Premier African Minerals Raises £1.25 Million for Zulu Lithium and Tantalum Project

Premier African Minerals, a London-listed company, has successfully raised £1.25 million to support its Zulu lithium and tantalum project in Zimbabwe.

Premier-African-Minerals

Premier African Minerals, a London-listed company, has successfully raised £1.25 million to support its Zulu lithium and tantalum project in Zimbabwe. The funds, garnered through a share placement, will be utilized to address ongoing technical challenges in the processing plant and to ensure the smooth continuation of mining operations.

Capital Raise and Share Placement

Premier African Minerals raised £1.25 million at a price of 0.16 pence per share. This strategic move aims to optimize the Zulu plant, which has faced delays and concerns regarding the grade of its offtake. The company also settled a payment of $2 million (£1.57 million) in invoices by issuing 983,500,000 new ordinary shares at the same price.

Addressing Technical Challenges

The Zulu plant, which has experienced significant technical difficulties, saw a pivotal change in March when Premier replaced the original contractor. The new contractor has made substantial progress, particularly in stabilizing the flotation circuit. However, Premier acknowledges that it will take time to fully address the design deficiencies and transition from interim fixes to a fully operational state.

George Roach, CEO of Premier African Minerals, expressed confidence in the ongoing improvements, stating, “The flotation circuit is now capable of running in a constant and stable state, but it will take time to fully remedy the original design deficiencies in the overall plant.”

Contractor Agreements and Payments

In a bid to streamline operations and manage costs, contractors at Zulu have agreed to accept $2 million of invoices in the form of new ordinary shares. This agreement reflects the contractors’ confidence in the project’s long-term viability and Premier’s commitment to resolving the existing technical issues.

Optimism Amidst Challenges

Despite the challenges, Premier African Minerals remains optimistic about the Zulu project. The company expects to begin providing quarterly production reports from the third quarter of 2024. Roach highlighted that the mining operations and run-of-mine (ROM) ore grades have consistently exceeded resource estimates, which helps offset some of the current deficiencies in the ore sorter.

“We are encouraged with mining operations and the ROM ore grades that consistently exceed our resource estimate. This is mitigating for the moment, the ore sorter deficiencies,” Roach stated.

Inspection and Export Readiness

Premier African Minerals has initiated inspections required for export, anticipating no delays in obtaining the necessary export permits. Recent meetings with the Zimbabwean government have been promising, particularly regarding the RHA Tungsten Private Limited (RHA) issue, which is now moving towards a likely resolution.

Strategic Outlook and Future Plans

Looking ahead, Premier African Minerals is focused on resolving the remaining technical challenges and optimizing the Zulu plant. The company is committed to providing periodic updates on the plant’s performance until a steady state of continuous production is achieved. Thereafter, Premier will commence quarterly production reports, providing stakeholders with detailed insights into the project’s progress.

In addition to addressing the technical challenges, Premier is reviewing overall operations and production costs. The rising price of tungsten is noted as a positive factor, potentially contributing to reduced production costs.

Industry Context and Market Potential

The Zulu project is strategically significant for Premier African Minerals, given the growing demand for lithium and tantalum in the global market. Lithium, a critical component in batteries for electric vehicles and renewable energy storage, is experiencing a surge in demand. Tantalum, used in electronics and aerospace applications, also presents lucrative opportunities.

Premier’s proactive measures to secure funding, address technical issues, and engage with government authorities position the company well to capitalize on these market opportunities. The successful implementation of the Zulu project could enhance Premier’s market standing and contribute to Zimbabwe’s mining sector growth.

Conclusion

Premier African Minerals’ recent capital raise and ongoing efforts to optimize the Zulu project underscore the company’s commitment to overcoming challenges and achieving long-term success. With a clear strategic plan and proactive engagement with stakeholders, Premier is poised to advance its Zulu lithium and tantalum project towards full production, offering significant potential for growth and profitability in the dynamic mining sector.

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