Andromeda Metals (ASX: ADN) has topped up its cash reserves to advance its flagship Poochera kaolin-halloysite project, which could potentially be used as feedstock to produce high purity alumina for lithium-ion battery markets.
The company has completed an oversubscribed share placement to raise A$1.1 million (before costs) via the issue of 186.5 million shares at A$0.006 each.
“The fund raising will allow the company to continue the transformation from explorer to developer of a world class resource,” Andromeda managing director James Marsh said.
“A number of key advancements are targeted over the remainder of 2018,” he added.
Poochera halloysite-kaolin project
The agreement allows for Andromeda to lock-in 51% of Poochera by spending A$3 million on advancing the project within two years.
Prior to the joint venture, Minotaur had carried out resource drilling at the project including bulk sampling, pilot trial and ore marketing.
In early 2012, Minotaur published a JORC 2004 maiden resource for the project of 16.3 million tonnes of kaolinized granite with 45% yield of -45 micron kaolin.
Minotaur’s marketing also confirmed Poochera kaolin was suitable for paint, paper, ceramic, plastic, rubber and pharmaceutical industries.
Since coming on board, Andromeda has undertaken its own metallurgical test work on ore from the project’s Carey’s Well deposit.
The test work produced a 99.99% high-purity alumina, with Andromeda planning further evaluation to optimise a process flow sheet as well as revising the scoping study and sending fresh samples to potential customers for trial.
In June, Andromeda representatives met interested parties in China to gauge the current state of the country’s halloysite-kaolin market, including eight Chinese porcelain manufacturing companies that had previously signed letters of intent with Minotaur for a combined offtake of 200,000 tonnes per annum of halloysite-kaolin from Carey’s Well.
Andromeda reported all parties its spoke to were “very keen” to secure supply from Poochera, with the demand for the material rising in both the mineralisation’s ceramics and high purity alumina markets.
As part of its development pathway, Andromeda will convert the project’s historic resource to company with JORC 2012.
By mid-afternoon, Andromeda’s share price was steady at A$0.008.