Iron ore aspirant Golden West Resources says it is planning a placement and share purchase plan to raise up to $20 million.

"The company believes it is opportune to raise funds now to take advantage of the recent significant increase in the company's share price and trading volumes, with a view to attracting additional sophisticated and institutional investors to the register," Golden West said in a statement.

The money will be used to complete a pre-feasibility study for the Wiluna West hematite project, the approval process for mining at the Joyners Find iron ore deposit, the study and implementation of mining of gold resources and working capital.