Variscan’s $2.5M Placement Progress Hinges on Final Tranche Completion

Successful Capital Raise Bolsters Project Funding

Variscan Mines Limited (ASX – VAR) has announced the completion of the majority of the second tranche of its $2.5 million placement, raising approximately $1.66 million before costs. This tranche involved the issue of over 332 million ordinary shares priced at $0.005 each, accompanied by nearly 200 million unlisted options exercisable at $0.008 per share until September 2028. The strong support from new sophisticated and professional investors underscores confidence in Variscan’s strategic direction and the potential of its flagship Novales-Udias zinc-lead project in northern Spain.

Backing a Near-Term Zinc Production Opportunity

The funds raised are earmarked to advance exploration and development activities at the Novales-Udias project, which is centred around the historic San Jose underground mine. This project benefits from a recently updated JORC-compliant mineral resource estimate of 3.4 million tonnes grading 7.6% zinc and 0.9% lead, positioning it as a near-term production opportunity subject to further positive exploration and development outcomes. The project’s location within the Basque-Cantabrian Basin, close to established infrastructure and smelting facilities operated by Glencore, adds to its logistical appeal.

Strategic Regional Potential and Historical Context

Novales-Udias lies within a prolific zinc-lead district, with proximity to the world-class Reocin Mine, one of the richest MVT (Mississippi Valley Type) deposits globally. Variscan’s exploration has delineated significant mineralised trends, supported by both contemporary and historic data. The project’s mineralisation is characterised by high-grade zinc pods, with historical production records indicating grades often exceeding 10-20% zinc, and in some cases surpassing 30%. This geological setting, combined with local community and government support, provides a solid foundation for Variscan’s ongoing work.

Investor Incentives and Shareholder Impact

Investors participating in both tranches of the placement received free attaching unlisted options on a one-for-two basis relative to shares subscribed, incentivising longer-term engagement with the company’s growth prospects. All shares issued rank equally with existing ordinary shares, ensuring no dilution of voting rights. The placement’s successful execution not only strengthens Variscan’s balance sheet but also enhances its capacity to accelerate exploration and development activities critical to unlocking value from the Novales-Udias project.

Looking Ahead

While the majority of the second tranche is complete, the final tranche status remains to be confirmed. The exercise of the unlisted options will be a key factor in future capital inflows. Variscan’s next steps will likely focus on drilling results, resource upgrades, and advancing feasibility studies to move closer to production. The market will be watching closely to see how these developments translate into shareholder value and positioning within the zinc sector.