The 2024 drill programme revealed additional high-grade zones and increased the project’s scale. Credit: Nordroden/Shutterstock.

Australian mining company South32 has signed a subscription agreement to invest $29.16m (A$44.58m) in Canadian copper explorer American Eagle Gold, which is focused on the Nakinilerak (NAK) project in British Columbia.

The investment will see South32 acquiring a 19.9% stake in American Eagle Gold, with the funds earmarked for further drilling at the NAK project, building on the 2024 drill programme.

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The 2024 drill programme revealed additional high-grade zones and increased the project’s scale.

The latest agreement will see American Eagle Gold issuing 33,321,577 common shares at C$0.875 each.

This price represents a premium over the five-day volume-weighted average trading price on the TSX Venture Exchange (TSX-V).

The completion of the offering is due around 26 November 2024.

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This is contingent upon the fulfilment of standard closing conditions including regulatory approvals and the acceptance of the TSX-V.

With this investment, American Eagle Gold is set to be well-funded for significant drill programme expansions planned for 2025 and 2026.

American Eagle Gold CEO Anthony Moreau said: “We are very pleased to welcome South32 as a strategic investor in American Eagle. This investment marks our second major mining enterprise that has endorsed our project and our work at the NAK copper-gold porphyry project.

“This investment underscores NAK’s potential, significantly strengthens our balance sheet and enhances NAK’s profile. Upon closing of the offering, American Eagle will hold approximately $37m in cash, enabling us to thoroughly test our thesis for NAK through a comprehensive drill programme to explore the full extent of the system, including the perimeter of the porphyry stock.

“We believe NAK has the potential for a large-scale resource with near-surface potential, favorable topography and excellent infrastructure access.”

In August this year, a subsidiary of South32 entered an earn-in agreement to acquire up to an 80% stake in Ridgeline Minerals’ Selena project in Nevada, US.