REG - Jubilee Metals Group - Company Update

Jubilee MetalsAnnouncement

24/04/2023 07:15

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RNS Number : 1947X  Jubilee Metals Group PLC  24 April 2023

Jubilee Metals Group PLC

Registration number (4459850)

Altx share code: JBL

AIM share code: JLP

ISIN: GB0031852162

("Jubilee" or "the Company" or "the Group")

 

 

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COMPANY UPDATE

Jubilee Metals Group PLC (AIM: JLP; Altx: JBL), a leader in diversified metals
processing, with operations in Africa, is pleased to provide an update on its
South African operations and its Zambian projects for the quarter ended 31
March 2023 ("Q3 FY2023").

Q3 FY2023 OVERVIEW

Operations

§ Lost time injury frequency rate (LTIFR) of 1.0 in South Africa; LTIFR of
2.3 in Zambia

§ 11 437 PGM oz were sold with PGM operations performing on target recording
9 019 PGM oz, from own operations, plus an additional 2 418 PGM oz, through
the sale of stock under its JV Partnership agreement

§ Chrome production of 310 721 tonnes, remains on track to reach full year
guidance of 1.2 million tonnes

§ Contribution from chrome by-product credits to the PGM operations more than
doubled on the back of stronger chrome production with cost per PGM oz (after
chrome by-product credits) dropping to US$383 per PGM oz

§ Upwards momentum in platinum and palladium prices during the current
period, with chrome and copper prices remaining resilient

§ Southern Copper Refining project ramp-up resumed end of February, with a
stable supply of water and power fully restored

§ 494 tonnes of copper sold with a further 202 tonnes of equivalent copper
held in copper concentrate and metal as stock at the end of the period

§ The flexibility of Sable Refinery offers the ability to pivot between
copper and cobalt production to rapidly respond to changing market
fundamentals. Flexibility used to maximise copper equivalent production units

o  Copper production prioritised due to cobalt prices reducing by 76% from
the year's high

o  110 tonnes of Cobalt hydroxide produced prior to pivoting to copper with a
further 70 tonnes of equivalent cobalt units held in stock

Strategy and growth projects

§ Good progress made with discussions to secure a further PGM processing
footprint in the Eastern Limb, targeting an additional 25 000 PGM oz per annum
and expected to commence construction in Q4 CY2023

§ Ramp-up of copper operations at Roan Concentrator in Zambia progressing
well with full output now expected in May 2023

§ Final design reviews for the Northern Refining Strategy are underway to
confirm the implementation schedule and required investment with further
information to be provided to the market by the full year close in June

Full year Guidance FY2023

§ PGM oz guidance remains unchanged at 38 000 PGM oz with the potential of
upwards revision depending on South Africa's power supply outlook

§ Chrome operations expected to exceed guidance of 1.2 million tonnes of
chrome concentrate supported by stronger chrome prices during Q3 FY 2023

§ Copper guidance remains unchanged at 3 000 tonnes

 

STATEMENT FROM LEON COETZER, CEO:

"Our South African operations continue to deliver a strong performance
recording 9 019 PGM oz from own operations and 2 418 PGM oz through our JV
partnership agreement, for the quarter January to March. The ounces sold under
the JV agreement stem from excess stock held at Inyoni with its capacity fully
utilised under the current agreements. This places our South African
operations on track to meet and potentially exceed the full year guidance of
38 000 PGM oz. Our chrome operations once again exceeded its operational
targets recording 310 721 tonnes of chrome concentrate and are therefore
expected to exceed our full year guidance of 1.2 million tonnes. The continued
supportive chrome prices over the past quarter translated into a more than
doubled chrome by-product credit in our PGM business, which calculates to a
cost per PGM oz of US$383. This confirms the strength of the South African
operation's integrated chrome and PGM business model.

"The ramp-up of operations at the Roan copper concentrator and integration
with the Sable refinery resumed from the end of February and recorded 494
tonnes of copper units sold for Q3 FY2023 with a further 202 tonnes of copper
held in stock at Roan. The leadership of our Zambian operations team has been
strengthened to ensure that the team is better structured to deliver on the
expected performance targets, with results already seen.

"Final design reviews for our Northern Refining Strategy are underway to
confirm the implementation schedule and required investment. I hope to provide
further clarity on this at the completion of the revised capital program which
is expected by the full year close in June."

KEY OPERATIONAL NUMBERS

 COMBINED OPERATIONAL PERFORMANCE                              3 months to     6 months to

                                                       Unit    31 Mar 2023     31 Dec 2022

                                                                (Q3 FY2023)     (H1 FY2023)*
                                                               Unaudited       Unaudited
 KEY UNITS OF PRODUCT
 PGM ounces:
 -       Inyoni Facility                               Oz      9 019           18 208
 -       Third party JV                                Oz      2 418           -
 Total PGM ounces                                      Oz      11 437          18 208
 Chrome tonnes                                         Tonne   310 721         634 111
 Copper tonnes                                         Tonne   494**           915
 Copper tonnes held in stock                           Tonne   202             280

 UNIT REVENUE
 PGM revenue per ounce                                 US$/oz  1 285***        1 453
 Chrome revenue per PGM ounce                          US$/oz  2 317***        2 292
 Copper revenue per tonne                              US$/t   8 459****       7 953

 UNIT COST
 Cost per PGM ounce (after chrome by-product credits)  US$/oz  383***          608
 Cost per copper tonne                                 US$/t   6 236****       6 468*

 UNIT EARNINGS
 Earnings per PGM ounce                                US$/oz  902***          845
 Earnings per copper tonne                             US$/t   2 223**         1 485

*                 Numbers are as per the half year operational
update prior to capitalisation of proportional Roan output

**                 Includes total copper tonnes sold inclusive of Roan
produced tonnes which are capitalised prior to full commercialisation of the
 project expected by end May 2023

***            PGM cost, revenue and earnings are accounted for
based on the combined 11 437 PGM oz

                       Total chrome credits account to US$402 per
oz of total PGM oz sold during the period. Inyoni unit cost before chrome
credits were US$708 per PGM oz

****            Copper revenue and cost represent total copper
tonnes sold and include capitalised cost of Project Roan

 

SOUTH AFRICA

Jubilee's Inyoni Facility continued to deliver a strong performance in line
with expectations. The Inyoni operations achieved 9 019 PGM oz for the
quarter (100% from own operations) and additionally, sold the equivalent of 2
418 PGM oz from excess feedstock through its JV partner agreement. At the
Company's Inyoni operations, the operational cost remained tightly under
control despite the inflationary pressure and benefitted from the chrome
offset on the back of the strong performance.

The chrome operations, as a by-product of the PGM operations, continued to
perform, delivering 310 721 tonnes of chrome concentrate over the period
against a targeted 300 000 tonnes. This strong performance coupled with
increased chrome prices during the past quarter, resulted in a more than
doubling of contribution from chrome credits towards the PGM operations,
equating to US$402 per PGM oz, and resulting in a cost per PGM oz (after
chrome by-product credits) of US$383 All in unit cost for the Inyoni operation
inclusive of feed material purchases and before accounting for the chrome
credits, totalled US$708 per PGM oz.

Chrome prices remain robust with strong demand from China coupled with
constrained supply. PGM basket prices remained lower at US$1 297 per oz net of
all refining charges.

As previously announced, Jubilee has made good progress with discussions to
secure a further PGM processing footprint in the Eastern Limb of the Bushveld
complex (the north-eastern region of South Africa's chrome and PGM mining
region), with final design reviews completed for the chrome beneficiation
facility that will precede the PGM facility in the Eastern Limb. The Company
targets to commence with the construction of the chrome beneficiation circuit
as soon as regulatory approvals are secured, which is expected during Q3 of
the 2023 calendar year. The construction of the circuit is budgeted to be
completed over a six-month period. The Eastern Limb PGM facility offers the
opportunity to further increase Jubilee's PGM operational footprint by 25 000
PGM ounces.

ZAMBIA

Jubilee's 780 000 tonnes per annum Roan copper concentrator forms part of its
fully integrated Southern Copper Refining Strategy which integrates the Sable
Refinery and the Roan Concentrator with a total capacity of 12 000 tonnes of
copper per annum.

At the end of February, with the power and water disruptions across Zambia now
resolved, Project Roan re-commenced with ramping up to full production and
commercialisation of the Southern Copper Refining project. The project sold
494 copper tonnes over the period with a further 202 tonnes of equivalent
copper contained in copper concentrate and copper cathode. To date, a total
capital investment of US$48.2 million has been made for the construction,
implementation, commissioning and ramp-up of the integrated Roan project
towards reaching commercialisation. Upon reaching commercial production, the
Roan copper concentrator is expected to contribute 550 tonnes of copper per
month to the production of the Sable Refinery with a further 130 tonnes per
month of copper from third party supplies.

As announced on 20 March 2023, the upgrade of the power and water
infrastructure at Project Roan offered the potential for the simplification of
the Northern Copper Refining Strategy by utilising Roan's expanded
infrastructure to establish a central copper concentrating hub at Roan which
would significantly reduce the required capital investment and project
timelines.

The Company will provide further clarity on the expected capital investment
and updated timelines for the implementation of the Northern Copper Refining
Strategy at the completion of the revised capital program which is expected by
the end of the current reporting period.

At Sable, Jubilee successfully completed the first cobalt production runs from
waste and looks to increase the capacity to be able to produce 450 tonnes per
month of cobalt hydroxide (125 tonnes of contained cobalt) from recycled waste
alone by the end of May 2023. This additional capability offers Jubilee the
flexibility to pivot between copper and cobalt production guided by prevailing
market conditions. Cobalt prices have depreciated sharply over the period with
cobalt hydroxide prices reducing by 76% from its highs during April 2022.
Cobalt production has therefore been halted and will resume once the market
displays signs of recovery.

24 April 2023

 

FOR FURTHER INFORMATION VISIT WWW.JUBILEEMETALSGROUP.COM
(http://WWW.JUBILEEMETALSGROUP.COM) OR PLEASE CONTACT:

 

 Jubilee Metals Group PLC                             Tel: +27 (0) 11 465 1913

 Leon Coetzer
 PR & IR Adviser - Tavistock                          Tel: +44 (0) 20 7920 3150

 Jos Simson/ Gareth Tredway
 Nominated Adviser - SPARK Advisory Partners Limited  Tel: +44 (0) 20 3368 3555

 Andrew Emmott/ James Keeshan
 Joint Broker - Berenberg                             Tel: +44 (0) 20 3207 7800

 Matthew Armitt/ Jennifer Lee/ Detlir Elezi
 Joint Broker - WHIreland                             Tel: +44 (0) 20 7220 1670/

 Harry Ansell/ Katy Mitchell                           +44 (0) 113 394 6618
 JSE Sponsor - Questco Corporate Advisory Pty Ltd     Tel: +27 (0) 11 011 9207

 Alison McLaren

 

 

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