Led by the team behind the development of the La Arena gold mine in Peru, Rio2 intends to use the proceeds at its Fenix gold project in Chile, which it acquired in July 2018 through its merger with Atacama Pacific Gold Corp.

Rio2 had announced plans earlier this month to raise between $3-$5 million by issuing up to 10.9 million units at 46c but now plans to issue 15.2 million at the same price, saying it might increase the amount further depending on market conditions.

The company said the funds would be used towards completing a resource update, an ongoing water options study, environmental baseline studies and for general working capital.

Rio2 is evaluating a smaller starter project for Fenix than envisaged in a 2014 prefeasibility study.

"As was the case with La Arena, we believe we can build a starter project at the Fenix gold project focused on higher‐grade, near-surface mineralisation that will help minimise start-up capex and allow us to expand production using cashflow," president and CEO Alex Black said last month.

Fenix, which was previously known as Cerro Maricunga, has a 5.2 million ounce measured and indicated resource and an inferred 603,000oz.

Its proven and probable reserve stands at 294.4 million tonnes at 0.4g/t for 3.7Moz.

Rio2 had announced results including 192m at 0.81g/t gold among its first drilling results from the project in January.

Its shares have slid from C$1.15 in July to 42c in December.

They last traded at 43c, capitalising Rio2 at $44.3 million.