Premier African Minerals Ltd (LON:PREM) is in talks over financing options for its RHA tungsten mine following December's output as it also updated on its plan to list the Zulu lithium project in London.
The miner said that while throughput last month exceeded the target of 6,000 tonnes in feed, the ore processed was largely from on-strike development at a diluted grade insufficient to achieve planned profitable production.
READ: Premier African reviewing options at RHA and planning to spin-off its Zulu lithium project
RHA will complete one final shipment before mid-January and will then suspend production until an agreement is struck to ensure its long-term future, it said.
Premier is now in discussions with the National Indigenisation and Economic Development Fund (NIEEF), which has a 51% interest in the project, to agree alternative financing options.
As previously reported, Premier has made significant progress over the last 18 months in developing Zulu, and given the market valuations for comparable hard-rock lithium projects, it believes "significant value can be unlocked for shareholders by having a separate listing for Zulu".
To that end, it said, it plans subject to appropriate legal and taxation advice, to distribute (at nil cost) a substantial proportion of Premier's retained interest in the Zulu Newco at the time of listing.
READ: Premier African issues more assays from 'best hole' yet at Zimbabwe lithium deposit
"In terms of RHA, Premier has been the sole funder of RHA to date, although it only has a 49% interest," noted George Roach, Premier's chief executive
"The proposed new legislation in Zimbabwe will permit 100% foreign ownership and Premier is therefore currently in discussions with NIEEF, as well as other interested groups, to review alternative financing arrangements that will allow for further external funding for RHA.
"I remain confident that when RHA is equitably financed, the mine has a sustainable future."