Kazakhstan-focused European Minerals has clinched an equity raising agreement for between £29.2 million and £40.8 million.

AIM-quoted and Toronto-listed European, chaired by entrepreneur Tony Williams, is raising the money to develop the Varvarinskoye project in northern Kazakhstan, where the company has established a mineable reserve of 2.34 million oz of gold (at prices above $375 an ounce) and 269 million lbs of copper. This reserve is within a larger estimated potential resource of 3.8 million oz of gold and 462 million lbs of copper.

A syndicate led by Canadian broker Canaccord and including Pacific International Securities has agreed to buy and resell US$50 million (£29.2 million)-worth of units from the company at the equivalent of 53p each. Each unit represents one European Minerals share and half a five-year warrant exercisable at the equivalent of 77p. Pacific International, which is underwriting the deal, has the option to increase the amount in two stages to US$70 million, £40.8 million, if the demand is there.

Williams, who says the funding deal has been well received, has also reopened a £44 million bank drawdown facility for European by successfully replacing MDM as contractor at Varvarinskoye with the South African Senet group. He says the company is now 'recasting' its reserve figures to Canadian and international standards, a process which is likely, if anything, to increase the figures.

European Minerals' shares, which have traded between 27.5p and 68p over the past year, are 2p up today at 53p, against 30p last August when Growth Company Investor noted their speculative appeal. They could go further if present mining market sentiment persists.

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