The investment by Sprint follows an earlier $1.2 million grant by a Japanese government agency for Stanmore to drill The Range project and the granting of interim authorisation to negotiate the construction of rail links in the Surat Basin.
Stanmore Coal managing director Nick Jorss said: “We welcome Sprint Capital as a significant Stanmore Coal shareholder. The funding support provided by Sprint Capital allows us to satisfy our immediate infrastructure commitments and reinforces the progress on the path towards development of our existing coal projects.
“It is a testament to the quality of our projects and team that we have been able to raise equity at an attractive premium to our current share price in these difficult market conditions. This agreement places us in a strong position to grow through acquisition and development.”
Sprint Capital managing director Chris McAuliffe said Stanmore Coal offered a combination of a “great team, quality development assets and access to first class committed rail and port infrastructure”
“We are delighted to partner with the Stanmore team and look forward to developing their current portfolio and providing support to pursue complementary boltâ€on acquisitions of high grade thermal and metallurgical coal projects across Queensland,” he said.
The funds will consist of a $27.01 million placement of 40.02 million shares at $0.675 per share and a $9.03 million placement of zeroâ€coupon notes convertible into 13.37 million shares at $0.675 per share. The issue and conversion price of $0.675 per share reflect a 46.4% premium to Stanmore Coal’s 30 day volume weighted average price and an 87.5% premium to Stanmore Coal’s last traded price of $0.36.
Xstrata Coal’s Wandoan project is shaping up as a major hub for mine developments in the Surat Basin, with Stanmore Coal lodging the environmental impact statement for its neighbouring $505 million The Range thermal coal project.
The Range, 25km southeast of Wandoan and close to the planned Surat Basin rail line, has a target of 5 million tonnes per annum of coal with saleable production starting in 2015.
The bankable feasibility study for an open cut mine with a 26-year mine life at The Range is underway, according to Stanmore.
During the March 2012 quarter, Stanmore completed an interim review of The Range which resulted in a 22% increase in the JORC inferred resource and a 14% increase in total JORC resource to 260 million tonnes.
A bankable feasible study for The Range kicked off during the March quarter, with more than 2800m of drilling completed since the drilling program started.
Also in the Surat Basin, MetroCoal is also negotiating with both foreign and Australian parties in a bid to clinch joint venture partners for its promising thermal coal projects.
This follows the successful raising of $24 million from Chinese giant DADI Engineering Development Group last year through a share placement, which has now received final Chinese government approval, making it the company’s second largest shareholder.
“The process of seeking a joint venture partner in EPC1164 and EPC 1251 [Wandoan West area tenements] is continuing,” MetroCoal said.
“MetroCoal recognises that the process is taking longer than anticipated in 2011. However, the interest from a number of foreign and Australian parties remains positive.
“Visits to the Bundi project have taken place and negotiations will continue into 2012.”
