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Drilling at the Castle Hill gold project. Picture: Jarrod Lucas Photos.
Drilling at the Castle Hill gold project. Picture: Jarrod Lucas Photos.

UPDATE 12.45pm: Phoenix Gold says it will raise $22 million to ramp up drilling and development activities at its Goldfields projects.

The raising, comprising of a $20 million placement and a $2 million share purchase plan, will be priced at 30 cents a share, a 13 per cent discount to its last traded price before the announcement.

Phoenix said the funds would be used to accelerate its drilling program to lift total resources from 2.2 million ounces to four million ounces and complete a definitive feasibility study for its core projects, focusing on Castle Hill, north of Coolgardie.

Managing director Jon Price said the work would put the company in a strong position to make a final investment decision by the December quarter of 2013.

Investec Bank and Patersons Securities will act as joint lead managers in the raising.

Phoenix shares were down half a cent, or 1.45 per cent, to 34 cents shortly before the close of trade after emerging from a trading halt today.