Flagship Raises $4M at $0.10/Share Including $2.5M Strategic EPC Investment

Strategic Capital Raise and Partnership

Flagship Minerals Limited (ASX, FLG) has successfully secured $4 million through a strongly supported share placement, marking a significant step forward for its Pantanillo Gold Project in Chile. The placement includes a $2.5 million strategic investment from Shandong Xinhai Mining Technology & Equipment Inc., a globally recognised engineering, procurement, and construction (EPC) company with extensive expertise in mineral processing and mine construction.

This partnership not only injects vital capital but also brings technical firepower and operational experience to Flagship’s development efforts. Xinhai’s involvement is set to facilitate a smoother pathway through feasibility studies, project financing, and eventual construction phases.

Advancing Pantanillo Towards Feasibility

The funds raised will be directed towards several key workstreams, including converting the existing foreign resource estimate to a JORC 2012-compliant Mineral Resource Estimate (MRE), conducting metallurgical testwork and heap leach processing studies, and undertaking drilling programs to expand and infill the resource base. These activities are critical to underpinning the upcoming feasibility studies planned for 2026.

Flagship aims to define sufficient mineral resources to support an open-pit mining operation with heap leach processing, targeting an annual production of 100,000 ounces of gold over a decade or more. The project’s proximity to other advanced developments, such as Rio2’s Fenix Gold Project, provides a useful benchmark for potential scale and economics.

Xinhai’s Role and Board Representation

As part of the strategic alliance, Xinhai will nominate a Non-executive Director to Flagship’s board, ensuring close collaboration and alignment between the two companies. This board representation is expected to bring practical insights and reduce risks associated with technical and financial decision-making.

Beyond capital, Xinhai will provide specialist expertise in metallurgy, mineral processing, engineering design, procurement, construction, and project financing. Their global track record, including over 500 EPC contracts and a growing footprint in Latin America, positions them as a valuable partner in advancing Pantanillo.

Market Reception and Next Steps

The placement was priced at a 28.6% discount to the last closing price, reflecting a strategic move to secure committed funding and a strong partner. The first tranche of Xinhai’s investment has been received, with the second tranche contingent on a site visit and finalisation of the partnership agreement.

Flagship’s Managing Director, Paul Lock, emphasised the significance of this milestone, highlighting the company’s transition into gold and copper development and the enhanced capacity to unlock Pantanillo’s value. The coming months will focus on resource validation, metallurgical testing, and advancing feasibility studies, setting the stage for potential project development.