Fresh from completing a highly successful rights issue, Magnetite Mines (ASX: MGT) welcomed shareholders to its AGM today to talk up progress at the flagship Razorback iron ore project in South Australia’s Braemar region.
The company, chaired since September by Jim McKerlie, reiterated to shareholders its focus on the 100%- owned Razorback project, which has 6Bt in Resources including 2Bt in in Ore Reserves. A definitive feasibility study is halfway complete.
The primary driver underpinning Razorback’s development will be the ability to provide somewhat rare, DR-grade iron ore volumes into a decarbonising ‘green’ steelmaking sector. Currently, only 35 of seaborne iron trade is DR-grade, with the deficit to jump to 200Mtpa by 2050 – highlighting Razorback’s opportunity.
The company told shareholders that steelmakers were looking now for future supplies, with Razorback able to support JVs with one or more partners. Magnetite Mines has opened a data room, with parties involved in the due diligence phase that could extend to funding support for the DFS.
Magnetite Mines told shareholders of the company’s substantial re-rating potential based on:
- Razorback’s projected long mine life and cash generation potential
- The company’s low market capitalisation compared to Razorback’s value
- Upcoming newsflow that could include partnerships and other key milestones.
Earlier this month Magnetites Mines completed a rights issue that raised $6.5 million, above the $6.2 million target. The rights issue attracted strong support from shareholders, directors and new investors introduced via Mahe Capital to signal a vote of confidence in the company and Razorback.
The rights issue has left Magnetite Mines funded to complete and submit the Razorback Mining Lease Proposal advance strategic partnering and value engineering work.