Orion Minerals has again turned to shareholders to inject liquidity into the business as it works to bring its copper development projects online.
Shares in the company plunged nearly 18% after it announced the placement of 333.33-million new shares to “sophisticated and professional investors” as well as to members of its board.
The new shares were issued at a price of 1.5c to unlock A$5m (R57m) in funding for the group’s Prieska Copper Zinc Mine (PCZM), the group’s flagship project and the first mine it plans to develop in SA, and Okiep Copper Project developments.
The soon-to-be-copper miner has executed a series of capital raises this year to provide working capital for its operations, which it hopes will allow it to start selling copper by next year.
Earlier this month, the group signed a non-binding term sheet with Glencore for up to $250m in financing and concentrate offtake, marking a major step in its transition from a pure exploration company to a developer and operating copper miner.
The funding provided by Tuesday’s rights issue will go towards general working capital to continue the development of Prieska and Okiep.
‘This capital raise is important as we progress with the Glencore due diligence process to reach a binding agreement on the offtake and financing for Prieska,” Orion CEO Anthony Lennox said.
“We appreciate the support of our major shareholders and the SA market. These recent developments at Orion pave the way for the company to transition from an exploration and studies company to a mine developer and ultimately a producer,” he said.
In late April, investors welcomed feasibility studies for the PCZM and Orion’s Flat Mines operation, the first mine to be developed at its Okiep Copper Project. By bringing PCZM and Okiep to first production, Orion expects to sell its first copper in late 2026 and aims to grow production to more than 50,000 tonnes a year by the end of the decade.
In previous decades, Okiep consistently produced 30,000-40,000 tonnes of copper a year under the ownership of Newmont and Gold Fields, while PCZM is expected to produce 213,055 tonnes over its lifespan.
The announcement of the rights issue comes a day after the company appointed Johan van Dyk as its project director “in support of the operational readiness activities currently under way”.
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