St Barbara (ASX:SBM) has announced a capital raising initiative to accelerate its Simberi Sulphide Expansion Project in Papua New Guinea. The company plans to raise A$110 million through a two-tranche placement and a share purchase plan. This initiative aims to advance the production timeline, with initial output expected in early Q1 of FY28.
St Barbara is set to enhance its production capabilities at the Simberi Operations by transitioning to sulphide production, leveraging a 2.8 Moz ore reserve. The capital raised will fund key infrastructure upgrades, including a new ball mill circuit, wharf, and ROM pad, aimed at boosting operational capacity. The company, with a strong balance sheet and no debt, anticipates producing over 200,000 ounces per annum starting in FY28. This strategic move is expected to increase shareholder value by optimizing current operations and supporting long-term growth. St Barbara's commitment to this project is underscored by its experienced leadership team and solid financial position.
The capital raising initiative is crucial for St Barbara as it allows us to expedite the development of the Simberi Sulphide Expansion Project. By bringing forward sulphide production, we are positioning ourselves to transition from processing remnant oxides to producing over 200,000 ounces of low-cost sulphides annually from Q1 September FY28.