Defense Metals raising $15 million for B.C. rare earths project
Defense Metals Corp. [DEFN-TSXV, DFMTF-OTCQB, 35D-FSE] said it plans to complete a private placement offering that aims to raise up to $15 million to fund the advancement of its flagship Wicheeda rare earth elements (REE) project in British Columbia. The project is located approximately 80 kilometres northeast of Prince George.
The private placement offering will consist of a brokered offering of up to 33.3 million units for gross proceeds of $10 million, and a non-brokered offering of up to 16.7 million that is expected to raise up to $5.0 million.
Each unit will consist of one common share and one-half of one common share purchase warrant. Each whole warrant will entitle the holder to acquire one common share at an exercise price of 45 cents for three years following the closing date. The warrants will be subject to an acceleration provision if the price of the shares exceed 90 cents for 10 consecutive trading days. The company has also granted the agents the option to sell up to that number of additional units equal to 15% of the brokered offering, a move that could generate an additional $1.5 million, the company said. That option is exercisable at any time not less than 48 hours prior to the closing date. Defense said it may also increase the size of the non-brokered offering by up to 15%, for additional proceeds of $750,000.
Net proceeds from the sale of the units will be used to continue optimization test work on the flow sheet developed for and published within the 2025 pre-feasibility study, complete pilot plant test work supporting the optimized flow sheet, conduct energy and transmission studies, commence a feasibility study on the Wicheeda project in early 2026, and continue baseline studies in support of future permitting. A pre-feasibility study released in February, 2025, says the project’s reserves support a 15-year life of mine with an average annual open pit production of 31,900 tonnes of Total Rare Earth Oxide (TREO) in concentrate, yielding approximately 5,200 tonnes of TREO in a high-value mixed rare earth carbonate after the removal of cerium and lanthanum.
The study pegs the initial capital cost at $1.4 billion. The company has said the mineral concentrates will be processed at Defense Metals’ own hydrometallurgical and solvent extraction separation process facilities. The mine is expected to produce ore feed for a 5,000 tonne per day flotation plant that will in turn produce a high-grade REE mineral concentrate that will feed a hydrometallurgical and SX process facilities to produce a value-added mixed rare earth carbonate (MREC) after the removal of cerium and lanthanum.
Mineral reserves include 25.5 million tonnes of mineable ore from one open pit at an average grade of 2.43% TREO.
Defense Metals shares were active Tuesday, easing 24% or $0.095 to 30 cents. The shares trade in a 52-week range of 43.5 cents and $0.085.