Jubilee Metals expands chrome and PGM footprint
The Jubilee chrome operations in South Africa play a key role in driving the performance and growth of the PGM operations. Chrome is recovered first from the chrome and PGM-bearing ore before being processed further to recover the PGMs at the Inyoni facility. The high efficiencies achieved by
Jubilee’s chrome operations not only produce better quality and more chrome product, that attracts chrome producers to Jubilee’s operations, but also provides a cleaner PGM-rich feed that is more amenable to the PGM recovery process.
To date, Jubilee has contracted its chrome operational capacity predominantly on a fixed chrome margin contract by tolling various chrome producers’ materials while retaining the majority of the earnings from the PGMs recovered.
As Jubilee looks to expand its chrome and PGM production by entering into new long-term partnership agreements, Jubilee intends to position itself as a stronger participant in the revenues from the sale of the produced chrome concentrates.
This offers Jubilee greater exposure to the chrome market fundamentals while retaining the protection of the increased processing efficiencies and the revenues of the PGMs recovered from the tailings of the chrome facilities. At current market prices the new contract offers the potential to increase Jubilee’s margin per tonne of chrome concentrate produced by approximately five-fold.
The key term of the new Agreement establishes a 6-year initial partnership that may be renewed for a further 4 years. Under the Agreement, Jubilee is appointed exclusive process solution provider and committed to retrofit and operate an existing 360 000 tonnes per annum chrome processing facility, located adjacent to the chrome ore producer, while holding the option to expand the operation to a 720 000 tonne per annum facility.
Jubilee targets to complete the expansion, to 720 000 tonne per annum, within 12 months of commencing operations at the retrofitted facility. The PGM rich tails produced will be processed at the expanded Inyoni facility.
Under the new Agreement Jubilee will process the ROM ore and produce chrome concentrate and a PGM rich tailings. The earnings derived from the sale of the chrome concentrate and PGMs produced from the PGM rich tailings, will be allocated based on the majority of the PGM earnings retained by Jubilee while participating in the chrome earnings at a significant level (equivalent of five times current levels).
Jubilee has recently completed the initial retrofitting of the 360 000 tonne per annum facility to resemble Jubilee’s existing operations and has commenced commissioning of the facility. The Jubilee projects team expects to reach the initial 360 000 tonne capacity within 12 months, with the combined potential to add a further 390 000 tonnes per annum of chrome concentrate increasing Jubilee’s total potential to 1.4 million tonnes per annum.
Jubilee has continued to roll out power back-up solutions at its chrome operations as a preventative measure to the continued power interruptions in South Africa. The back-up power solution will address 60% of Jubilee’s installed chrome processing capacity by end of June 2023.
Chrome prices remain robust with strong demand from China coupled with constrained supply from South Africa. PGM prices remain under pressure, but the lower PGM basket prices are in part buffered by the buoyant chrome prices.
