Rufus Short CEO of Edenville Energy LON:EDL commented: “I am pleased to announce a successful £2m fundraising (before expenses) and welcome our new shareholders at this exciting stage in the Company’s development. The Subscription proceeds will establish a step change in the development of our activities in Tanzania, allowing the Company to become a coal producer. The funds raised will complete the purchase of the wash plant and crusher, as well as the ancillary work required for mobilisation. In addition, the Subscription will enable Edenville to acquire mining equipment which will enable Edenville to commence full coal mining operations. We believe our Rukwa coal project has the potential to contribute significantly to the available coal supply in Tanzania and neighbouring countries and we look forward to providing our shareholders with further updates as appropriate.”
Edenville Energy plc (LON:EDL), the Company developing a coal-to-power project in south west Tanzania has told DirectorsTalk about a subscription, that was oversubscribed, to raise £2.0 million (before expenses) through the issue of 250,000,000 new ordinary shares of 0.02 pence each in the capital of the Company at 0.8 pence per New Ordinary Share to new and existing shareholders, together with 125,000,000 warrants issued to the subscribers on the basis of one warrant for every two New Ordinary Shares, exercisable at 1.08 pence per warrant at any time over the next 18 months.
The net proceeds from the Subscription will be used predominantly for the advancement of mining development and to facilitate the Company’s progress into full coal mining operations as soon as possible. More specifically the proceeds of the Subscription will be used to facilitate the following:
• Complete the purchase of a wash plant and crusher and facilitate the transportation and installation of these items on site in Tanzania;
• Acquire mining equipment for an initial planned production of up to 10,000 tonnes of coal per month;
• Complete land compensation requirements as required;
• Build supporting infrastructure, including weighbridge facilities and implementing systems for coal delivery to customers; and
• Provide working capital for the Company as it moves towards full production.
The above will allow the Company’s coal mining operations at Rukwa to complete the transition from development into full production, thus generating cash flow from the sale of processed coal, which the Directors anticipate will be sufficient to cover the Company’s day to day costs in normal circumstances.
The development of the coal mine will continue alongside the development of the Company’s planned coal to power project (the “Power Project”). As announced on 23 January 2017, the Company has established a strategic partnership with Sinohydro Corporation of China (“Sinohydro”) in relation to the Power Project. Pursuant to this strategic partnership, Sinohydro will complete a Bankable Feasibility Study for the proposed Rukwa Power Plant which the Company intends to use in relation to the future development of the Power Project.
As the Company currently only has authorities to issue a limited number of New Ordinary Shares the Subscription will take place in two tranches, details of which are further described below.
