Spanish Mountain Gold (TSXV: SPA) is planning another private placement of units with Eric Sprott following completion of a C$4 million financing in which the Canadian mining investor participated last week.

Sprott currently holds approximately 7.2% of Spanish Mountain’s outstanding shares on a non-diluted basis, and 13.4% on a partially diluted basis. Prior to last week’s financing, he did not own or control any share of the company.

The BC-focused gold explorer has now arranged a placement of units at C$0.30 per unit to raise further gross proceeds of C$5 million. Each unit will consist of one common share of the company and one common share purchase warrant, with each warrant exercisable at C$0.45 per share for a period of two years.

Proceeds of the private placement will be used to advance the company’s Spanish Mountain gold project beyond the preliminary feasibility study, which is expected to be completed within 12 months. So far, over C$80 million has been spent on the project, with more than 900 holes drilled totalling 180,000 metres.

The company has prioritized the development of the first phase of the project, where the pit-delineated high-grade core of the deposit is expected to sustain a standalone operation of 11 years with peak production of 130,000 ounces of gold annually.

Shares of Spanish Mountain surged nearly 25% on Monday to a new 52-week high of C$0.46 per share, capping the company at C$121.2 million. Trading volume reached 5.6 million shares for the day, nearly eight times its daily average.