BCI shareholders open wallets for Mardie project

Shareholders have lined up behind BCI by oversubscribing for a share purchase plan as it races down the home stretch at its Mardie salt and potash project.

Eligible shareholders subscribed for about 48 million shares priced at 43c each to raise $20.46m, more than the $20m it had sought, with funds supplementing the recently approved $240m placement.

Proceeds from the SPP will be applied by BCI Minerals (ASX:BCI) to construction and ramp-up activities at Mardie.

The $1.2bn Mardie project is the first major salt development in WA in more than 20 years and one of the largest in the world, producing 5.35Mtpa of sodium chloride and 140,000tpa of sulphate of potash over a life of 60 years.

Both the placement and SPP supplement the $740m project finance debt package that BCI has secured for Mardie’s construction and ramp-up activities.

The company just awarded the giant $190m marine structures design and construction contract to McConnell Dowell, which covers the 2.4km jetty structure, transhipper mooring equipment, material handling system and navigation aids.

Robust economics and green credentials

Mardie is expected to generate annual earnings before interest, taxes, depreciation, and amortisation (EBITDA) of $260m thanks to operating costs of about $21.50/t of salt and $337/t of potash, well in the bottom quartile of similar projects.

Key environmental approvals are already in place to allow development to begin, with work underway to finalise secondary approvals.

The company will “rigorously” manage its environmental conditions.

Mardie does not require mining pits or waste dumps nor large-scale de-watering. It will use an inexaustable seawater resource to produce salt and potash, with 99% of energy derived from solar and wind.

This article was developed in collaboration with BCI Minerals, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.