Perth-based exploration company MOD Resources has raised $2.5 million to advance New Zealand’s biggest underdeveloped gold project.

The funds were raised through a share placement, which remains subject to the clearance of funds.

The placement involved the issue of 50 million ordinary fully-paid MOD shares to a sophisticated investor at an issue price of 5c per share.

The funds will be used to advance the Sam’s Creek Gold Project in New Zealand and for working capital.

Recent drilling programs have discovered that the Sam’s Creek deposit holds over 1 million ounces of gold, with geological and geochemical characteristics of the resources indicating a potential intrusion buried beneath that could be an even larger source of the gold.

MOD is earning an 80 per cent interest in Sam’s Creek from OceanaGold.