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Company Premier African Minerals Ltd
TIDM PREM
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RHA Tungsten PEA and Mining Study

Released 15:30 28-Aug-2013
Number 31517-7359

RHA Tungsten PEA and Mining Study
Premier African Minerals Limited / Ticker: PREM / Index: AIM / Sector: Mining 

28 August 2013

         Premier African Minerals Limited (`Premier' or `the Company')         

Positive Results from RHA Tungsten Preliminary Economic Assessment and Concept 
                                 Mining Study                                  

Premier African Minerals Limited, the AIM quoted multi-commodity natural
resource company with mineral projects located in Western and Southern Africa,
is pleased to announce positive results from its recently completed Preliminary
Economic Assessment (`PEA') and Concept Mining Study (`the Mining Study') at
its flagship RHA Tungsten Project (`RHA' or `the Project'), located in the
prospective Kamativi Tin Belt in north-west Zimbabwe.

  * The Mining Study confirms the economic potential of Lode 2A to support a
    tungsten mining operation with an annual rate of ore production of 192,000
    tonnes over a six year Life of Mine
   
  * Open pit and underground mine key financials include:
   
  * 
      + Low capital cost of US$13.5 million
       
      + Operating cost estimated at US$59.30 per Run of Mine (`ROM') tonne
       
      + Net Present Value undiscounted and before tax of US$118 million
       
      + Internal Rate of Return (`IRR') before tax of 316%
       
  * Study based on Initial SAMREC Compliant Resource:
   
  * 
      + Inferred SAMREC code compliant resource of 1,093,000 tonnes at a
        diluted grade of 8.7 kg/t WO3
       
      + Indicated SAMREC code compliant resource of 147,000 tonnes at a diluted
        grade of 4.7 kg/t WO3
       
  * Premier plan to develop RHA with the aim of recommencing low cost, near
    term tungsten mining activities in 2014
   
  * Further exploration work planned to upgrade RHA mineral resource and
    establish limits of economic mineralisation to the SW, NE and in depth
   
The Mining Study was undertaken by independent mining consultants Royal
Haskoning DHV (`RHDHV') (formally Turgis Mining Consultants), with the purpose
of determining the economic viability for Premier to re-commence tungsten
mining activities at RHA.

The successful delineation of an initial SAMREC compliant resource with a
significant grade, combined with the robust results from the PEA and the Mining
Study, adds significant confidence to the economic viability of Premier's
flagship RHA Tungsten Project in Zimbabwe and expectation of moving the Project
into production in the near-term.

The Mining Study indicates a capital cost, inclusive of a 20% contingency of
US$13.5 million, a pre-tax IRR of 316%, positive cash flow of US$118 million,
an undiscounted pre-tax NPV of US$118 million, a mine life of six years and a
lead time to first production of saleable product of about 10 months from
initiation of the Project. Premier is actively engaged in discussions with
potential off-take partners. The Company is also concluding financing for the
Project. There are no other significant issues that need to be addressed before
the Project can be initiated.

The Mining Study proposes mining of Lode 2A, initially from an open pit
extending to about 40 metres below surface, followed by underground mining
(mechanised continuous retreat long hole open stoping with pillars) to about
200 metres below surface, and over a strike length of 300 metres. There are
known extensions to the ore body on both strike and dip, which have not yet
been included in the Resource statement and were accordingly not considered in
the Mining Study.

The Project shows strong promise to be expanded in the future as further
exploration is conducted on the known remaining mineralised lodes described in
the PEA and the Mining Study. Premier believes that this will add code
compliant resources and extend mine life.

The PEA and Mining Study and any reference to economics relates to the
operating subsidiary.

The highlights of the Mining Study are set out below for further information
and to view RHA's full Competent Person's Report please visit
www.premierafricanminerals.com:

Mine Study Highlights

Life of Mine Production                           6,791,482 kg WO3            
                                                                              
Mine Life                                         6 years                     
                                                                              
Average Annual Ore Production                     192,000 tonnes              
                                                                              
Project Economics                                 US$20,800/tonne of          
                                                  concentrate (65% WO3)       
WO3 Sale Price*                                                               
                                                  US$13.5 million             
Capital Cost (including 20% contingency)                                      
                                                  US$59.30/ROM tonne          
Operating Costs (life of mine)                                                
                                                  316%                        
IRR (before tax)                                                              
                                                  US$118 million              
NPV (before tax, undiscounted)                                                
                                                  US$118 million              
Free Cash Flow (before tax, undiscounted)                                     
                                                                              
Processing Plant Recovery                         85%                         

*The product sale price was based on an ammonium paratungstate (`APT') price of
US$400/metric ton unit of WO3

Premier acknowledges and respects the Zimbabwean Indigenisation process and has
agreed in principle with the Company's Zimbabwean partner, the National
Indigenisation and Economic Empowerment Fund that Premier's exploration costs
will be reimbursed through a loan account established in the operating
subsidiary. Premier will manage the Project and the operating subsidiary will
be responsible for development costs. Premier will hold 49% of the operating
subsidiary.

Initial MineralResource Estimate - July 2013

The geological model at RHA focuses on six mineralised lodes (1, 2, 4, 5, 6 and
7). These sub-parallel lodes trend northeast-southwest and dip steeply (85°) to
the northwest. The geological model is underpinned by data from historical
underground channel samples and sections of mined-out and interpreted reefs.
The historical data was complemented by the Company's recent trenching and
drilling programmes. Recently, Premier completed a 1,302 metre six hole
drilling campaign and more than 258 metres of trenching, further details of
which are set out in the announcements of 18 February 2013 and 17 April 2013.
The drilling confirmed the presence of numerous quartz-tourmaline veins that
are highly mineralised with wolframite. All holes with the exception of RHA
DD06 intersected the lodes at depth, enabling a depth extension down to the 750
metre level based on geological continuity. The trenching was completed over
the drill hole traces, targeting the expected outcrop of Lode 2. The new
trenches were geologically logged and channel sampled and confirmed the
occurrence of quartz veins with wolframite, which helped locate the outcrop
positions of Lode 2 A and B and other reefs.

At this time a Resource has been declared only for Lode 2, which covers two
areas (Lode 2A and Lode 2B). The in-situ mineral resource was prepared by
independent consultants CAE Mining Africa, of South Africa (`CAE') and is based
on both the current drilling and trenching data in addition to the historical
data. The mineral estimates have been prepared in accordance with the SAMREC
code, the South African code for the reporting of exploration results, minerals
resources and mineral reserves.

The first mineral resource estimate for Lode 2A is an Inferred SAMREC code
compliant Resource of 1,093,000 tonnes at a diluted grade of 8.7 kg/t WO3, as
defined by boreholes DD02, 03 and 04, over a strike of 300 metres and to the
750 metre level.

A second SAMREC code compliant Resource of 147,000 tonnes at a diluted grade of
4.7 kg/t WO3 in the Indicated category was also defined over an area known as
Lode 2B. Lode 2B is a 100 metre strike extension to Lode 2A, which occurs
within a 30 metre by 30 metre radius, to the 750 metre level. This estimate has
been defined using intersections of veins E to I in borehole DD05 and by
channel sampling results from relevant parts of underground developments on the
926 metre, 865 metre and 859 metre levels. It must be noted that this area has
been historically mined (to the 859 metre level) and therefore the depleted ore
resource from this has been taken into account when compiling this resource
estimate.

The SAMREC compliant Resources are summarized below.

Lode     Resource       Volume     Tonnes*     Density    W03(kg/t)  Content    
         Classification                                                         
                        (m3)                   (kg WO3/t)            (kg WO3)   
                                                                                
2A       Inferred       382,200    1,093,000   2.86       8.70       9,509,100  
                                                                                
2B       Indicated      51,400     147,000     2.86       4.68       680,610    

Note:Tonnages have been rounded off

Concept Mining Study

The Mining Study was based on the initial mineral resource defined above for
Lode 2A only, and did not take into account the existing underground workings,
which can access Lodes 3 and 7 to the south of Lode 2A. Nonetheless, RHDHV
believes that there is a potential opportunity to expand RHA's operations at a
later stage to include these underground workings, once further exploration and
feasibility work has been conducted.

RHDHV has recommended that Premier conducts further work to upgrade the RHA
mineral resource. This work should be based on additional diamond drilling,
which is expected to consist of at least 1,300 metres of drilling for 13
boreholes. The aim of this work would be to drill out Lode 2A on 50 metre
centres and also establish the limits of the economic mineralisation to the SW,
NE and in depth. It is also anticipated that this additional drilling will add
to the understanding of the persistent copper (`Cu') anomalous assay results
that have been observed at up to 3% Cu apparently in association with the WO3
mineralisation.

The main design parameters applied to the design and schedule of the mine are
listed below:

  * Mining will incorporate an open pit to 40 metres below surface (`BS')
    followed by underground mining to the 750 metre level, which is
    approximately 200 metres BS;
   
  * The primary access system for the underground mining will be a trackless
    decline with the portal positioned to the north of the open pit;
   
  * Lode 2A is made up of a series of narrow steeply dipping veins that were
    found to be collectively economic over a mining width of some six metres
    and is confined to mining the ore body over a strike distance of 300 metres
    and depth of ± 200 metres BS;
   
  * There are known extensions to the east not included in the Mining Study;
   
  * The underground mining will be mechanised, using small teams for the
    development, stoping and rock handling;
   
  * Assuming Lodes 3-7 provide positive results following exploration drilling,
    it is anticipated that payable zones will be extracted by hand held
    conventional mining to augment extraction from the Lode 2A mechanised
    operation;
   
  * It is proposed to employ contractors for both the open pit and underground
    mining phases;
   
  * Processing will be mainly gravity separation following manual waste sorting
    ahead of the mill. A processing recovery of 85% was used for the Mining
    Study;
   
  * The site is accessible via the main Bulawayo-Victoria Falls tar road and 23
    km of gravel road to the mine;
   
  * Electrical power will be available from a Zimbabwe Electricity Supply
    Authority (ZESA) power line;
   
  * Water will be imported from a borehole in Lukhosi, which is about 20 km
    west of the mine site;
   
  * Processing plant construction is expected to take approximately nine
    months; and will include a floatation circuit for Cu concentrate recovery.
   
  * Saleable product could be available some 10 months after commencement of
    operations.
   
Capital Costs

In terms of capital costs, a summary is provided below indicating a total
upfront capital cost of US$13.5 million which includes a 20% contingency. The
capital definition was for the plant and infrastructure only. Mining capital
forms part of the mining contractors' rates and is accounted for in the
operating cost. The accuracy of the estimates is within ±40%.

Description                            Capital Cost        
                                                           
                                       (US$ million)       
                                                           
Mining                                 0                   
                                                           
Processing                             3.9                 
                                                           
Surface Infrastructure                 7.3                 
                                                           
Contingency @ 20%                      2.2                 
                                                           
Total                                  13.5                

Operating Costs

The operating cost estimate is shown in the table below. The average life of
mine operating cost is estimated to be US$59.30 per life of mine ("LOM") tonne.

Description                            Operating Costs     
                                                           
                                       (US$ / tonne)       
                                                           
Mining & engineering                   44.4                
                                                           
Processing                             3.7                 
                                                           
Environment                            0.8                 
                                                           
Management Services                    8.6                 
                                                           
Transport/Freight                      1.8                 
                                                           
Total                                  59.3                

Financial Evaluation

Production is expected to start in year one and continue for six years and
production of 192,000 ore tonnes per annum (16,000 ore tonnes per month) is
expected to be reached within the first 12 months of operation. The financial
evaluation schedule over the life of the mine is shown in the table that
follows. Note that the values presented in the table have been rounded.

Year                LOM      1       2        3        4        5        6      
                                                                                
Mined Tonnes        904      48      192      192      192      192      88     
                                                                                
(t`000)                                                                         
                                                                                
65% WO3 Concentrate 8,881    472     1,887    1,887    1,887    1,887    864    
                                                                                
(tonnes)                                                                        
                                                                                
Revenue             184.7    9.8     39.2     39.2     39.2     39.2     18.0   
                                                                                
(US$ million)                                                                   
                                                                                
CAPEX               13.5     13.5                                               
                                                                                
(US$ Million)                                                                   
                                                                                
OPEX                53.6     5.1     11.9     11.1     11.3     9.7      4.6    
                                                                                
(US$ million)                                                                   
                                                                                
Pre Tax Free Cash   117.7    -8.7    27.4     28.2     28.0     29.5     13.4   
Flow                                                                            
                                                                                
(US$ million)                                                                   

The sensitivity of the Project to the price of APT was undertaken and is
reported as follows. Note that an APT price of US$400/mtu was the basis for the
product price used in the evaluation of the Project.

APT price (US$/mtu)                     Undiscounted NPV (US% millions)        
                                                                               
300                                     72                                     
                                                                               
350                                     95                                     
                                                                               
400                                     118                                    
                                                                               
450                                     141                                    
                                                                               
500                                     163                                    

RHA Additional Information

Intermittent small-scale mining has been conducted at RHA and the adjacent Tung
mine (which Premier has an option to acquire) located 5 km away. Between 1931
and 1979 the mines jointly produced 1,247 tonnes of WO3 in wolframite
concentrate at an average concentrate grade of 65% WO3.

RHA occupies a low ridge, which is approximately 850 metres long, 300 metres
wide and stands about 80 meters above its surroundings. Historic mine workings
are in the form of adits, open pits, caved stopes, trenches, roads and rock
dumps that occupy the surface. Tailings dumps are located on the north and
south sides of the ridge. Previous mine development was almost entirely carried
out during the 1930s where the mine was developed on 30 metre levels from the
945 metre level to the 859 metre level, by means of horizontal adits into the
sides of the ridge, and a single vertical shaft down to the 845 metre level.
Some open pitting also occurred on the western part of the deposit.

During the mid to late 1970s Falconbridge Ltd (which is now part of Xstrata),
trading as Blanket Mines in Zimbabwe, carried out underground geological
mapping and extensive channel sampling on the accessible parts of the
underground workings, principally on the 926, 865 and 859 levels.

At RHA, the known mineralised lodes and veins occur within an envelope that
extends over a strike of approximately 400 metres with a maximum width of 150
metres. The lodes are thought to converge to the east of the property. The
lodes strike approximately northeast-southwest paralleling the regional trend
of Kamativi Inlier. The host country-rock comprises high-grade, strongly
foliated biotite schists and paragneisses of the Precambrian Dete Inlier
belonging to the Tshontada Formation. The formation trends north-east on a
regional scale, paralleling the trend of the Kamativi Inlier and dips steeply
to the north-west.

The tungsten mineralisation occurs in quartz veins and shear zones, within a
sequence of quartz-tourmaline and pelitic schists that may be associated with
granite intrusions. High metamorphic grades with localised partial melting are
also evident. The schists also show that extreme deformation has occurred and
mylonite bands are common. The association of quartz veins with tourmaline
schists form distinct lodes, which were exploited by historic mining at RHA.
These lodes are steeply dipping to the northwest at 80o to90o. Seven lodes were
exploited in the past.

The tungsten mineral of primary economic interest is wolframite (Fe,MnWO4),
with minor amounts of scheelite (CaWO4). The only other mineral of possible
economic significance is chalcopyrite (CuFeS2). The wolframite occurs as
euhedral crystals, laths and clusters that may be up to 50 mm by 30 mm in size.
This very coarse grain size is characteristic of the quartz vein-hosted
tungsten mineralization.

Qualified Person

The technical information contained in this announcement has been prepared and
reviewed by Robert Ingram BSc, C.Eng., Pr.Nat.Sci., FGSSA, MSEG, and Alexander
du Plessis PrEng, BSc(Eng), MSc(Eng), CertEng, FSAIMM, who are the appointed
consultants to Premier African Minerals Limited. Professor du Plessis is also a
director of the Company. Mr Ingram is registered with The South African Council
for Natural Scientific Professions (SACNASP) Registration Number 400057/92, and
Professor du Plessis with the Engineering Council of South Africa (ECSA)
Registration Number 950232. They are satisfied with the accuracy and precision
of this release by Premier African Minerals Limited.

                                   **ENDS**                                    

For further information please visit www.premierafricanminerals.com or contact
the following:

Pamela Hueston    Premier African Minerals Limited       Tel: +44 (0) 755 778  
                                                         3855                  
                                                                               
Tony Rawlinson    Cairn Financial Advisers LLP (Nomad)   Tel: +44 (0) 207 148  
                                                         7900                  
                                                                               
Jerry Keen        Shore Capital Stockbrokers Limited     Tel: +44 (0) 207 408  
                  (Broker)                               4090                  
                                                                               
Edward Mansfield  Shore Capital Stockbrokers Limited     Tel: +44 (0) 207 408  
                  (Broker)                               4090                  
                                                                               
Felicity Edwards  St Brides Media & Finance Ltd (PR)     Tel: +44 (0) 20 7236  
                                                         1177                  
                                                                               
Charlotte Heap    St Brides Media & Finance Ltd (PR)     Tel: +44 (0) 20 7236  
                                                         1177                  

About Premier

Premier African Minerals Limited is a multi-commodity exploration and
development company focussed in Southern and West Africa. As well as its
shareholding in TSX quoted Agriminco, the Company has a diverse portfolio of
multi-commodity projects which includes tungsten, rare earth elements (`REE'),
gold, lithium, tantalum and uranium in Zimbabwe and Togo, which span from
brownfield projects with near-term production potential to grass-roots
exploration. Premier plans to create value by implementing defined exploration
and development programmes to prove-up resources with a view to future
production and/or forming strategic alliances and completing corporate
transactions to maximise shareholder value.

Premier is a controlling party to TSX-V listed Agriminco (TSX-V: ANO), holding
120 million shares representing 42% of Agriminco. See www.agriminco.com. In
addition, Premier's Katete REE project in Zimbabwe has the potential to be
developed as an open pit mine. The project, which spans 3,750 ha, has returned
a peak result from trenching of 14.6% TREO.

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RHA Tungsten PEA and Mining Study - RNS