The Western Australia-based company has just raised A$12 million, with $7 million via a placement and underwritten share purchase plan, its first raising since its late 2020 initial public offering that raised $22 million at 20c, backed with a new $5 million working capital loan facility being provided by its fifth-largest shareholder Gordon Martin.

 

WAK, which is developing a kaolin mine and processing plant at Wickepin, 220km south-east of Perth, commenced construction a year ago and anticipates first production next quarter.

 

Stage one was expected to run for about three years, but the operator of WA's only operating kaolin mine now says it wants to commission stage two before the end of 2023.

 

Stage one, which remains on time and on budget despite logistical challenges, is expected to commence plant commissioning from the end of March and will then commence a ramp-up to 200,000 tonnes per annum over the second half of the year.

 

The company says its proof of concept plant at Kwinana has continued to operate successfully during the development, and it has successfully been able to seed interest in new markets, which CEO Andrew Sorensen said had resulted in "unprecedented demand" in the project's product.

 

Consequently, WAK has brought forward $4 million of stage two's capital budget to take advantage of cost savings and to shorten lead-times, which required the working capital facility.

 

The placement and SPP will be used to help bring forward the stage two budget, and are priced at 18c, a 10-13% discount to recent trading. 

 

Sorensen said that while stage two was budgeted at $13.6 million in its definitive feasibility study, and would have been funded from cashflow, it was now expected to cost $16 million due to inflation. 

 

Around $12 million is left to spend to double production to 400,000tpa. 

 

WAK shares, which have traded at 16-26c over the past year, were up 2.5% today to 20.5c.