Australian Mines Ltd (ASX:AUZ) will launch an underwritten share purchase plan (SPP) to raise $5 million with the ability to take oversubscriptions of up to $5 million.

Eligible shareholders will be able to subscribe for up to $15,000 worth of shares priced at a 20% discount to VWAP measured over the five days preceding the date of issue of shares.

The funds raised through this SPP will be used to advance the company’s Sconi Cobalt-Nickel-Scandium Project in North Queensland.

READ: Australian Mines price jump attracts ASX query

The company has three projects in Australia with a focus on the Sconi Cobalt-Nickel-Scandium Project in Queensland.

AUZ has had a busy start to 2019, centred around an updated JORC resource in February 2019 for its Sconi Project.

With a bankable feasibility study (BFS) valuing the project at $697 million in November 2018, the focus for AUZ is project funding.

READ: Australian Mines reveals new resource at Bell Creek Nickel-Cobalt Project

In late April 2019, AUZ revealed a new resource of 25.8 million tonnes grading 0.72% nickel and 0.04% cobalt at its Bell Creek Nickel-Cobalt Project in Queensland.

Bell Creek was acquired as part of the recently completed transaction with Metallica Minerals Ltd (ASX:MLM) along with the Minnamoolka Nickel-Cobalt Project.

Both projects are within trucking distance of the proposed processing plant at the Sconi project.