NQ Minerals PLC (LON:NQMI) has raised £300,000 from a UK institutional investor, which the miner said will allow it to launch an exploration programme to add higher grade resources to its Hellyer mine in Tasmania.
In the year since it was commissioned, Hellyer has ramped up production of lead, zinc and precious metal concentrates, generating a record net profit before tax of A$2.44mln in November.
NQ’s Chairman, David Lenigas, said: "Some shareholders may question the need for NQ raising money at the PLC level at this time, especially now that the Hellyer operations are running profitably."
He said that, with most of the current operating cash surplus allocated towards planned 2020 expansion programmes and debt servicing obligations, “NQ must now start defining new higher-grade base metal deposits in the area that will complement Hellyer's 1.6mln tonnes a year operating capacity”.
Lenigas pointed to the company’s recently-granted 18km squared exploration licence, Chester, which is deemed “highly prospective” for volcanogenic mass sulphide deposits, which are known for containing precious metal ores.
Only 15km away from the Hellyer plant, the Chester lease is near infrastructure including the main Emu Bay rail line, high-voltage power, paved road access and a good water supply.
The NEX- and OTC-listed company said in a statement on Thursday that it will issue 4,615,385 new ordinary shares at 6.5 pence per share, which are expected to be admitted to trading on or around 24 December.