Bathurst Resources [NZX: BRL], which raised A$7.39 million in a discounted placement to institutional investors last month, is seeking up to $2.67 million in a rights issue, to help fund the development of its Escarpment open-cut coal mine on the Denniston Plateau near Westport.
The Wellington-based mining company intends to make a 1-for-23 pro rata non-renounceable entitlement offer at 6.5 cents per share, and plans to lodge the offer document tomorrow, it said in a statement. The shares were unchanged at 6.5 cents today.
"BRL intends to use the proceeds from this offer, along with the raising form the recent placement, primarily to fund the development of the Escarpment project, and to assess other sites on the West Coast of New Zealand for their potential for the production of coking coal," it said.
In February, the company said it would cut 29 jobs in response to the lowest world prices for coking coal in the past nine years. Bathurst won resource consents for Escarpment near Westport last October, more than two years after initial consents were appealed by environmental groups. In the meantime, prices slumped to the extent that there would be no margin in extracting coal from the new mine.