4 October 2024
East Star Resources
Plc
("East Star" or the
"Company")
Conditional Subscription
& Placing to Raise Approximately £1.16M
Delivers funding to advance
Verkhuba Copper Deposit and drill-test high-impact follow-on
targets
East Star Resources Plc (LSE:EST),
which is exploring for copper in Kazakhstan, announces it has
raised gross proceeds of approximately £1.16 million from an
oversubscribed subscription for, and placing of, 100,926,292 new
ordinary shares of £0.01 each ("Ordinary Shares") in the capital of
the Company (the "Fundraising") at a price of 1.15 pence per share
(the "Issue Price").
Key
points
·
Strong backing from existing major shareholder and
Directors
·
New resources-focused institutional cornerstone
investor
·
Company funded to advance Verkhuba Copper Deposit
and drill-test high-impact follow-on targets on the Rudny Altai
volcanogenic massive sulphide ("VMS") Belt licences and progress
Tier 1 copper deposit targeting strategies
A discussion and Q&A on
the Fundraising, forward work programme and recent Half Year Report
will be held via the Investor Meet Company platform on 7 October
2024 at 5 p.m. BST ("Webcast"). Further details appear
below.
Use
of proceeds
Following the Company's discovery of
the Verkhuba Copper Deposit in 2023 (20.3Mt @ 1.16% copper, 1.54%
zinc, 0.27% lead), East Star's management believes the Company can
add significantly to the value of this deposit by increasing
confidence in, and potentially growing, the resource, and advancing
metallurgical and engineering studies to determine the potential
economics of a mining operation.
At over 20Mt, Verkhuba is already in
the top third of this style of VMS deposit globally and with copper
near $10,000 per tonne, and the prospect of a low capex development
in an infrastructure-rich region, management believes considerable
further value from Verkhuba can be unlocked through a work
programme which will be funded through this Fundraising.
In addition to Verkhuba, East Star
has developed a number of high-impact follow-on targets on its
Rudny Altai VMS belt licences where copper occurrences have been
mapped in several locations in close proximity to the historical
Nikolaevsky deposit (40Mt @ 2.4% copper, 3.2% zinc, 1.1 g/t gold)
which is an area well-served by existing infrastructure.
Proceeds from the Fundraising will
be used to advance the development concept at Verkhuba through to a
stage where economic feasibility can be demonstrated. At the same
time, the Company intends to advance and drill-test several
high-impact targets in the Rudny Altai VMS Belt and progress its
targeting strategy for Tier 1 copper porphyry and sediment-hosted
copper deposits.
Further information on the Fundraising
The Company has received direct
subscriptions from several investors for 86,578,480 new Ordinary
Shares ("Subscription Shares") and will conduct a placing of
14,347,812 new Ordinary Shares ("Placing Shares"). Subject to
receipt of subscription funds, the Company is proposing to issue
and allot a total of 100,926,292 new Ordinary Shares as part of the
subscription and the placing (together the "Fundraising
Shares").
The Fundraising includes
participation by way of a direct subscription by certain Directors
of the Company. The Fundraising was also
supported by the Company's largest external shareholder, which has
agreed to invest £160,000 at the Issue Price. Additionally, the Fundraising
includes participation by a natural resources focused institutional
investor, which has agreed to invest £300,000 at the Issue
Price.
The Fundraising remains subject to
and conditional upon the Company having published a prospectus (the
"Prospectus"), which remains subject to FCA approval, and the
Fundraising Shares being admitted to trading by no later than the
longstop date of 15 November 2024 ("Admission").
A further announcement confirming the publication
of the Prospectus and the expected date of Admission will be made
in due course.
Alex Walker, CEO of East Star, commented:
"The opportunity in front of us is clear. Copper is the metal
the world urgently needs to discover more of and there are very few
projects with copper grades greater than 1%, close to surface, and
with existing infrastructure. We intend to drill Verkhuba to
further improve our geological understanding of what is already a
significant copper deposit, as precursor to undertaking economic
studies. In doing so we aim to capture exponentially greater value
from this asset for shareholders than we could have achieved
without this work. We also intend to drill several high-impact
targets that have been worked up following several years of desktop
work, geological mapping, sampling and geophysics. Success in any
one of these would add more valuable base metal assets close to
processing infrastructure.
I
would like to thank our long-standing and new investors for
supporting the Company. As an exploration company, our job is to
find mineral deposits where the value of the resources far exceeds
the capital required to discover and develop them. With Verkhuba
having more than 230,000 tonnes of contained copper, and with
copper at close to $10,000 per tonne, East Star has so far
delivered this in spades. We recognise the markets have been tough
for junior resource explorers, but we have not lost sight of the
prize in Kazakhstan to discover and develop highly sought-after new
sources of copper in several geological
settings."
Investor discussion and Q&A
Alex Walker, CEO, will host the
Webcast via the Investor Meet Company platform on 7 October 2024 at
5 p.m. BST. Questions can be submitted pre-event via your Investor
Meet Company dashboard up until 9 a.m. BST the day before the
Webcast or at any time during the live Webcast.
Investors can sign up to Investor
Meet Company for free and add East Star Resources Plc in order to
attend the Webcast via:
https://www.investormeetcompany.com/east-star-resources-plc/register-investor.
No material new financial or other
information will be provided. A recording of the Webcast will be
made available on the Company's website the following
day.
East Star
Resources Plc
Alex Walker, Chief Executive
Officer
Tel: +44 (0)20 7390 0234 (via Vigo
Consulting)
SI
Capital (Corporate Broker)
Nick Emerson
Tel: +44 (0)1483 413 500
Peterhouse Capital Limited (Corporate
Broker)
Peter Greensmith
Tel: +44 (0) 20 7469 0930
Vigo Consulting (Investor Relations)
Ben Simons / Peter Jacob
Tel: +44 (0)20 7390 0234
About East
Star Resources Plc
East Star Resources is focused on the discovery
and development of copper and other strategic minerals required for
the energy revolution. With eight licences covering >1,000 km²
in three mineral rich districts of Kazakhstan, East Star is
undertaking an intensive exploration programme, applying modern
geophysics to discover minerals in levels that were not previously
explored. East Star's most advanced project is a copper deposit on
the world-class Rudny Altai VMS Belt where the Company delivered a
JORC compliant inferred resource of 20.3Mt @ 1.16% copper, 1.54%
zinc and 0.27% lead close to infrastructure, within trucking
distance of third-party mills with excess capacity. East Star's
management are based permanently on the ground, supported by local
expertise, and a joint venture with the state mining company on
certain projects. In 2024, East Star was selected to receive grant
funding through the BHP Xplor programme for copper porphyry
exploration.
Visit our
website:
www.eaststarplc.com
Follow us on
social media:
LinkedIn: https://www.linkedin.com/company/east-star-resources/
X (formerly Twitter): https://twitter.com/EastStar_PLC
Subscribe to
our email alert service to be notified whenever East Star releases
news:
www.eaststarplc.com/newsalerts
The person who
arranged for the release of this announcement was Alex Walker, CEO
of the Company.
This announcement contains inside information
for the purposes of Article 7 of Regulation 2014/596/EU which is
part of domestic UK law pursuant to the Market Abuse (Amendment)
(EU Exit) Regulations (SI 2019/310) ("UK MAR"). Upon the
publication of this announcement, this inside information (as
defined in UK MAR) is now considered to be in the public
domain.