Kvanefjeld in Greenland is one of the most significant rare earth projects outside China.
JOHANNESBURG (miningweekly.com) – ASX-listed Greenland Minerals and Energy has received strong support from international institutional investors in a placement to raise A$10.25-million.
The capital raising, in which Ashanti Capital acted as lead manager, was undertaken at an issue price of A$0.09 a share, representing a 21.74% discount to the last closing price of Greenland Minerals’ shares on Tuesday.
The company accepted firm commitments for A$9-million and major shareholder, Shenghe Resources, also confirmed its intent to maintain its 12.5% shareholding through investing A$1.25-million.
Greenland MD John Mair said on Friday that the participation of Asian and Australian funds, alongside Shenghe, was a strong endorsement of the significance of the Kvanefjeld project as the outlook for the rare earth sector strengthened.
“We’re well placed to roll out optimisation work through 2018 that aims to have Kvanefjeld positioned as the lowest-cost largest capacity rare earth project outside China, with the longest projected mine life,” he said of the company’s project in Greenland, which forms part of Denmark.
Kvanjefjeld is forecast to be the largest producer of key rare earths, including neodymium, praseodymium and dysprosium that are essential to high powered permanent magnets used in the elective drive motors of electric vehicles. Demand for these elements is further boosted by strong growth in offshore wind power, where renewable energy magnets are also used.
Based on an ore reserve of 108-million tonnes, the project has an initial mine life of 37 years, with the reserve representing only about 10% of the one-billion tonne mineral resource estimate.