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Premier African Minerals surges as it reaches agreement with Zimbabwe government over financing of RHA tungsten mine

The firm said agreements were in the process of being drafted and that it expects to announce details and a return to production schedule “as soon as possible”

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The company’s hopes had been lifted in December when it received a letter indicating that the government was willing to inject the funds required to resuscitate the mine

Premier African Minerals Limited (LON:PREM) shares surged in late-morning Wednesday after it said it had reached “a general agreement” with the Zimbabwe Ministry of Industry regarding the financing and restarting of production at the RHA Tungsten mine.

The firm said agreements were in the process of being drafted and that it expects to announce details and a return to production schedule “as soon as possible”.

READ: Premier African Minerals drops Zimbabwe spin-off plan

The company’s hopes had been lifted back in December when it received a letter from the Ministry of Industry, Commerce and Enterprise Development that indicated it was willing to inject the funds required to resuscitate the mine.

A sticking point that had prevented the funds coming in earlier revolved around ownership of the mine, with Premier trying to get the Zimbabwe authorities to agree on a debt-for-equity swap that will see its holding in RHA rise to 90% from 49%.

The fact that the country has also been dealing with civil unrest over the last few months has not helped matters.

Premier had also been planning to de-merge its Zimbabwe assets and list them in London, although this was abandoned last week in favour of an acquisition of a 50% share in the assets of KME. its contractor at the RHA Tungsten and Zulu lithium projects in the country.

Shares were up 16% at 0.14p.

Quick facts: Premier African Minerals Ltd

Price: 0.145 GBX

AIM:PREM
Market: AIM
Market Cap: £15.96 m
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Watch

Premier African CEO would be disappointed if RHA not producing this year

George Roach, Premier African Minerals PLC’s (LON:PREM) chief executive remain confident that the US$6mln earmarked by the Zimbabwe government to re-start the RHA tungsten mine will be forthcoming. Once the money comes through he is confident RHA can be back in operation within 100...

on 7/6/19

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