Mineral Commodities Limited (ASX: MRC) has confirmed plans to raise up to A$15.7 million in additional funding towards its growth strategy as outlined in the company’s Five Year Strategic Plan 2022–2026.
Funding Proposal
1. To raise up to A$15.7M at an issue price of $0.075 per share pursuant to a Placement and Entitlement Issue
2. Placement of 23.3M shares raising A$1.7M
3. Entitlement Issue of 1 new share for every 3 shares on issue, resulting in the issue
of up to 186.3M new shares to raise up to A$14.0M
4. The Entitlement Issue will be partially underwritten by Au Mining Limited
(Au Mining) and two directors of the company
Application of Funds
The company plans to ensure funding is first applied to near term cash flow generative and future growth strategies within the Heavy Minerals Division, prior to medium term future growth strategic projects within the Battery Minerals Division.
Heavy Minerals Division:
1. 3rd Primary Concentration Plant (PCP), increasing overall plant capacity targeting an increase in concentrate production
2. Downstream integration transitioning into higher value finished products, targeting enhanced profitability, utilising GMA negotiated funding
3. Studies for future bulk mining unit targeting significant increase in production profile aimed at ensuring all available minerals are mined
4. Resource and reserve development to support larger production footprint
Battery Minerals Division:
1. Battery anode pilot plant utilising Munglinup and Skaland graphite feed. De-risks our commercial-scale battery anodes development, delivers larger qualification samples that will support and secure battery anode offtake agreements and accelerates development and FID decision of our Munglinup Graphite Project
2. PFS and DFS of the battery anode commercial plant
Corporate:
1. Improve the working capital position and balance sheet strength of the company.
Strategic Plan Update
Significant progress has been made to stabilise our operations at both Tormin and Skaland mines and to establish a stable platform for building and enhancing value. Several of the key building blocks and objectives as outlined in our Strategic Plan have now been put in place, which lays the foundation for future anticipated growth. The company anticipates the next 12 to 18 months to be transformational for MRC and our stakeholders as we continue to execute our New Vision, Values and Strategic Plan.
Our strategic achievements during the half-year ended 30 June 2022 and targeted developments in the next 12 months for the heavy minerals, battery minerals and corporate (including our Environment, Social and Governance (ESG) developments) business segments are outlined in detail in the company’s recent half-year report.
The Strategic Plan aims to return the company to solid profitability through maximising profitability from existing assets, expanding its resources and reserves and further develop its downstream offering in both Heavy Minerals and Battery divisions. This funding package underpins delivery of key objectives of the Strategic Plan.
The company has a well-developed execution strategy aimed at maximising value from the existing Tormin operation through: (a) improve the efficiency, flexibility, and scale of the Inland Strands operation; (b) sustainably mine the two placer beach deposits; (c) reduce costs to lowest quartile against comparable operations; (d) increase overall plant capacity targeting an increase in mixed concentrate production with the introduction of the 3rd PCP; and (e) maximise final product value through transitioning from mixed concentrates to finished garnet and ilmenite mineral products.
The company considers it is well positioned to take advantage of the green transition and to responsibly contribute to global demand for battery minerals. The combination of targeted battery anode production from Munglinup and Skaland provides the potential to be able to supply significant volumes to meet the needs of the European battery minerals market.
For further information please visit: www.mineralcommodities.com
