Premier African Minerals (LSE:PREM) is an AIM listed multi-commodity mining and natural resource development company with operations in Zimbabwe, Mozambique and Ethiopia.
PREM was admitted to AIM in December 2012 and raised £1.5 million in gross proceeds by placing 75 million ordinary shares at a share price of 2 pence each.
Following the initial placing, PREM had 335.5 million shares in issue and the market capitalisation of the company was £6.7 million.
In August 2023, the company had 22.836 billion shares in issue and the PREM share price was 0.53 pence giving a market cap of c. £120 million.
Overview of the company’s assets
The company has a wide range of projects and investments which include tungsten, rare earth elements, gold, lithium, tantalum and potash. The key assets owned by Premier African Minerals are as follows:
1. RHA Tungsten (Wolframite)
49% owned but 100% funded by PREM. Located in Zimbabwe. Latest resource estimates are Measured, Indicated and Inferred Resource of 1.325 million tonnes at 4.72 kg/t WO3 (underground) and Indicated & Inferred Resource of 20.882 mt at 2.34 kg/t WO3 (open pit).
2. Zulu Lithium and Tantalum
100% owned. Licence area covers 3.5 km² and is located 80 km east of Bulawayo. Maiden Inferred Mineral Resource Estimate at Zulu of 20.1 million tonnes grading 1.06% Li₂O (June 2017).
The Scoping Study indicates the economic value of the project for both the Concentrate Sales option US$127.3 million (NPV10) and the Lithium Carbonate Plant option US$718.9 million (NPV10). Capital costs, including a 30% contingency for both elements are estimated at US$ 64 million and US$ 238 million respectively.
3. Tinde Fluorite and Barite
Contains numerous hydrothermal fluorite veins up to 3 metres wide. No formal resource estimate given.
4. Katete Rare Earths
Contains carbonatite, 37.5 km² in size, with light rare earth, neodymium rich mineralisation. No formal resource estimate given.
5. Circum Minerals
In addition to the above projects, PREM also holds c. 5.010 million shares in Circum Minerals, a privately-owned potash development company which operates the Danakil Potash project in Ethiopia with a compliant resource of 4.9 billion tonnes potassium.
Circum is targeting production of 2 million tonnes per annum (mtpa) of Muriate of Potash (most common form of potash fertiliser), and 0.75 mtpa of Sulphate of Potash (a premium fertiliser product). Production is expected to commence in 2022.
Circum is seeking a listing on a recognised stock exchange and PREM has placed a fair value of US$ 6.3 million on these shares as at 31st December 2019.
6. Otjozondu Manganese mine
Premier holds a 19% interest in MN Holdings Limited (MNH), a privately owned company which operates the Otjozondu Manganese mine.
It has built up the stake on an incremental basis with the last 7% being purchased in June 2020 for US$ 700,000. The consideration was settled by issuing c. 498 million ordinary shares at a share price of 0.0111 pence each.
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