Regulatory Delays and Aleees Deal Exit Pose Risks to Avenira’s Growth Path
Avenira Limited is advancing its Wonarah Phosphate Project with site mobilisation planned for mid-2025, backed by a $7.567 million capital injection from major shareholder Sichuan Hebang Technology. Operational milestones and regulatory approvals are progressing, positioning the company for first ore shipment in Q4.
- Site mobilisation for Wonarah DSO Project expected May/June 2025
- Mining operations scheduled to commence in Q3 2025 with first shipment in Q4
- Secured $7.567 million placement and unsecured loan from Sichuan Hebang, increasing stake to 49%
- Revised Mining Management Plan nearing final approval by Northern Territory regulators
- Aeromagnetic survey completed at Jundee South Gold Project; geological review ongoing
Strategic Progress at Wonarah Phosphate Project
Avenira Limited (ASX: AEV) has laid out a clear development pathway for its flagship Wonarah Phosphate Project in the Northern Territory, targeting near-term production and cashflow. The company plans to mobilise to site between May and June 2025, with mining operations set to begin in the third quarter and the first direct shipping ore (DSO) shipment anticipated in the fourth quarter. This timeline underscores Avenira’s commitment to transitioning from exploration to production within the year.
Wonarah stands out as one of Australia’s largest undeveloped phosphate deposits, strategically located near key infrastructure such as the Barkly Highway, the Tennant Creek – Mount Isa gas pipeline, and the Darwin-Adelaide rail line. These logistical advantages are critical for efficient ore transport and cost management, enhancing the project’s commercial viability.
Regulatory and Operational Readiness Advancements
The company has made significant headway with regulatory approvals. The revised Mining Management Plan (MMP) submitted to the Northern Territory Department of Lands, Planning and Environment has undergone minor amendments and is currently in the final stages of review. Recommendations to the Minister for Mines are expected imminently, paving the way for formal authorisation.
Operational leadership has been strengthened with the re-engagement of Sean Buxton, a seasoned mining executive with prior involvement in the Wonarah project and experience in mine startups such as Core Lithium. Buxton’s appointment is a strategic move to accelerate operational readiness and ensure a smooth transition into production.
Preparations for mining include final mine design optimisation, logistics route assessments, camp refurbishment planning, and procurement of mobile equipment. These activities reflect a comprehensive approach to project execution, addressing both technical and logistical challenges ahead of mining commencement.
Capital Injection from Major Shareholder Sichuan Hebang
Avenira secured a substantial capital boost from its largest shareholder, Sichuan Hebang Biotechnology Limited, through a $7.567 million placement at $0.007 per share and an unsecured loan facility of the same amount. This funding package not only supports the DSO project development but also strengthens the company’s working capital position. Post-placement, Sichuan Hebang’s ownership stake will rise to 49%, signaling strong shareholder confidence and alignment with Avenira’s growth strategy.
The unsecured loan carries a 12% annual interest rate, capitalised and payable at maturity within 12 months, with an initial drawdown of $2 million already completed. This financial arrangement provides Avenira with flexible capital to meet upcoming operational and development expenditures.
Exploration and Corporate Updates
On the exploration front, Avenira completed a regional aeromagnetic survey over its Jundee South Gold Project in Western Australia, covering more than 29,000 linear kilometres. The survey employed advanced geophysical techniques to refine geological understanding and identify new target areas. Interpretation and verification of the data are underway, with further insights expected to be released soon.
In a strategic pivot, Avenira and Aleees mutually agreed to terminate their License and Technology Transfer Agreement and Subscription Agreement without further payments. This termination releases both parties from any claims or liabilities related to the agreements, and the performance rights held by Aleees have lapsed. The impact of this termination on Avenira’s technology strategy remains to be seen but suggests a refocus on core project priorities.
Financial Position and Outlook
At quarter-end, Avenira held $2.1 million in cash and had access to $7.567 million in financing facilities. Exploration expenditure for the quarter was approximately $0.5 million, with no mining production costs incurred yet. Payments to related parties, primarily directors’ salaries and fees, amounted to $136,000.
The company’s financial and operational updates indicate a well-structured approach to advancing the Wonarah project towards production, supported by strong shareholder backing and regulatory progress. However, the timing of final approvals and execution risks inherent in mining startups remain factors to monitor closely.
Bottom Line?
Avenira’s near-term production ambitions hinge on imminent regulatory approvals and operational execution, with major shareholder backing providing a crucial financial runway.
Questions in the middle?
- When will the Northern Territory Minister for Mines formally approve the revised Mining Management Plan?
- How will the termination of the Aleees agreement affect Avenira’s technology and development strategy?
- What geological targets and potential resource upgrades might emerge from the ongoing Jundee South survey review?
