Andean Silver raises $17 million to speed up Cerro Bayo exploration

Australia’s Andean Silver (ASX: ASL) is off to the races after receiving firm commitments from institutional and private investors to raise A$25 million ($17m) for exploration at its Cerro Bayo silver-gold project in Chile. 

The successful placement, priced at a discounted A$1.05 a share, was supported by existing and new domestic foreign investors, particularly from northern hemisphere-based groups, the company said.

The share price represents a 10.3% discount on the last sale price of $1.17, yet a 6.1% premium over the 15-day volume-weighted average price.

Upon completion of this funding round, slated for Sep. 25, Andean will have around A$32.8 million in cash, which will facilitate accelerated exploration at Cerro Bayo with at least four drill rigs.

Over 100 million silver eq. ounces

Andean Silver updated in early September the resource estimate for the project, saying silver equivalent ounces have increased by 80% to 8.3 million tonnes at 342 grams per tonne silver equivalent. This means the resource now stands at 91 million silver equivalent ounces. 

Chief executive officer Tim Laneyrie said the strong demand from investors was a testament to the promising exploration and resource growth potential at Cerro Bayo, acquired by Andean in February. 

“In just seven months, our team has increased the resource estimate by 66 million ounces of silver equivalent. (…) We have also made significant discoveries which remain outside the mineral resource estimate.,” Laneyrie stated. 

The executive said Andean is on track to announce the next resource upgrade in early 2025, which will include results from the Pegaso 7, Droughtmaster, and Cristal prospects, among other new targets.

Located in Chile’s southernmost region — Aysén — Cerro Bayo produced over 100 million silver equivalent ounces from 1995 to June 2017. The Project has been on care and maintenance since October 2022.