Strandline Resources Ltd (ASX:STA) has struck the mother lode with a cornerstone funding package from private equity group Tembo Capital of $6.6 million to fund Strandline’s portfolio of Tanzanian mineral sands projects.
The funding package from Tembo will include an up-front firm investment of $2.3 million via a placement of shares at $0.007 each and further funding over two years.
Tembo will also fully sub-underwrite a pro-rata renounceable rights issue to Strandline shareholders to raise up to $4.3 million at $0.005 per share.
Interestingly, the placement of shares to Tembo at $0.007 is at a 40% premium to Strandline’s last traded share price of $0.005.
The new funds will be used to fast-track development at the zircon-rich Fungoni deposit in Tanzania with indicated resource of 2.4 million tonnes containing 8.3% Total Heavy Minerals (THM).
A scoping study for the Fungoni project has projected an internal rate of return of 26.5% on an initial capital cost of US$12.3 million.
Additionally, Strandline is planning aircore drilling programs totalling 30,000 metres on several other high potential target areas along the Tanzanian coastline.
Tembo has indicated that it has a long-term investment strategy in Strandline, providing potential access to development funding of up to a further $US15 million over the medium to long term.
Source: Proactive Investors
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