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PERTH (miningweekly.com) – Mineral sands developer Sheffield Resources was hoping to raise up to A$11.5-million in a share placement to advance its Thunderbird project, in Western Australia.
The ASX-listed company said on Friday that it would place up to 14.2-million shares, at an issue price of 81c each, to sophisticated and professional investors, to raise the funds.
Sheffield’s directors have collectively committed to contribute A$320 000 in the placement, subject to shareholder approval.
“We are very pleased with the strong demand shown for the capital raising. It ensures Sheffield will have a robust balance sheet to deliver on significant upcoming milestones,” said MD Bruce McQuitty.
He noted that the company would start drilling at the Thunderbird project to target extensions of the high-grade mineralisation, with the aim of expanding the existing resource and enhancing the project economics.
A recently completed scoping study indicated that, based on a current resource of 2.62-billion tonnes, grading 6.5% heavy mineral sands, for 170-million tonnes of contained heavy mineral sands, the project could, on average, deliver 118 200 t/y of zircon, 545 000 t/y of ilmenite and 21 700 t/y of rutile and leucoxene.
The Thunderbird project was expected to have a mine life of 32 years.
The scoping study further estimated that with a preproduction capital expenditure of about A$257-million, plus a A$37-million contingency, Thunderbird was expected to deliver an operating cash flow of about A$5-billion over the project life, and yearly earnings before interest, tax, depreciation and amortisation of A$140-million.
McQuitty said on Friday that a prefeasibility study for the Thunderbird project was due in the first quarter of 2015, which would be followed by a definitive feasibility study. Production was targeted for 2017.