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While the world’s top three platinum producers are trying to stabilise their operations following the violent and unsettling labour unrest that rocked South Africa’s mining industry in the past weeks, the exploration side of the sector does not seem to be affected.
The statement is particularly true of another South African platinum explorer ,Jubilee Platinum plc (LSE:JLP), which announced several developments in its platinum exploration and mine-to-metals strategy with the signing of several contracts and memorandum of agreements, putting the company closer to becoming a producer of the highly-priced metal.
What is more significant and prominent is the fact that the market appetite in owning a piece of a South African mining firm – one that is not producing the expensive jewellery material yet – is still there, despite the recent troubles that rocked industry.
The Stakes Acquired
While Jubilee’s share price earlier today played between 9.8 pence and 9.9 pence, the same spiked as high as 10.95 pence minutes after the company said it has inked a binding and exclusive MOU to acquire 51% of a BEE-certified business that owns prospective rights to a portion of the western side of the Bushveld Complex, the centre of platinum mining extraction in the world, as well as exlusive option to purchase platinum-bearing assets in Zimbabwe.
Jubilee also informed its shareholders and the authorities today that it now wholly owns the holding company of RST Special Metals, a smelting in company operating in Middleburg, and increased its ownership of power generation company, Power Alt (Pty) Ltd., to 70%.
The total value of all four transactions are estimated to be at about £2.455 million, which can be compensated in cash or by the issue new shares in Jubilee, with the sole discretion given to the company.
“This positions Jubilee to establish itself as a significant platinum producer in the near term,” Chief Executive, Leon Coetzer, said in a statement.
Mr. Coetzer, or the company as a whole, seemed to be prophetic of the future of the platinum mining business in South Africa, viewed in the light of the recent events and the ongoing labour unrest and calls for wage hikes.
Over 1.3 million shares were traded as of 1:30 PM GMT, and Jubilee share price settled for a 6.3% increase by that time to 10.50 pence, as investors showed support of the new deals.
Company Spotlight
Jubilee Platinum plc is a mining exploration and development company now in its near-term stage, focussing on platinum and platinum group of metals in the mineral resource rich Bushveld region in South Africa.
Shares are listed on both the Alternative Investment Market of the London Stock Exchange and the Johannesburg Stock Exchange.
