Walkabout Resources Ltd (ASX:WKT) has outlined an underwritten $3 million share purchase plan (SPP) that will open next Friday 12 October 2018.
Funds raised under the SPP will be used to progress development of the Lindi Jumbo Graphite Project in southeastern Tanzania where the company was recently granted a mining licence.
With current cash reserves of circa $5 million, the company will have circa $8 million cash at bank upon completion of the SPP before costs.
READ: Walkabout Resources’ mining licence triggers multiple activities at Lindi Jumbo Graphite Project
Walkabout is currently finalising the engineering, procurement and construction (EPC) agreement with construction partner, Yantai Jinpeng Mining and Machinery Co Ltd.
An associate company of Jinpeng is currently Walkabout’s largest shareholder and has also expressed a desire to further invest by contributing to the capital costs of Lindi’s development.
Walkabout is also in discussions with a number of parties regarding project funding.
DFS completed in August 2017
A definitive feasibility study (DFS) was completed on the Lindi Graphite Project in August 2017 demonstrating strong economics.
Construction is estimated to take 10 months for a capital cost of US$29.7 million with a post-tax net present value (NPV) of US$180 million.
The 20-year mine life has a 19-month pay-back period and features very competitive operating costs of ~US$450 per tonne in concentrate.