LONDON – Premier African Minerals shares added over 6% as the company revealed it expects shipments from its RHA tungsten operation in Matabeleland North to start from July 17.
Grades in the initial fines (powdered tungsten) concentrate came in better than expected, Premier African said, and were running up to 70%.
The plant near Hwange has been running on a 24 hour continuous production cycle since 26 June, though tweaks were still being made to optimise production.
George Roach, chief executive, said there was scope above the designed 16 ton per hour capacity on the crushing circuits and modifications were planned to utilise this.
It should mean more higher grade fines concentrate as opposed to coarse grade, with a probable overall increase of total concentrate produced, he said.
Coarse grades were expected to represent about 75% of expected production from RHA, which in January was predicted to generate net revenue of $26mln over a 22 month life of mine.
All regulatory requirements, contracts and inspections processes necessary for export have been agreed, he added.
House broker Shore Capital described Wednesday’s announcement as “good news”.
“During plant optimisation, it became clear to PREM that the downstream concentration circuits had surplus capacity,” said analyst Yuen Low.
“To take advantage of this, PREM has ordered modifications to increase the current 16tph capacity of the crushing circuits; these modifications, which will involve only a nominal capital cost, should be incorporated into the plant within the next 30 days.
“Importantly, as well as increasing total concentrate tonnage produced, PREM expects that the proportion of higher-grade fines concentrate will increase in relation to coarse concentrate.”
Shares in the miner added 6.38% to 2.5p. – Proactive Investors