REG - Jubilee Metals Group - Copper Projects Update

Jubilee MetalsAnnouncement

23/09/2024 07:00

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RNS Number : 1392F  Jubilee Metals Group PLC  23 September 2024

Jubilee Metals Group PLC

Registration number (4459850)

AIM share code: JLP

Altx share code: JBL

ISIN: GB0031852162

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

 

 

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Copper Projects Update

 

Jubilee, a diversified metals producer with operations in Zambia and South
Africa, is pleased to provide an update on the implementation of its Copper
Strategy in Zambia.

 

The Zambian Copper strategy is centred around an initial processing capacity
target of 25 000 tonnes of copper per year, supported by two key operational
sites: the integrated Sable Refinery (Sable) and the upgraded Roan
Concentrator (Roan). The Company aims to fully utilise this capacity by
bringing its secured copper resources into production through open-pit mining
operations and the reprocessing of surface waste.

 

A crucial factor for successfully executing the Copper Strategy was securing a
stable power supply, a significant challenge in Zambia. The Company is pleased
to announce that its recently signed power purchase agreement with Lunsemfwa
Hydro Power Company (LHPC) which has been implemented, with uninterrupted
power being delivered to Jubilee's operations as of last week covering all of
its processing plants' power requirements with 100% renewable power.

 

 

Highlights

 

·    Stable power supply to Zambian operations commenced after
successfully implementing the LHPC agreement on 18 September 2024.

·    Roan front-end module has achieved design capacity, and operations
have been handed over to the Roan operational team.

·    Munkoyo open-pit operations began ramping up, targeting to reach 15
000 tonnes of run-of-mine ore per month comprising 5 000 tonnes of 3.0%
high-grade copper ore delivered direct to the Sable Refinery while the sub
1.0% lower grade copper ore is being stockpiled at site for further
processing.

·    Large Waste Rock project, with over 260 million tonnes of surface
rock, is set to begin a commercial trial of 15 000 tonnes processed through
Roan's front-end module in November 2024 as part of the final due diligence
review.

 

Leon Coetzer, CEO of Jubilee commented:

 

"I am pleased to provide this update on the progress of the implementation of
our Copper Strategy in Zambia. Establishing a stable power supply was crucial
to maintaining steady progress in our projects. The frequent rolling outages
posed an ongoing risk to the stability of our operations, so I am grateful
that we have now secured a reliable, continuous power source. This has been a
critical factor in achieving design throughput at our new Roan front-end
module.

 

With upgrades at our Roan Concentrator and Sable Refinery, we are
well-positioned to achieve our initial target processing capacity of 25 000
tonnes of copper per year. The recent milestones, including the ramp-up of our
Munkoyo open-pit operation, near completion of our due diligence of Project G,
which if successful will be brought into operation within 4 months, ensure a
continued upward drive in our copper output. Our discussions to secure a
further two open pit opportunities are progressing well and I am confident in
our ability to secure further similar opportunities.

 

We are nearing the completion of due diligence for our Waste Rock project,
with the distinct advantage of conducting a full-scale commercial trial using
our new Roan front-end module.

 

We are optimistic about the future and remain focused on bringing our secured
copper resources into production as we fully utilise our expanded processing
capacity. I look forward to keeping the market updated on all developments as
they unfold."

 

Implementation of Processing Capacity

 

The increased processing capacity of 25 000 tonnes of copper per annum will be
achieved through upgrades to both the Roan Concentrator and the Sable
Refinery.

 

The Roan Concentrator upgrade is now complete, with its front-end module
reaching design throughput of 45 tonnes per hour of waste rock feed for an
8-hour continuous period under the supervision of the Jubilee technical team.
This milestone has enabled the handover of operations to the Roan operational
team to operate the plant on a 24-hour continuous period.

 

Additionally, the commencement of stable power supply through the LHPC
agreement ensures continuous operation of Roan's front-end module targeting to
achieve 30 000 tonnes per month feed rate.  Roan's front-end module
production is expected to start reflecting in the production of Q4 CY2024 as
it commences to operate continuously which is in-line with the Company's
copper production forecast.

 

Roan is now capable of processing both historically mined low grade stockpiled
material and previously processed materials simultaneously, with a combined
capacity of its front-end module as well as milling and flotation plant of up
to 13 000 tonnes of copper per annum (4 500 and 8 500 capacity respectively),
depending on the feed grade. Roan will initially be dedicated to processing
waste from historical mining operations, upgrading copper materials into a
saleable concentrate that can either be sold on the market or further refined
at Sable, depending on Sable's available capacity.

 

The planned Sable Refinery upgrade marks the final stage in reaching the
initial target of a combined 25 000 tonnes of copper processing capacity per
annum. This upgrade includes enhancements across several areas of the
refinery, culminating in the commissioning of a second tank house for copper
cathode plating. Upon completion, Sable will be capable of producing both
copper sulphide concentrates and copper cathode, with a combined output of 16
000 tonnes per annum. The upgrade is currently underway and expected to be
fully integrated into the existing operations over the next 10 months with an
expected capital investment of US$9 million, confirming the processing
capacity of 25 000 tonnes annually. The Company's focus is now shifting
towards bringing secured copper resources into full production to fully
utilise this upgraded capacity in line with the production forecast which
assumes that the impact of the capacity upgrades will reflect during H2
FY2025.

 

Copper Resources

 

Open Pit Mining Operations

 

Jubilee acquired a 95% interest in the Munkoyo mine, which is located within
55 kilometres of the Sable Refinery, in June 2024 and proceeded to develop an
open pit mining operation to access the near surface weathered copper reefs.

 

The Munkoyo open-pit mining operations yield high-grade copper ore, which is
transported directly to Sable, as well as lower-grade copper ore that is
stockpiled on-site for further processing at a regional processing hub
(discussed further below). The high-grade ore, with a target copper content of
3.0%, is refined at Sable. Munkoyo commenced operations in July 2024 and
continues to ramp up to an initial target of 15 000 tonnes per month of
run-of-mine of which 5 000 tonnes per month are to be delivered directly to
Sable for refining. Munkoyo remains on track to reach its initial target of 15
000 tonnes per month mined run-of-mine ore by December 2024.

 

A resource drilling program is currently underway, and depending on the
confirmation of resource continuity, will target the potential to increase
production to 20 000 to 25 000 tonnes of run-of-mine ore per month.

 

The decision on the capacity of the regional processing hub is currently
under-review and subject to the completion of the technical development
program which is expected to be completed over the coming 4 months. The
regional hub will focus on upgrading the mined and currently stockpiled lower
grade copper reef (sub 1.0%). This material will then be transported as a high
grade copper concentrate to Sable which could potentially double the copper
output from Munkoyo delivered to Sable. This approach would be replicated for
all the open cast mining operations that Jubilee targets for acquisition.

 

Project G is the second open-pit mining operation being evaluated by Jubilee.
The Company is nearing the completion of its due diligence, which has included
full-scale processing trials at the Sable Refinery. A final decision on
Project G is anticipated by the end of September 2024. The due diligence
focuses on an initial mining rate of 10 000 tonnes per month achievable by
February 2025, with an existing on-site upgrading facility of the run-of-mine
material which already can produce 3 000 tonnes of copper concentrate per
month, containing 10% to 15% copper, for refining at Sable.  The lower grade
copper reef will initially be stockpiled at source for future processing
through the regional processing hub.

 

Jubilee is also in advanced discussions regarding two additional open-pit
mining opportunities in the Munkoyo and Project G region, as it aims to fully
dedicate Sable's 16 000 tonne per annum copper refining capacity to processing
open-pit mining resources. Jubilee has set a goal to achieve this by December
2025.

 

Previously Mined Waste Rock

 

Roan has begun processing low grade stockpiled material from historical mining
operations through its newly commissioned front-end module. The module is
designed to upgrade the waste rock material more than tenfold, producing a
high-grade copper concentrate in excess of 10% copper contained for further
refining or market trading. Additionally, the plant generates a lower-grade
copper stream that requires further processing. The Jubilee technical team is
currently evaluating various metal extraction techniques to refine this waste
stream, with a preference for on-site flotation and leaching. The review
includes exploring the use of glycine-based heap leaching in partnership with
Draslovka, a mining processing specialist. A semi-commercial trial for
flotation and on-site leaching of the low-grade copper stream is scheduled for
February 2025.

 

The large Waste Rock Project, with an estimated 260 million tonnes of surface
material, is currently undergoing its final technical review. As previously
announced, Jubilee has secured the rights to the extensive waste rock
stockpile, pending the successful completion of due diligence to Jubilee's
satisfaction, in partnership with International Resources Holding (IRH) from
Abu Dhabi.

 

The due diligence of the copper waste rock material undertaken by Jubilee has
included various sampling campaigns as well as laboratory and pilot scale test
programs to confirm the upgradability. In parallel to the test program,
Jubilee entered into agreements to accelerate delivery timelines of key long
lead items.

 

Jubilee has reached agreement to extend the due diligence period to 6 November
2024 to accommodate the extensive test program which culminates in a full
commercial trial of the large Waste Rock Material through the newly
commissioned Roan front-end module. It is planned to process approximately 15
000 tonnes of the material at Roan as final confirmation of the response of
the material to the proposed processing solution. Due to the initial delays in
the commissioning of Roan it is expected that the due diligence period will be
extended to January 2025 subject to agreement reached to ensure sufficient
time to complete the commercial trial and allow the Jubilee technical and
commercial team to complete the review of the results.

 

To date, US$4.95 million has been advanced to secure the rights to the large
Waste Rock Project, as part of the overall acquisition price of US$30 million,
payable quarterly over 18 months, contingent on the successful completion of
the due diligence period. According to the terms of the agreement, Jubilee
will forfeit the payments made thus far if it decides not to proceed with the
project. The successful completion of due diligence is a critical factor in
maintaining Jubilee's partnership with IRH.

 

The scale of the large Waste Rock Project indicates the need for four
processing modules similar to the Roan front-end module, requiring an
estimated capital investment of around US$50 million subject to funding.
Preliminary production estimates suggest that these modules could collectively
produce approximately 2 000 tonnes of copper per month.

 

An accelerated construction schedule for all four modules could generate
economies of scale and significant cost reductions. The project timeline for
implementing all four modules depends on the sequencing of their installation,
but through the establishment of strategic partnerships with the suppliers of
key long lead items, modules could be completed within a 12-month period from
the commencement of construction.

 

The figures above serve only as indicative numbers of the potential that the
resource holds based on the assumptions and test work undertaken by Jubilee's
technical services department and the successful completion of the due
diligence which includes the commercial trial at Roan.

 

 

Background Information on LHPC

 

LHPC is an established independent power producer in Zambia that owns and
operates two hydropower plants in the central province. LHPC is a member of
the Southern Africa Power Pool and an active power trader in the regional
market. LHPC is building a 20MW solar plant and plans to use its portfolio of
renewable power sources to meet Jubilee Zambia's power requirements. The
agreement highlights Jubilee's dedication to sustainable energy practices. The
power will be supplied from an integrated solar power and hydro-storage
facility which is expected to be brought into operation over the coming 12
months.  Under the agreement all of the current power needs of both Sable and
Roan will be supplied via the LHPC agreement.

 

 

ENDS

23 September 2024

For further information visit www.jubileemetalsgroup.com
(http://www.jubileemetalsgroup.com) , follow Jubilee on Twitter
(@Jubilee_Metals), visit www.lunsemfwahydro.com.zm  or contact below:

Jubilee Metals Group PLC

Leon Coetzer (CEO)

Tel: +27 (0) 11 465 1913

Nominated Adviser - SPARK Advisory Partners Limited

Andrew Emmott/James Keeshan

Tel: +44 (0) 20 3368 3555

PR & IR Adviser - Tavistock

Jos Simson/ Gareth Tredway

Tel: +44 (0) 207 920 3150

Joint Broker - RBC Capital Markets

Farid Dadashev/Jamil Miah

Tel +44 (0) 20 7653 4000

Joint Broker - Zeus Capital

Harry Ansell/Katy Mitchell

Tel: +44 (0) 20 7220 1670/+44 (0) 113 394 6618

JSE Sponsor - Questco Corporate Advisory Proprietary Limited

Alison McLaren

Tel: +27 (0)11 011 9207

 

About Jubilee

 

Jubilee is a low-cost, diversified producer, specialising in the recovery and
processing of metals from previously overlooked resources, such as unprocessed
historical waste rock, run-of-mine materials and tailings in Zambia and South
Africa. The Company's low-capex, modular processing facilities are deployed
close to these various types of material, producing high-grade concentrates
for sale or further refining to finished metal at the Company's downstream
facilities. Production currently consists of copper, chrome, and platinum
group metals (PGMs). The modular processing facilities offer a platform for
growth and the rapid expansion of Jubilee's operational footprint in Zambia
and South Africa. Jubilee's success is derived from operational and technical
excellence, an experienced management team and a pioneering Technical
Development Centre.

 

 

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