Premier pins Zulu project rescue plan on Glencore
PREMIER African Minerals is optimistic about securing a supply deal with commodities giant Glencore Plc, which is crucial to salvaging its troubled Zulu lithium project and shoring up its balance sheet.
The London-listed miner announced last week that it had signed a non-binding letter of interest with Glencore for spodumene concentrate from its Zulu lithium/tantalum project. A deal would be strategically important to address challenges around its mounting debt. If successful, this could help Premier clear its US$35 million liability to Canmax Technologies, a shareholder in the group, and regain its footing in the fast-growing battery metals sector.
“Premier has entered into a non-binding letter of interest with Glencore International, regarding the possible purchase of spodumene concentrate,” the company said in a statement.
The potential deal includes assistance from Glencore, the world’s largest globally diversified natural resource company, in managing and repaying its debt obligations. Glencore declined to comment on the talks.
Zulu lithium
The crisis stems from a 2022 offtake prepayment agreement between Premier and Canmax, under which Premier was to deliver 50 000 metric tonnes of spodumene annually, beginning May 2023. However, the Zulu project’s spodumene concentrator, key to processing lithium ore, faced persistent technical setbacks, leaving Premier unable to fulfil the agreement. By April 2025, the unfulfilled contract had morphed into a $35 million financial albatross, threatening Premier’s solvency and straining relations with Canmax, which holds a 13 percent stake in the company.
Premier said it had reached an understanding with Canmax to finalise a binding agreement with Glencore within the next three months, an ambitious timeline, given its past performance.
“We are working towards a solution that stabilises the company and ensures long-term viability for all stakeholders,” Premier said.
The market reacted positively to the news. Premier’s shares soared over 200 percent before settling at an 80 percent gain, lifting its valuation to £25,3 million (US$33,6 million). The spike underscored investor optimism about a potential turnaround, though the non-binding nature of the Glencore letter and continued operational uncertainty at Zulu remain significant risks.
Analysts caution that much hinges on Premier’s ability to bring its processing plant online.
“A letter of interest is not a contract,” said Takunda Mpemba, a London-based mining analyst. “There is no guarantee this will result in a binding deal unless Premier delivers on grade, volume, and consistency.”
The high-stakes negotiations come as global competition for lithium intensifies, driven by the electric vehicle boom and broader energy transition. Zimbabwe, home to some of Africa’s largest hard-rock lithium deposits, is increasingly viewed as a strategic player in the global supply chain. Some investors, however, say the environment is fraught with infrastructural and regulatory challenges.
“Premier’s potential deal with Glencore speaks to a broader trend of strategic alliances in securing critical minerals. But execution is everything. Until the Zulu mine reliably produces concentrate, this deal remains more of a lifeline than a turnaround,” said energy economist, Tapiwa Chiremba.
Still, Premier insists the Glencore engagement is a step in the right direction.
“This is an important development for Premier and our stakeholders and reflects confidence in the underlying potential of the Zulu project,” the company said.
As the clock ticks on the three-month window to finalise the deal, Premier’s future, and that of its creditors, now hang in the balance.-herald
