PIL Increases cash reserves to $7.3mil

  1. 4,756 Posts.

    HOMEX - Perth

    Diversified gold and base metals group Pilbara Mines Limited (ASX:
    PIL) has boosted its cash reserves to the tune of $7.3 million to
    underpin an expanded 2002 exploration push after completing a rights
    issue to shareholders and December 2000 optionholders.

    The Perth-based Company said today it had received total funds of
    $7.3 million from the issue, including the take-up of part of the
    shortfall to the issue at 20 cents per share by Directors.

    The issue, which was first announced in March, was for the issue of
    up to 45,704,905 shares to all shareholders on a one-for-one basis,
    including a free option and the placement of 2,399,982 shares on the
    same terms and including a free option to December 2000

    Pilbaras Managing Director, Mr John Davis, said the Board had
    decided to limit the issue of the shortfall due to the Companys
    strong cash position and the Directors desire to restrict dilution
    as far as possible.

    Pilbara is in a very strong position at a time of great opportunity
    in the resource sector, and we wanted to maximise our shareholders
    exposure to future growth by limiting the number of new shares being
    issued, Mr Davis said.

    Following completion of the issue, Pilbara has 82,268,928 shares on
    issue, capitalising it around $16 million at a share price of 20

    Pilbara is well placed for growth, with exposure to a quality base
    metals project at Teutonic Bore following the recent high-grade
    Jaguar discovery and an expanded exploration focus both at Teutonic
    Bore and at the Lennons Find base metals project in the Pilbara, Mr
    Davis said.

    The Jaguar discovery, located near the old Teutonic Bore mine some
    250 kilometres north of Kalgoorlie, has emerged as a promising
    copper-zinc-silver deposit and is currently subject to a major
    drilling program being carried out by project manager Inmet Mining

    Inmet, a Canadian-based base metals producer, is earning a 70%
    interest in the Teutonic Bore ground by spending $3.5 million up to
    November 2004, and is currently focusing its efforts on Jaguar.

    Pilbara retains the rights to all surface resources at Teutonic Bore
    as well as gold resources in the area, and recently kicked off
    17,000-metre drilling program on the property targeting identified
    gold anomalies, prospects and areas of interpreted gold potential.

    Pilbara has budgeted $1 million for this gold exploration program
    during 2002, with additional funding allocated to regional
    exploration at the Lennons Find base metals project near Marble Bar.

    Our gold exploration campaign at Teutonic Bore is particularly
    exciting, as there has been limited previous exploration for gold on
    the property, Mr Davis said.

    However, the area has proven gold potential, being located just 20
    kilometres from the multi-million ounce Thunderbox Project currently
    under development.

    The Teutonic Bore Project is located 260 kilometres north of
    Kalgoorlie and 60 kilometres north of the regional mining centre of
    Leonora in Western Australias Eastern Goldfields. It was operated as
    an open cut and underground mine by BP Minerals Australia Pty Limited
    between 1980 and 1985.

    ASX Code: PIL Options Code: PILO

    Released by: On behalf of:
    Jan Hope / Nicholas Read Mr John Davis
    Jan Hope & Partners Managing Director
    Telephone: (08) 9388-1474 Pilbara Mines NL
    Telephone: (08) 9322-9999
    Mobile: (0417) 916-849

    I do not hold PIL or PILO
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