Australian Mines Limited - Raising fast-tracks development of scandium-cobalt projects
Australian Mines (ASX: AUZ) announced it had attracted a high level of professional investor interest in its scandium and cobalt assets in raising $4.3 million via the placement of fully paid ordinary shares and the issue of unsecured convertible notes. The capital raising, conducted with the assistance of the UK-based and FCA regulated Arlington Group, will be used to fast-track development of scandium-cobalt assets at Sconi and Flemington.
- $4.3 million raised from professional investors introduced by UK-based, FCA regulated Arlington Group Asset Management Limited to fast track development of the Company’s two core scandium - cobalt assets
- $2 million fully underwritten Entitlement Offer offered to existing shareholders
- Proceeds from the fundraising will be used to fast-track the development of the Company’s two core scandium - cobalt projects at Sconi and Flemington.
- Specific use of proceeds includes:
- completion of the Definitive Feasibility Study at Sconi
- completion of the Scoping Study and commencement of a Pre-Feasibility Study at Flemington
- completion of a significant drill program at Flemington to define an initial JORC cobalt resource and to increase the size of the existing scandium resource
- fast-track offtake discussions by funding the processing of a bulk tonnage sample from ore taken from Sconi. This will produce a scandium oxide powder and, nickel and cobalt sulphate that can be delivered to interested offtake parties
- securing a Mining Lease and Water Licence at Flemington
- payment of the Company’s option commitments at Flemington
Managing Director, Benjamin Bell commented, “With scandium and cobalt set to play pivotal roles in the rapidly developing electric vehicle industry, Australian Mines finds itself uniquely positioned with two high-quality scandium – cobalt ore bodies in the low-risk mining jurisdiction of Australia”.
“Using BHP Billiton’s own definition(1), Australian Mines’ Sconi Project is truly a ‘world-class’ deposit, which as BHP puts it, is important to investors because “they make lots of money for a long time” and world-class deposits “help launch major mining companies”. The Scoping Study for Flemington, which will be released in the coming weeks, will indicate whether it too falls into the ‘world-class’ category”.
“Recent processing and metallurgical testwork has confirmed that the Company will be able to produce both a premium scandium oxide and also a nickel & cobalt sulphate. The fact that this can be achieved using standard off-the-shelf equipment significantly reduces the technical risk associated with these projects”.
Australian Mines Limited (“Australian Mines” or “the Company”) is pleased to announce it has attracted a high level of professional investor interest in its scandium and cobalt assets raising $4.3 million via the placement of fully paid ordinary shares and the issue of unsecured convertible notes with the assistance of Arlington Group Asset Management (“Arlington”).
Arlington is a United Kingdom-based, FCA regulated investment management and corporate finance group that specialises in the natural resource sector and in the emerging markets.
The placement of 60,745,071 fully paid ordinary shares at an issue price of $0.008 per share raised gross proceeds of $485,960 and was undertaken in accordance with Section 708 of the Corporations Act and Listing Rule 7.1A of the ASX Listing Rules as outlined in Appendix 3 of this announcement.
The zero-coupon unsecured convertible notes issue, which raised a further $3,804,310 was also done at an issue price of $0.008.
Conversion of the convertible notes into fully paid ordinary shares at the issue price is subject to shareholder approval, which the Company will seek to obtain via a General Meeting from shareholders in the near future.
(1) BHP Billiton define a ‘world-class’ deposit as one which has an NPV of at least $250 million. (www.bhpbilliton.com/-/media/bhp/documents/investors/reports/2006/amecconference.pdf). The Scoping Study of Australian Mines’ Sconi Project, released to the ASX by Metallica Minerals Limited on 16 October 2012, indicated that the proposed mining operation at Sconi would have an NPV of $870 million, which to Australian Mines indicates that the Sconi project qualifies as a ‘world class’ asset.
