American Rare Earths Ltd (ASX:ARR) has raised approximately A$2.4 million in a well-supported placement to professional and sophisticated investors with funds to advance its strategically-placed project in the US.
The company will now place approximately 26.66 million shares at an issue price of A$0.09 per share.
These funds will enable the company to advance exploration activities and metallurgical test-work as it works towards delivery of a Preliminary Economic Assessment (PEA) on the La Paz Rare Earths and Scandium Project in Arizona USA in 2021.
The placement also includes a 1 for 2 free attaching option exercisable at A$0.15 with an expiry date of three years from the date of issue.
ARR has received binding firm commitments from professional and sophisticated investors for the placement which will be completed utilising the company’s 15% capacity pursuant to ASX Listing Rule 7.1.
Completion of the placement and receipt of funds is expected to occur on or around Thursday, December 10, 2020.
Taylor Collison acted as lead manager to the placement.
Use of funds
Funds will be used in the upcoming drilling program identified from the previously released JORC 2012-compliant, 2020 Technical Report on the rare earths and scandium project.
This program will test for mineralisation at depth and will also obtain core samples for use in further metallurgical test-work.
The technical report identified extensive areas of REEs greater than 300 parts per million (ppm) and scandium greater than 11 ppm that warranted deeper drilling in the lower plate where, higher grade rare earths, would substantially increase the resource base for the project.
Funds will be also used to drill in the recently acquired tenements in the Southwest to follow-up favourable rare earths and scandium sampling results.
With appropriate additional drilling to verify the data, the authors of the JORC 2020 resource estimate consider, if successful, the REE and scandium resources can be confidently reclassified and expanded.
Preliminary metallurgical test-work on the core will be undertaken by the Saskatchewan Research Council (SRC) in preparation for the advanced new processing technologies of REE and scandium being proposed by Purdue University and the University of Kentucky.
Story by ProactiveInvestors
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