Jubilee set to acquire Sable Zinc refinery

22nd March 2019

By: Nadine James

Features Deputy Editor


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Dual-listed Jubilee Metals on Friday announced that it has executed a share purchase agreement for the acquisition of the Sable Zinc refinery in Kabwe, Zambia.

The refinery is situated immediately adjacent to the large stockpiles of zinc, lead and vanadium that Jubilee has contracted from BMR Group.

The company secured a combination of debt and equity financing to fully complete the transaction, as well as the project capital required to deliver the Kabwe project.

Jubilee executed the acquisition of Sable Zinc from two subsidiaries of Glencore for a consideration of $12-million, or R175.97-million.

The company successfully completed a placing of about 491-million new Jubilee shares at an issue price of 53.98c to raise R212.57-million, before expenses.

Further, through its wholly owned Mauritian subsidiary Braemore Holdings, Jubilee successfully secured debt funding of $8-million, or R117.31-million, from ACAM, an affiliate of two sophisticated investors based in London and New York.

The loan funding is secured over Jubilee’s Zambian assets, bears interest at 12% a year and is repayable in full 36 months from the date of execution of the funding agreement.

The Sable project targets an initial processing rate of 20 t/h, producing a zinc concentrate and vanadium pentoxide, before ramping up to a targeted rate of 40 t/h, producing zinc metal, vanadium pentoxide and a lead concentrate.

It should produce in excess of 8 000 t/y of zinc, 1 500 t/y of vanadium and 15 000 t/y of lead as it ramps up to full capacity over a two-year period.

Jubilee has already secured Zambian Ministerial approval for the transaction. The Minister also waived previous conditions placed on the Kabwe mining licences.

“I am delighted that, after months of testwork, flowsheet design and refinery acquisition negotiations, we can announce the full implementation plan for the Kabwe base metals project,” Jubilee CEO Leon Coetzer commented.


Jubilee on Friday also released an operational update regarding its other operations.

The company noted that the PlatCro Chrome operation, which was acquired in January, had already started contributing to group earnings – ahead of schedule –  to the tune of R16.06-million for January and February.

The PlatCro platinum group metals (PGMs) project accelerates deliveries of PGMs-containing material to Northam Platinum’s Eland platinum concentrator, which is scheduled to start PGMs recovery and refining during May.

The project is targeting the processing of  up to 60 000 t a month of PGMs material, which equates to a production potential of 30 000 oz/y of PGMs, on par with Jubilee’s Hernic PGMs operation.

The company also brought the Dilokong Chrome Mine (DCM) fine chrome plant into production during January and ramped it up to reach commercial production levels earlier this month.

The project is the first of its kind in the industry, targeting the recovery of the superfine chrome component usually lost to tails. The DCM plant has capacity to process up to 25 000 t a month of chrome-containing tailings material.

Jubilee will target the roll-out of this process to its other operations in due course.

Further, the Hernic operation delivered “strong” earnings of R19.69-million for January and February despite a delayed start-up following the December break and challenges posed as a result of power outages.

Jubilee said it expects production to return to previous levels from this month onward, and added that it would look to enhance the earnings potential as it targets the increased delivery of feed material to the operation.

“The period [over January and February] has been remarkable both operationally and financially for Jubilee, leading to a solid South African platform which precedes our targeted growth into base metals in Zambia.

“The quarter, to date, has delivered major growth in both our South African chrome and PGMs operations. I am particularly pleased with the team’s performance at PlatCro Chrome . . . the progress is testimony to the operational excellence and tenacity of the Jubilee team,” said Coetzer.

He concluded that Jubilee would continue to consolidate its projects to further advance earnings and fast-track expansion plans both within and outside of South Africa.

Edited by Chanel de Bruyn
Creamer Media Senior Deputy Editor Online


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