NSL Consolidated will use $460,200 raised in a placement to advance its joint venture agreement (JVA) between subsidiary NSL Mining Resources and Vijay Mining, a wholly-owned unit of the Vijay Group. NSL has secured commitments for the placement of more than 23 million shares.
The funds raised will be utilized by NSL as the company works with Vijay regarding Vijay’s financial commitments under the JVA, and while the NSL pursues investigate alternative funding. NSL discussions with Vijay are ongoing. Vijay also continues operational commitments under the JVA, by mining and delivering ROM (Run of Mine) material to NSL’s stockyard.
NSL’s JVA was first committed by secured investments of INR150 million in April for the Vijay Group, allowing NSL’s current iron ore expansion annually targeting 1.5 million tonnes of saleable iron ore by 2015, with potential to increase this target further. Other growth, including future mine acquisitions, primarily in Andhra Pradesh, will also be possible, according to company officials.
Vijay Group’s extensive iron ore and coal mining business in India has been operating at annual rate of 70 million tonnes. Existing equipment and management expertise has been integrated into the JVA.
NSL’s managing director Cedric Goode says, “The Vijay Group has a history of rapid business growth, coupled with local expertise specializing in mining operations and mining equipment related businesses. NSL and Vijay are targeting the JV to be operating at an estimated 1.5 million tonnes per annum of saleable iron ore within two years, with potential to increase this target further in the next 4-5 years.”