(MENAFN - ProactiveInvestors - Australia) Fox Resources (ASX: FXR) has secured A2.56 million in equity funding to progress its exploration program on its base metals tenements in Western Australia's Pilbara region and repay debt.
Major shareholders have reaffirmed their support for the company by committing to further share placements at a price equal to Fox's last traded share price.
Zashvin Pty Ltd has agreed to a placement of 41 million shares at 0.04 per share and a 360,000 converting loan repayable through the issue of a further 9 million shares at the same price.
Concurrently, Jungle Creek Gold Mines " an entity controlled by Fox Resources chairman Terry Streeter " has agreed to allow Fox to partly repay advanced loans of 6.16 million through the issue of 14 million shares at 0.04 each.
The issue price represents a 7.2% discount to the volume weighted average price of Fox shares traded over the 15 trading days up to and including 5 March 2013.
Terry Streeter, chairman of Fox Resources, commented: "The success of this fundraising confirms the continuing support of our major shareholders, including Zashvin, and the attractiveness of our exploration targets.
"The Board of Fox is most appreciative of the ongoing loyalty of shareholders."
Meanwhile, Fox has separately agreed with Magnetic South, a company associated with existing shareholder Shay Nee Chong, to vary its expenditure commitment as Fox's partner on the Mt Oscar Joint Venture.
Magnetic South's expenditure commitment to obtain its 60% farm-in interest will now be 18 million over the 10 year period from February 2011 to February 2021.
Streeter said the remaining expenditure commitment of about 17 million is considered more than adequate to achieve the current Mt Oscar JV exploration objectives.
Pilbara base metals
Fox Resources holds 2,140 square kilometres of tenements considered highly prospective for base metals, platinum group metals and gold.
Earlier this year the company signed a non-binding agreement to farm-in to 10 of Pilbara Minerals' (ASX: PLS) 14 exploration tenements in the West Pilbara.
Under the memorandum of understanding, Fox will acquire up to 80% working interest in the tenements in return for carrying out extensive exploration activity.
Fox and Pilbara are working to finalise a formal farm-in agreement and establish a joint venture to carry out exploration activities within the tenements.
A review of a data package provided by Pilbara Minerals has identified a large number of anomalies that warrant follow-up work.
Fox's exploration strategy is to focus on the more prospective newly acquired tenements in 2013.
A VTEM survey has been approved for some of the Pilbara Minerals tenements in early 2013.
The 2.56 million equity raising secures important funding for Fox to begin exploring on its newly acquired, highly prospective Pilbara tenements.
The company's exploration strategy is to progress its prospects at a range of development stages from greenfields through to defined resources.
Importantly, there is strong potential for Fox to move into project development in the short to medium term.
Exploration is being conducted utilising Newexco Services, an exploration consultancy with a proven track record of success.
Fox plans to prioritise its focus on the recently acquired Pilbara Minerals tenements " which are considered highly prospective for base metals, platinum group metals and gold.
VTEM has provided some exciting anomalies which Fox is focusing on.
Fox holds tenure over a significant strike length of the Whundo sequence along strike to the northeast.
Exploration drilling is planned for the Ayshia, Austin " which lies beneath Whundo, Conquest and Sunchaser prospects.
Importantly, there is the possibility of resource extensions in the Whundo area.
Fox is aiming to develop the VMS camp into a pipeline of mineable projects.
The company is focusing on generating a pipeline of targets to consolidate the defined resources at Radio Hill and Sholl.
Its primary focus is to delineate resources to extend the life of the bacterial heap leach project.
There is a large tenement holding surrounding Radio Hill and large tonnage, low grade nickel-copper deposits amenable to bacterial heap leaching.
There is the potential for increases in low grade resources that may have been overlooked in the past.
Fox has control of a large mineral portfolio including 10,358 square kilometres in Queensland.
There is newsflow for Fox from a drill program that is planned for the Bundaberg coal tenement in the first quarter 2013. International Coal (ASX: ICX) announced a coking coal success on neighbouring tenement EPC 2196. This is a key focus in Bundaberg for coking coal for Fox.
Significantly, Fox is in discussions with potential coal exploration joint venture partners.
A market cap. of 17 million is undemanding with a strong suite of mineral assets and newsflow to follow. Its chairman Terry Streeter is also chairman of the 734 million market cap Western Areas (ASX: WSA). His success in building that company should ensure that Fox Resources is one that investors will watch.