Mining exploration and production company Premier African Minerals’ (PREM:AIM) £300,000 cash call at a 20% discount to last night’s price for a gold deal has frustrated investors.
Shares in the mining minnow, which acquires and develops mineral properties across Africa, trade 8.6% lower at 0.36p on the news.
Premier African Minerals has taken a 4.5% stake in private firm Casa Mining which owns various gold mining and exploration licences in the Democratic Republic of Congo.
NOT THE FIRST
Interestingly, another AIM-quoted firm already has an investment in Casa. Ortac Resources (OTC:AIM) has been busy building a stake and now owns 19.6% of the business.
Casa’s flagship asset is the Akyanga deposit which has a 1.2m ounce resource with an average gold grade of 1.7 grams per tonne.
A scoping study has confirmed 80,000 ounces of gold per year could potentially be recovered via a heap leach operation.
Casa plans to run a 5,000 metre drill programme soon as it targets 3m oz of gold from Akyanga. A revised scoping study will be published by the end of 2017.
While over $30m has been spent by Casa to identify a 60km-long corridor prospective for gold, the Central African country is notoriously a difficult place in which to do work.
It looks an odd deal for Premier African Minerals, which continues to take a scattergun approach to its career.
First tungsten, then lithium and now gold; investors may prefer it to have a tighter focus on a single commodity.