Richlister backs Metallica silica sand mining bid
The company has announced a renounceable rights issue to raise about $4.9 million to fund the next phase of the development of its project, located in the world-class Cape Flattery dune field.
New cornerstone investor Ilwella, the private investment vehicle of the family of billionaire Brian Flannery, is sub-underwriting about $2.2 million.
Ilwella chief investment officer Quentin Flannery said the group was committed to being a substantial long-term shareholder and looked forward to seeing the Cape Flattery project in production.
"We have a strong view that the world’s appetite for high grade Cape Flattery silica sand products will continue to grow and this project will play a key part in meeting this future demand,” Mr Flannery said.
“We believe the silica sands market represents a huge opportunity over the next decade and continue to be committed to supporting high quality projects in this space.”
Ilwella is also major cornerstone investor in fellow Cape York silica sand proponent Diatreme Resources, which is advancing the Galalar project. In October last year it supported a Diatreme capital raising by subscribing to a further $1.65 million worth of shares.
Metallica said industry research firm IMARC Group estimated the global silica sand market could grow from $US7 billion in 2019 to $US20 billion in 2024.
This month Metallica Minerals announced it has tripled the high-purity silica sand resource at its Cape Flattery project to 38.3 million tonnes.
Recent presentations indicate it is aiming for first production in the second half of 2023.
Metallica’s project lies adjacent to the Cape Flattery Silica Sand mining and shipping operation owned by Mitsubishi.
Exploration drilling to date has confirmed that the sand dunes within EPM 25734 contain high purity silica sands with an insitu quality which is understood to be comparable to that operation.
Funds from the capital raising will be used for:
- Further resource drilling and evaluation in the key area that holds a 38.3mt JORC resource
- Finalisation of the Cape Flattery silica sand scoping study
- Mining lease application
- Environmental studies and applications to advance the project’s development
- A pre-feasibility study
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