LONDON (Alliance News) - Galileo Resources PLC is to start off-take agreement talks with Jubilee Metals Group PLC for Galileo's Star Zinc project, Galileo said on Wednesday.
Jubilee recently bought the Sable refinery in Kabwe, Zambia, and Galileo said this means it can now start talking to Jubilee over selling ore mined from Star Zinc. Jubilee hopes to start delivering first metal from Kabwe tailings within a year.
Star Zinc, Galileo said, has an estimated exploration target of between 600,000 tonnes and 900,000 tonnes of ore, at an estimated grade up 10% to 12% zinc.
Near-term earnings from the project could be significant, and mining risks and costs are low since the deposit at the mine is shallow, it said.
Galileo Chief Executive Colin Bird said: "Jubilee's acquisition of the Sable refinery and development plans necessitates fast-tracking negotiations for an off-take agreement to supply Star Zinc ore.
"We will undertake all necessary work, related to expedite producing a JORC compliant maiden resource estimate and a mining plan for ore from Star Zinc. The Kashitu prospect has the potential to be a bigger resource than Star Zinc and we intend to commence a study for exploration on this prospect as soon as practicable."
Galileo shares were 4.7% lower on Wednesday morning at 0.51 pence each.
Jubilee Metals (JLP)
Galileo Resourc (GLR)