Australia-based exploration firm Predictive Discovery is set to raise A$55m ($39.37m) through a share placement to fund the development of the Bankan gold project in Guinea.

The company will raise the capital through a two-tranche share placement to institutional investors. The placement is priced at A$0.18 a share.

The first tranche of the placement, comprising 206,195,748 shares worth around $37.1m, is planned to end on 6 June 2022.

Comprising 99,359,808 shares worth around $17.9m, the second tranche is planned to be issued subject to shareholders’ approval at a meeting planned for early July 2022.

Predictive Discovery plans to use the proceeds from the placement to fund the 60,000m diamond and reverse cycle drilling programme at the Bankan project.

It also intends to fund the drilling work at Bankan’s north-northwest structural corridor that aims to explore potential ‘NE Bankan-style’ deposits.

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By GlobalData

The proceeds will also be used to complete baseline environmental studies, including a best practice biodiversity management programme, as well as deliver a comprehensive scoping study of the project by the end of 2023 to the Guinea Government.

Predictive managing director Andrew Pardey said: “The significant demand from investors to take part in the placement underpins the quality of the Bankan Project.

“The funds raised will allow Predictive to accelerate its comprehensive drilling programme and build further on the 3.65Moz already discovered, as well as deliver a scoping study, which will include our baseline and environmental study results in late 2023.

“Bankan is potentially one of many significant gold deposits and marks the beginning of our journey in developing Guinea’s Siguiri basin into one of the most exciting new gold addresses in West Africa.”

Predictive is also planning to raise an additional $5m from retail investors via a share purchase plan.

With the potential to become the largest gold mine in Guinea, the Bankan project is anticipated to start production in 2025, stated Reuters.