Rex Minerals Limited (ASX:RXM) is planning to launch a two-tranche placement of shares to raise around A$50 million for funding pre-development activities at its Hillside Copper Project in South Australia.
The proceeds from the proposed placement of shares will be primarily used to fund Hillside pre-development activities and expand the project delivery team.
Rex is targeting a final investment decision for stage 1 of the Hillside Copper Project in the fourth quarter of the calendar year 2022.
“Build momentum ahead of our target for a successful FID”
Rex managing director and CEO Richard Laufmann said: “The successful completion of this placement will be yet another milestone for Rex and its shareholders, as we advance development activities for the Hillside Copper Project, our flagship asset.
“We are pleased to welcome strong institutional investors to our share register, with proceeds from the equity raising vital in ensuring that we are able to expand our project delivery team at Hillside and build momentum ahead of our target for a successful FID in the fourth quarter of 2022.
“Rex is advancing rapidly as an emerging copper development company, following the South Australian Government’s approval of the PEPR.
“Subsequently, we released the 2020 Hillside Feasibility Costing Update, retired all debt, completed the board succession, and doubled Hillside’s Copper Ore Reserves.
“With the global pivot to the electrification of everything the time has never been more perfect to deliver Hillside Copper.”
Use of funds
The company plans to spend proceeds from the placement primarily on Hillside pre-development activities such as building a project delivery team and appointing key contractors for the project.
Funds will also be spent on building early infrastructure projects including road realignment and electrical and water infrastructure works.
Rex will also use the funds in initiating the process of selecting an engineering house for development, mining fleet/contractor contract discussions, site maintenance, tenure fees and mine geology, and to select final financing solution.
A total of US$410 million of capex is required for Hillside Stage 1, with the balance of financing required in the second half of 2022 to be met through a mix of equity and debt.
Other initiatives
Rex will also be undertaking exploration activities including fieldwork, drilling, mineral claim and compliance fees, exploration plan of operation permits at its 100% owned Hog Ranch Gold Property in Nevada, US.