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Highlights
- Arafura's Nolans Project focuses on exploration of rare earth elements.
- The company's shares were trading 13.79% higher today at AU$0.33 per share on ASX at 12.29 PM AEST.
Arafura Resources Limited (ASX:ARU) is a company based in Australia that manufactures rare earth products. The company's Nolans Project focuses on exploration of rare earth elements.
The Nolans Project consists of a mine, process plant, including beneficiation, extraction, and separation plants, as well as supporting infrastructure, all of which will be built and located at the Nolans site.
Meanwhile shares of Arafura were trading 13.79% higher today at AU$0.33 per share on ASX at 12.29 PM AEST.
Arafura raises AU$41.5M funding
Arafura stated last month (5 August) that it had got firm commitments to fund AU$41.5 million (before fees) from Australian and overseas institutional and professional investors through a placement of fully paid ordinary shares at an issue price of AU$0.265 per share.
The AU$0.265 per new share issue price represents a 17.2% discount to Arafura’s closing price on August 2, 2022.
The placement received good support from investors across the world, sending a message that they were interested in Arafura's tier 1 asset and vertically integrated corporate strategy.
The funds raised will also be utilised for general working capital, such as continued marketing and sales talks in the US, Asia, and Europe, as well as financing activities.
Image Source: © 2022 Kalkine Media ®
Data Source- Company announcement dated 05 August 2022
Prior to this investment, Arafura was awarded a grant of AU$30 million in March as part of the Federal Government's Modern Manufacturing Initiative. The money was supposed to go toward the Nolans Project's building of a rare earth separation facility.
The AU$1.3 billion MMI is part of the Roadmap for Resources Technology and Critical Minerals Processing, which intends to establish Australia as a regional resources technology and critical minerals processing powerhouse within the next ten years. Arafura's grant is part of the MMI's Collaboration Stream, which will fund a small number of transformational projects to develop and facilitate collaborative ecosystems.
Arafura's offtake strategy
Following its earlier validation of final rare earth oxide (REO) products by supply chain partners from Europe, Japan, and China, Arafura has continued to advance its offtake plan. In its 2022 annual report, the company has got a lot of interest from potential customers that are looking for a long-term strategic supply of NdPr Oxide. Advanced negotiations are ongoing for the sale of a product that represents more than 260% of our annual nameplate production of 4,440 tonnes of NdPr oxide.
In May, Arauyra had signed a non-binding MoU with Hyundai Motor Company to pursue a seven-year offtake arrangement for the sale of NdPr Oxide beginning in 2025.
