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Sovereign Metals secures $6.5M to expedite graphite project in Malawi

Published: 15:31 25 Oct 2017 AEDT

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Potential to meet graphite end-market specifications

Sovereign Metals Limited (ASX:SVM) has secured commitments from institutional and sophisticated investors in Australia and the U.S. to raise $6.5 million at an issue price of $0.11 per share.

Proceeds from the placement will be used to expedite development of the company’s Malingunde Flake graphite project in Malawi, including all technical works and feasibility studies.

Earlier in August, Sovereign had revealed that its Malingunde graphite concentrates have a strong potential to meet the specifications of major graphite end-markets, including lithium-ion batteries.

In 2017 Sovereign delivered the world’s largest reported soft saprolite-hosted graphite resource and scoping study.

The study highlighting that the project has capital and operating costs per unit at the very bottom of the graphite supply cost-curve.

Malingunde deposit comprises 65.1 million tonnes at 7.1% total graphitic carbon (saprolite, saprock & fresh rock).

The study also demonstrated the potential for an annual graphite concentrate production of circa 44,000 tonnes over an initial mine life of 17 years.

Sovereign intends to issue 12 million unlisted options exercisable at $0.18 each on or before 31 July 2020 to a key advisor assisting the company with offtake arrangements.

The company’s share price has increased circa 14% in the past one month and was last trading at $0.125.

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