Serabi Mining, founded and controlled by Australian engineer Bill Clough, is coming to AIM after drumming up £8 million (before £1 million expenses) in an AIM placing at 30p to develop gold prospects in the Tapajos gold province in north-west Brazil.

KBC Peel Hunt is nominated adviser and joint broker with Ambrian Partners to London-headquartered Serabi, which, unlike many AIM mining floats, is already producing gold at the rate of 25,000 oz from the Palito mine in Tapajos and aims to up that to 45,000 oz the following year. Executive chairman Graham Roberts, a one time Consolidated Gold Fields executive and afterwards director of entrepreneurial broker WI Carr and London boss of Canadian investment group BMO Nesbitt Burns, says exploration around the existing mine could dramatically increase its latest 'mined, confirmed and speculative' resource estimate of 416,000 oz at a high grade of 18.9 grammes of gold per tonne of ore.

He predicts output of 60,000 oz to 63,000 oz for 2007. By then cash extraction costs (before financing and investment) are seen as falling from an uncomfortable 5 an ounce to 0, against today's market price of 6.

Private backers have so far invested £7.9 million into Serabi, which is prospecting near Palito at Jardim do Ouro ('Garden of Gold') and elsewhere in the Tapajos region. Roberts says results so far are encouraging.

The 30p flotation, which should cut the Clough's family stake to 39 per cent, follows two pre-float fundings, one for £2 million at 15p and another for £2.5 million at 25p. Roberts holds 1.3 million heavily 'in the money' options at 15p and 900,000 at 30p, while Bill Clough has one million bargain options at 15p and 686,000 at 30p.

Serabi has an experienced board and these days Brazil is friendly to mining. The shares have speculative appeal.