HomeBusinessAfter EPO award, frustrated investor changes mind on Zim

After EPO award, frustrated investor changes mind on Zim

FIVE months ago, George Roach, the CEO of Premier Africa Minerals, was sounding the frustration shared by many would-be investors in Zimbabwe. He was casting his eyes elsewhere.

Bureaucracy was stalling the company’s investment plans, focused on the RHA Tungsten mine and Zulu Lithium in Fort Rixon. A single signature, he said then, was delaying the granting of an exclusive prospecting order (EPO), a permit that would allow the company to explore claims and move towards development.

Numerous meetings with senior officials, including with the Mines minister, had brought no results, Roach said.

The company was now looking to its other investments in the region, especially a then new investment in Namibia’s MN Holdings Otjozondu. Premier, listed on London’s AIM exchange, was also thinking about selling part of its Zimbabwe assets.

But Roach has changed his mind.

Zulu Lithium is one of 20 new EPOs just issued by the  Mines ministry, and now the industry veteran says his company is not only staying put in Zimbabwe, but it is no longer looking to sell any assets in the country.

“The strategy related to the divestment of our Zimbabwe assets may no longer be appropriate. Accordingly, Premier will focus on the development of Zulu and realisation of the potential true value of this asset and proper exploration of the upside potential in the EPO,” Roach says.

Last year, Roach panned the ministry of Mines, saying after a series of meetings, including with the minister, Winston Chitando there was no movement. Now, he is more upbeat. News of the EPO has driven up Premier’s share price on AIM, and attracted funding interest.

“The granting of the EPO reaffirms the Zimbabwean government policy that Zimbabwe is open for business,” he says. “Premier’s prospects are today fundamentally different.”

Premier has hired New York-based EAS Advisors to introduce institutions and funding, as the explorer works to advance mining and exploration projects. The company plans to fund a definitive feasibility study (DFS) at Zulu Lithium.

A scoping study indicated a value of US$127 million for a 15-year opencast operation mining a concentrate of spodumene and petalite at Zulu Lithium. The site is about 80km from Bulawayo, and may be one of the largest undeveloped lithium-bearing areas in Zimbabwe.

With the EPO, Premier has received offers for funding for DFS, which would take an estimated 14 months. There are also offers for investment linked to take-off and future mine development.

Beyond RHA and Zulu, Premier in June last year announced that it had bought a portfolio of hard-rock lithium assets from Australian firm Li3. The 1500 hectares of licences are located within the Mutare Greenstone Belt, near the Mozambican border.

newZWire

Recent Posts

Stories you will enjoy

Recommended reading