Premier African Minerals : RHA update & Proposed Zulu Lithium Listing

Premier African Minerals Limited / Ticker: PREM / Index: AIM / Sector: Mining

For immediate release

5 January 2018

Premier African Minerals Limited

('Premier' or the 'Company')

RHA update

Proposed Separate Listing of Zulu Lithium

('Zulu')

RHA Tungsten

Further to the announcement on 2 January 2018, Premier advises that whilst plant throughput during the latter part of December 2017 exceeded the target of 6,000 tonnes in aggregate ore feed, the ore processed was largely from on-strike development at a diluted ore grade insufficient to achieve planned profitable production. RHA mine management has advised that development to expose stopes has lagged and mining of undiluted ore from stopes will now only be possible from the latter part of Q1 and accordingly, RHA requires additional financial support until this time. Premier has previously stated that it will not provide any further finance other than in the form of a bridging facility for concentrate ready for shipment. In summary, the status of RHA is as follows:

· Ore delivered to surface is at diluted grade and deviates from the Resource grade. Development in preparation for mining stopes causes mining dilution of approximately 3 to 1.

· Predicted Resource grades from stope ore as opposed to development ore are adequate to achieve profitable operation.

· Open pit operations are suspended and may resume subject to a further short-hole drilling programme that would indicate how much additional stripping is required to access predicted grade improvements.

Continuing operations at RHA are now dependent on additional sources of capital being provided. New policy statements in Zimbabwe enable 100% foreign ownership of mining projects (outside the diamond and platinum sectors). Premier is currently in discussions with the National Indigenisation and Economic Development Fund ('NIEEF'), which has an interest of 51% in RHA, to agree alternative financing options. As previously stated, Premier has sole-funded RHA to date and the plant and equipment at RHA are exclusively owned by Premier. The mineral claims are ceded as security under the plant rental agreement by RHA to Premier. RHA will complete one final shipment before mid-January and will then suspend production until such time as a commercial and viable agreement is reached with NIEEF to ensure a long-term future for RHA. Premier will continue to incur minimal ongoing care and maintenance costs in relation to RHA whilst the position is resolved.

Zulu Lithium

As announced on 2 January 2018, the Board of Premier has decided that a separate listing should be sought for the Zulu Project ('Zulu NewCo') to maximise the value of the project.

Over the past 18 months, Premier has made significant progress in the development of the Zulu Lithium Project and given the market valuations for comparable hard-rock lithium projects, the Board believes that significant value can be unlocked for shareholders by having a separate listing for Zulu.

Premier is currently therefore considering with its advisers a separate listing of Zulu in London. The listing is intended to take place as soon as possible, subject to regulatory and other approvals. Premier intends, subject to appropriate legal and taxation advice, to distribute (at nil cost) to Premier shareholders at the time of listing a substantial proportion of Premier's retained interest in Zulu Newco.

George Roach, Premier's CEO, commented:'In terms of RHA, Premier has been the sole funder of RHA to date, although it only has a 49% interest. The proposed new legislation in Zimbabwe will permit 100% foreign ownership and Premier is therefore currently in discussions with NIEEF, as well as other interested groups, to review alternative financing arrangements that will allow for further external funding for RHA. I remain confident that when RHA is equitably financed, the mine has a sustainable future.

It is evident that a separate listing of Zulu Lithium has the potential to unlock significant value based on comparable hard-rock lithium projects. I am also pleased to state that Premier intends to distribute a substantial proportion of its retained shares in the separately listed Zulu to Premier shareholders in the most efficient manner at that time to enable them to directly benefit from any value uplift.'

Enquiries:

Notes to Editors:

Premier African Minerals Limited (AIM: PREM) is a multi-commodity mining and natural resource development company focused in Southern and Western Africa with production started at its flagship RHA project in Zimbabwe.

The Company has a diverse portfolio of projects, which include tungsten, rare earth elements, lithium and tantalum in Zimbabwe, encompassing brownfield projects with near-term production potential to grass-roots exploration. In addition, the Company holds 5,010,333 shares in Circum Minerals Limited ('Circum'), the owners of the Danakil Potash Project in Ethiopia, which has the potential to be a world class asset. At present those shares are valued at US$10.2 million based on the latest price at which Circum has accepted subscriptions. Premier also has an interest in Casa Mining Limited, a privately-owned exploration company that has a 71.25% interest in the 1.5 million ounce inferred resource Akyanga gold deposit in the DRC.

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.

This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014.

ENDS