Greenland Minerals and Energy Ltd (ASX:GGG) has completed a strongly supported share placement to Asian and Australian institutional investors to raise $10.25 million.
The company owns the Kvanefjeld Project in Greenland, one of the world’s most significant emerging rare earth projects.
Greenland has accepted firm commitments for $9 million from leading funds in Hong Kong, Singapore and Australia, at $0.09 per share.
In addition, the company’s major shareholder and strategic partner Shenghe Resources has confirmed its intent to maintain its 12.5% shareholding by investing $1.25 million.
Well-funded to accelerate project development
Greenland is now well-funded to continue optimisation work, update project cost structure, feasibility studies and enhance its development strategy.
Based on an ore reserve of 108 million tonnes, the project has an initial mine-life of 37 years, with the reserve representing only circa 10% of the 1 billion tonne resource estimate.
Through 2018, the outcomes of optimisation work will be progressively rolled out, with engineering and feasibility studies updated accordingly.
Of the small number of advanced rare earth projects globally, Kvanefjeld is forecast to be the largest producer of key rare earths including neodymium, praseodymium and dysprosium.
These elements are essential to high powered permanent magnets used in the electric drive motors of electric vehicles.
Projected to be largest capacity rare earth project outside of China
John Mair, managing director, said: “We’re extremely pleased with the strong level of support from a cross section of prominent institutional investors who along with Shenghe provide strong endorsement of the Kvanefjeld Project and the company strategy.
“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 of China, with the longest projected mine life.
“In association with Shenghe, we’ll be looking to develop a complete path to market and project finance strategy.
“The demand outlook for rare earths continues to strengthen creating an optimal window to position Kvanefjeld for the development phase.”