Jubilee Metals Group’s South African operations maintained their growth trajectory during the six-month period ended 31 December 2020 on the back of a record operational performance for both its PGM and chrome operations.
During the period under review Jubilee commissioned its new Windsor 8 chrome beneficiation plant further increasing its chrome processing capacity by 35 000 tonnes per month, while also commencing with the construction of its new 80 000 tonnes per month chrome beneficiation plant situated near its Inyoni Operation. PGM and Chrome operational earnings increasing by a record 178 % to £ 27.7 million compared to the same comparative six-month period in 2019.
In addition to the strong performance of its South African operations, Jubilee has made exceptional progress in the implementation of its Copper and Cobalt strategy in Zambia.
At the beginning of the reporting period, in July 2020, Jubilee outlined its plans to expand its business model into all aspects of copper in Zambia due to the vast quantities of tailings available, with the long term target of achieving production of 25 000 tonnes of copper per annum within four years.
Six months on, this copper and cobalt strategy has already gained significant momentum, with Jubilee having secured almost 300 million tonnes of copper and cobalt tailings located in three zones across Zambia via the completion of five major transactions.
The roll-out of this strategy has the potential to significantly increase earnings growth and the Company is committed to reaching its targeted goal of 25 000 tonnes per annum within the defined four-year period.
Jubilee has targeted to construct three copper processing facilities to process the copper tailings to produce a copper concentrate that will be refined at Jubilee’s Sable Refinery. The three copper processing projects have been named Projects Roan, Elephant One and Elephant Two, with Project Roan commencing construction and set to produce its first intermediate copper concentrate for further refining at Sable during April 2021.
PGM production for the six-month period was up 34 % to 28 187 ounces (2019: 21 082 ounces) with PGM revenue up 125 % to ZAR 776 million (2019: ZAR 281.6 million). PGM attributable earnings were up 172 % to ZAR 560 million (2019: ZAR 167.7 million).
Increased PGM production was achieved, including record production during December, despite the planned scale down of operations at Jubilee’s Eland Platinum JV PGM partner. Inyoni expansion currently underway is targeting to further improve PGM production rates and targeted PGM recoveries, expansion expected to conclude during Q2 2021.
Chrome production for the six-month period was up 72 % to 319 834 tonnes of saleable chromite concentrate (2019: 186 249 tonnes) with Chrome revenue up 27 % to ZAR 245.3 million (2019: ZAR 157.8 million).
Attributable chrome earnings are up 333 % to ZAR 28 million (2019: ZAR 4.7 million. The increase in chrome earnings was supported by the implementation of the new fixed margin chrome processing contracts.
The new 35 000 tonnes per month chrome beneficiation facility named, Windsor 8, commenced operations in October 2020.
Jubilee commenced with the construction of an additional new 80 000 tonne per month chrome beneficiation operation near its Inyoni PGM Operations. The facility will consist of four integrated chrome recovery circuits to maximise chrome efficiencies and is expected to be fully commissioned within Q2 2021
Jubilee commenced with the commissioning of the first of the four integrated chrome recovery circuits combined forming the new 80 000 tonnes per month chrome beneficiation facility, with the second and third process scheduled to commence commissioning immediately.
Jubilee’s Sable Refinery achieves early earnings from its copper and cobalt production as part of securing operational readiness to accept first production from Project Roan, producing a total of 1 447 tonnes of plated copper cathode to date.
The construction of the first processing facility, named Project Roan, has commenced and will be commissioned in three phases to allow the early production of partially upgraded copper concentrates for refining at the Sable Refinery.
A capital budget of US$ 17 million has been allocated to Project Roan which is funded from Jubilee’s own cash-flow.
Jubilee secured the rights to in excess of 300 million tonnes of copper and cobalt containing material at surface, which combined will be the primary feed source to the three copper and cobalt processing facilities being targeted for construction.
Phase one of Project Roan reaching completion and targeting to commence delivery of intermediate copper concentrate to Sable Refinery during April 2021 despite severe disruptions caused by heavy rains in the region.
Leon Coetzer, CEO of Jubilee, commented: “The acquisition of the rights to almost 300 million tonnes of copper and cobalt tailings with the completion of five major transactions in Zambia; the maturity of operations and continued delivery of record PGM and Chrome earnings in South Africa; and a 110 % increase in Group Revenue to £ 53.4 million resulting in attributable earnings of £ 30.9 million, are just a few of the milestones met by the Jubilee team during the six-month period under review. Despite the unprecedented challenges posed by the ongoing pandemic, H2 2020 was a period of significant growth for the Company.
“Central to achieving the above milestones is our commitment to ‘The Jubilee Way’, and I am extremely grateful to the Jubilee team which has continuously demonstrated its resilience and commitment to this, always striving to translate leading in-house processing and metals recovery excellency into industry leading operational efficiencies.
“On the back of new third party and ore supply agreements as well as improved efficiencies across our chrome and PGM operations, we have delivered both record production and financial performance at our South African operations. Importantly, thanks to this sustained earnings growth, we have been able to fund the capitalisation of our Sable Refinery and Project Roan currently under construction in Zambia which has been the focus of much of our efforts over the six-month period.
“We are now ramping up production with the first copper concentrator currently under construction at Project Roan and set to commence delivery of the first intermediate copper concentrate to Sable Refinery within the next three weeks. We are fully committed to achieving our target of producing 25 000 tonnes of copper per annum within the next four years.
“Our success in South Africa and progress in Zambia is a clear demonstration of our technical know-how and IP when it comes to surface material into value and we are now perfectly poised to play a commanding role in the sector including in Zambia.”