Jubilee Metals Share News (JLP)

(Sharecast News) - Jubilee Metals announced on Thursday that it has secured a high-grade copper resource to support the restart of its Roan operations in Zambia, following the implementation of a new power agreement.

The AIM-traded firm said it was accelerating copper production by prioritising the processing of new higher-grade feed material while assessing the potential sale of surplus lower-grade stocks that were not part of its short- to medium-term production plans.

It said the Roan operations, which can process both high-grade mined material and previously-processed tailings, would immediately begin processing an initial 200,000 tonnes of high-grade copper material with an expected copper content of 1.6%, more than double the 0.7% copper grade currently being processed.

Jubilee said it also held an option to increase this allocation and secure a long-term supply of high-grade feedstock.

Roan has the capacity to process up to 45,000 tonnes per month, though initially 30,000 tonnes per month would be allocated to the newly-secured high-grade material.

The company said it was evaluating the feasibility of running Roan at full 45,000-tonne capacity for an extended period of more than three years.

Jubilee said the copper resource acquisition was being financed through a combination of cash and equity.

Its Zambian operations would make a part payment, while the company would issue 51.8 million new ordinary shares at 4.2p each, amounting to £2.17m or $2.7m with lock-in provisions of up to 180 days.

Additionally, Jubilee said it was in the final stages of due diligence on its large waste project, adding that it expected to conclude that transaction in March.

"Our years of investment to transform the Roan concentrator to a position that allows it to uniquely process both run-of-mine and waste copper material simultaneously, is once again vindicated by the ability to opportunistically secure high grade adjacent resources," said chief executive officer Leon Coetzer.

"These high grade resources have already been tested within our facility confirming its quality and metallurgical performance.

"While the downtime experienced due to the power outages at Roan had a material negative impact on our production over the past couple of months, the Jubilee team has demonstrated their ability to immediately react to the challenges faced."

Coetzer said the company had secured a stable power supply, allowing it to bring Roan back into operation, adding that it had secured higher grade material, providing an immediate opportunity to recoup part of the lost production and enhance cash flows within a short period of time.

"The investment support from Jubilee to its Zambian operations ensures that we capture this opportunity and increase our copper production as we accelerate our Zambia operations' recovery from the operational interruptions.

"Our Zambian copper strategy remains robust on the back of a vast resource base of copper material already at surface together with two operating open-pit mining operations and a fully operational processing and refining footprint.

"We are reviewing several opportunities to liquidate for value certain of the non-core lower grade assets."

At 1038 GMT, shares in Jubilee Metals Group were down 6.13% at 3.86p.

Reporting by Josh White for Sharecast.com.