Sirius Minerals is to try and raise £50m through a share placing to finance its potash project in York through to the end of a definitive feasibility study.
Russell Scrimshaw, Chairman of Sirius, has indicated his intention to subscribe for approximately £3.4m of the new shares.
Sirius bought the York project in January 2011 and says since then assay results have been "better than expected".
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The proceeds from the placing will be used to drill perhaps as many as 8 additional holes with a view to making a maiden resource announcement in April this year.
The price of the placing shares was not disclosed, with Sirius saying it will be announced "as soon as practicable after the close of the book-building process".
The books will close at 3pm in London today and the offer is not being underwritten. The company hopes the new shares will be admitted for trading by the end of January.
Sirius's share price had dropped 13% by 12:05pm on news of the placing.
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