Premier African Minerals Ltd said on Monday the government of Zimbabwe has shown willingness to inject funds into the mining company’s subsidiary RHA Tungsten Pvt Ltd.
Premier African holds a 49% interest in RHA, which operates the RHA tungsten mine in Zimbabwe.
In a letter to Premier African, the Minister of Industry, Commerce & Enterprise Development asked for more details on Premier African’s involvement in the subsidiary, and its restructuring.
Chief Executive George Roach said the letter noted the management contract for the mine would need to be negotiated.
At the beginning of November, Premier African said it intended to restructure its Zimbabwe projects and purchase exploration and mining assets owned by KME Holdings Ltd.
In addition, the mining company said on completion of the restructuring and acquisition, it planned to demerge its Zimbabwe minerals projects and seek a separate listing for them and the KME assets on a London-based market.
Under the proposed restructuring, Premier African it establish a new subsidiary, Newco, into which it will consolidate its entire interests in the RHA tungsten mine and processing plant, the Tinde fluorspar & barite project, the Katete rare earths project and the Zulu lithium project.
“As indicated in the letter, the Minister looks forward to discussing the matter further. Our formal response to the Minister will suggest I am ready to meet the Minister at any time the Minister finds convenient,” Roach said.
“I look forward to progressing the Newco/KME transaction and bringing the RHA status back to production as soon as possible in 2019,” he added.
Shares in Premier African Minerals were up 7.8% at 0.11 pence on Monday.