PERTH (miningweekly.com) – ASX-listed junior Battery Minerals will raise A$20-million through a share placement to continue building its Montepuez graphite project, in Mozambique.
The company on Thursday announced that about 333.33-million shares would be issued at 6c each to institutional and professional investors. The placement would be undertaken in two tranches, with the first consisting of 183.6-million shares and placed under Battery Minerals' existing capacity.
The balance of the shares would be subject to shareholder approval.
The placement shares would be issued with one free attaching option for every two shares issued, which could be exercised at a price of 10c each, with an expiry date of July 2023.
MD David Flanagan told shareholders that the successful raising, which had been oversubscribed, marked another step towards starting production and cash flow from the Montepuez project.
“We are overwhelmed with offers from investors who are attracted to the short lead time to production and cash flow. Construction at Montepuez is already well-advanced. We have ordered our long lead items and these will be delivered over the coming months,” Flanagan said, adding that the crushing circuit was commissioned last week.
The proceeds from the raising would be used to continue the construction at Montepuez, where commissioning was expected to take place in the March quarter of next year.
The Stage 1 operation would see Montepuez produce between 45 000 t/y and 50 000 t/y of graphite concentrate, generating $25-million of net operating cash flow a year, based on current prices.
The project was expected to expand to about 100 000 t/y of flake graphite concentrate by 2020.
In addition to the placement, Battery Minerals would also launch a share purchase plan, allowing eligible shareholders to subscribe for up to A$15 000 of new shares.
The share purchase plan was expected to garner a further A$5-million.