Emmerson moves to pre-construction at Khemisset

The AIM-traded firm said it had awarded the first basic engineering contract to Barr Engineering for the mineral processing facility, on-time and within budget.

It said the contract was prioritised to address the project's “critical path” focussed on achieving first production in early 2024.

Emmerson said it expected to select the further contractors for the balance of basic engineering before the end of the year, signing contracts by the end of January.

“The financing deal we secured with GSM and GQC included an upfront cash injection so that we could advance the next stage of the project's development, the basic engineering,” said chief executive officer Graham Clarke.

“This is part of the upfront capital expenditure, rather than an additional cost, and moves us firmly into the pre-construction phase.”

Clarke said that, having already signed the contract with Barr Engineering for the mineral processing facility, the company also received bids for the balance of the basic engineering aspects of the project, comprising highways connection and site access, portal and declines, mine site infrastructure, tailings storage facility, electrical power, and water.

“We expect to be able to sign contracts for these before the end of January 2022 so that this work can be dual tracked with the due diligence phase of the lending banks syndicate.”

At 1400 GMT, shares in Emmerson were down 3.91% at 6.2p.