New Energy Minerals Ltd (ASX:NXE) (FRA:GGY) substantial shareholder Regius Resources Group Limited has increased its interest in the graphite focused company to 11.92% from 6.85%.
This follows the conversion of $700,000 debt owing by New Energy to Regius by the issue of 10 million shares.
London-based Regius now holds almost 18 million shares in New Energy, which has an 80%-interest in the Caula Vanadium Graphite Project in Mozambique.
Last month the company completed a $5 million strategic investment and joint venture transaction with Hong Kong-based investor UBezTT International Investment Holdings (BVI) Ltd.
UBezTT’s largest shareholder is the strategic investor and Hong Kong-listed PT International Development Corporation Ltd’s (HK:00372) chairman and managing director Louis Ching.
Project on fast-track
At the time, NXE managing director Bernard Olivier said: “We are pleased to have completed this transaction and we welcome Mr Ching’s investment into New Energy.
“With the scoping study now completed, we look forward to applying these funds to fast-tracking the development of the Caula Vanadium Graphite Project.”
Caula’s graphite deposit has one of the highest grades in the world, with up to 28% total graphitic carbon.
The project has a 21.9 million-tonne measured resource grading 13.4% total graphitic content (TGC) at an 8% cut-off for 2,933,100 tonnes of contained graphite.
The vanadium assets include a 22 million-tonne measured resource grading 0.37% vanadium oxide at a 0.2% cut-off for 81,600 tonnes of contained vanadium.
A scoping study for the world-class project has delivered positive economics with the company targeting first cash flows in the second half of 2019.
Caula’s after-tax net present value (NPV10) for the entire project is US$448.76 million at a 10% discount, while its after-tax internal rate of return (IRR) is 58.8%.
Graphite and vanadium production planned
Phase I would target annual production of 10,000-15,000 tonnes a year of graphite concentrate and 14,000-18,000 tonnes a year of vanadium concentrate.
Capital expenditure of the first phase would be US$7.368 million.
The peak funding requirement for the whole project would be US$77.54 million while ongoing capex would be US$18.14 million.
New Energy’s costings were based on a US$1,103.50 graphite basket price assumption and a vanadium price assumption of US$40,785 a tonne vanadium oxide concentrate at mine gate.
The operating cost per tonne is US$50.87, putting revenue at US$135.52 a tonne.