SYDNEY, Oct. 12 (Xinhua) -- Energy Resources Australia (ERA), one of the largest uranium producers in the world, will raise 500 million AU dollars (497.10 million U.S. dollars) with the issue of new shares to fund expansion plans, the company announced on Wednesday.

The ERA said its majority shareholder Rio Tinto, which holds a 68.4 percent stake in the ERA, is fully supportive of the share offer and has committed to subscribing for its 68.4 percent entitlement in full.

The ERA will offer 12 new shares for every seven shares held, at an offer price of 1.53 AU dollars (1.52 U.S. dollars) a share to raise approximately 500 million AU dollars (497.10 million U.S. dollars).

The proceeds of the entitlement offer will be used to fund the construction of water management infrastructure and exploration activities at ERA's Ranger mine in the Northern Territory in Australia.

ERA's Chief Executive Rob Atkinson said the capital raising would provide funding for the three very important projects for the ERA.

"It is important that the ERA understands the full extent of the resources on the Ranger project area and, as such, has planned to conduct an expanded exploration program over the period from 2012 to 2014," Atkinson said in a statement.

The ERA expects to make a decision on the Ranger 3 Deeps mine development in 2014, Atkinson said.