St George Mining Upscales Araxá Drilling with $5M Placement at Premium
St George Mining has raised A$5 million through a premium-priced placement to upscale its diamond drilling program at the Araxá Project, aiming to expand its globally significant rare earths and niobium resource.
- A$5 million raised at 13.1% premium to 30-day VWAP
- Diamond drilling program expanded to three rigs with 9,000m planned
- Araxá Project hosts 40.6Mt @ 4.13% TREO rare earths resource
- Exploring US downstream partnerships amid growing rare earths demand
- Strong investor interest from Europe and government support in Brazil
Strategic Capital Raise Fuels Expansion
St George Mining Limited (ASX – SGQ) has successfully secured A$5 million through a strategic placement priced at a 13.1% premium to its 30-day volume weighted average price. This capital injection is earmarked to accelerate the company’s diamond drilling program at its 100%-owned Araxá Project in Minas Gerais, Brazil.
The placement, which attracted strong interest from European strategic investors, will see the deployment of three diamond drill rigs; two more than initially planned; alongside existing auger and reverse circulation rigs. This expanded drilling effort aims to deliver over 9,000 metres of diamond drilling, focusing on resource expansion and upgrading inferred resources to the indicated category.
A Globally Significant Rare Earths and Niobium Resource
The Araxá Project already boasts a substantial mineral resource estimate of 40.6 million tonnes at 4.13% total rare earth oxides (TREO), complemented by a significant niobium resource. The deposit is open in all directions, offering considerable upside potential through ongoing exploration.
Located adjacent to CBMM’s world-leading niobium operations, Araxá benefits from established infrastructure, renewable power access, and a skilled local workforce. The project has also garnered government support for expedited permitting, positioning it well for accelerated development.
Positioning for US Downstream Partnerships
Beyond resource expansion, St George is actively pursuing partnerships in the United States to support downstream rare earths processing and magnet production. This strategic move aligns with the US government's and major corporates’ efforts to establish independent rare earths supply chains outside China, highlighted by landmark investments in MP Materials by the US Department of Defense and Apple.
Such partnerships could enhance Araxá’s value proposition by integrating mining with processing and manufacturing, addressing critical supply chain vulnerabilities in the rare earths sector.
Investor Confidence and Market Implications
The premium pricing of the placement and the participation of strategic investors underscore growing market confidence in St George’s Araxá Project. Executive Chairman John Prineas emphasized the project's world-class status and the company’s commitment to delivering sustained value through resource expansion, metallurgical testwork, and development studies.
With a strong pipeline of assay results and drilling updates expected throughout the second half of 2025, St George is poised to maintain momentum in a sector increasingly critical to global technology and defence supply chains.
Bottom Line?
St George’s well-funded expansion and strategic US partnerships could redefine its role in the global rare earths landscape.
Questions in the middle?
- How will upcoming drilling results impact the Araxá resource classification and size?
- What progress is being made in securing downstream processing partnerships in the US?
- How might geopolitical shifts in rare earths supply chains affect St George’s market valuation?
