Windimurra Vanadium Ltd has raised $54.8 million to fund development of its namesake project in Western Australia's Mid West, following the closure of its heavily oversubscribed entitlement issue.
The raising completes all funding requirements for development of the project, located 600 kilometres north east of Perth and due to be commissioned in the last quarter of 2008.
Windimurra managing director Dr Iain Scott said the company had raised the maximum amount of funds available through the entitlement issue, which enabled shareholders to subscribe for one new share for each three shares held.
Through the offer, Windimurra will issue approximately 34.2 million new ordinary shares at a price of $1.60 per share.
"We are very pleased with the strong shareholder support for Windimurra, with all our major shareholders participating and most of them subscribing for additional shares." Dr Scott said.
"This raising significantly de-risks the project by completing the $200 million finance package, following the finalisation of the $145 million debt funding arrangement in January. The capital raised will be used to complete redevelopment of the mine and plant at Windimurra and to take the project into production."
"We are also making significant progress in execution on the ground, with about 50% of the project capital expenditure spent or committed," Dr Scott said.
Global demand for vanadium is expanding, driven mainly by growth in steel consumption which has seen vanadium spot prices increasing to above US$80/kg from price levels of just under US$40/kg during 2007.
Dr Scott said during the past six months, the company had achieved a number of major milestones on the path toward production.
"We have secured all principal environmental approvals, have put in place key supply contacts (including gas), and have signed a 10 year, $300 million contract with Mineral Resources to build, own, operate and transfer the beneficiation plant, which is now underway," Dr Scott said.
"Now with the completion of finance, we can continue with full confidence toward becoming one of the world's lowest cost vanadium projects."
