Jubilee Platinum (LON:JLP) has signed off its tailings treatment contract to produce platinum from Hernic's ferrochrome waste dumps in South Africa.
It is one of two surface projects that Jubilee hopes to bring on track next year.
Combined, the two will have an annualised processing capacity in excess of 900,000 tons.
Hernic’s surface dumps contain 1.7 mln tons, of which approximately 90% is in the measured category. Further drilling of secondary stocks could increase this to 3 mln tons.
The total project is estimated to contain in excess of 224 000 ounces of platinum equivalent and will be the largest PGM beneficiation plant of surface chrome tailings in South Africa.
At an average price around US$900 per ounce, the plant can generate annual revenues of £18.2mln (R400mln) and will be built in four phases over an 11 month period subject to funding.
About £11.5mln (R255mln) before financing costs is needed to bring both plants on stream, with a further estimated £3.4 mln (R75 mln) for working capital.
Jubilee hopes its other project, at ASA’s Dilokong mine, will be up and running by early 2016.
Leon Coetzer, chief executive, said Jubilee was honoured to be appointed as exclusive partner to the largest PGM beneficiation plant of surface chrome tailings in South Africa.