Diamond sales and operational update

RNS Number : 5049I

Kazera Global PLC

19 April 2022

 

19 April 2022

Kazera Global plc

("Kazera" or the "Company")

Diamond sales and operational update

Kazera Global plc, the AIM quoted investment company, is pleased to announce that diamond sales of $236,547 for the December 2021/January 2022 cycle were achieved from production at Alexander Bay, South Africa. Following a trial period of operating the Muisvlak plant in conjunction with MV5, management have now decided to hire a Pan Plant which will give the Company total independence from the Muisvlak plant and will give it a much greater level of control over the processing of its diamonds.

In Namibia, Kazera has upgraded the tantalum processing plant to ensure that the plant can meet the Company's export expectations. As a result, the Company expects successful production to be imminent.

Finally, in expectation of the grant of the Heavy Mineral Sands permit, the Company's subsidiary, Whale Head Minerals ('WHM'), has appointed Dr Gil Mahlati and Dr Dempsey Naidoo, two highly respected South African businessmen to its Board.

Highlights

· Gross diamond sales from December 2021/January 2022 cycle equate to US$236,547.71.

· A further 160 carats remain to be sold.

· The 13 carat stone sold for US$45,938.

· Future diamond operations are now totally independent of the Muisvlak plant.

· 30% of future sales income is no longer payable to MV5.

· Management have concluded that the Tantalite Valley processing plant will not meet production targets in its current form. The plant is being upgraded and further updates are expected shortly.

· The appointments of Dr Gil Mahlati and Dr Dempsey Naidoo to the Board of Whale Head Minerals in anticipation of the grant of the Mining Permit will greatly increase the profile of WHM locally, as well as adding a wealth of expertise in infrastructure projects and Heavy Mineral Sands ('HMS').

Details  

Diamond Project

Gross diamond sales for the December 2021/January 2022 sales cycle totaled US$ 236,547.71. From this amount Alexkor are entitled to 30% as the owner of the mine and MV5 are entitled to a further 30% in terms of the Joint Venture entered into with them. A further 160 carats remain to be sold. It was expected that the Company's previous issues with processing diamonds through the Muisvlak plant would be resolved by the JV with MV5 referred to in previous announcements. Despite record numbers of carats being produced, various political factors together with the fact that MV5 received 30% of diamond sales made the project unsustainable. To resolve this, the Company has now agreed to work with a third party who will provide a Pan Plant, which will not only eliminate the need for the Company to use the Muisvlak plant at all, but will also reduce processing costs. Payment for the use of the Pan Plant will only be made as diamonds are sold. The Company has also instituted legal action against MV5 for payment of monies due.

In a further major development, the Company has been working with another third party to trial a new X Ray sorting process for diamonds. This process is now in the final stages of approval and will give Deep Blue Minerals even greater control over its diamond production.

Tantalum Project

In Namibia, the works undertaken by the Company's wholly owned subsidiary, African Tantalum, in conjunction with DJ Drilling, has led to the entire refurbishment and redesign of the plant. From test production it is clear that the plant is in an appreciably better condition than it has been since 2017. However, to further ensure that it is capable of handling the tonnage now projected for 2022 and beyond, a classifier has been added to the process and the current spirals are being refurbished. It is expected that on completion of these the plant will have both the capacity and a level of redundancy to enable it to meet projected demand. Water usage remains comfortably within manageable levels.

Heavy Mineral Sands Project

As mentioned in the Company's announcement of 15 February 2022, the Company is awaiting a ruling from the Minister of Mines in South Africa on the one appeal received against the application for its HMS Mining Permit. An advocate has been appointed to examine the application and to make a recommendation to the Minister. In the interim, Alexkor, whose CEO at the time lodged the appeal, have appointed a new CEO, who took office on 1 April 2022. It is hoped that he will reconsider the (to the Company and its professional advisers) illogical and unsubstantiated appeal by his predecessor. In the interim, and in anticipation of the Mining Permit being granted imminently, the Company is delighted to announce the appointment to the Board of Whale Head Minerals, Dr Gil Mahlati as Chairman and of Dr Dempsey Naidoo as a non-executive director (further details in Appendix (1) below).

Dennis Edmonds, Kazera Chief Executive Officer, commented: 

"In South Africa, we are greatly encouraged by the words of the President of South Africa, Mr Cyril Ramaphosa, who is actively encouraging foreign investment into South Africa. We are also hopeful that the new Board of Alexkor will bring a fresh and entrepreneurial approach to the region.

Within the scope of our own operations, the last couple of months have been frustrating for the Company, however, we are very proud of becoming largely independent of the ability of outside forces to influence our diamond production. It is also very encouraging to see the developments in Namibia which will give us a facility capable of meeting all our requirements in the very near future.

On behalf of the Board, I am very excited to welcome Gil and Dempsey to the Board of WHM. I have no doubt that their wisdom, experience and local knowledge will be huge factor in making WHM the success it deserves to be, both financially, but also in terms of the creation of jobs and opportunities in a community which is desperately short of both "

Appendix (1)

Dr Mahlati

Dr Mahlati trained in both South Africa and the UK as a liver transplant surgeon. Since ceasing to practice as a surgeon he has focused on healthcare ventures throughout Africa. He has acted as a senior executive of a number of healthcare related businesses, including Vuwa Investments and Enaleni Pharmaceuticals (now Amabhubesi Healthcare). He is also currently the Chairman of African Financial Group, which focuses on investments and advisory services.

Dr Naidoo

Dr Naidoo is a highly qualified engineer, having worked at Anglo American and De Beers (where he was part of the Management Team at Namaqua Sands Mine). He is also the founder of the PD Naidoo Group, the largest multi-disciplinary engineering consultancy in the newly democratic South Africa. He has served on numerous boards in both the public and private sectors in South Africa and internationally.

This announcement contains inside information for the purposes of Article 7 of Regulation (EU) No. 596/2014 ('MAR').

For further information on the Company, visit:  www. kazeraglobal .com

Kazera Global plc (c/o Camarco) Dennis Edmonds (CEO)	Tel: [phone]
finnCap (Nominated Adviser and Joint Broker) Christopher Raggett / Tim Harper (Corporate Finance) Peterhouse Capital Limited (Joint Broker) Duncan Vasey and Lucy Williams (Corporate Broker)	Tel: [phone] Tel: [phone]
Camarco (PR) James Crothers / Hugo Liddy/Gordon Poole	Tel: [phone]

**ENDS**

 

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