Transnet’s ports and logistical hurdles have forced Jubilee Metals Group to delay an upgrade project at its Zambian copper concentrator by nine weeks, with the Roan project expected to continue operating at half of its capacity owing to late delivery of components for the expansion project.
So bad has been the Transnet ports and logistical bottlenecks that Jubilee, which raised production of chrome chrome concentrates despite a fall in copper production, has been unable to ship and deliver electrical components for the upgrade project on time.
“In Zambia the team were able to grow our copper output despite the operational interruptions caused by the Roan front-end upgrade and associated import delays. The team is working tirelessly to overcome the delay and will continue to operate Roan at a reduced capacity during this time,” said Jubilee CEO, Leon Coetzer.
The company brought back the Roan copper concentrator into operation last month to reduce “the impact of the front-end upgrade project start-up being postponed due to the delay in the delivery of critical electrical components due to the ongoing logistics constraints at” South African ports.
This means the Roan project will operate at 50% of its capacity as the company pursues alternative solutions to sourcing electrical components. This includes “the option to locally manufacture” the components in South Africa over a period of up to two months.
The Aim and AltX listed junior miner however raised chrome concentrate production by 13.2% to a new quarterly production record of 381 114 tonnes over the period to end-December 2023.
Output benefited from the Thutse project, which attained production targets. Jubilee is in negotiations to establish additional life-of-mine for the Thutse project.
It is also involved in a separate expansion program under which it is investing $6 million - funded from cash from its chrome operations - to ramp up output to a yearly 2 million tonnes.
Inyoni PGM production was flat at 10 131 ounces during the quarter although there was no third-party production during period. Jubilee said it was a traditionally a “slower quarter” that had however coincided with cost-cutting and retrenchments from some of the bigger SA PGM producers.
Copper cathode and copper in concentrate production was lower at 749 tons compared to 934 tons the previous quarter. The company said it was geared to expand production in the current half year period as upgrades to Roan kick in.
Jubilee is also expanding its Thutse Project by adding 50 000 tons of output per month after it completed the first chrome module at the operation in August last year.
“The potential expansion will move us nearer to our objective of producing 2.1 million tonnes of chrome concentrate per annum,” the company explained.
Later this year, Jubilee, which has completed designs work for the expansion of the sulphide copper recovery circuit at the Sable Refinery, will commence construction of the facility. This will help Sable Refinery ramp up capacity to 16 000 copper units per year.
In spite of the challenges with copper production owing to the delays of the Roan upgrade, Jubilee is maintaining its production guidance for chrome and PGM production at 1.45 million tons and 42 000 PGM ounces for the year to end-June.
Production guidance for copper has also been maintained at 5 850 tons, pending confirmation of the manufacturing timeline of the electrical components that are delaying the front-end upgrade of the Roan project.
Shares in the company slumped 8.72% to R1.36 yesterday.