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Lithium and nickel exploration company Azure Minerals has launched a $120 million two-tranche institutional placement and a $10 million share purchase plan (SPP).

The underwritten $120 million two-tranche institutional placement is for the issue of 50 million new fully-paid ordinary shares at an offer price of $2.40 per new share.

Tranche 1 of the placement is expected to raise approximately $100 million and Tranche 2 is set to raise approximately $20 million, but it includes shares subject to shareholder approval.

Azure Minerals will also undertake a non-underwritten SPP at the same price as the placement to raise up to $10 million. The placement and the SPP is expected to raise total gross proceeds of up to $130 million.

The announcement of the placement and SPP follows news of multiple broad, high-grade intersections confirming the potential of the Andover project becoming a globally significant hard-rock lithium discovery.

The company said the placement is a key milestone in the exploration and development of the Andover lithium project that is located in the west Pilbara region of Western Australia.

“Azure is delighted to announce the underwritten institutional placement, which provides a strong capital base to accelerate exploration and resource drilling at Andover as we advance towards announcing a maiden lithium mineral resources targeted in the first quarter of 2024,” Azure Minerals managing director Tony Rovira said.

Rovira said the placement provides sufficient funding to progress various studies at Andover, which includes a scoping study that is expected be finalised in 2024.

“The placement provides a strong endorsement for Andover as one of the best lithium exploration projects globally, with abundant outcropping mineralised pegmatites and substantial widths of high-grade mineralisation intersected from limited drilling to date,” Rovira said.