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JUBILEE METALS GROUP PLC - Investment Programme Delivers Significant Growth Across PGM and Copper Operations

Release Date: 16/05/2022 08:00
Code(s): JBL     PDF:  
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Investment Programme Delivers Significant Growth Across PGM and Copper Operations

 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:
Investment Programme Delivers Significant Growth Across PGM and Copper Operations


Jubilee Metals Group PLC, a leader in metals processing with operations in Africa (AIM: JLP/Altx: JBL), is pleased
to provide a performance update of its new and expanded fully integrated South African Inyoni PGM and
Chrome Operations and its Zambian Southern Copper Strategy, which involves integrating the Sable Copper
and Cobalt refinery with the newly constructed copper concentrator, Project Roan. This new and significantly
enlarged operational footprint follows an investment programme implemented over the past 12 months of
£ 39.5 million (ZAR 786 million).


HIGHLIGHTS


South Africa


    •   Jubilee’s new and expanded Inyoni Operations (“Inyoni”) is already exceeding design throughput
        targets reaching 86 000 tonnes per month of chrome and PGM containing run-of-mine (“ROM”) feed,
        together with 40 000 tonnes of PGM containing historical tailings material, placing Jubilee on course
        to achieve its PGM ounce production target of 44 000 ounces per annum through its 100% owned
        Inyoni alone (previous max design capacity 30 000 ounces), replacing any reliance on existing PGM
        recovery joint ventures
    •   The Company’s significantly increased chrome ore beneficiation capacity to in excess of 220 000 tonnes
        per month (previously 140 000 tonnes per month) of ROM feed and tailings, allows the Company to
        sharply increase the production of chrome concentrates from the various feed streams as an offset
        cost to its PGM production costs; Jubilee targets to produce 1.2 million tonnes of chrome concentrate
        per annum
    •   Inyoni continuous to ramp-up production rates targeting full production rates during May 2022 and
        delivered 8 018 PGM ounces from Inyoni operation in calendar Q1 CY2022, an increase of 75% when
        compared with Inyoni’s average production rate of the previous two quarters despite refilling of the
        operational pipeline after start-up. With the completion of the ramp-up if Inyoni during May 2022
        Jubilee expects to achieve the 43 000 PGM ounce guidance for the financial period end to June 2022
    •    On a chrome by-product credits basis, Jubilee’s net cost to produce an ounce of PGM during Q1 CY2022
         was US$ 433 per ounce excluding transport costs of US$ 198 per ounce, which transport cost will be
         reduce significantly once the Company’s eastern limb expansion strategy to establish a PGM processing
         footprint in the eastern limb is successfully implemented

Zambia

    •    Significant milestones achieved in the delivery of the Southern Copper Refining Strategy in Zambia,
         which targets to produce up to 12 000 tonnes of copper units per annum including a cobalt by-product
         from certain cobalt-containing feed streams:
             •   Project Roan commissioning activities are nearing conclusion with the official hand-over of the
                 new copper concentrator to the operational team. The ramp-up of the concentrator is
                 expected to reach design capacities during July 2022, which targets the processing of 830
                 tonnes of copper in concentrate per month for refining at Sable
             •   Project Roan has to date created local employment opportunities to almost 600 people as part
                 of the construction and operational team. The project has brought investment, employment
                 and opportunities for local service providers to the region
             •   Jubilee’s Project Roan and Sable Refinery combined has offered employment and contractor
                 opportunities to more than 800 people, the most of which are long term, while Jubilee has
                 prioritised local supply of services often working with local companies to assist in developing
                 the required services to create a sustainable support infrastructure
             •   In addition to the copper refining capacity at Sable, the construction of a cobalt refining circuit
                 at the site is underway and expected to commence commissioning during June 2022
             •   Initial design capacity able to produce up to 1 200 tonnes of cobalt per annum which has the
                 potential to add significant revenues to the Southern Copper Refining Strategy (current cobalt
                 prices c. US$ 81 000 per tonne (source LME))


Leon Coetzer, CEO of Jubilee, commented: “The Jubilee team was bold in its plans to expand and optimise the
South African and Zambian operations, however a confident, but prudent approach to the deployment of our
£ 39.5 million investment programme has already resulted in the delivery of significant results for the Group.


“Rolling out our business case across multiple countries, operations and commodities has enabled us to de-
risk, capture economies of scale, and also provided exposure to numerous value points throughout the
recovery and metal processing chain. In addition, our expanding production profile and the economies of scale
it provides, offers insulation from the inflationary pressures smaller operators are facing, enabling Jubilee to
maintain a cost per PGM ounce produced when fully accounting for the chrome by-product production credits
resulting in a net cost of below US$ 450 per PGM ounce when excluding transport cost. Our eastern limb
expansion strategy holds the additional benefit of significantly reducing transport cost of material from this
region which makes up the bulk of current transport cost.


“I am extremely proud of the Group’s performance over the past 12 months, which is testament to the
dedication and innovation of our operational teams. Despite the various issues which we have faced over the
previous two years, including, at times, intense and prolonged supply chain disruptions mostly due to Covid,
the Jubilee team has risen to the challenge and has delivered on its objectives on schedule, and on budget.


“Crucially, and in line with our goals to promote sustained, inclusive economic growth, the Southern Copper
Refining Strategy has resulted in significant job creation, with total jobs filled in Zambia reaching near 800
during the last 12 months. We have prioritised the sourcing of skills and services from our local communities
and have, in many instances, partnered with local firms to assist in their growth and development to offer a
sustained service to our projects. With the completion of the construction of Project Roan we now look to
accelerate our investment program into the Northern Refining Strategy targeting the Luanshya, Kitwe and
Mufulira area.


“As we emerge from this phase of significant growth and sustained financial performance, and I look forward
to providing further updates as our various new projects hit their targeted output in the coming weeks and will
be fully reflected in the next financial reporting period.”


Further Information


South Africa
During early 2021 at Inyoni, the Company’s primary PGM recovery circuit, Jubilee launched a project to create
a new fully integrated and significantly expanded Inyoni operations. By way of a reminder, the project would
deliver a fully integrated multi feed chrome and PGM beneficiation circuit that comprised:
    -   a new run-of-mine chrome beneficiation plant (“OBB”) with a design capacity of 80 000 tonnes per
        month (previous decommissioned facility historically averaging 45 000 tonnes per month) of mined
        chrome and PGM containing ore from various suppliers to Jubilee;
    -   an expanded fine chrome beneficiation circuit able to process up to 45 000 tonnes per month (previous
        35 000 tonnes per month) of historical chrome and PGM tailings;
    -   a renowned ultra-fine chrome (“UFC”) processing plant capable of processing up to 30 000 tonnes per
        month to maximise the recovery of the chrome prior to recovering the PGMs; and
    -   expansion of the Inyoni PGM circuit capable of processing up to 75 000 tonnes per month (previous
        45 000 tonnes per month) of tailings produced by the chrome beneficiation circuits which increases
        Inyoni’s PGM capability to 44 000 PGM ounces per annum


The new Inyoni operations would, on completion, target the processing of multiple feed sources to maximise
the extraction of chrome as a by-product to produce a high quality PGM rich feed to the new upgraded and
expanded Inyoni PGM plant, representing a first for the industry. The expanded operations would also reduce
Jubilee’s reliance on JV arrangements, such as the Windsor PGM JV, to grow its financial and operational
performance.


The total allocated capital for the integrated chrome and expanded PGM recovery facilities was £ 20.5 million
(ZAR 408 million) targeted to be implemented over 11 months to carefully plan the commissioning of the new
and expanded chrome and PGM circuits with the existing operations.
The project culminated in the commissioning of Jubilee’s proven UFC facility in February 2022 following the
commissioning of the new expanded Inyoni PGM circuit during November 2021, bringing to completion the
new fully integrated chrome and PGM recovery circuits. The UFC facility is able to recover ultra-fine chrome
from the PGM feed stream further enhancing the PGM feed grade, while producing additional saleable chrome
as a by-product at virtually no additional operating cost.


The success of this new world class facility is delivering early results in the operational performance for Q1
2022 with Inyoni’s chrome and PGM production increasing materially. The OBB facility has exceeded its
throughput targets achieving a record processing of 86 000 tonnes of ROM ore in a single month since its
commissioning in October 2021 adding to the existing Windsor and Windsor 8 chrome beneficiation plants to
reach a processing record of 190 000 tonnes of ROM ore in a single month.


At Inyoni alone, chrome production remains on target. PGM ounce production continues to increase after first
replenishing the in-process PGM pipeline that was drained as part of the capital project. Inyoni is expected to
reach its 3 500 PGM ounce monthly target for May 2022 and delivered 8 018 PGM ounces in Q1 2022, an
increase of 75% when compared with Inyoni’s average production rate of the previous two quarters despite
refilling of the operational pipeline after start-up.


The increased throughput and production rates of the integrated Inyoni Facility has the added benefit of
further dilution of cost to cushion the current inflationary pressure on operating costs. Cost per PGM ounce
produced excluding transport cost is US$ 669 (transport cost currently US$198 per PGM ounce) and when fully
accounting for the chrome by-product production credits results in an effective cost per PGM ounce produced
of below US$ 450 (excluding transport cost). Jubilee’s targeted eastern limb PGM expansion strategy will
significantly reduce transport cost of feed material from this region while expanding overall PGM production.
Jubilee is in advanced discussions to secure an existing mothballed PGM processing footprint capable of being
repurposed by Jubilee.


With the Inyoni ramp-up expected to be completed during May 2022, the Company expects to achieve its
guidance of 43 000 PGM ounces for the full financial period despite the interruptions caused by the
implementation of the new integrated and expanded Inyoni operations.


Zambia
The first phase of Jubilee’s copper strategy in Zambia includes the implementation of its Southern Copper
Refining Strategy which targets to produce up to 12 000 tonnes of copper units per annum including a cobalt
by-product from certain cobalt containing feed streams.


The strategy integrates the upgraded Sable Refinery with Project Roan, a new copper concentrator processing
both ROM copper ore as well as tailings to produce copper concentrates for refining at Sable (10 000 tonnes
per annum), which complements the existing supply of third-party feed to Sable Refinery (2 000 tonnes per
annum). The integrated Southern Copper Refining Strategy’s capital allocation was c. £ 19 million (ZAR 378
million).
Jubilee’s project execution team broke ground for the construction of the new copper concentrator, Project
Roan, in June 2021 and, despite the challenges caused by the COVID 19 pandemic and its effect on supply
chains, the team was able to commence testing of certain equipment within seven months and completed all
construction activity within 11 months, a remarkable achievement. Commissioning activities have been further
frustrated with the lack of availability of certain electronic equipment, largely due to increased supply chain
pressures out of Europe. Through innovative engineering by the team, these have been overcome and
commissioning activities remain on track to commence ramp-up of the plant during May 2022. Project Roan is
expected to complete the ramp-up of the operations, which targets 830 tonnes of copper per month, during
July 2022.


In addition to the copper refining capacity at Sable, Jubilee has approved the implementation of a cobalt
refining circuit at Sable able to produce up to 1 200 tonnes of cobalt per annum. The new cobalt circuit is
expected to commence commissioning during June 2022. At current prices of cobalt of c. US$ 81 000 per tonne
of cobalt, this exciting project holds the potential to add significant revenues to the Southern Copper Refining
Strategy.


Crucially, and in line with Jubilee’s goals to promote sustained, inclusive economic growth, the Southern
Copper Refining Strategy has resulted in significant job creation, with total jobs filled in Zambia reaching near
800 during the last 12 months. Jubilee has prioritised the sourcing of skills and services from local communities
and have, in many instances, partnered with local firms to assist in their growth and development, which also
offer a sustained service to our projects.


      For further information visit www.jubileemetalsgroup.com or contact:
      Jubilee Metals Group PLC
      Colin Bird/Leon Coetzer
      Tel +44 (0) 20 7584 2155 / Tel +27 (0) 11 465 1913


      Nominated Adviser – SPARK Advisory Partners Limited
      Andrew Emmott/James Keeshan
      Tel: +44 (0) 20 3368 3555


      Broker – Shard Capital Partners LLP
      Damon Heath/Erik Woolgar
      Tel +44 (0) 20 7186 9900


      Joint Broker – WHIreland
      Harry Ansell/Katy Mitchell
      Tel: +44 (0) 20 7220 1670/+44 (0) 113 394 6618



      PR & IR Adviser – Tavistock
      Jos Simson/ Gareth Tredway/Charles Vivian
      Tel: +44 (0) 207 920 3150
16 May 2022

JSE Sponsor to Jubilee




 Questco Corporate Advisory Proprietary Limited
 Sharon Owens
 T: +27 (11) 011 9212

Date: 16-05-2022 08:00:00
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