ETHIOPIA – Megado Gold Limited has began trading on the Australian Securities Exchange (ASX) following the completion of an initial public offering (IPO) at 20 cents per share which raised US$6 million.
The company issued 30 million shares for its IPO and securities have begun trading in the range of 23.5 to 28.5 cents after opening at 25.5 cents with volume of more than 4.5 million.
The company was established in March last year with a focus on building a portfolio of Ethiopian gold projects and has identified numerous high-priority gold targets.
Megado has five granted permits in Ethiopia covering 511 square kilometres with an additional licence application covering 227 square kilometres in under-explored areas along strike from existing gold mines.
Megado Gold CEO and managing director Michael Gumbley said: “We would like to thank shareholders for their support in what was a strongly backed IPO.
“We have been working towards this as a team for some time and expect to commence our maiden drilling program in the coming weeks. Earlier this year, we compiled a vast satellite imagery dataset to identify potential gold targets consistent with the two large operating mines along strike from our permits. Our initial interpretation identified over 50 targets some of which are coincident with major gold-in-soil anomalies and outcropping gold-bearing quartz veins, which is really exciting” Gumbley said.
“Drilling is expected to commence early in November as we progressively start to test these,” he added.
The company has also engaged a drilling contractor to start drilling immediately post the IPO and within the current quarter.
Its strategy includes identifying and potentially acquiring other gold projects in Ethiopia.
Megado believes that Ethiopia is geologically highly prospective for deposits of significant scale and contains a world-class greenstone geological terrane within the prolific Arabian-Nubian Shield.
The Mormora, Dawa and Chakata projects are 100%-owned by Megado, while the Babicho and Chochi projects are 80%-owned in partnership with local Ethiopian partners, and once awarded, the Dermi Dama Licence will also be 100%-owned.
The company is planning to start drilling at Babicho, the first of its priority targets, in the coming weeks.
This drilling will initially target a 2-kilometre-long gold-in-soil anomaly with outcropping gold-bearing quartz veins.
The company has already done extensive sampling while mapping and trenching is underway across its projects.
Megado also expects to double its full-time geologist team from six to at least 12 in-country employees to accelerate the on-ground review of anomalies and first-pass grassroots exploration across its holdings.
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