Premier African Minerals Keeps Moving Towards Underground Mining at RHA

Premier African Minerals (LSE:PREM) reported on Monday that the completion of an underground implementation study at its RHA tungsten mine in Zimbabwe supports the board’s decision to accelerate underground development.
As quoted in the press release, highlights of the study included:

• Six month underground mining plan on 926 level while re-equipping of vertical shaft to 870 level implemented from November 2015;
• Estimated capital cost of US$406,000;
• Project schedule for equipping vertical shaft hoist and commissioning of operations on 870 level remains on schedule for February 2016, and
• Positive operational cash flow from RHA (before capital expenditure and working capital) expected in spring 2016.

Premier African Minerals CEO, George Roach, said:

RHA was always planned, in the longer term, to be an underground mine. Unforeseen developments during the initial open pit operations led the Company to accelerate the move to underground mining. This change in strategy has resulted in the need to finance company overheads for an extended period without recourse to cash flow generated from the open pit and finance substantial additional debt generated by RHA. We have been successfully extracting and stockpiling ore from underground since late November 2015 and we now anticipate RHA to generate positive operational cash flow during the course of spring 2016. The Company also anticipates a liquidity event in relation to its interest in Circum Minerals Limited during 2016. These two events should significantly strengthen the company’s balance sheet. I would like to thank the shareholders for their support and look forward to providing a revised resource estimate for RHA in the coming days.

Click here for the full press release.