Premier African Minerals (LON:PREM) has raised a further £810,000 of debt to support its RHA tungsten operation in Zimbabwe while it builds up to full production.
Premier will issue 36 unsecured convertible loan notes worth £25,000 each to financier Darwin Strategic, for which it will receive 90% of face value.
George Roach, Premier’s chief executive, said: "Effectively, RHA Tungsten should have been contributing to loan repayments from July 2015.
“Whilst the delay in attaining profitability is disappointing, we have confidence in the future of this project as a significant contributor in the medium term.
“RHA remains responsible for the repayment of the full, true cost of debt and that includes the effective cost of any equity placed pursuant to a conversion of loan notes.”
Premier is already owed US$11mln by RHA and has US$4mln of debt on its own book. RHA is expected to start rental payments and begin to pay down the debt to Premier from the start of 2016.