Mining

AVZ Minerals raises $75m for Manono lithium-tin project, ‘significantly oversubscribed’

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By Robin Bromby - 
AVZ Minerals ASX AVZ drilling spodumene lithium Manono DRC

Drilling at AVZ Minerals’ Manono lithium project in the DRC.

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Early site works at its African lithium-tin project will now go ahead after AVZ Minerals (ASX: AVZ) raised $75 million from global institutions and a private Chinese investment company.

The company says the proceeds of the raising will allow early site works to begin while it waits the awarding of a mining licence from the Democratic Republic of Congo government.

AVZ holds interests in exploration projects prospective for lithium, tin, tantalum and associated minerals in the Democratic Republic of Congo, including a 75% interest in the Manono project, a lithium-rich pegmatite deposit and a 100% interest in the surrounding Manono Extension project (lithium, tin, tantalum).

Some 85% of the latest raising came from global institutions, while the balance was subscribed by sophisticated shareholders, including the Chinese cornerstone investor Suzhou CATH Energy Technologies.

The company said the issue was “significantly” oversubscribed and “further confirms the significant level of interest in the company’s world-class Manono lithium and tin project”.

Working with DRC to get mining licence awarded

Managing director Nigel Ferguson said the raising not only strengthens the financial position of the company but will help keep the project timeline within reach — despite the awarding of the mining licence taking longer than expected.

“We are in close consultation with the DRC Government authorities that are undertaking the mining licence assessment and are confident of delivering a favourable outcome for all our stakeholders — most importantly the people of the DRC and our shareholders,” he added.

“Such a significant cash injection further de-risks the company where increased market volatility is apparent and global economic uncertainty still remains.”

The placement comprises 150 million new shares (about 4% of the enlarged share register) at $0.50 per share.

Relationship with DRC Government ‘supportive’

AVZ will use the money to raise its equity holding in Manono to 90%, as well as get started with early works including upgrades of roads, bridges, as well as press on with camp construction.

The company will also be progressing various technical studies, negotiating final project financing and looking for new exploration opportunities.

“AVZ continues to enjoy a collaborative and supportive relationship with the DRC Government and remains confident of [a] positive outcome with respect to all licencing and permitting requirements for the Manono project,” the company stated.