Rare earths developer Aclara Resources (TSX: ARA) is raising $25 million from a private placement of shares to fund the Carina project in Brazil, for which it plans to apply for a preliminary licence and complete a pre-feasibility study next year.
The shares will be priced at C$0.70 each, representing a 41% premium over Aclara’s closing price on the TSX last Friday. In total, Aclara will issue approximately 51.3 million shares to three subscribing parties: CAP SA, Hochschild Mining Holdings and New Hartsdale Capital. The latter two are current shareholders of the company.
Upon completion, CAP, Hochschild and New Hartsdale will each own 10.18%, 19.65 and 36.9% of Aclara’s share capital.
Aclara Resources’ stock rose 7.1% to C$0.53 apiece as of 11:50 a.m. ET, for a market capitalization of C$87.3 million. It traded between C$0.36 and C$0.65 over the past 52 weeks.
In welcoming CAP as a new shareholder, Aclara’s chairman Eduardo Hochschild said the Chilean conglomerate will bring “deep industry expertise” and is “an invaluable partner in our mission to establish a sustainable and integrated supply chain for rare earths.”
Ramon Barua, CEO of Aclara, added that the financing is “an important step” in Aclara’s clear strategy to become a reliable and sustainable producer of all magnetic rare earths, highlighting CAP’s investments in the company’s Penco module project in Chile.
In April, CAP, which operates iron ore mines in the South American country, announced that it plans to invest $80 million into the Penco project in exchange for a 20% equity participation. At the time, Aclara said it will draw on CAP’s experience in environmental permitting to strengthen its own environmental impact assessment (EIA) process.
In September, Aclara made progress in its permitting for Penco, located in the Bio-Bio region of Chile, and is now working with various agencies through the environmental assessment. The project hosts an ionic clay deposit containing about 63,000 tonnes of total rare earth oxides (TREO) in the measured and indicated category (27.5 million tonnes grading 2,292 ppm TREO).
In 2025, the company will also look to make advancements at the Carina module in Brazil’s Goiás state, which will use up almost the entire $25 million in proceeds from the placement. In the second quarter, it expects to submit an environmental impact study, as well as build a semi-industrial scale continuous pilot operation and complete a drilling program.
The resource upgrade from drilling will be incorporated in a pre-feasibility study, scheduled for the third quarter. The project currently has only inferred resources of about 298 million tonnes grading 1,452 ppm TREO, for 432,000 tonnes of TREO.
Aclara also intends to allocate a smaller portion of the net proceeds, along with potential government funding, to advance its separation project in the US. Targeted milestones include completion of the plant location study, laboratory test work and integrated pilot scale testing.
