Australia-based exploration company A-Cap Resources has raised $3.25m through share placement to fund its Letlhakane uranium project in Botswana.

The company major shareholder China Growth Minerals has invested $2.125m raising its stake value to 19.99%.

Funds from the placement will be used to finance ongoing feasibility and development program at the Letlhakane project; further the credit facility will be used to evaluate its coal projects.

A-Cap CEO Paul Thomson said that the company is pleased with the positive response to its share placement, appreciating the support from its major stakeholder China Growth Minerals.

"These funds will be used to continue the development work at Letlhakane and ensure that the project is ready to benefit from the forecast upturn in uranium prices and also to evaluate our new coal discoveries," revealed Thomson.

In addition, the company stated that the value adding work to further the uranium mineralization at the mine would be a priority over the next quarter of fiscal. It has identified reserves of 90 million pounds of higher grade uranium at Letlhakane mine that the company expects has capacity to produce 352 million pounds of uranium.

"With limited new supply of uranium and a tightening of market due to new demand by 2014/15, A-Cap’s comparative advantage is that it’s project can be one of the few new sources capable of production with CAPEX less $400m, and is forecast to have competitive operating costs and low sovereign risk," explained Thomson.

Meanwhile, the company is seeking exploration, assay and test work at recent coal discoveries at Mea, Bolau and Letlhakane projects.