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Gulf Manganese Corporation Ltd (ASX:GMC) has successfully completed a share placement to institutional and sophisticated investors to raise $1.5 million.
The company plans to develop a ferromanganese smelting business in West Timor, Indonesia to produce and sell medium and low carbon ferromanganese alloy.
Gulf Manganese will leverage the potential low operational and ore costs, combined with modest power costs.
The company is targeting the production of premium quality 78% ferromanganese alloy resulting from the unique qualities of Indonesian high-grade, low-impurity manganese ore.
Manganese is a little-known element yet it is the fourth most used metal in terms of tonnage, ranked behind iron, aluminium and copper.
Importantly, the demand for manganese is projected to rise 40% in the next 10 years underpinned by China’s increasing urbanisation and continued industrialisation.
After steel, the second most important market for manganese, in dioxide form, is for portable dry cell batteries.
At full production, Gulf Manganese aims to purchase and process 320,000 tonnes of manganese ore per annum, producing circa 155,000 tonnes of premium quality ferromanganese alloy.