Clara Resources Advances Ashford Drilling Plans Amid Capital Raise Efforts

Ashford Coking Coal Project Drilling Preparations

Clara Resources Limited (ASX: C7A) is advancing its Ashford Coking Coal Project with detailed preparations for a Resource and Quality Drilling Program on exploration licence EL6234. The program, scheduled to commence in the second quarter of 2025, will include four cored holes and nine chip holes. This drilling campaign aims to upgrade the existing JORC resource classification to Measured and Indicated categories, verify coal seam depth and structure, and enhance coal quality data, particularly coking properties and washability.

These efforts are critical inputs for Clara’s upcoming pre-feasibility study, which will refine mining plans, coal preparation processes, and cost models. The company has completed ecological assessments, cultural heritage surveys, and secured necessary government permits, signaling readiness to proceed.

Capital Management and Funding Initiatives

To support project development and repay bridging loans, Clara has been actively managing its capital structure. A non-renounceable rights issue announced in September 2024 aimed to raise approximately A$1.66 million at $0.01 per share but received only $198,000 in valid applications, leaving a significant shortfall. Cerberus Advisory partially underwrote the shortfall, with sub-underwriting agreements involving key directors.

In December 2024, Clara launched an accelerated non-renounceable pro-rata entitlement offer (ANREO) to raise up to A$1.7 million at $0.006 per share, alongside a placement to institutional investors raising approximately A$420,000. The institutional component included a shortfall bookbuild, resulting in the issuance of around 150 million new shares. Post-quarter, an additional $200,000 placement was completed, while the retail component of the entitlement offer remains open, with Clara seeking binding commitments to cover any shortfall.

Governance and Boardroom Developments

The quarter saw significant board changes, including the appointment of Richard Willson as Independent Non-Executive Chairman and Peter Westerhuis, the CEO, joining the board as Managing Director. Alexander Fitzgerald was also appointed as a Non-Executive Director after completing regulatory registrations. These changes follow shareholder unrest, with notices received from substantial shareholders seeking to remove existing directors Brian Moller and Nicholas Mather and appoint new directors, including Frederick Bart and Glenn Whiddon. These resolutions were not approved at the November AGM, but further meeting notices were filed post-quarter by Tawny Tussock Trust, a related party of Mr. Fitzgerald, indicating ongoing governance tensions.

Kildanga Nickel/Cobalt Project Progress

Clara continues to compile and reconcile historical geological data across its Kildanga Nickel/Cobalt tenements in Queensland. This work involves building comprehensive borehole and geochemical databases, conducting geophysical reviews, and developing a new geological model. The company is evaluating exploration options, including potential divestment, as it seeks to define a mineralized resource suitable for economic development.

Financial Position and Outlook

Clara reported exploration and evaluation expenditure of $36,000 during the quarter, primarily for landholder engagement and cultural clearances. The company ended the quarter with $300,000 in cash and equivalents and financing facilities totaling $417,000, all drawn. Despite a current funding runway estimated at 1.4 quarters, Clara expects to continue operations supported by the ongoing entitlement offer and placement proceeds. The company has repaid its bridging loan in cash or equity conversion, with loan variations being negotiated with directors to extend terms favorably.

Overall, Clara Resources is positioning itself for the next phase of project development with a focus on upgrading resource confidence at Ashford, securing necessary capital, and stabilizing governance amid shareholder activism.