Premier African Minerals Limited / Ticker: PREM / Index: AIM / Sector: Mining
For immediate release
7 May 2019
Premier African Minerals Limited
Completion of RHA Investment and Management Agreement
Premier African Minerals Limited ("Premier" or the "Company") is pleased to report the signing of a new Management Agreement ("MA") with the National Indigenization and Economic Empowerment Fund of Zimbabwe ("NIEEF") that is expected to see RHA Tungsten Private Limited ("RHA") brought back into production without any further financing requirement from Premier. Premier holds a 49% interest in RHA and is the operator.
George Roach, CEO of Premier commented: "Whilst it has been a long haul, I am very pleased to be able to report that we have signed a new legally binding agreement with NIEEF that includes a funding undertaking of US$6 million for RHA. Use and application of these funds is expected to see RHA back in production later this year and allows for required upgrades that are expected to result in major operating cost reductions including electricity grid connection. Premier retains ownership of the plant and equipment and is reappointed as the manager for a further 5 years with renewal thereafter.
The investment from NIEEF will be structured as share capital and Premier will simultaneously capitalise an equivalent amount from Premier's existing loan account. In my opinion, this represents both an equitable solution and a good time for the Zimbabwean Government to invest directly in this project. RHA has been significantly de-risked over the past 4 years and is now an operation that is better understood.
We have agreed a provisional implementation process with NIEEF and I expect to provide further guidance thereafter."
Key terms of the Management Agreement
The new MA replaces the old Management Agreement that had been entered into on the 23 September 2013. Premier's 100% owned subsidiary ZimDiv Holdings Limited is appointed as the Manager for a period of 5 years. In particular, the Manager has full authority and responsibility for the day to day operations of RHA.
The Manager will conduct the operations at RHA in accordance with the general terms and conditions of the MA and the approved budget and shall report directly to the board of RHA. The board of RHA will agree the Management Fee that will include a performance related adjustment, which requires first concentrate shipment within 100 days of receipt of the new investment.
This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014. The person who arranged the release of this announcement on behalf of the Company was George Roach.
Premier African Minerals Limited
Tel: +44 (0)7734 922074
Michael Cornish / Roland Cornish
Beaumont Cornish Limited
Tel: +44 (0) 20 7628 3396
Jerry Keen/Edward Mansfield
Shore Capital Stockbrokers Limited
Tel: +44 (0) 20 7408 4090
Tom Curran/Elliot Hance
SVS Securities Limited
Tel: +44 (0) 20 3700 0100
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, encompassing brownfield projects with near-term production potential to grass-roots exploration. In addition, the Company holds 5,010,333 shares in Circum Minerals Limited ("Circum"), the owners of the Danakil Potash Project in Ethiopia, which has the potential to be a world-class asset.
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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