For immediate release

16 August 2021 

Premier African Minerals Limited

("Premier" or the "Company")

Zulu Updated Scoping Study 

Premier African Minerals Limited ("Premier" or the "Company"), is pleased to provide an update on the Zulu Lithium Private Limited ("Zulu") Scoping Study as previously published in November 2017 to reflect the current Spodumene selling prices, together with current costings.

George Roach, CEO commented, "With the recently reported surge in Spodumene concentrate selling prices, Premier approached Bara Consulting with a request that the scoping study financial matrix be reviewed taking cognisance of the price changes and any other salient factors that may have changed in the period after publication of the scoping study.

The review was limited to the concentrate option only and the results thereof are published below. It should be noted that Premier has already embarked on a definitive feasibility study at Zulu with drilling at Zulu well underway with two rigs operating at present. It is encouraging to note that preliminary work in that regard continues to support the findings set out in the scoping study. Specific examples include an overall reduction in certain specific costs in Zimbabwe, most notably in respect of labour and confirmation of the projected logistics costs on an FOB Beira basis.

It is interesting to note the significant increase in Zulu's net present value with improved and projected Spodumene concentrate pricing compared to Premier's present market capitalisation. Further updates will follow as details of intersections and results start to flow."

Updated Scoping Study

The Company published in November 2017 the results of the scoping study completed on its Zulu Lithium and Tantalum Project ("Zulu" or "Zulu Project") in Zimbabwe ("Scoping Study"). The Scoping Study was prepared in compliance with the guidelines of SAMREC by independent South African mine planning consultants, Bara Consulting (Pty) Limited ("Bara Consulting") and evaluated the economics of developing an open pit mine and processing facility to directly produce Spodumene and Petalite concentrate.

The Scoping Study identified a target production of 84,000 tonnes of Spodumene concentrate and 32,500 tonnes of Petalite concentrate per year for an initial 15-year life of mine ("LOM") to be the most appropriate option and was based on prices of US$800/t Spodumene and US$400/t Petalite concentrate prices respectively. 

The Updated Scoping Study models three scenarios for different Spodumene concentrate sales prices to illustrate the impact of the recent significant increase in prices of Spodumene and Petatlite. In addition, Bara Consulting escalated the capital and operating costs by United States of America inflation for a period of 4 years (at a rate of 2.0% per annum) as costs are reported in US$. No further changes have been made to the underlying economic, technical, engineering or processing assumptions used in the Scoping Study, nor resources or the mine plan.

Overall, the improvement in Spodumene pricing, and therefore the revenue factors, have a significant positive improvement in the economic results despite the escalated capital and operating costs.

Shareholders should note that the Updated Scoping Study is preliminary in nature and includes Inferred Mineral Resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorised as Mineral Reserves. The Updated Scoping Study referred to in this report is based on preliminary technical and economic assessments. It is preliminary in nature, and includes Inferred Mineral Resources which are insufficient to provide certainty that the conclusions of the Updated Scoping Study will be realised.

The results of the Updated Scoping study, together with a comparison to the Scoping Study (2017) is set out in the table below:

Notes:

Note 1: The NPVs are shown for the gross value of the Zulu Project.

Note 2: All NPV values extracted from the Updated Scoping Study have been rounded to the nearest whole M.

Note 3: The peak funding requirement has been calculated on a yearly basis and represents the peak at the end of year 2. As production is assumed to commence in year 2, the actual peak funding requirement during the year will be higher.

Note 4: Source - Updated Scoping Study.

Bara Consulting has not re-run the pit optimisation which would generate a larger pit with more mining inventory as pay limit grades would drop. A tonnage of 13.7 Mt was used in the selected optimised pit shell (shell 35) in the Scoping Study and which lies within the Maiden SAMREC Compliant Inferred Mineral Resource Estimate announced on 6 June 2017 and which amounted to 20.1 M tonnes @ 1.06 % Li₂O and 51 ppm Ta₂O₅ using a cut-off grade of 0.5% Li₂O. As the Updated Scoping Study model is based on the historical pit optimisation outcomes at lower revenue factors used in the Scoping Study, given the increase in Spodumene prices, a re-run of the pit optimisation would be expected to result in a longer life of mine or an increase in production, with an increase in the project NPV and IRR.

Zulu SAMREC Compliant Updated Scoping Study

The Updated Scoping Study has prepared in accordance with SAMREC, and was led by the following Qualified Person ("QP"), as such term is defined by SAMREC, who is independent of Premier African Minerals Limited and has read and confirmed that this announcement fairly and accurately reflects the contents of the Updated Scoping Study:

Mr. A. D. Pooley (BEng (Hons) Mining Engineering, FSAIMM) - Andrew Pooley is the managing director of Bara Consulting Pty Limited. He has approximately 26 years' experience in the mining industry. This time has been split between production work in conventional and mechanised mines, project work and consulting. He has been involved in a significant number of large pre-feasibility and feasibility studies and has also been involved in the project management and implementation of several projects.  Andrew Pooley is currently active in the following technical areas:

-    Project management. Management of multi-disciplinary teams conducting studies for new mining projects.

-    Feasibility studies. Mining design and detailed costing for various projects.

-    Due diligence. Technical audit and expert opinion on existing mining operations.

Andrew Pooley holds the following qualifications and affiliations:

-    Honors Degree in Mining Engineering from Nottingham University in the UK (B.Eng. (Hons)).

-    Fellow in good standing of the Southern African Institute of Mining and Metallurgy (FSAIMM).

Bara Consulting (Pty) Limited

Bara Consulting has reviewed the information in this announcement that relates to the Updated Scoping Study and has confirmed that the information so presented is balanced and complete and not inconsistent with the Updated Scoping Study.

Mineral Reserves and Mineral Resources

The Company estimates and discloses Mineral Reserves and Mineral Resources using the definitions adopted by the SAMREC Code. Further details are available at www.samcode.co.za/samcode-ssc/samrec. See the "Glossary of Geological and Mining Terms" for complete definitions of Mineral Reserves and Mineral Resources.

Forward Looking Statements

Certain statements in this announcement, are, or may be deemed to be, forward looking statements. Forward looking statements are identified by their use of terms and phrases such as ''believe'', ''could'', "should" ''envisage'', ''estimate'', ''intend'', ''may'', ''plan'', ''will'' or the negative of those, variations or comparable expressions, including references to assumptions. These forward-looking statements are not based on historical facts but rather on the Directors' current expectations and assumptions regarding the Company's future growth, results of operations, performance, future capital and other expenditures (including the amount, nature and sources of funding thereof), competitive advantages, business prospects and opportunities. Such forward looking statements reflect the Directors' current beliefs and assumptions and are based on information currently available to the Directors. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking statements including risks associated with vulnerability to general economic and business conditions, competition, environmental and other regulatory changes, actions by governmental authorities, the availability of capital markets, reliance on key personnel, uninsured and underinsured losses and other factors, many of which are beyond the control of the Company. Although any forward-looking statements contained in this announcement are based upon what the Directors believe to be reasonable assumptions, the Company cannot assure investors that actual results will be consistent with such forward looking statements.

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 as it forms part of UK Domestic Law by virtue of the European Union (Withdrawal) Act 2018. 

The person who arranged the release of this announcement on behalf of the Company was George Roach.

Notes to Editors:

Premier African Minerals Limited (AIM: PREM) is a multi-commodity mining and natural resource development company focused on Southern Africa with its RHA Tungsten and Zulu Lithium projects in Zimbabwe.

The Company has a diverse portfolio of projects, which include tungsten, rare earth elements, lithium and tantalum in Zimbabwe and lithium and gold in Mozambique, encompassing brownfield projects with near-term production potential to grass-roots exploration. The Company holds 5,010,333 shares in Circum Minerals Limited, the owners of the Danakil Potash Project in Ethiopia, which has the potential to be a world class asset. In addition, the Company holds a 19% interest in MN Holdings Limited, the operator of the Otjozondu Manganese Mining Project in Namibia.

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ENDS