Tasmania’s newest mine could be just weeks away, with the proponent aiming to raise $5.5 million from investors and existing shareholders.
Venture Minerals Limited said the money would mainly be used to start mining and production at its Riley Iron Ore Mine, near Tullah, “as soon as practicable”.
The mine is expected to create about 100 jobs.
Venture on Monday announced it would undertake a $4 million share placement and offer a share purchase plan to eligible shareholders to raise $1.5 million.
It said its board was committed to making a final investment decision (FID) on “shovel ready” Riley immediately following settlement of the placement.
“With on-site infrastructure already complete, the Riley mining team can commence ore mining and dry screening activities within approximately one week of the board’s positive FID and receipt of placement funds,” it said.
Shares under the placement are scheduled to be issued on August 6 and the share purchase plan results to be announced on September 3.
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Venture said it had received firm commitments from “sophisticated, professional and institutional investors” to raise up to $4 million.
It would ship its iron ore from the Burnie Port.
“Riley’s short mine life (two years) and quick time to production presents a unique opportunity to capitalise on the current historically high iron ore price and realise significant cashflow for Venture in the near term,” the company said.
“Iron ore prices have been strong throughout 2020, with the outlook for the rest of the calendar year remaining positive due to demand generated by Chinese government infrastructure spending and continued supply concerns from Brazil due to the COVID-19 outbreak.”
The capital raising would also support mainland exploration work and provide working capital.
Shadow Resources Minister Shane Broad said the announcement was welcome news for the North-West and West Coast.
“It’s good to see this capital raising will allow the Riley mine to proceed,” Dr Broad said.
“Importantly, we hope the Riley operation will provide Venture with the necessary funds to go ahead with the larger Mt Lindsay tin mine, which will create much-needed jobs.”