London-listed Premier African Minerals is raising about £1.25-million through the issue of about 781.25-million shares at 0.16p each.
It will use the funds raised for the ongoing mining operations at its Zulu lithium and tantalum project, in Zimbabwe, as well as for working capital purposes.
"We are encouraged with mining operations and the run-of-mine ore grades that consistently exceed our resource estimate and this is mitigating, for the moment, the ore sorter deficiencies.
"This also supports a review of overall operations and production costs and the likely reduced production costs," CEO George Roach comments.
Premier in March replaced the original contractor at the Zulu plant and says that, while the flotation circuit is now capable of running in a constant and stable state, it will take time to fully remedy the original design deficiencies in the overall plant and move from what, in many instances, are interim fixes to the final operating plant.
Extensive ore sorting testwork will soon start and replacement ore sorters will be considered thereafter. "It remains our preferred outcome that the original supplier resolves this," the company states.
Further, the company has installed a header box and gravity feed arrangement for hydrosizers at plant.
"While there will still be some optimisation required, the initial operation suggests that the plant will run on a single hydrosizer, and this arrangement has resulted in better optimisation of the mill. The unexpected upside of this is that the overall plant capacity in respect of the crushers, milling and sizing circuit is likely to allow for a substantial increase in throughput at a lower cost than would otherwise have been the case with an additional mill," the company points out.
In addition, dense media separation-based testwork on the undersized ore fraction being stockpiled has been completed and laboratory results are awaited to determine spodumene and tantalum recoverability.
At the same time, the original-equipment manufacturer for the installed magnetic separation is assisting and working closely with Zulu.
"We have a long way to go but we remain encouraged by the fact that we are producing spodumene that is saleable. The design for the additional conditioning circuit required is complete and most components are either on site or on order.
Premier expects to take delivery of the circuit at end-June.
"Provided this timeline is met, installation and integration are expected to take a further 14 days. Normal operations are not expected to be impacted.
"This is expected to be the final component to allow recoveries at design capacity," the company states.