Australia’s Kogi Iron has completed a two-phase capital raising to primarily fund a Bankable Feasibility Study (BFS) on its wholly owned and advanced Agbaja Plateau iron ore mining and cast steel mill project in Kogi State, southern Nigeria.
The final phase of the capital raising comprised a Share Purchase Plan (SPP) to raise up to AU$2 million. The SPP has now closed, securing AU$860,300 in new equity from shareholders who applied for 21.5 million ordinary shares at an issue price of 4 cents per share (equivalent to a 43 per cent uptake).
Kogi Iron Board has thanked shareholders for their support for the SPP with proceeds adding to commitments over November of AU$2 million from US-based institutional investor, Sorbie Bornholm LP, and a further AU$350,000 from Australian sophisticated investors.
Kogi Iron Managing Director, Mr David Turvey said the successful capital raisings and conversion of outstanding Director fees to shares positioned Kogi for a very focused, well-funded and strategic start to calendar 2020 where the primary focus will be on advancing the BFS for the fully integrated Agbaja project.
“The project itself was boosted earlier this month with the grant of our fourth mining lease, for 25 years, in Nigeria, Africa’s second largest economy,” added Mr Turvey.
“A proposal to conduct steel test work and plant design engineering studies as key inputs to the BFS is imminent. We are currently in discussions and negotiations with more than two dozen potential investors to raise the balance of approximately AU$10 million the BFS is expected to cost. The study is anticipated to take about 12 months to complete.”
Kogi Iron has been successfully advancing the project since 2016, with access to company leased iron ore deposits and nearby coal and limestone sources. Laboratory-scale tests on the Agbaja iron ore demonstrated that it could be converted to a steel feedstock suitable for electric arc furnaces.
A successful Pilot Plant Test Program completed in September 2018 on a large bulk sample confirmed the feasibility of producing a marketable cast steel product, together with the development of a preliminary flowsheet for the processing of Agbaja iron ore into cast steel billets suitable for supply to steel manufacturing and product fabricators in both Nigeria and overseas.