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Losses widen as Rainbow Rare Earths operations hum
High grade rare earth concentrate producer Rainbow Rare Earths announced its unaudited results for the six months ended 31 December on Wednesday, confirming that it had commenced production during the period, with the first shipment of rare earth concentrate completed on schedule in the fourth quarter.
The company said commissioning of the processing plant was "well advanced" at period end, and was now completed.
Ground gravity and airborne radiometric surveys had identified highly prospective anomalies, which were being drilled in the current quarter.
The successful completion of a share placing in December was also noted by the board raising net $3.5m to finance its first drilling campaign, as well as an expansion of the mine fleet.
Cash stood at $2.7m as at 31 December.
The company's loss for the six months ended 31 December widened to $1.1m, from $0.4m a year earlier, which the board said reflected an increase in pre-production administrative activity.
"Following Rainbow's IPO at the beginning of 2017, the six months to 31 December were a busy and highly productive period for Rainbow, during which we commenced production of rare earth concentrate from one of the highest grade projects globally on schedule and on budget," commented chief executive Martin Eales.
"During the period, the initial mine at Gasagwe developed from an area which had undergone manual pre-stripping work only, to an operational mine site.
"At the same time, the plant site at Kabezi went from being an area which had been cleared and levelled, to the site of an operating plant which had, by the end of 2017, completed the first two exportations of mineral concentrate."
Eales noted that rare earth prices had also strengthened over the period, buoyed by growing demand from green technologies such as hybrid and electric vehicles.
"As owners of Africa's only producing rare earth mine, and one of only a few outside China, the company is well placed to take advantage of the burgeoning rare earth market.
"Although the focus was on constructing the plant and commencing production during 2017, ground gravity and airborne radiometric surveys undertaken during the period identified some highly prospective, and large, anomalies within Rainbow's licence area."
Eales also highlighted that in December, the company successfully completed a share placing which raised net proceeds of $3.5m, in order to finance an exploration programme to investigate these exciting anomalies, as well as to accelerate production growth through expanding the mining fleet.