PERTH (miningweekly.com) – Rare earths developer Peak Resources was hoping to raise as much as A$5.5-million in a share placement and entitlement issue aimed at progressing work at its Ngualla project, in Tanzania.
The company on Tuesday announced that it will raise some A$2.8-million through a share placement to investors, priced at 4c a share.
The placement will be made in two tranches, with the first consisting of more than 30.6-million shares, and the second of 39.3-million shares. The shares will be issued under the company’s 15% placement capacity, and will not require shareholder approval.
In addition to the share placement, Peak Resources was also hoping to raise as much as A$2.7-million through a one-for-eight entitlement issue, allowing shareholders to subscribe for some 68.4-million shares at a price of 4c each.
“We are grateful for the continued support of the company’s shareholders and also delighted to welcome some new investors in the company, including ERP Strategic Minerals,” said Peak MD Darren Townsend.
Funds raised in the placement and entitlement offer will be used to progress permitting and mining license applications at Ngualla, as well as to fund study opportunities to further improve the project economics.
A recent process optimisation study increased expected production from the 28 300 t/y of mineral concentrate considered in the bankable feasibility study (BFS), to 32 700 t/y.
While the mine life at Ngualla reduced from 31 years to 26 years, operating margins have improved by 20% from $145-million a year to $174-million a year, while unit operating costs reduced by 5.7% from $34.20/kg to $32.24/kg.
The post tax and royalty net present value and internal rate of return have increased from a respective $445-million and 21%, to $579-million and 24%.