London-listed Altona Rare Earths has reported that it has received partial mineralogy and geochemistry results of gallium samples from the Monte Muambe rare earths and gallium project, in Mozambique, from inspection, verification, testing and certification company SGS Johannesburg.

Altona says laboratory results on two fenite samples collected in June confirm previous gallium results obtained using the company's portable X-ray fluorescence (pXRF) analyser, with grades of 210 g/t and 269 g/t, respectively.

In addition, mineralogy results identified the presence of fluorspar in both gallium-containing samples, with 34% and 26.38% fluorite – equivalent to calcium fluoride (CaF₂) – respectively.

The company notes that the presence of fluorite had not been detected in the initial pXRF analyser assays because this device cannot analyse the chemical element fluorine.

Altona says it is also very encouraging that the fluorite content of these samples is significantly above the cutoff grade intended for the resource estimate to be prepared later this year – cutoff grades ranging from 15% to 20% CaF₂ will be tested.

The company says it will, therefore, consider these rocks as potential ore for the fluorspar project.

In addition, the samples contain over 45% of K-feldspar, a mineral that previous metallurgical testing has shown can easily be separated from fluorite, auguring enhanced recoveries for this type of ore.

Altona says mineralogical characterisation continues with the aim of confirming which mineral species contains gallium. Owing to the chemical properties of this element, gallium is unlikely to be hosted in fluorite.

During the flotation process, gallium concentration is, therefore, expected to increase in the tailings after fluorite is extracted.

Altona says this may potentially enhance the economic and technical feasibility of recovering gallium from the flotation tailings.

The company notes that these results also provide additional validation of the use of gallium for fluorspar exploration, which resulted in the discovery of new fluorspar outcrops announced on May 28 – assay results announced on July 7 – and further strengthens the company's confidence in increasing the fluorspar resource base through additional surface exploration and drilling planned this quarter.

"I am very excited to see that every fluorspar and gallium result coming back from the field and from the lab is serving to only strengthen further this project and its potential economics. I look forward to starting the resource drilling campaign during the course of this quarter and updating shareholders as this work progresses,” says Altona CEO Cédric Simonet.

FUNDRAISING

Meanwhile, Altona has raised £507 450, which comprises a fundraise of £407 450 and a further warrant exercise notice of £100 000 to fund the activities at Monte Muambe to advance the fluorspar scoping study, including resource drilling and advanced metallurgical work.

The funds will also support the Sesana copper/silver project, in Botswana, through environmental permitting, as well as initial geophysical surveys.

They will also be used to continue assessing the recent Gallium discovery and to secure a strategic partner for the development of the Monte Muambe rare earths project.

Altona says its board continues to seek additional, alternative funding sources, including proposed strategic investments at project level through equity, debt, grants or pre-payments in the context of offtake agreements.

In addition to the fundraise, the company says it has also received a notice of exercise from an existing warrant holder in respect of ten-million warrants over shares at a price of 1p per ordinary share.

The exercise of these warrants brings £100 000 in cash, in addition to the proceeds of the fundraise. Accordingly, the company says it will issue ten-million new ordinary shares to such existing warrant holders.

Altona notes that it will also issue 1.95-million new ordinary shares each in lieu of cash salary or fee payments for directors.

The number of salary-sacrifice shares to be issued was calculated by dividing the amount of monthly salary or fees to be paid in ordinary shares by the volume weighted average price of the ordinary shares during the last ten days of the calendar period that the services were provided, being an average of 1.62p per salary-sacrifice share. 

As part of cash conservation measures, the company explains that the directors have agreed to continue receiving part of their salary or fees in ordinary shares until further notice.

Of the total number of salary-sacrifice shares issued, 1.95-million were issued to persons discharging managerial responsibilities. The company has also issued 243 002 new ordinary shares to a service provider in lieu of fees of £5 000 at a price of 2.06p per service share.

"The completion of this fundraise is a significant milestone which will enable the company to continue delivering on its strategy towards early monetisation of its assets, and in particular advancing the Monte Muambe fluorspar project towards a fresh Joint Ore Reserves Committee mineral resource estimate, final metallurgical studies and a scoping study, and through commercial engagement with potential offtakers.

"I am delighted to see that this fundraise was achieved with strong price support from new and existing holders. This, and the exercise of warrants by one of our shareholders, shows investors' confidence in our strategy and assets,” says Simonet.