- South Harz Potash (SHP) has raised $5.3 million via a placement to sophisticated and institutional investors to advance its Ohmgebirge potash project in Germany
- The oversubscribed placement comprises the issue of around 43.8 million new fully paid ordinary shares at 12 cents per share
- Funding will enable the acceleration of an evaluation program at its flagship Ohmgebirge development, including feasibility study activities during Q2 2022
- Drilling is expected to commence in the coming weeks with a scoping study underway for completion by the end of Q1 2022
- South Harz Potash shares last traded at 14 cents on December 8
South Harz Potash (SHP) has raised $5.3 million via a placement to sophisticated and institutional investors to advance its Ohmgebirge potash project in Germany.
The oversubscribed placement will result in the issue of around 43.8 million new fully paid ordinary shares at 12 cents per share, representing an approximate 12 per cent discount to the 5-day volume-weighted average (VWAP) of 13.6 cents per share.
Around 2.1 million shares will be issued to South Harz directors, subject to shareholder approval, which will be decided at a shareholder general meeting to be called as soon as practicable.
South Harz said this positions the company in its strongest financial position to date, enabling the acceleration of the evaluation program at its flagship Ohmgebirge development in Germany.
Funding from the placement will see the completion of the two-hole drilling program, expected to commence in the coming weeks, allowing the company to upgrade a substantial proportion of the current Ohmgebirge JORC inferred mineral resource estimate to the Indicated category.
This will allow the release of a scoping study for the project, scheduled for completion by the first quarter of 2022.
The new funding will also allow South Harz the ability to rapidly transition into planned feasibility study workstreams on Ohmgebirge during Q2 2022, as well as, bolster working capital and recruit further specialists in Germany.
South Harz Potash managing director, Chris Gilchrist, says despite challenges, the company is hopeful.
“This is set against a background of a global potash market facing increasing supply constraints and geopolitical challenges, evidenced in the rapid and substantial increases in potash prices which the market expects to continue into 2022,” Dr Gilchrist said.
“We believe that South Harz provides premier exposure to a world-class potash development project, located in a Tier 1 operating jurisdiction, at the centre of a key global demand market.”
Placement shares are expected to be issued around December 20.
South Harz Potash shares last traded at 14 cents on December 8.