Element 25 Ltd (ASX:E25) has received commitments from investors to raise $35.5 million in a strongly supported placement which will fund the planned stage-2 expansion of manganese concentrate production at Butcherbird Project in Western Australia, enabling the production of more than 1 million tonnes per annum.
The placement, which was priced at $2.20 per share, received strong support from a leading Swiss ESG fund.
As well as fully funding the expected capital outlay for Stage 2, funds will also allow E25 to put a dedicated team in place to accelerate the flowsheet and plant design work to produce High Purity Battery-Grade Manganese Sulphate (HPMSM) for New Energy Vehicles (NEV).
Stage 1 production at Butcherbird is on track with wet commissioning underway and a progressive ramp-up scheduled for the next three months to nameplate production.
Ideally placed to feed potential demand
Manganese is emerging as an increasingly important ingredient for EV batteries, with potential supply constraints for nickel and cobalt forcing battery manufacturers to look to high manganese cathodes to produce the vast amount of cathode material required by the EV industry in coming years.
The recent announcement by Volkswagen reinforces this transition to high manganese content on these cathode materials.
Butcherbird is ideally placed to feed this potential demand, with advanced flowsheet development work undertaken in 2019 and 2020 confirming a simple, unique, ambient temperature and atmospheric pressure leach process for E25 ores which, when combined with offsets, will target the world’s first Zero Carbon ManganeseTM for EV cathode manufacture.
Placement shares (16,136,364 shares) will be issued without shareholder approval relying on the company’s capacity under Listing Rule 7.1 and 7.1A.