OD6 Metals receives firm commitments for $1.5m placement priced at 7.1c per share
Existing shareholders to be offered up to $30,000 worth of shares under SPP to raise up to $1m
Proceeds will be used to advance Splinter Rock through drilling and optimisation of metallurgical test work
Special Report: Institutional and sophisticated investors have backed OD6 Metals’ plans to advance its flagship Splinter Rock project through drilling, metallurgical optimisation and completing a scoping study by committing to a $1.5m placement.
The ~4,828km2 Splinter Rock project near Esperance, WA, is close to an existing port, sealed roads, and essential infrastructure.
It features the 2km by 1km Inside Centre area within the Centre prospect which features grades ranging from 1,400ppm to 2,000ppm total rare earth oxides. Centre already has a resource of 149Mt @ 1,423ppm TREO.
OD6 Metals (ASX:OD6) has made significant progress in comprehending basin composition, regolith characteristics, rare earth element (REE) mineralogy and metallurgical recovery potential through ongoing collaboration with various agencies.
This includes work with the Australian Nuclear Science and Technology Organisation (ANSTO) and CSIRO on techniques to improve exploration and extraction of clay deposits.
Metallurgical test work carried out to date has successfully delivered rare earth element (REE) recoveries of up to 90% in around 60 samples from four large prospects including Prop, Centre, Scrum and Flanker.
These samples also averaged 62% valuable magnet REEs inclusive of neodymium, praseodymium, dysprosium, and terbium.
Funding to accelerate exploration
Institutional, professional, and sophisticated investors have committed to subscribing for ~21.13 million shares priced at 7.1c each – a 18.4% discount to the last closing price of 8.7c on 21 March 2024.
OD6 also plans to raise up to a further $1m through a share purchase plan.
Existing shareholders will have the opportunity to subscribe for up to $30,000 worth of shares priced at 7.1c.
Proceeds from the placement and SPP be used to advance the Splinter Rock project towards development.
Key activities include focused infill drilling at the Inside Centre prospect, extensional drilling targeting resource growth and regional reconnaissance drilling.
OD6 will also use funds on the ANSTO metallurgical program to optimise leach recovery and impurity removal with the aim to produce a mixed rare earth carbonate product that will enable completion of the scoping study.
“The Splinter Rock Project has the potential to be a truly world class project, with strong support being received from new professional and sophisticated investors as well as a number of our long-term retail and institutional shareholders,” managing director Brett Hazelden said.
“Proceeds from the capital raising ensure OD6 is well funded to advance the Splinter Rock project with a significant focus on the Inside Centre prospect.
“Metallurgical work to be undertaken at ANSTO, will look to optimise our already impressive leach recoveries and low reagent usage, with the next step of producing a high-quality mixed rare earth carbonate, that will enable discussions to be held with various potential strategic partners and off-takers.
“These works will then form the basis and the delivery of a scoping study scheduled for completion by calendar year end.”
This article was developed in collaboration with OD6 Metals, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.
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