Ontario-focused Dryden Gold (TSXV: DRY) (OTCQB: DRYGF) received a boost on Tuesday after it announced that Centerra Gold (TSX: CG) (NYSE: CGAU) will be taking up a 9.9% equity interest in the company.
Centerra will make the investment through the participation of a $3.38 million private placement by Dryden, which plans to issue 14.93 million shares, including nearly 12 million flow-through shares priced at $0.24 each. The rest will be hard-dollar shares priced at $0.17 each.
Dryden Gold’s shares traded at $0.15 apiece at press time, for a 15.4% intraday gain and a $20.2 million market capitalization. Since the stock began listing earlier this year, it has traded at a peak of $0.40 and a low of $0.095.
Proceeds of this financing will be used to advance the company’s exploration initiatives in the Dryden gold district of northwestern Ontario. The junior has so far consolidated a 702 km2 land package within the district, including historic gold mines with limited modern exploration. Its three main assets are the brownfield Gold Rock project, and the early-exploration-stage Lower Manitou and Tremblay projects.
“Centerra is using its strong balance sheet to focus on organic growth through strategic investments and is providing valuable capital to select junior mining companies. We look at this investment as a strong validation of our property, our team and the science behind our exploration program,” stated Dryden’s CEO Trey Wasser.
According to Dryden, its property package hosts high-grade gold mineralization that stretches over 50 km of strike length along the Manitou-Dinorwic deformation zone. Others that have explored in this region include Kinross, NexGold Mining (Treasury Metals) and Kenorland Minerals.
With the Centerra-backed funding, Dryden said it will now be fully financed through 2025 with a $5.8 million exploration budget, plus an additional $2 million to cover other expenses, including a final payment due to Alamos Gold (TSX: AGI) for its purchase of the Manitou property. Alamos is currently a significant shareholder (15%) of the company.
