Metro Mining (ASX:MMI) has closed a $3.6 million non-renounceable entitlement issue to complete the Bankable Feasibility Study for its Bauxite Hills Project at Cape York, Queensland.
It received subscriptions for 12,670,171 shares priced at $0.08, or 28.3% of all shares offered under the 1 for 7 offer.
The remaining 32,146,686 shortfall shares will be taken up in full by the joint underwriters Argonaut Capital and GMP Securities or their nominees.
In July, the company raised $2 million through the placement of 25 million shares at $0.08.
Besides completing the DFS, proceeds will also be used for:
- Complete authorities and licenses to operate the Bauxite Hills Project (environment approvals, Native Title Agreements);
- Secure pre-commitments for mining and transhipment contractors as required;
- Exploration activities and business development;
- Proposed buy-back of shareholders’ un-marketable parcels; and
- Provide working capital.
Bauxite Offtake
In August, the company signed an offtake agreement with Xinfa Group - one of the largest integrated aluminium companies in China.
The non-binding offtake agreement contemplates a minimum contract tonnage of 1 million tonnes of bauxite a year up to a maximum of 1.2 million tonnes a year over the initial five years term – representing around half of the annual production.
Bauxite Hills has an Ore Reserve of 48.2 million tonnes with high grade total alumina of 50.2% and reactive silica of 6.3%.
It is on track for first production in the third quarter of 2016.
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