ASX-listed gold exploration company Rox Resources has obtained binding commitments for an A$7m ($4.5m) placement to support development programmes at its Youanmi gold project in Western Australia.

The placement will include the issuance of 35 million new Rox shares to institutional and sophisticated investors at A$0.20 apiece.

Rox’s substantial shareholders, including Hawke’s Point and Venus Metals, will also participate in this placement.

Hawke’s Point agreed to subscribe for nearly 7.5 million shares for A$1.49m, which will raise its stake in the company from 8.8% to 9.99%.

Venus Metals will subscribe for 1.25 million shares to raise about A$0.25m. The directors of Rox have also committed to nearly 600,000 shares for A$0.12m.

Rox plans to issue a total of 9.3 million shares to Hawke’s Point, Venus Metals and its directors. This awaits shareholder clearance at Rox’s annual general meeting scheduled this November.

The issuance of the remaining 25.7 million shares will take place around 29 August.

Using proceeds from the placement, Rox will fund drilling and regional exploration programmes at Youanmi, including testing a series of near-mine and regional targets, as well as completing an updated mineral resource estimate for the project.

The company will also utilise the funds to proceed with important components of a pre-feasibility study, which is expected to be completed in 2024.

Rox managing director Robert Ryan said: “Consolidating the ownership over the Youanmi gold project and regional tenure position places Rox in a highly strategic position.

“An in-depth targeting process is underway over the consolidated regional tenure that incorporates all available geochemical data and new geophysical targets that extend from north of the Youanmi mine area to well south of the high-grade Penny West gold mine.”

Located 480km north-east of Perth and 400km inland and to the east of Geraldton, the Youanmi gold project sits within the central part of the Youanmi Greenstone Belt.

The greater region surrounding this belt, the Southern Cross Province of the Archaean Yilgarn Craton, is considered to be Australia’s premier gold province.

Rox claims that the project is surrounded by million-ounce mines and major gold producers. Historically, the location has been producing gold at an average of 667koz from both open pits and underground mines.