Lucapa raises $10m for Mothae mine

Perth-based Lucapa Diamond Company has raised funds to expand the processing capacity at its Mothae kimberlite mine in southern Africa by 45 per cent.

Mothae is a partnership between Lucapa, which owns 70 per cent of the mine, and the Kingdom of Lesotho (30 per cent).

The mine, situated in Lesotho's Maluti mountain region, has an indicated and inferred JORC resource of 48.5 million tonnes and around 1.2 million carats.

Lucapa says it will use the funds raised from a $10 million placement to expand the mine’s processing capacity from 1.1 million tonnes per annum to 1.6mtpa.

It is expected to cost $8.5 million.

The raised processing capacity should materially increase production and revenue, as well as improve unit operating costs, Lucapa said.

The company will issue about 182 million shares priced at 5.5 cents each, along with about 55 million free attaching unlisted options priced at 8 cents, and with a two-year expiry.

The placement was oversubscribed, Lucapa said, with a cornerstone investment from Brisbane-based Ilwella Pty Ltd.

It was co-lead by Far East Capital and West Perth-based Prenzler Group.

Lucapa was trading 3.5 per cent higher at 1:02pm AEDT to 5.9 cents.