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. Last Updated: 07/27/2016

Mining Firm Amur Aims to Raise $10M in London IPO

Mining company Amur Minerals plans to raise $10 million in a London flotation next week to finance a nickel and copper project in the Far East's Amur region.

Amur Minerals, which was started by a group of mostly British investors in 2004, plans to issue 14 million ordinary shares on the Alternative Investment Market, a London Stock Exchange platform, in early March, CFO David Wood said in a recent telephone interview.

The listing puts a value of roughly $55 million on the company, Wood said. The price of shares was set in a range of between 0.33 pence (58 cents) and 0.35 pence last Thursday, with the first day of trading set for March 7.

The listing gives the company financing for the exploration of a 950-square-kilometer greenfield site in Amur, only 5 percent of which has been explored to date. The company also plans to bid for additional mining licenses in the Far East and Kazakhstan and pursue acquisitions, he said.

The company, which is registered in the British Virgin Islands, estimates its Amur site could hold nickel and related metal resources equivalent to one-quarter of Norilsk Nickel's annual production, Wood said.

Norilsk produced 243,000 tons of nickel last year, according to its web site.

Amur plans to upgrade its exploration license for the site to a production license in 2007, Woods said.

Looking further ahead, Amur will also bid for new mining licenses in the Far East and selectively pursue acquisitions, Wood said.

Timothy McCutcheon, a metals analyst at Aton brokerage, said companies like Amur Minerals play a valuable role in feeding new projects to major mining companies such as Norilsk Nickel or the U.S.-based Phelps Dodge.

"All of these companies are more of a punt, an idea of getting something big. ... No one is interested in what they are now, but in what they could find," McCutcheon said.

He said Amur would most likely team up with a strategic partner to develop the field.