Rex Minerals to raise $50 million to advance Yorke Peninsula copper project
SA miner Rex Minerals has announced a bid to raise $50 million to fund pre-development activities at its Hillside copper/gold project on Yorke Peninsula.
The proposed Hillside mine sits on 1327 hectares of freehold farm land south of Ardrossan on Yorke Peninsula.
The capital raise will fund the project up to a final investment decision, which is expected in the last quarter of 2022.
If it goes ahead, an additional $550 million in capital expenditure ($US410 million) will be required to construct the open-pit mine.
The site is located 12km south of Ardrossan and 3km north of Pine Point.
It is about 165km from Adelaide by road and 60km by water.
Adelaide-based Rex received approval for Stage 1 of the proposed mine on agricultural land it owns from the South Australian Government in July 2020.
This was despite community opposition including from shack owners at holiday beach Black Point, which is about 9km from the proposed mine.
While $38 million of the $50 million will go towards Hillside pre-development, $4 million will also be invested in exploration activities at Rex’s Hog Ranch project in Nevada in the United States.
The $50 million placement will occur in two stages.
Tranche 1 involves a $5.3 million unconditional placement comprising 17.8 million new fully paid ordinary shares at $0.30 each.
Tranche 2 is a $44.7 million conditional placement comprising 148.8 million new fully paid ordinary shares at $0.30 each, which will require Rex shareholder approval.
A general meeting of Rex shareholders is planned for September to allow shareholders to vote on Tranche 2.
Macquarie Capital (Australia) and Euroz Hartleys Limited are acting as joint lead managers to the placement.
Rex Minerals’ share price was unchanged at $0.36 following yesterday’s announcement to the Australian Securities Exchange.
Rex’s managing director and CEO Richard Laufmann said the completion of the placement would be another milestone for its flagship Hillside project.
He said proceeds from the equity raising would build momentum ahead of the final investment decision in Q4 2022.
“Rex is advancing rapidly as an emerging copper development company following the South Australian Government’s approval of the PEPR (program for environment protection and rehabilitation),” Laufmann said.
“With the global pivot to electrification of everything, the time has never been more perfect to deliver Hillside Copper.”
Rex estimates the mine will be staffed by 430 full-time workers during production following a 20-month construction period.
The company has a market capitalisation of $152 million and was ranked No.83 in InDaily’s 2020 South Australian Business Index of the state’s top 100 companies.
