Mineral Resources has continued to diversify its interests, taking a $2 million stake in West Perth-based Barra Resources, which is developing the Mt Thirsty cobalt project near Norseman.
That is equal to a 10.8 per cent slice of the company.
MinRes secured the shareholding through a placement issued at 3.5 cents per share, equal to the company’s five-day volume-weighted average share price.
About 57 million shares will be issued, with the cash to be used to fund a pre-feasibility study on the Mt Thirsty project.
Barra owns 50 per cent of Mt Thirsty, with the remainder held by West Perth-based junior Conico.
Also today, Conico fell short in a bid to raise about $1.2 million through a rights issue, with a shortfall of about $565,000.
It comes after there has been increased interest in cobalt developments globally, driven by the expected acceleration of demand for batteries to be used in electric vehicles.
Cobalt is a component in numerous types of lithium battery, although most of the world’s production is sourced from the unstable African nation of Angola.
MinRes chief executive Chris Ellison said he hoped the company could use its experience to provide support to Barra through development.
“MinRes is a proven low cost developer and operator of greenfields resource projects,” he said.
“As Barra’s new second largest shareholder, we will welcome the opportunity to provide input and support when Barra brings its projects into production.”
Shares in Barra were up 21.2 per cent to be 4 cents each at the close of trade.