Multi-commodity mining and natural resource development company Premier African Minerals has fully commissioned the processing plant at its Zulu lithium and tantalum project, in Zimbabwe, but first shipments have been delayed to next month.
In an update on progress at the project, Premier CEO George Roach said on Thursday that the plant supplier had advised that the milling and sizing component of the plant required certain modifications to allow for full optimisation to design capacity throughput and had recommended a staged approach to optimisation.
“Premier understands that the costs associated with this remedial action will be met by the plant supplier, and we will work with them to ensure that the plant achieves nameplate throughput expeditiously.”
The plant supplier has provided details and timelines for remedial action and pending completion of this work, has advised that expected production of concentrate to June 30, will be 1 376 t. Production for July and August will be 1 137 t a month, increasing to 2 359 t in September, 3 577 t in October and 4 471 t from December 1.
“At present concentrate prices and production at these current levels to the end of August, the company expects Zulu to operate profitably,” he said.
The delay means that Premier will not be able to ship its first spodumene to energy materials producer Canmax Technologies by May 30, as per their agreement. Canmax may thus elect to cancel the marketing and pre-payment agreement and require that the prepayment plus interest is settled within 90 days following notice.
“Canmax has always been supportive of Premier, and we continue to engage with them and look forward to first shipment in June 2023,” Roach said.
“While frustrated with the timeline for putting the plant into full production, I am encouraged by our growing confidence in our resource and mining operations, the near completion of our dam and tailings facility, and the performance of the crushing, sorting and flotation elements of the plant,” he said.
Premier had previously advised that the delays had caused its cash to be constrained. Recent exercise of options and issue of remaining shares free from pre-emptive rights by way of direct placement has provided interim relief to this position. Alternative further funding may need to be sought if there were any further significant shipment delays, he highlighted.