Premier African Minerals Limited (LON:PREM) has arranged a new financing package to provide working capital and to increase its stake in Ehtiopian fertiliser project developer Circum.
The additional 1% stake in Circum is costing Premier African roughly US$1.3mln, with the money to come from a £2.9mln new loan agreement and a combiined £4.8mln subscription at 0.7p and £3.3mln stand-by facility that will give it access to a further net £1.5mln.
Premier African is taking advantage of a surge in interest in lithium assets, which has driven its share price higher in recent weeks.
The money will allow it to up the exploration effort at its Zulu Lithium deposit in Zimbabwe and to start a preliminary economic study.
George Roach, chief executive, said it had been advised to do further exploration at Zulu before making a decision on whether to sell the project or to joint venture.
Roach added that Circum’s Danakil Potash Project, meanwhile, is a world class and low-cost potash project and the opportunity to acquire a further 1% in Circum for a cash consideration of US$1.25 per share is an attractive opportunity given the last placement was at US$2 per share.
"The real underlying value in Premier African are Zulu Lithum and the acquisition of additional interests in Circum," he told Proactive Investors.
WATCH: Premier African Minerals boosted by new funding package to advance ‘tier-1’ Circum and Zulu projects
At its tungsten mine RHA, also in Zimbabwe, the plant is currently processing ore at approximately 55% of the XRT sorter capacity.
Changes to the primary crusher are being made. Underground development has been slower than anticipated and to achieve profitable operations at the currently constrained plant throughput, a larger portion of the plant feed needs to be higher grade underground ore.
Shares dropped 0.22p to 0.52p.
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