Jubilee Metals Group PLC (LON:JLP) has said it is “doing all things necessary” to assist BMR Group PLC (LON:BMR) after the latter lost its mining right for their Kabwe joint venture project in Zambia.
Shares in BMR were suspended on Wednesday after receiving a letter from the Mining Cadastre Department of Zambia terminating its mining right for the Kabwe lead, zinc and vanadium project in the country.
The letter was dated 19 December 2017 and gave BMR 30 days to exercise its right of appeal.
BMR chairman Alex Borrelli, said: "We had understood that all mining companies in Zambia had received the default notice and we had responded accordingly.
“We will now pursue all avenues to rectify this situation as soon as possible and will issue a further announcement when we have further news."
The news comes a day after Jubilee said it had completed its due diligence at Kabwe and elected to exercise its option to earn a 40% interest. This took its effective interest up to 57.41%, since already owns a stake in BMR.
Jubilee says it remains committed to BMR
In response to the news about BMR, Jubilee chief executive Leon Coetzer said: “This announcement was totally unexpected and Jubilee was not made aware of any potential challenge to the mining right.
“We are doing all things necessary to assist BMR to resolve this matter timeously and favourably.
“In this regard we have made contact with the mining ministry of Zambia to arrange an urgent discussion to clarify the reasons for such a notification and its impact on the Kabwe project.”
Jubilee will provide further clarity on the Kabwe project and the expected execution of the project following its discussion with the mining ministry.
It said it remains committed to BMR for the immediate execution of the Kabwe project.