Northern Minerals has secured a further Aus$4 million in interim funding from an entity controlled by a major shareholder, Australian Conglin International Investment Group (ACIIG), for extensive work under way at its Browns Range Heavy Rare Earth Project. This loan complements an interest-free Aus$4 million loan provided repayable in December 2013.
A 20,000-metre drill program at Browns Range, part of Northern’s Aus$35 million work program for 2013, is targeting expansion of the current JORC-compliant resource at the Wolverine deposit, and new resources at Gambit West and Area 5. Results of the program are expected in October 2013.
In addition, extensive activities are under way within the Browns Range Scoping Study, include work on environmental and native title approvals, process flow sheet optimization, and project design.
Meanwhile, Northern Minerals has agreed to a request from ACIIG for the deferred payment of the underwriting for the company’s recently closed Rights Issue. Upon completion the fully underwritten issue will raise about $26 million towards the funding of the work program for the Browns Range project through to completion of a bankable feasibility study.
The $8 million in loans from ACIIG will be set-off against part of the Rights Issue underwriting and converted to Northern Minerals shares. $6 million of the underwriting funds will be paid by ACIIG on 22 July 22, 2013, and the final instalment of $11.11 million is now payable by ACIIG by September 16, 2013
Northern Minerals CEO George Bauk says the loan funds ensure work remains on schedule, while reinforcing ACIIG’s commitment to fast-tracking the project toward production. “The Northern Minerals Board acknowledges the strong financial support ACIIG has shown in the past 12 months, most recently by providing two $4 million interest free loans in the lead up to the completion of the Rights Issue. As a result, we have the funding in place to complete our JORC drilling program, and to prepare our upgraded JORC resource and scoping study.”
Northern Minerals is a developer of rare earth elements with large landholdings in Western Australia and the Northern Territory with Browns Range its flagship asset. Browns Range has a number of prospects with high-value heavy rare earths in xenotime mineralization. The mineralization includes high levels of dysprosium and yttrium, both in short supply globally and expected to be increasingly sought-after as world economies stabilize and trends in urbanization and technology diffusion, particularly in Asia, accelerate.