AVZ Minerals has raised new funds to start early site works at the Manono Lithium and Tin Project (Manono Project) in the Democratic Republic of the Congo (DRC) while awaiting a mining licence.

The company completed an oversubscribed $53.49m (A$75m) share placement (before costs).

Around 85% of funds are coming from new global institutions and the remaining from existing sophisticated shareholders including Suzhou CATH Energy Technologies (CATH), which signed a transaction implementation agreement in September to provide $240m cash for the Manono Project.

The placement comprises 150 million new shares at an issue price of $0.50 per share to raise the money.

The early works programme will include the upgrade of roads and bridges, as well as advance with camp construction.

Apart from early site works, the proceeds will also be used for various technical studies and to negotiate final project financing requirements.

It will also provide capital for corporate requirements.

Additionally, the stronger balance sheet will enable AVZ Minerals to negotiate the extra 15% equity in Manono from the DRC Government.

AVZ managing director Nigel Ferguson said: “This capital raising marks an important milestone in our journey to develop the Manono Project which strengthens the financial position of the company and will assist to keep the project timeline within reach, despite the award of our mining licence taking longer than we had previously anticipated.

“We are in close consultation with the DRC Government authorities that are undertaking the mining licence assessment and are confident of delivering a favourable outcome for all stakeholders – most importantly the people of the DRC and our shareholders.

“Such a significant cash injection further de-risks the company during a time where increased market volatility is apparent and global economic uncertainty still remains.”

The Manono Project includes an area of around 188km² and an initial drilling campaign confirmed the potentiality of the project.