Jubilee Metals Group plc (LON:JLP), a diversified leader in metals processing with operations in Africa, has announced an operational and projects update to 31 December 2023. The Group has delivered a robust Q2 operational performance and remains on track to deliver against the production guidance for the 2024 financial year.
Operational highlights
· Q2 FY2024 production figures:
o Chrome concentrate production increased by 13.2% setting a new quarterly production record of 381 114 tonnes, (Q1 FY2024: 336 683 tonnes) benefiting from the Thutse Project reaching full production targets.
o Inyoni’s PGM production was maintained at 10 131 oz in what is traditionally a slower quarter (Q1 FY2024: 10 113 oz), with no third-party production in the period.
o Copper cathode and copper in concentrate production reached 749 tonnes (Q1 FY2024: 934 tonnes). The production was achieved despite the operational disruptions at Roan as part of the ongoing upgrade project which is set to significantly increase copper production during the current half year period.
· Lost Time Frequency Injury Rate (LTFIR) for Zambia improved to 0.61 (Q1 FY2024: 2.36). LTFIR for South Africa was 2.17 (Q1 FY2024: 1.44).
Key Projects highlights
· Jubilee has elected to expand the Thutse Project with the addition of a further 50 000 tonnes per month feed processing module, following the successful completion of the first chrome module during August 2023. The potential expansion will move us nearer to our objective of producing 2.1 million tonnes of chrome concentrate per annum.
· Roan copper concentrator was brought back into operation during December 2023 to reduce the impact of the front-end upgrade project start-up being postponed due to the delay in the delivery of a critical electrical components due to the ongoing logistics constraints at ports across South Africa.
· Roan will continue to operate at approximately 50% of full capacity while an alternative solution is being pursued to source the electrical components which includes the option to locally manufacture the components. A 9 weeks delay is expected to the upgrade of the Roan project.
· The development of Project M (Monkoyo Copper Resource) near Jubilee’s Sable Refinery is progressing to schedule with the first test material from this exciting copper resource expected to be delivered to the Sable refinery during Q4 FY2024. The material forms part of the development of detailed surface copper resource definition, which offers the potential of a long-term quality copper supply to Sable Refinery from early in the 2025 calendar year.
· The accelerated development of the newly secured large copper waste rock asset is being progressed along various work streams. This includes the development of a more detailed resource definition, undertaking bulk processing trials of the source material by Jubilee Technical Services (“JTS”) to confirm detail designs of the processing units, and the securing of manufacturing capacity for plant and equipment.
· The expansion of the sulphide copper recovery circuit at the Sable Refinery is progressing to schedule with installation expected to commence during Q3 CY2024 which aligns with the expected near-term increase in copper concentrate delivery from the various copper expansion projects.
Leon Coetzer, CEO commented:
“In the face of a dynamic and challenging global market, Jubilee has continued to demonstrate resilience and adaptability, delivering a strong operational performance in the second quarter of the 2024 fiscal year. Our commitment to operational excellence and strategic growth is evident in our robust production figures and sustained progress across key projects.
“We are particularly proud of the significant increase in chrome concentrate production setting a record for Jubilee. The targeted expansion of our Thutse project brings us closer to reaching our strategic goal of 2.1 million tonnes of chrome concentrate per annum. Our chrome operations are capable of funding the expansion capital from its cash generation, and the commencement of the Thutse expansion is subject to internal capital and funding approval processes.
“In Zambia the team were able to grow our copper output despite the operational interruptions caused by the Roan front-end upgrade and associated import delays. The team is working tirelessly to overcome the delay and will continue to operate Roan at a reduced capacity during this time.
“I am excited by the early indications from both our Project M and newly secured large waste rock asset. Both projects offer significant growth opportunities anchored by a large copper resource. We will keep shareholders updated on the development of both projects.
“Safety remains a core value at Jubilee, and we continue our unwavering commitment to the health and safety of our workforce to continuously improve.
“In conclusion, Jubilee is well-positioned to continue its growth trajectory. Our operational achievements, strategic expansions, and strong market presence underscore our resilience and adaptability in a complex global landscape. We remain committed to delivering value to our stakeholders and playing a pivotal role in the sustainable development of the metals processing industry.”
Projects Update
South Africa
Thutse complex
The Group is making progress in negotiations to establish additional Life-of-Mine (“LOM”) partnerships. Concurrently, the Company is focusing on expanding its chrome operations through the implementation of one additional processing module. This initiative is part of the Company’s strategic plan to achieve a future annual chrome concentrate production milestone in excess of 2 million tonnes per annum. This expansion will be approximately US$6 million, funded through cash generated by the chrome operations, the commencement of the project is subject to our internal capital and funding approval processes.
The success of the Thutse Project has motivated the further expansion of the Thutse operations by implementing a further 50 000 tonnes per month feed processing unit at Thutse. This expansion takes Jubilee Metals a step closer towards achieving a targeted 2.1 million tonnes per annum of chrome concentrate. It is expected that the additional chrome module will be implemented during Q3 CY2024 and is capable of producing an additional 300 000 tonnes of chrome concentrate per annum.
Zambia
Historical Waste Rock Dump in Zambia
As announced during November 2023, Jubilee secured one of the largest copper waste rock assets on surface in Zambia and has formed a strategic partnership with Abu Dhabi based International Resources Holding RSC Limited (“IRH”).
Jubilee executed a binding funding term sheet with IRH to form a dedicated special purpose vehicle (“SPV”) through which both the acquisition of the copper waste rock asset and implementation of the processing solution will be funded. According to the terms of the funding term sheet, IRH and Jubilee will aim to complete the implementation of the SPV and associated appointments by 31 January 2024. IRH will provide the necessary capital through equity and loans, subject only to IRH completing its due diligence. Jubilee will design, implement, and operate the Waste Rock Project, set to commence in Q1 CY2024. With a total projected investment of around US$50 million, this venture highlights Jubilee’s commitment to delivering cost-effective and environmentally sustainable mining solutions.
The accelerated development of the Waste Rock Project is being progressed along various work streams which includes the development of a more detailed resource definition, processing trials undertaken by JTS to confirm the designs of processing units and securing manufacturing capacity for plant and equipment.
Project Roan
The upgrade of Roan currently underway includes the implementation of a 50 000 tonnes per month modular unit, which allows Roan to simultaneously process multiple feed sources. JTS is currently completing a review of various additional feed sources near Roan which is in addition to the previously announced approximate 6-year off-take agreement of unprocessed copper ROM material discarded as mined waste. The upgraded Roan is perfectly positioned to uniquely capitalise on the opportunities on offer.
Project Roan, through these key upgrades, is poised for a significant operational rebound.
The Roan front-end upgrade has suffered delays in completion due to delayed delivery of an imported critical electrical component caused by logistical challenges at South African ports. JTS has been able to bring unaffected sections of Roan back into operation to reduce the impact of the delays. JTS has approached local manufacturers in South Africa to produce the component as an emergency measure which is expected to be completed within 8 weeks. Until completion, Roan will continue to operate by processing selectively suitable material.
During this period overall production rates are capable of being maintained in excess of 600 copper units per month before offering the opportunity to increase to beyond 1 000 tonnes per month once Roan returns to full production.
Sable Refinery Upgrade
JTS has completed the design work for the expansion of the sulphide copper recovery circuit at the Sable Refinery, in anticipation of the expected near-term increase in copper concentrate delivery from the various copper expansion projects. Construction is expected to commence during Q3 of CY2024. The project forms part of Jubilee’s strategy to expand the Sable Refinery’s capacity to produce up to 16 000 copper units per annum.
Project M
As announced on 1 November 2023, Jubilee Metals secured its first LOM copper ore off-take agreement from an existing mining company. Project M seeks to emulate the success of the South African modular chrome expansion roll-out drive, to process copper containing ore, deemed as waste by current or previous operators.
The team has undertaken significant work at Project M over the past quarter, with the first sample material from the extended open pit material expected to be delivered to Sable Refinery in May 2024 as part of the development of detailed copper resource definition. Project M offers the potential to be a sustained long term supplementary copper supply for Sable refinery by early 2025 calendar year.
At completion, Project M will include the implementation of a further copper processing module of approximate 35 000 tonnes per month feed processing capacity. The project forms part of the targeted roll-out of the copper modular units across the Zambian projects which mimics the success achieved through the modular roll out of the chrome units in South Africa.
Mufulira Slag Project
The Mufulira Slag project targets the processing of all historical slag waste from the Mufulira smelter operations under a joint venture agreement with Mopani Copper Mines. JTS has commenced the joint technical review of the project to create a processing solution that is environmentally friendly. More information about the project will be available once JTS concludes this initial technical review.
Production guidance for the 2024 financial year
The chrome and PGM production guidance remains unchanged at 1.45 million tonnes of chrome concentrate and 42 000 PGM ounces for the current financial year ending June 2024.
Copper guidance remains at 5 850 tonnes, pending confirmation of the manufacturing timeline of the electrical component delaying the front-end upgrade of the Project Roan.
The table below presents the unaudited operational performance of the group for Q2 FY2024:
| OPERATIONAL PERFORMANCE | Unit | Q2 FY2024 | Q1 FY2024 | % change | Q2FY2023 | % changeQ2 FY2024 on Q2 FY2023 |
| KEY UNITS OF PRODUCTION | ||||||
| PGM ounces | Oz | 10 131 | 10 113 | 0.2% | 11 088 | (9%) |
| Chrome tonnes | Tonne | 381 114 | 336 683 | 13% | 274 390 | 39% |
| Copper tonnes | Tonne | 749 | 934 | (20%) | 562 | 33% |
