New rare earth miner lists in London, raises $10 million for Burundi project
Rainbow Rare Earths (LON:RBW) had a spectacular debut on the London Stock Exchange Monday as the newcomer raised 8 million pounds ($10 million) to dust off and restart the Gakara mine in Burundi.
The company, which only project is the former mine in the landlocked east African country, expects to begin sales to Germany's thyssenkrupp before the end of the year, it said in the statement.
Rainbow Rare Earths expects to begin sales to Germany's thyssenkrupp before the end of the year.
This as the project has a 10-year distribution and offtake agreement with a division of thyssenkrupp to take 100% of production up to 5,000 tonnes and the option to take anything above that.
Gakara, which operated for 30 years until 1978, holds some high-grade rare earth elements, including lanthanum, cerium and neodymium, which are expected to become essential for the manufacturing of batteries, magnets and electric vehicles.
It is also a very cheap project — with only $2.23 million of required capital expenditure and low production costs.
“Beyond the extremely high-grade ore and low-capital expenditure associated with the initial development of the project, the company also benefits from strong support for the development of Gakara, both from the Burundi government and the local community,” CEO Martin Eales said in the statement.
"Our project boasts an in-situ grade in the range of 47-67 percent TREO (total rare earth oxide), making it one of the highest-grade rare earth element (REE) projects globally," he added.
During an initial two-year trial phase the project is expected to generate around 3,900 tonnes of concentrate before ramping up to 5,000 tonnes per year. First production from the mine is expected in the fourth quarter of the year.
Rainbow's shares were placed at 10 pence per share. They opened at 10.75 pence, hit a session high of 12.84 pence and closed at 11.62p.