De Grey Mining (ASX:DEG) seeks a massive $600 million from shareholders to establish the foundation for the debt required to finance its $1 billion-plus Hemi gold mine in the WA Pilbara.

The equity raising, as stated in a release to the ASX by De Grey, will involve the issuance of 545.5 million shares. This includes an institutional placement of $344 million and a 1-for-7.95 pro-rata accelerated non-renounceable entitlement offer for $256 million.

The fundraising is a prerequisite for accessing debt financing for the Hemi project and will be executed at $1.10 a share, representing a 13% discount to the shares' last sale.

"The (Hemi) project financing enables better planning and management of the forward capital works plan, including near-term ordering of long-lead items and contractor appointments," De Grey stated.

The miner anticipates commencing full construction activities at the Hemi gold project in the second half of this year, with first gold production targeted for the second half of 2026.

This issuance will necessitate Gold Road Resources to secure approximately $120 million to maintain its nearly 20% stake in De Grey. Gold Road reported having around $146 million in cash and securities at the end of March.

Despite being the largest shareholder, it's somewhat surprising that Gold Road didn't issue a statement on Wednesday following De Grey's funding announcement.

Directors at De Grey mentioned that the fundraising, which came as somewhat unexpected, combined with approximately $319 million in cash on hand at the end of the March quarter, is "expected to fully fund the equity component of the Hemi Gold Project financing, representing a significant de-risking milestone for the Project's development."

"Proactively finalizing the equity component of the project financing will allow for more effective planning and management of the capital works plan, including the near-term ordering of additional long-lead items and major contractor appointments.

"The equity funding solution satisfies a key typical precondition of access to debt financing, with the expected receipt of credit-approved term sheets from debt financiers remaining on schedule for mid-2024.

"Leveraging the optimal project financing structure and commercial arrangements for shareholders, discussions continue with financiers," the company said.