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  • Cauldron Energy To Bank $4M From Chinese Investor 0 comments
    Jul 3, 2014 11:53 PM

    Cauldron Energy (ASX:CXU) has received a further endorsement of its projects after raising $4 million through a placement to Chinese investor Starry World Investment Ltd.

    Notably, this adds to the $11 million in funding from other Chinese investors that it had closed last month. The new placement was struck at an issue price of A$0.118 per share.

    The issue price is consistent with that of the original placement agreements the company said.

    Cauldron will also issue Starry World with 16 million unlisted options.

    The additional placement will enable Cauldron to undertake extensive additional exploration activities within the wider Yanrey region in Western Australia beyond fast tracking the potential ISR project at Bennet Well.

    It will also allow the company to progress its Marree base metals project area in South Australia by funding geophysical work required to understand the potential of this project.

    This will in turn lead into drill programs for Mount Freeling, Ooloo and Ooloo south west as well as other anomalies.

    Cauldron also has the financial resources to progress its projects in Argentina.

    Placement in detail

    Under the agreement, the company will issue Starry World with 33,898,318 new shares priced at $0.118 each to raise $4 million.

    The funds will be paid in four equal instalments:

    - $1 million on 31 March 2015;
    - $1 million on 30 June 2015;
    - $1 million on 30 September 2015; and
    - $1 million on 31 December 2015.

    Cauldron will also issue Starry World with 16 million unlisted options exercisable at:

    - $0.118 per option if exercised on or before 31 December 2015; or
    - $0.138 per option if exercised on or before 31 December 2016.

    The placement and issue of options are subject to shareholder approval.

    As part of the deal, the company will appoint another Chinese director to its board.

    Yanrey Uranium Project

    Yanrey comprises 12 granted exploration licences (3,326km2) and six applications for exploration licences (386km2). Uaroo Joint Venture comprises 2 granted exploration licences (114km2).

    Yanrey is prospective for large sedimentary hosted uranium deposits.

    Recent work included:

    - ANSTO and CoreLabs test work has now been completed;
    - Metallurgical studies on Bennet Well diamond core show potential for a significant increase to the uranium oxide grades;
    - This is likely to lead to a significant increase in the combined resource of 15.7 million pounds of uranium oxide;

    Significantly, initial metallurgical testing showed that uranium extractions for the moderate ISL conditions (CAULD1 and CAULD2) were high at 97.3% and 96.4% for the two composites.

    Argentina assets

    In Argentina, Cauldron controls, through its wholly-owned subsidiary and an agreement with Caudillo Resources S.A. more than 3,400 km2 of ground in six project areas in four provinces.


    Cauldron Energy has been able to raise significant funds in a current challenging market environment, now having raised a total of $15 million with the addition of this $4 million placement.

    This speaks to the quality of the Yanrey uranium project and the belief in the company's ability to fast track the potential ISR project at Bennet Well.

    The sentiment for uranium is slowly turning around with growing demand expected to result in higher prices in 2015, further improving the outlook for Bennet Well.

    Proactive Investors Australia is the market leader in producing news, articles and research reports on ASX "Small and Mid-cap" stocks with distribution in Australia, UK, North America and Hong Kong / China.

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