21
May 2024
Premier African Minerals
Limited
Funding of Zulu Project
and Update
Premier African Minerals Limited
("Premier" or the "Company") is pleased to announce a subscription
today for 781,250,000 new ordinary shares to raise approximately
£1.25 million before expenses at an issue price of 0.16 pence per
new ordinary share primarily for the Zulu Lithium and Tantalum
Project ("Zulu").
George Roach, CEO, commented, "The Company provided a full discussion on the Zulu
plant performance in our announcement of 8 May 2024. The Company
expects that periodic updates will be provided on the overall plant
performance until such time as a steady of state of continuance
production has been achieved, Premier expects thereafter to begin
providing quarterly production reports for Zulu from Q3 of
2024.
Over and above this, we are
encouraged with mining operations and the ROM ore grades that
consistently exceed our resource estimate and this is mitigating
for the moment, the ore sorter deficiencies. This also supports the
review of overall operations and production costs and the likely
reduced production costs discussed below.
Inspections required as a prelude to
export have commenced, and this precedes any export. We do not
expect any delays in regard to export permits required.
This was confirmed in recent
meetings with Government of Zimbabwe when the issue of RHA Tungsten
Private Limited ("RHA") was also discussed and we are encouraged
that there is now likely resolution of this issue. The rising price
of Tungsten is noted".
The Zulu Plant
For the reasons previously reported,
Premier replaced the original plant contractor in March 2024.
Whilst the floatation circuit is now capable of running in a
constant and stable state, it will take time to fully remedy the
original design deficiencies in the overall plant and move from
what in many instances are interim fixes to the final operating
plant. The current status on these issues is set out
below:
Ore Sorters
Extensive ore sorting test work is
about to commence and replacement ore sorters will be considered
thereafter. It remains our preferred outcome that the original
supplier resolves this.
Milling and sizing
During the past week, Zulu has
constructed and installed the recommended header box and gravity
feed arrangement for the hydrosizers. Whilst there will still be
some optimisation required, the initial operation suggests that the
plant will run on a single hydrosizer, and this arrangement has
resulted in better optimisation of the mill. The unexpected upside
of this is that the overall plant capacity in respect of the
crushers, milling and sizing circuit is likely to allow for a
substantial increase in through put at a lower cost than would
otherwise have been the case with an additional mill.
Magnetic separation and Tantalum
recovery
Dense Media Separation based test
work on the undersized ore fraction being stockpiled has completed
and laboratory results are awaited to determine spodumene and
tantalum recoverability. At the same time the original equipment
manufacturer for the installed magnetic separation is assisting and
working closely with Zulu.
Floatation Circuit
As this circuit is optimised, there
are likely to be further challenges but with the resolution of
each, plant availability, recoveries and concentrate grade are all
improved. We have a long way to go but we remain encouraged by the
facts that we are producing spodumene that is saleable. The design
for the additional conditioning circuit required is complete and
most components are either on site or on order. Projected delivery
date to site is expected at end June 2024 and provided this
timeline is met, installation and integration is expected to
require a further 14 days. Normal operations are not expected to be
impacted. This is expected to be the final component to allow
recoveries at design capacity.
Ore body and plant grades
Current operations continue to
support our previous comments to the effect that with development
of the open pit, the Company has now been able to validate the
actual pegmatite that is being mined. In-pit evaluation is
undertaken through the sampling of the pegmatite from blast hole
drilling and channel samples cut across the bench. This allows for
better reconciliation to the 5m x 5m x 5m Assay Block
Model grades. On the bench level previously developed and
mined, the Indicated Resource grade from the assay block model was
1.01% Li2O while the average grade of the ore hauled to the ROM pad was
1.13% Li2O, an approximate 10% increase.
At the same time, as previously
reported, with material blended from selective mining in the EPO
area, Li2O grades recorded in the ore feed to the floatation circuit
are in the range of 1,1% Li2O to 1,8%
Li2O,
and the dry solids being fed to the spodumene float plant contain
between 12% and 25% spodumene".
Spodumene Concentrate
The term SC6 is used as a price
determination point, being the price paid for spodumene concentrate
in which the Li2O grade is 6%. Approximately
74% of the concentrate would then be made up of spodumene.
Spodumene concentrate in any grade more than 4%
Li2O is
saleable with an adjustment to the price p aid relative to the
actual amount of spodumene contained in that bag. It should be
noted that prices are quoted for spodumene concentrates at lower
grades and these prices are in the public domain.
It is worth noting that the market
for lepidolite is improving and Premier believes that it is likely
that our Mica/lepidolite will sell in the near future.
Financial model
Premier's internal review of
production costs (which have not been independently verified) now
indicates an average overall delivered China port cost per ton of
US$834 in for 2024, with future costs on the same basis below
US$800 per ton delivered China port.
Premier has engaged an independent
engineering consultancy to review this financial model.
Subscription
Premier has today issued by way of a
direct subscription ("Subscription"), conditional on admission,
781,250,000 new ordinary shares of nil par value ("Subscription
Shares") at a Subscription price of 0.16 pence per Subscription
Share. The Subscription Shares will, when issued, rank pari passu
in all respects with the existing ordinary shares. CMC Markets UK
Plc trading as CMC CapX, acted as the Company's placing agent in
respect of the placing.
The Subscription has been arranged
within the Company's existing share authorities. Premier intends to
use the proceeds of the Subscription principally to assist with the
ongoing mining operations at Zulu and general working
capital.
Contractor Settlement
Contractors at Zulu
have agreed to accept payment of US$2 million dollars of invoices,
in new ordinary shares of the Company. Accordingly, the
Company has today settled payment of US$2
million (equivalent to £1.57 million) in invoices through
the issue of 983,500,000 new ordinary shares of the Company at the
price of 0.16 pence per ordinary share ("Settlement
Shares"). The Settlement Shares will, when issued,
rank pari passu in all respects with the existing ordinary
shares.
Any sales of the Settlement Shares
will be handled by Premier's brokers under orderly market
conditions with an initial 10-day lockup of the Settlement
Shares.
Admission
Application is being made for
781,250,000 Subscription Shares and 983,500,000 Settlement Shares,
in aggregate 1,764,750,000 new ordinary shares, to be admitted to
trading on AIM and admission is expected to take place on or around
24 May 2024.
Total Voting Rights
Following the issue of the
Subscription Shares, the Company's issued share capital consists of
31,381,688,211 Ordinary Shares, with voting rights.
This figure may be used by
shareholders in the Company as the denominator for the calculation
by which they will determine if they are required to notify their
interest in, or a change to their interest in, the share capital of
the Company under the Financial Conduct Authority's Disclosure and
Transparency Rules.
Competent Persons
Statement
Bruce Cumming, a consulting
geologist to Premier, has reviewed and approved this release to the
extent that reference is made to the geology and mineralogy of the
Zulu pegmatites. Mr. Cumming is a SACNASP and GSSA
registered geoscientist with 48 years' experience in exploration
and project management, in multicommodity projects
throughout Africa.
Market Abuse Regulations
The information contained within
this announcement is deemed by the Company to constitute inside
information as stipulated under the Market Abuse Regulations (EU)
No. 596/2014 as it forms part of UK Domestic Law by
virtue of the European Union (Withdrawal) Act 2018
("UK MAR").
The person who arranged the release
of this announcement on behalf of the Company was George
Roach.
A copy of this announcement is
available at the Company's website, www.premierafricanminerals.com.
CMC CapX
Brokers and investors wishing to
gain access to future CMC Markets transactions, should register
their interest at https://www.cmcmarkets.com/en-gb/capx.
Enquiries:
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George Roach
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Premier African Minerals Limited
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Tel: +27 (0) 100 201 281
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Michael Cornish / Roland Cornish
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Beaumont Cornish Limited
(Nominated Adviser)
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Tel: +44 (0) 20 7628 3396
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Douglas Crippen
|
CMC
Markets UK Plc
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Tel: +44 (0) 20 3003 8632
|
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Toby Gibbs/Rachel Goldstein
|
Shore Capital Stockbrokers Limited
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Tel: +44 (0) 20 7408 4090
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Nominated Adviser Statement
Beaumont Cornish
Limited ("Beaumont
Cornish"), which is authorised and regulated in
the United Kingdom by the Financial Conduct Authority, is
acting as nominated adviser to the Company in connection with this
announcement and will not regard any other person as its client and
will not be responsible to anyone else for providing the
protections afforded to the clients of Beaumont Cornish or for
providing advice in relation to such proposals. Beaumont Cornish
has not authorised the contents of, or any part of, this document
and no liability whatsoever is accepted by Beaumont Cornish for the
accuracy of any information, or opinions contained in this document
or for the omission of any information. Beaumont Cornish as
nominated adviser to the Company owes certain responsibilities to
the London Stock Exchange which are not owed to the
Company, the Directors, Shareholders, or any other
person.
Forward Looking Statements
Certain statements in this
announcement are or may be deemed to be forward looking statements.
Forward looking statements are identified by their use of terms and
phrases such as ''believe'' ''could'' "should" ''envisage''
''estimate'' ''intend'' ''may'' ''plan'' ''will'' or the negative
of those variations or comparable expressions including references
to assumptions. These forward-looking statements are not based on
historical facts but rather on the Directors' current expectations
and assumptions regarding the Company's future growth results of
operations performance future capital and other expenditures
(including the amount. Nature and sources of funding thereof)
competitive advantages business prospects and opportunities. Such
forward looking statements reflect the Directors' current beliefs
and assumptions and are based on information currently available to
the Directors. A number of factors could cause actual results to
differ materially from the results discussed in the forward-looking
statements including risks associated with vulnerability to general
economic and business conditions competition environmental and
other regulatory changes actions by governmental authorities the
availability of capital markets reliance on key personnel uninsured
and underinsured losses and other factors many of which are beyond
the control of the Company. Although any forward-looking statements
contained in this announcement are based upon what the Directors
believe to be reasonable assumptions. The Company cannot assure
investors that actual results will be consistent with such forward
looking statements.
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Glossary
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"Li2O"
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Lithium Oxide (Lithia) - an
inorganic lithium compound used to assess lithium
minerals.
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"m"
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Meter.
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"ROM"
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Run-of-mine.
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"SC6"
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spodumene concentrate.
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"Assay Block Model"
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Block modelling refers to a subset
of 3D models. Normally, the blocks or cells are measured x by y by
z, in metres. In a block model, geological zones are divided into
blocks and the tonnage and grade of contained mineral is estimated
for each block. The shape of blocks (either cubes or rectangular
cuboids) and the estimation methods vary according to the specific
requirements of a project.
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"XRT"
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X-ray sorting technique where
specific mineral bearing rock can be separated from specific
mineral-poor rock and other impurities. This upgrades in metal
terms the material feed to the plant and lowers the tonnage of rock
requiring processing which results in improved economics for
mineral processing operations.
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Notes to Editors:
Premier African Minerals
Limited (AIM: PREM) is a multi-commodity mining and natural
resource development company focused on Southern
Africa with its RHA Tungsten and Zulu Lithium projects
in Zimbabwe.
The Company has a diverse portfolio
of projects, which include tungsten, rare earth elements, lithium
and tantalum in Zimbabwe and lithium and gold
in Mozambique, encompassing brownfield projects with near-term
production potential to grass-roots exploration. The Company has
accepted a share offer by Vortex Limited ("Vortex") for the exchange of Premier's
entire 4.8% interest in Circum Minerals
Limited ("Circum"),
the owners of the Danakil Potash
Project in Ethiopia, for a 13.1% interest in the enlarged
share capital of Vortex. Vortex has an interest of 36.7% in
Circum.
Ends