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Australian-headquartered mineral explorer, Comet Resources Limited (ASX:CRL) has recently received a strong endorsement by way of firm commitments for the proposed $2 million capital raising for the acquisition of Barraba Copper Project.
In addition to the proposed acquisition of the Barraba Project, the Company owns 100 per cent interest in the Springdale graphite project, situated about 30km to the east of Hopetoun in south Western Australia.
The Company believes that the Barraba Project complements its current Springdale graphite project owing to their shared end applications in batteries for Battery Electric Vehicles (BEV’s), and best to use existing board and management resources in order to drive shareholder value.
Key Details of Capital Raising
The Company has obtained firm commitments for the issuance of 80 million fully paid shares at a subscription price of 2.5 cents per share under the terms of offer. Moreover, the Company will also issue one unlisted option to subscribers, with an expiry of 30th June 2021 at a strike price of 3.5 cents for each share issued under the offer.
The Company will now lodge the notice of meeting for the general meeting, seeking shareholder approval for the capital raising and the Barraba Project acquisition. The capital raising satisfies the key condition required to be met prior to progressing with the acquisition.
Capital Raising to Support an Exploration Programme at Barraba Project
The capital raising is targeted to support an exploration programme involving geophysics (downhole and surface) along with targeted Reverse Circulation or diamond drilling.
The Company notified that the Barraba Copper Project has never been tested systematically by modern exploration technique, and its initial exploration program will comprise drill testing areas below the historically identified deposits. In addition, an induced polarisation (IP) survey conducted of sections of the license area outlined high-grade exploration targets that were never followed up. These targets will also be drill tested.
The Company will also finalise downhole geophysics to provide further information about potential blind and parallel lodes, besides the known historical lodes, to complement the drill testing.
The initial drilling program has been scheduled for Q2 2020 on the Barraba Project.
Robust Market Opportunity Ahead
Copper is not only an important constituent of the batteries used in battery vehicles, it is also used significantly in the electric motors that drive the wheels of BEVs. Moreover, it is used intensively in generating electricity from renewables, like wind and solar.
The Company believes there are robust market opportunities ahead as copper is set to observe a rise in demand because of global efforts to lower emissions from the generation of renewable electricity and from the transport network.
The Company is excited about the potential for fresh discoveries on the Barraba Project via testing the extent of the partly mined and formerly discovered lodes, and new exploration works.
On 18th February 2020, CRL settled 8 per cent up on the ASX at $0.027.
