Zulu Lithium Mine in financial distress
A critical financial situation is threatening the viability of the Zulu Lithium Mine, with the internal communication revealing significant outstanding payments to contractors, jeopardising the mine’s continued operation.
The total arrears owed to major contractors amount to a staggering US$2,7 million and the debt includes unpaid invoices for mining works, penalties, insurance and standing time.
Zulu Lithium is owned by Premier African Minerals, a company listed on the London’s Alternative Investment Markets.
The mine is located about 80 kilometers east of Bulawayo and is widely considered potentially the largest undeveloped lithium-bearing pegmatite in the Zimbabwe.
The report reveals the lack of guaranteed fuel and explosive supplies, essential for daily operations, raising concerns about the mine’s ability to maintain production levels.
“An agreed-upon payment plan established at the Meikles Hotel in Harare on June 5, 2024, has been breached,” said one source who confirmed the authenticity of the internal communication, adding “the current outstanding balance under this plan is US$1,1 million.
The contractors are demanding Zulu Lithium Mine to “regularise and catch up” with the payment plan and secure essential supplies.
Zulu Lithium has a history of struggling to meet its payment obligations to contractors. In February this year, operations at the Zulu project were halted due to these very same delays.
Premium raised approximately £2.5 million through a share offering to its shareholders. The capital raise involved issuing 900 million new ordinary shares at a price of 0,275 pence per share. The funds raised were used to support ongoing mining activities and working capital needs.
Premier 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.-ebusinessweekly
