Photo by: Bloomberg
PERTH (miningweekly.com) – Junior metals developer Australian Mines’ shares shot up 44% on Monday, after the company raised A$20-million to fund work at its Sconi cobalt/nickel/scandium project, in Queensland.
The ASX-listed company said on Monday it had approached a number of institutional fund managers regarding a possible raise, and had received applications for nearly A$40-million of what it had intended to be a A$10-million placement.
The company accepted applications for A$20-million, comprising more than 235.2-million fully paid ordinary shares at 8.5c each.
Shares surged to 14c apiece on Monday, from Friday’s closing price of 10c each, giving the prospector a market capitalisation of A$332.21-million.
Australian Mines said that the willingness of the global funds to invest in the company was seen as a strong endorsement of the quality of the Sconi project, the development strategy being pursued at the assets and the strength of its management team.
The funds raised would go towards continuing trial mining at the Sconi project, as well as completing a bankable feasibility study (BFS) by the end of April 2018. A final investment decision was expected following the BFS.
Trial mining at Sconi started in September this year, with 20 t of bulk sample material successfully mined. The bulk ore sample is expected to produce about 160 kg of nickel sulphate, 20 kg of cobalt sulphate and 5 kg of high-purity scandium oxide.
Funding would also be used to accelerate resource expansion drilling at the Femington cobalt/scandium/nickel project, in New South Wales.
In September, Australian Mines took 100% ownership of Sconi after striking a A$10-million cash and share deal with Metallica Minerals, negating an earlier earn-in agreement under which it would have earned a 75% interest.