LONDON: Jubilee Metals Group has executed a share purchase agreement for the acquisition of the Sable Zinc refinery in Kabwe Zambia. The refinery is situated immediately adjacent to the large stock piles of zinc, lead and vanadium that Jubilee has contracted from BMR Group PLC.

Jubilee Metals has also secured a combination of debt and equity financing to fully complete the transaction and deliver the Company’s Kabwe project, a notification issued to London Stock Exchange said.

According to details, consideration for the Sable Zinc refinery is GBP 9.16 million (US$12 million) in stage payments; the acquisition reduces the time to build the refinery by some 18 months delivering the first metal within a year from the acquisition.

Overall project capital to produce first metal is significantly reduced to some GBP18.32 million (US$ 24 million). The project will ramp up over a two-year period from 20 tonnes to 40 tonnes per hour producing significant amounts of zinc, vanadium and lead.

Jubilee Metals is financing the acquisition and ramp up by an equity raising of GBP11.07 million (US$14.5 million) and a secured convertible loan note of GBP6.11 million (US$8 million).[the_ad id=”31605″]The Kabwe project is expected to significantly enhance Company earnings on the back of three revenue producing metals.

Leon Coetzer, Chief Executive Officer, says: “I am delighted that, after months of test work, flowsheet design and refinery acquisition negotiations, we can announce the full implementation plan for the Kabwe base metal project. I am particularly pleased that we have been able to secure the support of large institutional funders in the equity placing which, is testimony to Jubilee’s Metals Recovery strategy and the quality of the Kabwe project”

“The combined secured funding fully funds the acquisition as well as the project capital required to implement the project to produce zinc, vanadium and lead from the surface material at Kabwe. The project targets an initial processing rate of 20 tonnes per hour producing a zinc concentrate and vanadium pentoxide before ramping up to a targeted 40 tonnes per hour producing zinc metal, vanadium pentoxide and a lead concentrate.  The project targets to produce annually over 8 000 tonnes of zinc, 1 500 tonnes of vanadium and 15 000 tonnes of lead as it ramps up to full capacity over a 2-year period,” the notification said.

Jubilee has already secured Zambian ministerial approval for the transaction. The Minister also waived previous conditions placed on the Kabwe mining licences.

Jubilee executed the acquisition of Sable Zinc Kabwe Limited in Zambia from two subsidiaries of Glencore plc for a consideration of GBP9.16 million (US$12 million). The acquisition is funded through a combination of debt and equity.