Silver Mines has secured A$30.2m ($20.31m) in convertible debenture funding to support its Bowdens Silver Project in New South Wales (NSW), Australia.

The binding interim convertible debenture agreement has been signed with Canada’s Bromma Asset Management, MMCAP International and Rick Rule.

Under the agreement, Silver Mines will issue 30,200 convertible debentures each valued at A$1,000.

The holders can convert all or any of the debentures into ordinary shares at $0.22 each.

Silver Mines has engaged SCP Resource Finance as its adviser for the transaction.

The funds are earmarked for the development of the Bowdens Silver Project, which is said to be the largest known undeveloped silver deposit in Australia.

Silver Mines plans to use the proceeds for a variety of activities including drilling, engineering studies for the definitive feasibility study, pre-construction efforts, and general and administrative expenses related to the project.

Silver Mines managing director Jo Battershill said: “This funding is a significant milestone for Silver Mines as we continue to advance our Bowdens Silver Project. The financial support underscores the strong potential of our project and the confidence in our team.

“This convertible debenture is particularly advantageous for our shareholders as it is less dilutive compared to a traditional placement.

“The conversion price is set at a significant premium to the last trading price, which reflects the value and future potential of our project. This structure allows us to secure necessary funding while minimising dilution and preserving shareholder value.”

Located around 26km east of Mudgee in the Central Tablelands region of NSW, the Bowdens Silver Project lies within Exploration Licence 5920, which is fully owned by Silver Mines.