BMR raises £0.35m as Kabwe plant construction progresses

BMR Group announced on Friday that Peterhouse Corporate Finance had raised £0.35m - before expenses - by way of a placing of 9,333,333 new ordinary shares of 1p each in the capital of the company, at 3.75p per share.

The AIM-traded firm also gave a general update, reporting that civil construction works for the Kabwe plant remained on track, with construction scheduled to complete in the fourth quarter of 2017, ahead of the start of commissioning by the end of the year, subject to equipment suppliers meeting their delivery schedules.

Provided construction and commissioning continue to remain on track, the directors still anticipated production commencing in the first quarter next year.

The company had requested Zambian Electrical Supply Commission to supply a third 500 Kva transformer to ensure adequate capacity before plant commissioning, the board added.

BMR’s board also announced that drilling phases 3 and 4 of the Kashitu large scale mining licence exploration programme had been completed.

Evaluation of the phase 3 results, based on assays carried out in-house by x-ray fluorescence, reported selected grades of up to 40.64% of zinc and up to 18.52% of lead.

The silver grades would be announced when they became available, the board said.

Overall, while the phase 4 assay results for zinc grades were not of the same magnitude as those of phase 3, suggesting a 'tailing off' of mineralisation to the south east, the directors said they believed that they remained of interest as a potential ore-blending resource.

All results from each of the four phases of exploration were currently being analysed in conjunction with the historic exploration data.

“We have given detailed consideration to the cash requirements of the company over the next few months for the Kabwe plant construction as well as for necessary working capital,” said CEO Alex Borrelli.

“We concluded that it is in shareholders' best interests for this small fund raise to be completed without further delay while we remain in frequent discussions with African Compass International over our first drawdown request under the project construction and trade finance agreement referred to in our announcement on 8 June 2017, for the awaited initial $900,000.

“On the basis of the current fund raising and subject to ACI satisfying its commitments under that facility agreement, we are satisfied that the construction of the Kabwe plant is fully funded.”