Raisebook

Potential for Large Scale Graphite Deposits in Madagascar
Blackearth Minerals
Blackearth Minerals
ASX:BEM

Graphite explorer BlackEarth Minerals NL is currently undergoing an Initial Public Offer as part of an ASX listing.

Raisebook is offering both sophisticated and retail investors the opportunity to bid for shares in this IPO.

The issuer of the securities is BlackEarth Minerals NL ACN 610 168 191. The securities to be issued are ordinary shares.

Raise Amount
$4,500,000
Offer Price
$0.2000
Closes
Dec 14, 2017

The disclosure document for the offer can be obtained by clicking on the "Download the Prospectus" button on this page.

The offers of the securities are made in, or accompanied by, a copy of the disclosure document.

Investors should consider the disclosure document in deciding whether to acquire the securities.

Anyone who wants to acquire the securities will need to complete an electronic application form which will be sent via email after downloading the prospectus.

BlackEarth’s current projects lie in two distinct geographic regions, being Madagascar and Western Australia (WA).

BlackEarth’s Madagascan projects, the Maniry and Ianapera Projects, are both highly prospective for high-quality graphite deposits.

The Maniry Project specifically is currently at an advanced evaluation stage, pending additional work to establish an initial resource base.

During the first 12 months of listed activity, BlackEarth has plans to release a maiden resource, undertake early stage metallurgy and complete a scoping study on this Project.

Madagascar itself has over 100 years of mining history in graphite and is recognised as a low-cost, high-quality product worldwide.

This should assist in offtake discussions, which BlackEarth anticipates will commence immediately in Europe, the USA and Asia.

In addition to the exciting portfolio of graphite assets, BlackEarth has assembled a Board and management team who collectively are experienced with the necessary technical, operational, legal and corporate expertise in mineral exploration, finance, project acquisition, development and operations, including in listed public companies.

The Company’s WA assets are greenfield projects, and as such have seen little in the way of graphite-focused exploration to date.

After the Listing Date, the Company will undertake a methodical exploration approach to prioritising these projects, with a view to adding value for Shareholders in an expeditious manner.

This offer is for up to 30 million shares at an issue price of $0.20 each, together with one (1) free attaching Partly Paid Share (paid to up to $0.001, unpaid to $0.2499) for every two (2) shares subscribed for, to raise up to $6 million.

The Offer is subject to a minimum subscription requirement of 22.5 million shares at an issue price of $0.20 each to raise $4.5 million.

Madagascan Graphite Projects

BlackEarth’s initial focus will be on advanced exploration for graphite on the Ampanihy Project in Madagascar, which consists of two sub- projects; namely:

  1. Maniry, and;
  2. Ianapera,

which it will acquire upon and subject to completion of the Madagascan Acquisition Agreement by acquiring 100% control of Madagascar Graphite (a Mauritian company) and its 100% owned subsidiary Mada-Aust (a Madagascan company), which is the holder of the Madagascan Projects.

Completion is conditional upon the satisfaction of a number of conditions precedent, including the Company’s admission to the Official ASX List.

The mineralisation at Maniry and Ianapera Projects in most cases is outcropping, enabling relatively shallow drilling and trenching to quickly delineate resources.

Furthermore, the Ianapera Project in southern Madagascar is considered as having the potential to host a series of large-scale graphite deposits.

Both the Maniry and Ianapera Projects, which comprise the overall Ampanihy Project, have been the focus of quality exploration that will facilitate a quick transition to resource evaluation.

Maniry Project

Graphite prospectivity of the region has been established by the nearby discovery of the large, high-quality Molo Project owned by Canadian listed company NextSource Materials Inc. (previously Energizer Resources Inc.).

Previous work undertaken on the Maniry Project and announced by Capricorn on 12 February 2015 on the ASX platform identified at least 34 large-scale zones of prominently outcropping graphite mineralisation over an area of 6.5 by 2.5 kilometres.

The individual lenses within the area have strike extensions of up to 1.8 kilometres and can attain widths of up to 350 metres. Grades of 7-20% C (up to 50%) have been reported.

The Directors believe that the Maniry Project has the early potential to develop significant zones of near surface, large flake size, high-grade graphite into a standalone, quality mining asset.

During the first 12 months of listed activity, BlackEarth has plans to release a maiden resource, undertake early stage metallurgy and complete a scoping study on this Project.

Ianapera Project

Located just 5 kilometres north of NextSource Materials Inc.’s Molo Project is the Company’s Ianapera Project, which recently announced the results of its updated feasibility study.

Capricorn previously announced a series of high-grade outcrops of graphite mineralisation that potentially sit above a larger concealed system approximately 800 metres long and 30 metres wide.

Although less exploration has been undertaken in the area than at Maniry, a series of high-grade outcrops of graphite mineralisation lie over the top of a large conductive body as defined by the airborne electromagnetic data.

The Company will undertake systematic exploration over the anomaly with a view to identifying a clear strategic path forward for the project over the next 12 months.

Western Australian Graphite Projects

BlackEarth has plans to explore four project locations in the Gascoyne, Murchison and southwest regions of WA that have a total area of over 560 square kilometres.

All are greenfield projects and, as such, have seen little graphite focused exploration.

The WA project areas have been selected on the basis that they either overlie neglected historically reported graphite occurrences or contain other specific geological or geophysical characteristics that signify prospectivity for the discovery of graphite mineralisation.

The Company, through its wholly owned subsidiary BlackEarth Australia Pty Ltd, will also commence early exploration for graphite on its projects in Western Australia; these projects are:

  1. Donnelly River;
  2. Greenhills;
  3. Northern Gully, and;
  4. Yalbra.

Donnelly River

Previous exploration described the Donnelly River material as being mostly composed of very finely divided graphite, with only a small proportion of flake material, of which the best flake (5.4%) assayed at 99.6% TGC. In those early years, there were limited suitable applications for Donnelly River graphite. However, later testing of graphite from this deposit showed that the material ranges from extremely fine-grained to medium-grained flake graphite.

Historical exploration activity in the area has targeted base metals, gold, tin-tantalum and lithium, with no primary targeting of graphite.

Given the extent of favourable host lithologies, there would appear to be potential to discover new deposits of commercial-grade graphite.

Greenhills

There are three recorded graphite occurrences, Balkuling, Doodenanning and Greenhills, within the project area. A single sample taken from Balkuling in 1951 was reported to contain 5% graphite flakes less than 0.2 mm in diameter and returned 10% TGC.

During the same year, the Doodenanning occurrence was inspected and the two graphite samples taken returned assays of 5.6% and 18.7% TGC. Both samples contained flake graphite of various sizes.

The Greenhills graphite zone was defined by previous exploration activity and is interpreted to be a 20-kilometre, east-northeast trending zone from Greenhills railway siding towards Doodenanning.

No systematic exploration has been conducted for graphite across the project area to date.

Northern Gully

Two graphite samples taken from the Lady Sampson pegmatite in 1951 returned 16.5% and 19.4% graphitic carbon. Observations by others indicate that the greatest concentration of graphite is exposed best at the mine and is contained as graphite-silica matts in lling strain zones within the pegmatites, gneiss and migmatites.

Yalbra

Buxton Resources Ltd’s Yalbra graphite occurrence lies 6.3 kilometres to the east of Exploration Licence E09/2172 and consists of six graphite prospects over a strike length of 4 kilometres.

The graphite is contained as multiple bands in a schist that strikes generally east-west and dips steeply to the north and south.

First investigated in the early 1970s by Carpentaria Exploration Company Pty Ltd, Buxton Resources Ltd defined an Inferred JORC (2012) Code Mineral Resource of 4 Mt @ 16.2% TGC over a strike length of 600 metres.

Further exploration (VTEM) has defined strong graphite conductors with a strike length of over 6 kilometres. Most of the mineralisation remains open at depth and along strike and ranges from amorphous to medium-coarse flakes greater than 1 millimetre in length. Typical coarse-flake graphite is greater than 150 microns in length.

BlackEarth's Objectives

The Company is focused on defining a maiden resource and commencing a scoping study on the Maniry Project within the first 12 months after the Listing Date.

It will systematically explore the Ianapera Project and at its WA Projects will commence early exploration aimed at the discovery of graphite mineralisation.

The Company will consider acquiring additional interests by way of direct project acquisition, farm in, joint venture or direct equity in the project owners, and may include minerals, or prospectivity for minerals, other than graphite.

Over the medium to long term the Company’s objective is to develop mining operations on its Projects.

Continuing work programmes and Projects will be subject to initial results and funds may be diverted to other prospective, existing or additional projects if the Board considers this to be warranted.

Over the medium to long term the Company also intends to continue to identify, evaluate and, if warranted, acquire additional resource projects and assets in Australia and/or overseas if the Board considers they have the potential to add Shareholder value.

On completion of the Offer, the Board believes the Company will have sufficient working capital to achieve these objectives.

Investing in the securities offered by this prospectus should be considered as highly speculative in nature, we recommend potential investors to read this Prospectus in its entirety, paying particular attention to key risks.

Investors should be aware of the speculative nature of mineral exploration and mining with the inherent risks it carries through events and circumstances which cannot all be foreseen or mitigated.

Please seek professional advice if necessary prior to making your informed decision to invest.

Pro Forma Capital Structure

Minimum ($4.5M) Maximim ($6M)
Offer price per Share $0.20 $0.20
Shares offered for subscription 22,500,000 30,000,000
Free attaching Partly Paid Shared offered for subscription 11,250,000 15,000,000

General

Minimum ($4.5M) Maximim ($6M)
Total Shares on Issue as at the date of Propspectus¹ 31,500,000 31,500,000
Total Shares to be Issued to vendor under Madagascan Acquisition Agreement 2,000,000 2,000,000
Total Shares on Issue after completion of the Offer 56,000,000 63,500,000
Total Partly Paid Shared on Issue after completion of the Offer 25,750,000 29,500,000
Total Options on Issue as at the date of Propspectus² 2,750,000 2,750,000

Notes:

  1. Includes 1 million shares issued to Lithium Australia NL, the vendor under the WA Acquisition Agreement

  2. An aggregate of 2.75 million options have been issued to the Chairman, Managing Director and Company Secretary. Refer to Section 16.1 9 (c) of the Prospectus for the terms and conditions of these Options.

Please also refer to Section 6.10 of the Prospectus for further details relating to the current and proposed capital structure of the Company.

Indicative Timetable*

Offer Closing Date 14 December 2017
Issue date of securities under the offer 18 December 2017
Despatch of holding statements 19 December 2017
Expected date for quotation on the ASX 22 December 2017

* The above dates are indicative only and may change without notice subject to the Corporations Act, ASX Listing Rules and other applicable laws.

This deal closed on December 14, 2017