JOHANNESBURG (miningweekly.com) – Diversified mining company Jubilee Metals has decided to dispose of its chrome and platinum group metals (PGMs) business in South Africa to focus fully on Zambia, where the directors believe there are material opportunities to deliver growth at the existing sites by expanding the portfolio of copper-producing assets.

This follows the receipt by the Johannesburg AltX- and London AIM-listed company of a conditional binding offer from a private mining and metals trading company to acquire the group’s chrome and PGM operations in South Africa for up to $90-million, payable through a combination of upfront cash and deferred cash over three years.

“The South African business has reached a stage of maturity that would require a large capital outlay to achieve any step change in production going forward. On the other hand, in Zambia, the potential capital returns and earnings growth offered from our exciting suite of assets could not be more evident,” Jubilee CEO Leon Coetzer commented in a release to Mining Weekly.

In addition to Zambia’s Roan now being fully operational, growth is also beckoning at the Central African country’s Munkoyo and Project G near-surface opportunities.

“The staggered nature of the proposed acquisition consideration, along with funds from the expected sales of noncore assets in Zambia, and project specific funding discussions, align with our future capital growth plans in the country,” added Coetzer.

Jubilee expects copper demand to remain high amid its ability to recover copper from shallow transitional reefs successfully and trials confirming the Roan concentrator’s capability to maintain run-of-mine feedstock production at between 35 000 and 40 000 tonnes a month.

Of Munkoyo’s 80 000-tonne-a-month mine rate, 3 500 tonnes a month of high-grade material is delivered to Jubilee’s nearby Sable Refinery, while at Project G work on the design of an opencast expansion is under way.

Next year’s planned introduction of a second tank-house at Sable will increase the capacity to about 14 000 tonnes a year and will accommodate production from Munkoyo and Project G’s nearby modular units.

At the Large Waste Project, Jubilee reports that it has entered into negotiations with various parties to potentially invest into the construction of the targeted modular processing units for this project. 

The targeted companies are described as offering more attractive investment terms under a partnership agreement approach than offered previously by the Abu Dhabi-based investment firm. 

The refinery expansion was delayed over the past quarter to prioritise investment into these mining operations and the completion of the processing trials at Roan. Completion of the Sable expansion is scheduled in the first quarter of next year.