London-listed Galileo Resources said on Thursday that negotiations for an offtake agreement with fellow-listed Jubilee Metals were advancing satisfactorily.
The companies are working on an agreement to process ore from the Zambian Star Zinc and Kashitu projects at the Kabwe refinery, where Jubilee plans to commission a dedicated zinc, vanadium and lead refinery circuit, in addition to the existing copper circuit.
“The projects offer the potential to provide consistent quantity and quality of ore to the refinery,” said Galileo CEO Colin Bird.
The offtake agreement contemplates ore supply of 60 000 t/y at a grade of at least 14% zinc, over a three-year term.
Bird added that the suitability of the potentially much larger Kashitu deposit and its vanadium content offered the opportunity of a long-term sustainable ore supply.
Mining at Star Zinc is expected to start in the second quarter of 2020, subject to further funding and the granting of a mining right.