications and Next Steps

While the successful tranche completion is a positive milestone, investors should note that the full $2.5 million raise remains underway. The forthcoming shareholder meeting to approve the attaching options will be a key event to watch, as it will influence the company’s capital structure and potential dilution.

Moreover, the mineral resource figures incorporate historical data not fully compliant with the latest JORC standards, which may affect future resource classification and valuation. Continued drilling and exploration results will be critical to validating and potentially expanding the resource base.

Overall, Variscan’s progress in securing funding reflects growing investor interest in base metals projects with clear pathways to production, particularly in zinc, which remains a metal of strategic importance globally.

Bottom Line?

Variscan’s funding momentum sets the stage for pivotal shareholder decisions and exploration milestones ahead.

Questions in the middle?

• Will shareholders approve the attaching unlisted options at the upcoming meeting?
• How will further exploration results impact the mineral resource classification and project valuation?
• What is the timeline for completing the remaining tranches of the $2.5 million placement?