PHOSPHATE MINING PROJECT
Kropz targets fund raising on London’s AIM
Kropz, an emerging plant nutrient producer, plans to raise $50m on the London Stock Exchange’s AIM platform aimed at small companies. The money will be used to complete an advanced-stage phosphate mining project in SA.
CEO Ian Harebottle said its flagship Elandsfontein project in the Western Cape would be one of a few new mines to come onstream in SA in several years and was a vote of confidence in the industry’s future.
However, he said the privately held company had opted to first raise funds abroad where it could access a broader pool of investors and avoid the perils of rand volatility.
The Elandsfontein project, in which the company has already invested $120m to date, has been suspended since July 2017 following a bid by environmentalists to have its water-use licence revoked.
Kropz opted to list on the AIM over a South African equivalent, such as the JSE’s AltX, because it provided broader access to funds and enabled the company to talk to people through a global platform, Harebottle said. To raise capital in SA, it would have the drawback of being rand based and so would have been more susceptible to currency volatility, he said.
Upon listing, the funds raised on the AIM would also be used to reduce the firm’s current debt position and develop a wider African asset base, Kropz said.
Harebottle said the phosphate operation was on track to come online in the second half of 2019. This is despite a court challenge brought by the West Coast Environmental Protection Association, which argued the Elandsfontein operation would cause irreparable damage to the ecologically sensitive Langebaan Lagoon. The court referred the matter to the Department of Water Affairs’ water tribunal.
Harebottle said he was confident approvals would come through on the basis of scientific work, which sampled more than 100 holes on a monthly basis. The plant will produce in excess of 800,000 tonnes of phosphate rock concentrate, with an initial 14-year mine life.
Kropz, which also has exploration assets in West Africa, plans to develop into an integrated, mine-to-market plant nutrient company.