Funds will be used principally to further develop the company’s Caula Vanadium Graphite Project in Mozambique.
Notably, management and board members subscribed for $258,000 worth of stock.
Mustang’s managing director Bernard Olivier said: “This capital raise is important in the fast-tracked development of the Caula Vanadium Graphite project in Mozambique where we have recently established a JORC Measured resource of 22 million tonnes at 0.37% vanadium pentoxide and 13.4% total graphitic carbon (TGC) for 180 million pounds of vanadium and 2.93 million tonnes of graphite respectively.
“With the feasibility study drilling now well underway it is likely that the resource will be enlarged in the near future, and this placement plays an important role.
“We will update the market as soon as the drilling and scoping study results are available.”
Mustang’s strategy is to produce a scoping study in September 2018 with the aim of advancing to a pre-feasibility study (PFS) by end of December 2018 and definitive feasibility study in the March quarter of 2019.
Mustang is targeting phase I trial mining to produce vanadium and graphite concentrates in the December half of 2019.
Placement shares will come with a 1:2 option exercisable at 2 cents expiring in 24 months from issue.
The options issue is subject to shareholder approval which will be sort at a general meeting expected to be held in late September.