Ramelius Resources says it will raise $5 million in a placement and begin a drilling program at its soon to be acquired Vivien gold project in the Northern Goldfields.
The placement to existing substantial shareholder, Canada's Sprott Asset Management, will be priced at 20 cents.
The funds will be used to complete the acquisition of the Vivien gold project from Gold Fields Limited, which will now be completed in two $5 million tranches, with the first payable by the end of next month.
Ramelius said it would have access to Vivien tenements for exploration when it completed the first tranche payment. The remaining $5 million tranche would need to be paid by the end of June next year.
"Ramelius plans to commence an infill and extensional drilling program at the Vivien project as soon as possible after making the first payment to Gold Fields Limited," the company said in a statement.
The Vivien gold project has an indicated mineral resource of 579,000 tonnes at 8.3 grams per tonne for 154,000 ounces of gold.
Ramelius shares were up 1.5 cents, or 7.5 per cent, to 21.5 cents at 8.10am.