Jubilee Metals inks refining capacity deal with Mopani

Jubilee Metals announced the execution of a binding memorandum of understanding with Mopani Copper Mines, a subsidiary of ZCCM Investment Holdings in Zambia, for the implementation of additional copper and cobalt refining capacity through the recapitalisation of existing capacity placed under care and maintenance by Mopani.

The AIM-traded firm said the additional refining capacity would increase Jubilee's existing capacity by a further 17,000 tonnes of copper per annum and, together with the Sable refinery, would increase the group's total potential refining capacity to more than 31,000 tonnes per annum.

It said the project would establish Jubilee's Northern Zambian refining footprint for the refining of the copper and cobalt concentrates produced at its Kitwe and the Luanshya copper and cobalt tailings.

Jubilee's Sable refinery would be dedicated to the refining of concentrates produced by its Project Roan - currently under construction, and set to begin commissioning in November - as well as its copper tailings at Kabwe, and contracted third party ore suppliers.

The board said the agreement recognised the “significant synergies” offered through the project to the parties, explaining that Jubilee would be able to accelerate the implementation of its Zambian copper strategy at “significantly-reduced” capital and project risk, with the potential to increase its production rates to use the available refining capacity.

“The agreement is structured within a collaborative framework which recognises each party's contribution to the ultimate success of the project and establishes a mutually beneficial partnership to fast track the implementation of our copper and cobalt tailings projects,” said chief executive officer Leon Coetzer.

“The agreement endorses the mutual respect between Mopani and Jubilee and the joint value offered by Jubilee refurbishing and expanding Mopani's decommissioned copper and cobalt processing facilities.

“I am delighted by the agreement reached which sets into motion the accelerated implementation of our Kitwe and Luanshya copper and cobalt tailings projects to reach even sooner our target of 25 000 tonnes of copper per annum.”

Coetzer said the deal would see Jubilee refurbish and expand some of Mopani's processing facilities currently not in use, and remove the need to build a new processing facility for the nearby tailings deposits secured last year.

“This agreement with Mopani directly improves both our expected project timelines and required project capital while reducing overall project risk through the access offered to existing refining infrastructure.

“Our engineers are already on-site working alongside the Mopani team to upgrade the detailed project designs as we accelerate the implementation.”

At 1039 BST, shares in Jubilee Metals Group were up 12.55% at 15.37p.