Mindax (ASX: MDX) has raised A$1.75 million after securing commitments for a placement of 17.5 million shares at $0.10 per share, a hefty discount to the company’s last traded price of $0.15.
The funds will be used to progress exploration and development of Mindax’s prospects, in particular the Mt Forrest Iron Project.
The placement will be made to a number of sophisticated and professional investors, including one of the company’s largest shareholders, LAP Exploration.
LAP has agreed to subscribe for 10 million of the 17.5 million shares, representing an investment of $1 million and giving the company a 16.98% stake in Mindax.
The capital raising boosts Mindax’s cash in hand balance of $3.2 million at the end of the December quarter to almost $5 million.
Unlocking Mt Forrest DSO Potential
Mindax has enhanced the mining case for Mt Forrest with metallurgical test work unlocking the direct shipping ore (DSO) potential of the project and returning grades of above 63% iron.
Coarse crushing with heavy media separation, a simple process used by Rio Tinto (ASX: RIO) at its Tom Price operations, showed the best upgrade and mass recovery.
Mindax has also delivered a 20% upgrade to the Indicated and Inferred regolith iron Resource at Mt Forrest which now stands at 14 million tonnes at 45.3% iron. The upgrade is based on 269 reverse circulation drill holes and 4,134 samples.
Significantly, more than 60% of the regolith iron Resource above a 40% iron cut-off has now been unlocked due to the encouraging metallurgical test work, adding further value to the Mt Forrest Project.
Mindax has only just scratched the surface at Mt Forrest and the project is already revealing its potential for a further substantial resource upgrade with up to 10 kilometres of untested strike length of greater than 40% iron awaiting further exploration.
The company is focusing on initiating mining at Mt Forrest with a modest 1.5 million tonne per annum DSO operation.
Solid progress is being made on approvals, infrastructure planning and negotiations with infrastructure providers with the aim to mine DSO in 2013 and magnetite in 2015.
Importantly, Mindax has completed a Scoping Study which is due for release soon and is preparing to begin a Feasibility Study.
Mt Forrest covers seven mining leases over 50 square kilometres and includes 20 kilometres of banded iron formation strike.
The project is located 160 kilometres northwest of the town of Menzies in Western Australia, which is on the railway line to the deepwater iron ore port of Esperance.
Originally published at: http://www.proactiveinvestors.com.au/companies/news/25585/mindax-ramps-up-momentum-at-mt-forrest-with-strong-investor-backing--25585.html