Strike Resources has raised $5 million to secure long lead equipment for its Paulsens East iron ore mine, as the junior miner targets first production later this year.
The funding comes after the last quarter saw several approvals at Paulsens East granted by the relevant Western Australian departments, setting the project for a final investment decision (FID) by the September quarter of 2021.
With the funding in place, the company has ordered 13 ultra quad road trains for exclusive use on the Paulsens East project, as well as a range of other long lead items related to transport, communications and mineral processing.
Strike reported key infrastructure is also being developed ahead of the FID.
“Time-critical water bore development works and communication infrastructure are also being scheduled ahead of FID, construction plans are being finalised and the company is ramping up its hiring of key operational staff in anticipation of a positive FID,” the company stated.
The site is 10 kilometres east of Northern Star’s Paulsens gold mine, in the Pilbara region, which produced 55,000 ounces in 2017 before it was closed.
The capital raising exercise was heavily oversubscribed which, according to Strike, is a testament to its investors and the quality of its assets.
Late last year, Strike managing director William Johnson foreshadowed this interest as the project started getting off the ground.
“The interest that has been shown in the Paulsens East project by customers and traders has been extremely encouraging, confirming the underlying strength in the iron ore market and the recognition that Paulsens East has the potential to produce highly sought after, high-grade products,” Johnson said.
The $5 million in funding will also contribute largely to the Apurimac project in Peru, where Strike has planned to double sales of high-grade DSO, add 30 haul trucks to the fleet and target first ore shipments by July 2021.