Name and Location
RHA tungsten project, Zimbabwe.

Client
Premier African Minerals holds 49% of RHA Tungsten, with the remaining 51% held by Zimbabwe’s National Indigenisation and Economic Empowerment Fund.

Project Description
The preliminary economic assessment (PEA) on the project was completed in August 2013. The mine plan presented in the PEA consists of an openpit, followed by an underground operation, with a combined life-of-mine (LoM) of six years at a run-of-mine production rate of 192 000 t/y, or 16 000 t/m.

Premier Mining has since commissioned Bara Consulting to update the financial model of the project to demonstrate the effect of the additional work that has been completed since the publication of the PEA on the product valuation. The financial model outlines a low-capital implementation strategy.

Net Present Value/Internal Rate of Return
Bara’s financial model reflects a pretax net present value of $15.8-million and an annualised internal rate of return of 286%, calculated on a quarterly basis.

Value
The project preproduction capital has been reduced from $4.77-million to $4.15-million.

Duration
Production is expected to start in June 2015.

Latest Developments
Premier announced last month that plant modifications for its flagship RHA Tungsten project had arrived on site and that the first tungsten concentrate from the project had been shipped to Durban, South Africa.

With the arrival of these plant modifications, the company expects that it will progress rapidly to steady-state production. Siumtaneously, higher-grade ore is arriving at the plant, as mining continues to expose more of the defined resource in the developing openpits.

“While I had expected the plant to settle to steady state quicker than what has been the case, the fact that the plant has demonstrated the ability to recover wolframite in concentrates of up to 70% tungsten trioxide augers well for the future of RHA,” says Premier African Minerals CEO George Roach.

He has noted that the initial shipment of concentrates will test the packing, inspection and assay procedures, as well as verify the export, inland transport and payment methods of the project.

“It remains our intention to update the market and provide details of anticipated revenues thereafter and when steady-state production is attained,” Roach concludes.

Key Contracts and Suppliers
Bara Consulting (updated financial model).

On Budget and on Time?
The development of infrastructure is behind schedule, owing to orders being placed five days behind schedule.

“Current focus is on expediting these orders to pull the schedule back through early delivery,” Premier has noted.

First production from the mine is scheduled for June this year.

Contact Details for Project Information
Premier African Minerals, tel +27 100 201 281 or email info@premierafricanminerals.com.