Funding of Zulu Project and Update
The Board of Premier African Minerals Limited is pleased to announce a subscription today to raise £2,475,000 on before expenses at an issue price of 0.275 pence per new ordinary share for the Zulu Lithium and Tantalum Project (“Zulu”).
Highlights:
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Ø | Premier now funded until first production at Zulu. |
Ø | Ball Mill Power on and test run in situ. |
Ø | Commencement of Commercial Production in late February with first shipments expected in March 2024. |
Ø | Thickener Plant completion date 19 February 2024. |
Ø | Ongoing negotiations with Zimbabwe-based lenders for working capital facilities at Zulu once in production are progressing.
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George Roach, CEO, commented, “This placement assures Zulu of plant startup, subject only to suppliers meeting their obligations and undertakings. This has and remains Premier single most important objective at this stage. That is targeted for next week and remains on target at this time. Early indications are that subsequent working capital finance will be available from commercial lenders at Zulu when production is underway as Zulu must begin to fund its operations without the assistance of Premier once commercial production has commenced.
Funds now raised will be used specifically for direct operating expenses at Zulu that includes:-
- Final payments related to the thickener purchase and installation,
- Final payments related to the ball mill and associated hydrosizers, transport and installation thereof,
- Plant operating spares and reagents,
- Mining costs, and
- Day-to-day operating expenses including diesel.”
Funding
As announced on 18 January 2024, Premier elected to make a significant expansion in the mining operations to facilitate delivery of ore with less country waste to ensure against any residual issues with the sorters (which continue to be optimised) when plant production recommences at Zulu.
And while the mill has now been delivered and installed at Zulu, there was a delay with the delivery which further constrained Premier’s cash resources.
Premier continues to engage with Zimbabwean-based lenders for working capital facilities at Zulu – these potential lenders need to see production from Zulu and while Premier strongly believes that Zulu will be able to source a working capital facility, this is now largely dependent on Zulu being in production.
Based on the above, Premier believe that securing funding through the above Subscription is the best immediate solution to securing further project funding in order to see Zulu commence production in late February 2024. Once production has commenced, Premier believe that it should see one or more of the alternatives to equity-based funding materialise. On this basis, Premier’s current expectation is that it is now fully funded to the first production at Zulu.