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Premier African Minerals appoints interim chairman, updates investors on RHA mine

Premier African is considering a number of proposals to reopen the RHA tungsten mine

George Roach
George Roach is handing over his chairman duties but will remain chief executive

Premier African Minerals Ltd (LON:PREM) has appointed Michael Foster as interim chairman to replace George Roach who will remain chief executive.

Foster, a senior non-executive of the board, is to start in the new role effective immediately.

“The separation of chairman and CEO roles is long overdue and is expected to enhance board oversight and direction,” said Roach.

“Michael has a wealth of experience in management and development of resource companies and I am appreciative that he has agreed to work with me over the next 6 months that are critical to realising the vast potential that Premier offers."

Alongside the announcement, the company also updated investors on the RHA tungsten mine in Zimbabwe ahead of its annual general meeting in August.  

READ: Premier African says changes to RHA ownership structure “substantially agreed”

Premier, which owns 49% of the project and is the operator of RHA, is awaiting the final sign-off from the Zimbabwean government on a proposed equity restructuring.

Premier reviews proposals for restarting operations at RHA

Ahead of the expected sign-off of the restructuring, RHA’s management has carried out an in-depth assessment of alternatives to re-open the mine.  

Premier is considering a few proposals, including re-starting existing underground operations at 6,000 tonnes per month and maintaining the same mining rate for the life of the mine.

Another option is to re-start operations at the same rate of production but with the construction of new decline shaft to allow vehicle access direct to the underlying operations. This could lead to a “substantial increase in ore delivery to the plant at significantly reduced mining cost”, Premier said.

The group is also considering reopening the open pit, which will make best use of the XRT sorter and result in higher throughput and lower capital expenditure.

A steady increase in the price of wolframite over the past year has opened up an option to start production of the commodity from as early as the second month of mining and without any further drilling.

Funding options for RHA

Premier said it was also reviewing various funding options to bring RHA back to production. Some of these include a new off-take agreement with advance payment for concentrate, or zero cost drilling as an offset for the contract at Zulu Lithium (Pvt) Ltd.

It is also looking at direct equity investment at project level or spinning out into a new company of which Premier would retain a "no cost" interest.

If the price of wolframite continues to rise, Premier said it could self-finance the project but this is its least preferred option and would only be considered on the basis of a rights issue or open offer.

Quick facts: Premier African Minerals Ltd

Price: 0.072 GBX

Market: AIM
Market Cap: £12.81 m

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on 27/7/18

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