Marenica Energy Ltd
(ASX:MEY) has secured $5 million of funding to develop its uranium project in Namibia.
The minerals explorer says it will now progress with the next phase of pre-feasibility work, having inked a deal with China's Sichuan Hanlong Group.
The debt and equity funding arrangement will involve Hanlong providing immediate funding of $3 million through a $2 million convertible note and a $1 million share placement at seven cents per share.
In addition, Hanlong will underwrite a $2 million rights issue at seven cents per share to existing shareholders, lifting the total funds raised to $5 million.
Marenica says Hanlong is committed to supporting Marenica to become a successful uranium miner, with both companies having executed a memorandum of understanding that involves further funding support, development financing, uranium offtake and support for strategic acquisitions until the end of next year.
Marenica Energy recorded a net loss of $9.7 million in the year to 30 June 2010.
