Cadence Minerals plc said that its joint venture (JV) partner had received commitments to raise $100.7 million through an equity placement for the Yangibana rare earth project in the Gascoyne region of Western Australia.
Australian company Hastings Technology Metals owns 70% and Cadence holds 30% of three mining leases and six exploration licences which form part of the project.
Cadence has previously reported on positive indicators of world beating quantities of neodymium and praseodymium near JV’s site. bityl.co/5rTn
Details announced last week (24 February) reveal that the funds will be raised through a two-tranche placement priced at $0.19 per share.
Following settlement of both tranches of the placement, Cadence will have a cash balance of approximately $120 million (before costs).
Tranche one of the placement raised $57.2 million and is fully underwritten and has shareholder approval.
Tranche two, which is subject to Hastings’ shareholder approval, is to raise $43.5 million.
The equity component of the Yangibana project’s capital cost is $124 million.
Funds raised from the placement will be used to start construction at Yangibana in the second quarter of 2021.
This will cover procurement of long-lead item equipment; front-end engineering plant design; mine site works – camp installation, access road construction, civil plant base earthworks, water bore and pipeline installation, IT backbone tower installation; and working capital.
PRODUCTION
Production is currently planned to start in year six.
Cadence added: “The definitive feasibility study published in 2017, modelled two production scenarios the second of which had included within it 808,000 tonnes of plant feed from one of our joint venture areas (Yangibana) in year six.
“This production target and additional production target from the definitive feasibility study indicates that 11% of the plant feed will come from our joint venture area.”
When the development of the mine starts, the two partners would need to agree a new mining joint venture agreement to replace the existing one.