Jindalee Resources Limited (ASX:JRL) intends to raise up to $1.05 million in a 1 for 10 non-renounceable pro-rata entitlement offer of fully paid shares at 30 cents per share.
Funds raised will be used to accelerate exploration on the company's projects with a focus on the McDermitt Lithium Project in the US.
The Widgiemooltha Gold-Nickel Project in Western Australia is also expected to benefit from further exploration.
Jindalee managing director Pip Darvall said: “This is the first capital raising Jindalee has undertaken since its listing in 2002 and will enable the company to accelerate exploration, particularly at our McDermitt lithium project.
"Drilling to both infill and extend mineralisation and provide samples for further metallurgical test work is due to commence shortly.
“We are excited about the potential for value creation for shareholders at both McDermitt and Widgiemooltha and look forward to updating the market as results are achieved.”
The Entitlement Offer is available to all company shareholders registered at 5pm (WST) on the record date of July 15, 2019, whose registered address is in Australia or New Zealand.
Jindalee's shares are trading at 40 cents after reaching a new high of 45 cents less than a month ago.
The company recently obtained further positive metallurgical test results from the McDermitt project with more than 90% of lithium reporting to the leach solution within two hours on June 19.
The results from conventional sulphuric acid leaching under a range of temperature, slurry density and time conditions demonstrated results similar to those obtained in previous tests.
Metallurgical testing will continue with the goal of further optimising leach conditions and leachate composition as well as testing for any beneficiation opportunities.
Jindalee is expected to start drilling at the McDermitt project this month with six core holes planned for the initial program aimed at locating higher-grade zones, extending existing mienralised zones and supporting resource estimation work.