TNG Limited has put in place funding arrangements for critical engineering and design work on its flagship Mount Peake vanadium-titanium-iron project in the Northern Territory.
The company is looking to raise $4.98 million through a fully underwritten rights issue of one share priced at 9.3 cents for every 20 shares held by eligible shareholders.
Securing the underwriting commitment from German investment company Deutsche Balaton Aktiengesellschaft gives TNG the certainty to carry out the front-end engineering and design, or “FEED”, work and the planning and design work for the non-process infrastructure.
German metallurgical engineering company SMS Group is undertaking the FEED work while Australian contractor McMahon Services is progressing the program of work for the non-process infrastructure.
Mount Peake has an ore reserve of 41.1 million tonnes grading 0.42% vanadium pentoxide, 7.99% titanium dioxide and 28% iron.
Ore from the project will be processed in Darwin using the company’s proprietary TIVAN process to produce 243,000 tonnes of high-purity vanadium pentoxide, 3.5 million tonnes of titanium dioxide pigment and 10.6 million tonnes of high-grade iron oxide during the initial 19-year mine life.
TIVAN is a method for treating ore without the need for expensive, energy-intensive roasting.
The process has been used successfully to produce a 99% purity vanadium pentoxide, a high-grade titanium dioxide feedstock grading about 80% titanium dioxide and a 99.9% iron oxide product.
Last month, Swiss global specialty chemical distributor DKSH agreed to purchase, on a life-of-mine basis, up to 100% of TNG’s titanium dioxide products produced from Mount Peake.
A binding offtake agreement is in place with South Korea’s Woojin for at least 60% of the project’s vanadium output and negotiations are underway for offtake of the remaining 40%.
TNG has also reached a binding term sheet with major global commodity trader Gunvor for iron products, though the company is also in talks with other iron ore buyers.
