Hancock Prospecting invests in Araxá rare earths project

St George Mining (ASX: SGQ) has secured $72.5m in funding for its rare earths-niobium Araxá project in Brazil. 

The placement involved the issue of 725 million new ordinary shares and attracted major interest from prominent investors, including Gina Rinehart’s Hancock Prospecting. Hancock acquired 225 million shares — representing about 31% of the placement value. 

St George initially targeted a smaller placement, but upsized due to overwhelming interest from investors in Europe, the US and Australia. 

The Araxá project’s mineral resource estimate (MRE) includes six of the top 10 minerals on the US Department of Interior’s critical minerals list including samarium, lutetium, terbium, dysprosium, gadolinium and niobium. 

The project hosts 6mt at 4.13% total rare earth oxides (TREO) and 41.2mt at .68% niobium, grades which are considerable as average grades worldwide typically range between 1-8% TREO. 

St Georges Mining executive chairman John Prineas says the interest highlights the enormous potential of the project. 

“We are also very pleased that Hancock Prospecting has chosen to increase its existing shareholding in St George and emerge as a substantial shareholder,” he said. 

“Hancock Prospecting is a company with significant experience in recognising the value in strategic commodities and backing successful critical minerals companies including MP Materials and Lynas (ASX: LYC) Corporation — as well as having significant project execution and delivery experience for St George to leverage off in the future. 

“The new funding will bolster St George’s program of advancing the Araxá project through feasibility study work and towards a financial investment decision.” 

The funding will support an upgraded MRE, with a major drilling program already underway, as well as project permitting, metallurgical test work including pilot plant development and feasibility study work.