Arafura Resources (ASX:ARU) has raised $3,133,500 from shareholders via a share purchase plan at $0.060 per share.
The new funds along with Arafura’s existing cash reserves will be used to progress the Nolans Neodymium- Praseodymium Project pilot program.
Arafura had completed a $3.6 million capital raising in February which was well supported by institutional investors.
The Nolans project contains one of the world’s largest neodymium and praseodymium deposits, a valuable source of rare earth magnets.
Last month, the company engaged phosphoric acid expert Prayon Technologies to provide specialist support for operating a phosphate extraction pilot plant at Nolans.
Arafura is aiming to extract phosphate from the concentrate produced from the beneficiation pilot plant and produce phosphoric acid as a value-enhancing by-product.
Importantly, the ability to produce phosphoric acid as a by-product at Nolans provides Arafura with a natural advantage over other rare earth projects as it will reduce overall operating costs.
Arafura is aiming to become one of the world’s largest suppliers of rare earth magnets, which are poised for significant growth supported by demand from the electric vehicle industry.
The recent interest shown in the Nolans project by investors has given the company confidence to commence the next phase of the final feasibility study.
Arafura’s share price has increased by circa 23% since the start of 2017, last trading at $0.070.