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Premier African awaits RHA restructuring decision

Premier African Minerals (AIM:PREM) expects to receive a decision by the end of October on whether the Zimbabwean government will allow it to restructure and increase its holding in the RHA tungsten mine.
Premier African awaits RHA restructuring decision Premier African awaits RHA restructuring decision Premier African awaits RHA restructuring decision Premier African awaits RHA restructuring decision Premier African awaits RHA restructuring decision

Premier African Minerals is hoping to increase take a majority stake in the RHA tungsten mine

Staff reporter

It needs a thumbs up from the ministry of industry, commerce and enterprise development to put fresh equity into the 49%-owned project, as 49% is the maximum stake allowed in Zimbabwe, although it hopes the new government will relax these rules.

Premier suspended underground mining at RHA in January due to lower than expected grades and recovery rates and the failure to reach expected production rates, but said earlier in October a technical and economic assessment had shown it was viable to restart operations.

CEO George Roach said the company had received word that a decision would be finalised by the end of the month, or it would look to other legal processes to secure the remaining equity in RHA.

"It is simply not possible that Premier, or any other, could be expected to continue to fund the ongoing holding costs and the return to production with a minority stake and no contribution from the remaining shareholders," he said.

"The cost to RHA employees, many of whom have received no income this year, the cost to a body of international shareholders and the loss of potential revenue must end now."

Roach said the company could only bring underground mining back online after proper legal process was concluded and the ownership of RHA reflected present Zimbabwean government policy.

The company started a diamond drilling programme at RHA at the end of August.

Premier's shares were down 6.48% Monday after the news to 0.12p (US0.16c).