The company plans to issue 93.8 million shares priced at $1.60 with the proceeds to be used to strengthen its balance sheet and repay debt.

New Gold has $75.1 million in operational and development capital commitments over the next 12 months compared with $27.2 million at the end of 2018, as it continues to right-size its Rainy River mine in Ontario, Canada.

The company also needs additional liquidity to stay in the range of its debt covenants.

New Gold had liabilities of US$1.3 billion at the end of the second quarter, up from $1.2 billion at the end of 2018.

Its debts include $500 million of 6.25% senior unsecured notes due 2022, $300 million of 6.375% senior unsecured notes due 2025 and a $400 million revolving credit facility with a maturity date of August 2021.

New Gold produced 85,216 ounces of gold, 151,305oz of silver and 21.6 million pounds of copper in the second quarter, or 132,556 gold-equivalent ounces, at an all-in sustaining cost of $1,087 per ounce sold. The company expects to produce between 465,000-520,000 gold-equivalent ounces this year.

Shares in New Gold (TSX:NGD) are trading at C$1.57, valuing the company at $909 million.