Jubilee Metals Group PLC (LON:JLP), a leading diversified metals processor in Africa with significant operations in South Africa and Zambia, has published its Operational Update and production figures for the quarter ended 31 March 2024 and also provides an update on its rapidly expanding partnerships with small-scale copper miners in Zambia.
Highlights
South Africa
| · | Third quarter Lost Time Injury Frequency Rate (LTIFR) improved to 1.45 (Q2 FY2024: 2.17). |
| · | Record Q3 FY2024 chrome production of 408 710 tonnes achieved (Q2 FY2024: 381 114 tonnes), despite being a quarter traditionally known for lower production rates due to the January holiday period. |
| · | The month of March 2024 set a record monthly production of 145 102 tonnes of chrome concentrates. |
| · | Year-to-date (9 months to 31 March 2024) chrome concentrate production increased by 19.2% to reach 1 126 506 tonnes compared to 944 832 tonnes for the prior year comparative period. |
| · | Construction of a second chrome processing module at Jubilee’s Thutse Project, with a design capacity to produce 300 000 tonnes of chrome concentrates per annum, remains on track for completion in August 2024. |
| · | Jubilee’s fixed margin chrome tolling agreements which are in addition to the processing of Jubilee’s own resources, have been further extended to 2027, recognising Jubilee’s processing excellence. |
| · | Platinum Group Metals 6E (“PGM 6E”) production quarter-on-quarter reduced to 8 339 oz (Q2 FY2024: 10 131 oz), mainly due to reducing available stock of lower grade feed material. The year-to-date PGM 6E production was 3.6% lower at 28 583 oz compared to 29 645 oz for the comparative period. |
Zambia
| · | LTIFR increased to 1.27 in Zambia (Q2 FY2024: 0.61) due to two classified injuries reported at Sable during January 2024. |
| · | Copper production during the quarter has been impacted by the scheduled construction activities at the Roan concentrator (Roan) and Sable refinery (Sable) with 691 tonnes (Q2 FY2024: 749 tonnes) of contained copper in cathode and concentrates (Contained Copper) produced, while in process copper inventory increased to 192 tonnes which is expected to continue increasing following the commissioning activities at Roan. |
| · | Year-to-date copper production increased by 68.5% to reach 2 374 tonnes (1 409 tonnes for the prior year comparative period) supported by the accelerated expansion of the operations prior to the expansion of Roan. |
| · | The expansion of Jubilee’s Roan copper concentrator (Project Roan) is set to deliver increased production during the current quarter targeting an annual capacity of 13 000 tonnes per annum of copper. Project Roan has experienced a 6 week delay in the delivery of the final electrical components. This will impact the completion of the commissioning of the final circuits and based on the latest delivery schedules, the team is set to conclude assembly and commissioning by the end of May 2024. |
| · | Jubilee executed two small-scale miners’ partnership agreements offering the potential to deliver first material to the upgraded Roan and Sable from June 2024. |
| · | Jubilee is in advanced discussions to conclude three further copper partnership agreements to potentially secure a total of five small-scale copper mine partnership agreements, which combined would offer the potential to deliver copper units that far exceed the installed 16 000 tonnes per annum copper processing and refining capacity in Zambia. |
Production guidance for the 2024 financial year
| · | The chrome and PGM production guidance remains unchanged at 1.45 million tonnes (FY2023: 1.2 million tonnes) of chrome concentrates, and 40 000 – 42 000 PGM 6E oz (FY2023 produced 42 433 PGM 6E oz) for the current financial year ending June 2024. |
| · | Revised copper guidance of 3 250 – 4 000 tonnes (FY2023 produced 2 923 tonnes), taking into account the delay to complete the Roan expansion. |
Statement from Leon Coetzer, Jubilee Metals CEO:
“Our South African chrome operations have delivered an exceptional performance, setting new record production levels for both the quarter and our monthly output for March 2024. The team’s performance speaks to our renowned technical and processing capabilities supported by the modular expansion approach. The processing efficiencies underpinning this performance continues to offer additional growth opportunities in this sector.
We remain firmly committed to replicating the success of this modular expansion strategy at our Zambian Operations. I am encouraged by the team’s ability to overcome the final frustrating logistical difficulties that have challenged the completion of Project Roan. Project Roan offers us the ability to significantly step-up our copper production in Zambia within the current quarter.
Project Roan and the expansion of Sable are supported by our rapidly growing footprint of secured copper resources. These resources include the increased feed sources from small-scale partnership agreements in addition to the already secured long term feed supply to Roan.
Our large surface copper Waste Rock Project continues to develop in partnership with International Resources Holding RSC Limited (IRH) from Abu Dhabi. The potential of these projects combined sets Jubilee on a path to far exceed its initial target of 25 000 tonnes per annum of copper over the next two years.
Jubilee is well-positioned to continue its growth trajectory. Delivering on another successful quarter, highlights our operational excellence, resilience and adaptability. With robust operations in South Africa and a solid foundation for growth established in Zambia, Jubilee is well-positioned to deliver a strong Q4 performance, with production increases expected across all commodities.”
Quarterly production results
The table below presents the unaudited operational performance of the group for Q3 FY2024:
| Q3 FY2024 | Q2 FY2024 | % change | YTDFY2024 | YTDFY2023 | % change | ||
| PGM 6E | oz | 8 339 | 10 131 | (17.7%) | 28 583 | 29 645 | (3.6%) |
| Chrome | tonnes | 408 710 | 381 114 | 7.2% | 1 126 506 | 944 832 | 19.2% |
| Copper tonnes | tonnes | 691 | 749 | (8.4%) | 2 374 | 1 409 | 68.5% |
South Africa
Jubilee’s chrome business delivers a strong performance in the quarter under review owing to increased operational efficiencies, and Jubilee’s modular expansion approach. The construction of the second Thutse chrome processing module, with a capacity to produce 300 000 tonnes of chrome concentrates per annum, remains on track for completion in August 2024 and will bring Jubilee a step closer to achieving its targeted production of 2.1 million tonnes of chrome concentrate per annum.
Additionally, the extension of the chrome tolling agreements through to February 2027, securing a total processing feed capacity of 2.4 million tonnes per annum in relation to fixed margin feed, speaks to the acknowledgement by the industry of Jubilee’s operational excellence and capabilities. The Group’s PGM 6E operation performance was slightly down quarter on quarter owing to a variability in feed grade however, this has been offset by a very strong quarter of chrome concentrate production.
Zambia
Jubilee remains focused on achieving low-cost, near-term production growth and expanding operations in Zambia to exceed 25 000 tonnes per annum of Contained Copper through innovative modular processing technology.
The first modular expansion is currently being completed as part of Project Roan which is set for completion during the current quarter. The technologies deployed in the modular units have proven very successful in upgrading the copper ores produced by the small-scale miners in Zambia offering Jubilee the opportunity to partner with the owners of these operations to upscale their operations while securing copper bearing material for further refining by Jubilee. This largely unexploited sector offers Jubilee the potential to rapidly deploy its modular copper processing units across a large number of current mines assisting both the sustainability of the small-scale miner as well as offering exponential growth in the refining of these copper units.
Waste Rock Project
As previously announced, Jubilee and IRH entered into a binding framework and joint venture agreement in December 2023 for the implementation of the Waste Rock Project, which targets the processing of in excess of 260 million tonnes of copper containing surface material. Under the binding framework and joint venture agreement, IRH has elected to exercise its right to form the dedicated joint venture through which the project will be implemented. The project targets to initially implement four modular processing plants, holding a combined processing capacity of 2.4 million tonnes per annum capable of producing more than 20 000 tonnes of copper in concentrates per annum.
As per the agreement with IRH, Jubilee is undertaking a detailed resource definition to confirm the material reclamation strategy and location of the targeted processing units.
Project Roan Upgrade
The assembly of the new front-end modular unit at Roan is scheduled to commence commissioning and ramp-up during May 2024. This will expand the overall capacity of Roan to produce up to 13 000 tonnes of Contained Copper per annum.
The completion of the upgrade has been frustrated by the delay in the delivery of the final electrical components due to logistical challenges and based on current delivery schedules, has delayed the completion of the project by six weeks expected to the end of May 2024. This delay impacts the forecasted copper tonnes for the FY2024 period as the full impact of the upgrade will only be seen during the month of June 2024.
Sable Refinery Upgrade
Sable’s sulphide circuit expansion is expected to commence during Q3 CY2024. This upgrade is set to expand Sable’s capacity to produce 16 000 tonnes per annum of Contained Copper.
Zambia Small-Scale Mining Partners
Project Munkoyo forms part of Jubilee’s commitment to work with small-scale miners in Zambia and to convert their operations into sustainable long term copper operations. Project Munkoyo remains on-track to deliver initial copper ore to Sable in September 2024. Project Munkoyo is expected to commence with a 300 000 tonnes per annum mining operation that could potentially deliver an additional 4 500 tonnes per annum of contained copper to Sable for refining. The further expansion of Sable will be determined based on the completion of the copper resource definition.
Jubilee Metals has successfully completed two additional small-scale copper mines partnership agreements with one near Sable while the other is located within a 10 km radius of Roan. The project scope includes the extension of the current open-pit and surface operations and the inclusion of a modular copper processing unit to produce copper oxide concentrates suitable for further refining. The project near Roan will utilise the existing front end modular unit at Roan.
Both projects have immediate copper bearing material available from early-stage test work which will either be processed at Roan or refined at Sable as part of Jubilee’s due diligence review. The transactions afford Jubilee the right to secure a majority ownership interest in both operations capped to a maximum amount of US$3 million following the completion of the due diligence period.
Initial estimates indicate that the two additional projects could potentially contribute a further 240 000 tonnes per annum of copper bearing material for processing at Sable and Roan.
