$12.5 Million Raised To Accelerate Exploration at Ontario Gold Deposit

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Goldshore Resources Inc. (TSXV: GSHR; OTCQB: GSHRF ; FWB: 8X00) has announced a US$12.5 million private placement to advance its Moss Gold deposit in Ontario. The financing is being led by Eight Capital and Clarus Securities Inc., with the potential to increase proceeds by 15% if the over-allotment option is exercised. The funds will be raised through flow-through shares priced at 47.5 cents each and charity flow-through shares priced at 53 cents. The proceeds are intended for exploration expenses that qualify under Canadian and Ontario tax regulations, supporting Goldshore's efforts in the Moss project. Eventus Capital Corp. is advising on the transaction.

Goldshore CEO Michael Henrichsen commented that the funds will accelerate the company's winter drill program and other exploration initiatives. He added in the news release, "This program will aim to increase the deposit's ounce profile, reduce the strip ratio, and enhance economic performance ahead of the PEA in Q1 2025." The financing is still subject to final approvals, including from the TSX Venture Exchange.

Digging Gold

As Reuters wrote on September 19, "Gold prices rose over 1% on Thursday as the U.S. Federal Reserve launched its monetary easing cycle, boosting bullion to an all-time high and just a few cents shy of the key US$2,600 ceiling." This surge in prices underscored the strength of the gold market in 2024, which has been fueled by both economic uncertainty and a favorable low-rate environment. According to UBS in the report, the rally is expected to continue, with the firm projecting prices to reach US$2,700 per ounce by mid-2025.

On September 11, Fortune.com reported that the Boundary zone near the Moss deposit is being viewed as a promising exploration target due to its proximity to the main deposit. Goldshore Resources has positioned itself to capitalize on this favorable market environment with its Moss Gold deposit in Ontario. CEO Michael Henrichsen highlighted that new exploration targets in the Southwest extension of the Moss deposit, particularly around the Moss Nose area, added significant potential for future resource expansion.

On that note, 321 Gold remarked on September 17 that gold is "in a sweet spot," with potential rate cuts setting the stage for "a stunning drop in real interest rates." The publication noted that high net-worth investors and funds are eyeing opportunities in the sector, particularly as Western ETF buyers could trigger a further rise in gold prices. This backdrop has supported Goldshore's efforts to advance its exploration and resource-building initiatives, as the company remains focused on both expanding its mineral resource and increasing its gold production profile.

This momentum in the sector has also benefitted junior miners, as Kitco reported on September 18. The article stated that gold's continued climb above US$2,600 per ounce has invigorated the mining sector, creating value for smaller companies as investors recognize their growth potential. 

Goldshore's Catalysts

The US$12.5 million private placement will serve as a critical financial catalyst for Goldshore's strategic plans at the Moss Gold deposit. According to the company's October 2024 investor presentation, the funds will help execute a 15,000-meter winter drill program focused on expanding known mineralization and improving drill density near the surface. The ultimate goal is to enhance the project's economic potential by increasing the mineral resource and reducing the strip ratio.

Goldshore also plans to use the proceeds to conduct a regional exploration program surrounding the Moss deposit, covering a 10 km by 6 km area, to identify new targets and further realize the district-scale potential of the property.

The company is also accelerating its environmental initiatives, moving toward formal permitting processes. The corporate presentation highlights the importance of this funding to fast-track multiple components of their development strategy.

Ownership and Share Structure

The company provided a breakdown of its ownership, where 6.4% of Goldshore is held by management and directors. 

Institutions own approximately 15% of the company. The largest shareholder in this category is Sprott Asset Management LP, with 4.59% or 13.72 million shares.

Strategic shareholders own 35%. Brian Paes-Braga is the largest shareholder in this category, with 11.48% or 34.31 million shares. 

The rest is with retail investors. 

The company reports that there are around 298.9 million shares outstanding, while the company has a market cap of CA$86.7M million as of close August 16, 2024.