The Luxembourg-based green energy fund, Thematica Future Mobility, is the "cornerstone" backer of the raising that is pricing 22.2 million new shares at 67c each.

Specifics weren't disclosed.

Sovereign's Kasiya rutile project in Malawi features the largest deposit in the world, and a potential major source of "low carbon footprint critical minerals natural rutile and graphite".

Natural rutile is the purest, highest-grade natural form of titanium dioxide and is the preferred feedstock in manufacturing titanium pigment and producing titanium metal.

Titanium pigments are used in paints, coatings and plastics as well as specialty uses including in welding, aerospace and military applications.

Sovereign is undertaking scoping work on a development, with results due in "coming months".

Shares in Sovereign were down 8% to 65.5c in morning trade, capitalising the company at $289 million.

The stock was at similar levels 12 months ago but up from 40c earlier this year.