WWT - just for you mare1 Feb 2018 17:10
Shares in the former Jubilee Platinum, now Jubilee Metals Group (JLP) have recently been on the slide – and this including after a recent Operations Update…
This showed strong quarterly Hernic project growth - including earnings up to £0.97 million and the company emphasised this, and “a drop in unit cost to below the USD400 per PGM ounce making the Hernic project one of the lowest cost platinum producers in the industry” despite “extended plant maintenance and operational slow down during the festive period”. However, there was reduced production and earnings from the Dilokong Chrome Mine due to “significant plant upgrade” work.
This was to increase crushing capacity for processing of 3rd party run-of-mine material as well as to introduce the flexibility required to compensate for feed variance of such material. It was added that “a further processing upgrade to enhance the recovery of very fine chrome from tailings will be implemented during Q1 2018” - and that this “holds significant business benefits for the wider Jubilee tailings retreatment projects”. It was then emphasised that “pipe-line projects offer significant growth potential in the short term (2 years) and we continue to actively pursue further opportunities”. The former currently include;
DCM platinum project – “has concluded that a dedicated process plant for Dilokong is the optimal commercial strategy and will target to commence execution of the project during Q2 2018… A processing plant targeting approximately 10 000 PGM ounces per annum is envisaged. Funding for the project will be secured via the existing project debt funding agreement that Jubilee secured with Riverfort Capital and Jubilee's current cash position.”
Kabwe project – “on-going due diligence… has confirmed our understanding of the significant size and quality of the various surface assets… Our final circuit trials are focussing on the refining of the leached metals, which we expect to conclude over the next two weeks, in order to confirm the refining processing strategy.”
PlatCro platinum project – “similar to the DCM study, the option study includes laboratory and pilot plant trials. The final round of the plant trials has been concluded with results expected in the short term.”
This all compares to a current market cap of just above £40 million – and suggests to me there potential value again here. I’ll review again on the greater detail of the interims due by the end of next month - but for the more adventurous, Gary’s conclusion of last year still looks to hold.