Base Resources to raise A$8.1m to advance Kwale zircon Project

Nov. 30, 2010 - Base Resources will place 27 million shares at $0.30 per share to raise $8.1 million to provide additional funding for the completion of the enhanced definitive feasibility study for the Kwale Project in Kenya, and allow greater flexibility in the timing of implementation and development funding activities.
Kwale is an advanced and highly competitive project in a sector with a significant forecast supply shortfall widely expected to emerge in the medium term.
The placement has been arranged by RFC Corporate Finance Ltd (RFC) and will see the issue of a total of 27 million shares in 2 stages.
An initial 18 million shares will be issued within the 15% discretionary placement limit and a further 9 million shares will be issued subject to shareholder approval at a general meeting to be held on or about 24 January 2011.
The recently completed process design review at Kwale identified and evaluated to scoping study level a suite of design and concept changes to the original definitive feasibility study that improve the project in terms of enhanced returns and risk profile.
This work has established the scope of the enhanced definitive feasibility study, due for completion in the 2nd quarter of 2011, with a view to completing off-take and financing arrangements in the 3rd quarter of 2011. A realistic development time line should see the Kwale Project in production in 2013.
In addition, several implementation steps have been identified, the acceleration of which ahead of completion of the main development funding will simplify funding activities, reduce some development timing risks and generally provide greater flexibility.
Tim Carstens, managing director, said, "We are delighted with the way the Kwale Project development is unfolding. We are undoubtedly in the right sector with the right project at the right time."