Jubilee Metals Group has selected a preferred purchaser for its Large Waste Project (LWP) in Zambia in a proposed US$35 million transaction that will allow the company to redirect capital towards its existing copper mining, processing and refining operations.
The announcement, made on August 26, follows the receipt of two binding offers for the project. Jubilee said the disposal forms part of its strategy to evolve from a predominantly processing-led business into an integrated copper mining and processing company.
According to the company, its established processing infrastructure remains central to the business, but it is increasingly focused on building value through “Jubilee-controlled mining assets” and developing its underlying copper resource base.
The LWP transaction is also intended to reduce the capital and execution risks associated with developing the large-scale, greenfield project.
Jubilee said its existing mining, processing and refining operations offer a “lower-capital and lower-execution-risk pathway” to increasing copper production by making use of infrastructure and operating capabilities already in place.
The proposed US$35 million sale will not be completed immediately. It is subject to a two-stage due diligence process, beginning with confirmation of the contractual and regulatory framework governing the LWP. Jubilee expects this first stage to take about 10 days.
If that process is completed satisfactorily, the preferred purchaser will pay US$2.25 million to secure a further 45-day exclusivity period while it undertakes the remaining due diligence.
Following completion of due diligence and execution of definitive documentation, the balance of the consideration will be paid over three years.
The purchaser will also have the option to accelerate settlement within two years, although doing so would reduce the total consideration to US$30 million.
Jubilee said management had satisfied itself regarding the purchaser’s ability to meet the agreed consideration.
The transaction replaces an earlier agreement covering the sale of 10 million tonnes of waste material from the LWP for US$6.75 million.
About 550,000 tonnes had been collected under that arrangement, generating approximately US$600,000 in payments to Jubilee.
Mining Review Africa reported that the disposal gives Jubilee an opportunity to monetise the project while redirecting capital and management attention towards its core copper growth strategy.
The shift marks a change from Jubilee’s earlier plans for the LWP. The project had previously been positioned as an important part of the company’s growth strategy, with Jubilee considering modular processing units to treat the substantial waste resource.
Company filings have described the project as containing more than 240 million tonnes and previously targeted an initial 5,000 tonnes of copper units a year from modular processing capacity.
For Jubilee, the sale therefore represents more than an asset disposal. The company says monetising the LWP at a “substantial premium to the original acquisition price” will help optimise its portfolio and concentrate investment on operations that management considers less risky.
The strategy also reflects Jubilee’s broader ambition to build a “resource-backed production platform” in Zambia by combining its processing and refining infrastructure with greater control over copper-bearing feed and a growing portfolio of mining assets.
The proposed transaction remains subject to due diligence and definitive documentation, meaning the US$35 million proceeds are not yet secured in full.
Nevertheless, the deal provides Jubilee with a potential source of funding as it seeks to expand copper production while limiting exposure to the substantial standalone capital requirements of a large greenfield development.
