Corporate Update

RNS Number : 6943G

Premier African Minerals Limited

24 November 2015

 

Premier African Minerals Limited / Ticker: PREM / Index: AIM / Sector: Mining

Premier African Minerals Limited

("Premier" or the "Company")

Corporate Update

Premier African Minerals Limited, the AIM-traded, multi-commodity mining and resource development company focused on Southern and Western Africa, is pleased to issue this interim update on progress and developments at the RHA Tungsten mine ("RHA"), in respect of which the Company is the operator and holds a 49% interest, and other projects.

·     Underground developments on track to meet full plant capacity in Q1 2016.

·     Results from Benin exploration activities support further development.

·     Promising initial results from Zulu tantalite.

·     Re-evaluation of open pit and pre-feed upgrade test results most encouraging for expanded bulk mining at RHA.

·     Imminent new resource statement due from RHA.

RHA Update

Previous announcements have disclosed the requirements for profitability at RHA. Development of the open pit on the basis of direct Run of Mine ("ROM") ore feed, in light of the present Wolframite pricing, is unlikely to bring RHA into profit in the short term. RHA has temporarily suspended open pit operations to reduce cash outflow, and has accelerated the development of underground mining (something that had always been planned but on the basis that a profitable operation of the open pit would fund underground development). Premier reported first ore from underground on 27 October 2015 and ore from the 926 adit level continues to be mined and stock-piled. Simultaneously, Premier is accelerating access to fully developed historic reserves on the 870 level. This has previously been reported as 100,000 ton grading at approximately 7kg per ton. Premier expects hoisting and ventilation installation for this level to be installed and operational by Q1 2016. At the same time, Premier has conducted initial test work utilising XRT technology that has demonstrated excellent capability in recognition of mineralised ore that may result in significant grade improvement of the Run of Mine ore. In turn, this is likely to substantially increase the available resource and reduce operating costs.  Further test work has been commissioned which, subject to completion and conclusion of a toll process agreement, could significantly affect open pit operating costs. The net effect of the above is, provided the anticipated grade and tonnage from underground mining is achieved, and plant operations and recoveries meet expectations that RHA operates profitably from Q1 2016 as previously indicated.

Benin Exploration

Initial test results from the limited exploration that Premier was able to conclude before the West African wet season started in July are encouraging. The Company expects that ongoing pitting and trenching that will be complete in Q1 2016, may lead to an early resource determination. Our focus remains on low cost near term production and the Benin operations will need to demonstrate this potential during this exploration campaign. The highest grade encountered to date is 188 ppm Ta₂O₅ and 1631 ppm Nb₂O₅ in eluvial material just south of the main artisanal mining site of Toumi. 

Zulu Pegmatites

Premier is concerned with Lithium minerals and Tantalite at Zulu. In regard to Tantalite, the western side of the 3,5km long Zulu pegmatite has been pitted and sampled along a 750 m strike. Possible future exploitation of this surface mineralisation is likely to be based on sluicing of eluvial material and processing of a <4mm fraction. The coarser fraction may represent an additional tantalite resource. Analysis of this <4mm fraction of material from the pitting that covered an area of some 0.54 km² of eluvial material has been completed in the Company laboratory and is now only subject to independent verification before release of details . The area so far covered by pitting is estimated to contain a minimum of 32,000 m³ of eluvial material. Test work on the hard rock lithium bulk samples is now expected to commence during this quarter. Premier notes that spodumene pricing, one of the anticipated products that could be produced at Zulu from the pegmatite bodies, is one of very few minerals to have maintained it's pricing through the current commodity pull back.

Circum Minerals

Premier is advised independently of Circum Minerals that the mining licence application submitted earlier this year has been well received and is likely to be granted in the near future.

George Roach, CEO, Comments: "The combination of a falling APT price, difficulties in achieving the planned Run of Mine feed grade from the open pit and some residual issues in attaining steady state in plant operations, have not made for the start to production Premier had anticipated. Despite this we have opened a new mine in very trying times. Our experience to date has provided a solid platform from which we expect to see a move to profit during Q1 2016. Acceleration of the underground mining and the potential to upgrade through XRT sorting of the open pit material has real promise for the future of RHA. Our exploration activities in Benin and at Zulu in Zimbabwe continue to show promise for early production at low capital cost and will be pursued provided that the objective remains realistic. At the same time, Premier is viewing other opportunities in niche minerals that offer the same opportunity and it is hopeful that transactions can be concluded in the near future.

"In addition, the investment in Circum Minerals has the potential to be realised during 2016. The apparent value in this investment provides comfort to the necessary debt and equity based funding that Premier may need as we develop our company."

Please visit our website to view images of the progress made with the construction of the plant at www.premierafricanminerals.com.

Qualified Person

Werner Swanepoel, Chief Operating Officer of Premier, has reviewed and approved all technical matters relating to this release.  Mr Swanepoel has 21 years' experience in the Southern African mining industry and holds a Master's degree in Mining Engineering, an MBA and Mine Manager's Certificates in both Metalliferous and Coal Mining. He is a registered Professional Engineer with the Engineering Council of South Africa.

Bruce Cumming has reviewed and approved the commentary above to the extent reference is made to geological resource and resource grade. Mr. Cumming holds a Bachelor of Science (Honours) in Geology from the University of Cape Town and is accredited to the South African Counsel for Natural Scientific Professionals (SACNASP). Mr. Cumming has sufficient geological experience (over 35 years).

Wolfgang Hampel, Exploration Manager of Premier African Minerals Limited in West Africa, has reviewed and approved this release with regards to exploration work on the Zulu pegmatite and in Benin. Mr Hampel has 24 years' experience in the African, American, European and Asian exploration and mining industry and holds a Diploma in Economic Geology (Dipl.-Geol.) from the Technical University of Munich. He is a registered European Geologist (EurGeol), n° 1261, with the European Federation of Geologists

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.

Enquiries

Pamela Hueston	Premier African Minerals Limited	Tel: [phone]
Michael Cornish / Roland Cornish	Beaumont Cornish Limited (Nominated Adviser)	Tel: [phone]
Jerry Keen/ Edward Mansfield	Shore Capital Stockbrokers Limited	Tel: [phone]
Aidan Stanley /Dominic Barretto	Yellow Jersey PR Limited	Tel: [phone]

Notes

Premier African Minerals Limited (AIM: PREM) is a multi-commodity mining and resource development company focused in Southern and Western Africa with production started at its flagship RHA project in Zimbabwe.

The Company has a diverse portfolio of projects, which includes tungsten, rare earth elements, gold, lithium and tantalum in Zimbabwe and Benin, encompassing brownfield projects with near-term production potential to grass-roots exploration. The Company also holds 2 million 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. At present those shares are valued at US$4 million based on the latest price at which Circum has accepted subscriptions.

Glossary of Technical Terms

"APT" means ammonium para-tungstate.

 "eluvial" is said of an incoherent mineral deposit resulting from the decomposition or disintegration of rock in place. The material may have slumped or washed downslope for a short distance but has not been transported by a stream.

 "Nb₂O₅" is diniobium pentoxide.

"pegmatite" is an exceptionally coarse-grained igneous rock, with interlocking crystals, usually found as irregular dikes, lenses, or veins, esp. at the margins of granitic intrusions

"Potash" is any of various mined and manufactured salts that contain potassium in water-soluble form

"ppm" is parts-per-million or gram per tonne

 "Spodumene" is the mineral name for lithium aluminium silicate LiAlSi₂O₆ an important ore of lithium.
 

 "Ta₂O₅" is ditantalum pentoxide.

"tantalite" a mostly dark grey to black mineral, iron bearing varieties are called ferrotantalite or tantalite-Fe ; a major tantalum ore.

"Tungsten" is a metallic element known also as wolfram with the chemical symbol W and atomic number 74.

 "wolframite" is the mineral name for iron-manganese tungstate; (Fe,Mn)WO_4, an ore of tungsten. The ratio of iron to manganese varies; iron-rich wolframite is known as ferberite FeWO₄, manganese-rich wolframite is known as hübnerite MnWO_4.

"XRT technology", an X-ray sorting technique where metal bearing rock can be separated from metal-poor rock and other impurities. This saves large amounts of energy in the area of fine milling and fine-grain sorting, thus substantially improving the economics of mineral processing operations.

ENDS

 

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