Happy days for Arafura with final tranche of $40m placement completed
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Arafura has completed tranche 2 of its $40 million placement to fund FEED activities at its Nolans neodymium-praseodymium (NdPr) project in the Northern Territory.
Tranche 2 raised $18,925,946 via the issue of 157,716,220 new fully paid ordinary shares, and the company also offered existing shareholders the opportunity to participate in a share purchase plan to raise up to an additional $5m – which will close today.
FEED work is expected to take about 12 months and Arafura Resources (ASX:ARU) remains on track to make a final investment decision for Nolans in the second half of 2022.
The company is confident that Nolans has the potential to diversify rare earth supply chains, with an ore reserve of 29.5 million tonnes grading 2.9 per cent total rare earth oxides with high-value NdPr making up 26.4 per cent of the rare earths content.
The project is backed by the Northern Australia Infrastructure Facility which recently set out terms for a potential senior debt facility of up to $100m with a facility term of up to 15 years in a without-commitment letter.
It’s worth noting that the company had previously received a proposal from Export Finance Australia for a $200m senior debt facility with a 15-year term.
Arafura says Nolans is the only new shovel-ready NdPr oxide project in Australia capable of delivering advanced materials into the critical minerals supply chain – with the potential to supply up to 10 per cent of the world’s demand for NdPr when in full production.
This article was developed in collaboration with Arafura Resources, 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.