Northern Minerals to raise $30m

Northern Minerals is set to raise $30 million via a private share placement as it seeks to advance its Browns Range rare earths project in the east Kimberley.

The placement was conducted in three tranches, all with an issue price of 6.2 cents each, a 12.7 per cent discount to its previous closing price of 7.1 cents.

The company said it was continuing commissioning of its $56 million Browns Range pilot plant and was seeking to improve its technical performance.

Argonaut was the financial adviser, and Johnson Winter & Slattery were legal advisers.

Funds raised will go towards further exploration, an ore sorting machine, and an assessment of whether or not it can shift production to a domestic site.

Northern Minerals hit a roadblock in May when it announced that its R&D activities for the 2017 and 2018 financial years would be declared ineligible, after a review of its income tax returns by the federal government.

In addition to the $10.78 million it will have to pay back for the 2018 financial year, it said it would have to pay back around $2.6 million for the financial year prior.

The company said it was primarily utilising the newly raised funds to develop the Browns Range pilot plant.

Shares in Northern Minerals were down 2.8 per cent to trade at 6.9 cents each at 3pm AEST.