Red Rock Resources Plc, the natural resource development company with interests in gold and battery metal and steel feed materials, announces that Jupiter Mines Limited (“Jupiter”, ASX:JMS), an Australian public company in which Red Rock holds 17,024,914 shares (0.87%) and which owns 49.9% of the Tshipi Borwa manganese mine in South Africa, has released a statement, the text of which is set out below, to the Australian Stock Exchange:
“TSHIPI EXPANSION CONCEPT STUDY COMPLETED
Jupiter Mines Limited (“Jupiter” or “the Company”) (ASX: JMS) is pleased to announce that the concept study into the expansion of the Tshipi Borwa Manganese Mine has been completed. A comprehensive feasibility study will commence shortly.
The feasibility study will be based on a production profile of 4.5 million tonnes (the “Base Case Scenario”), a 50% increase on the current 3 million tonne production level.
Production profiles in excess of the Base Case Scenario were explored as part of the concept study, however the infrastructure required is significantly less complex, will involve a shorter timeframe to implement, has a lower capital requirement, there is less reliance on road transport and the legal requirements are significantly more favourable from a timing perspective for the Base Case Scenario.
Some of the major constraints to go beyond the Base Case scenario include potential mining constraints, the lack of water in the area and logistical constraints in the medium term.
Infrastructural optionality will be considered for substantial production upside beyond the Base Case Scenario, to be leveraged upon in the future, should the constraints and market dynamics change.
Total capital expenditure required for the expansion is estimated to be R1.025 billion (+- 30% level of confidence). This expenditure provides for some of the infrastructure required for the production optionality mentioned above.
Subject to the completion of the feasibility study and commercial process (approximately 1 year), Tshipi would expect to reach steady state exports of 4.5 million tonne in 3 years, with an increase in manganese ore exports in year 2 and year 3, via a stepped approach”.
Andrew Bell, Chairman, comments: “A potential 50% production increase over 3 years is one of a number of encouraging developments at Jupiter, which continues its drive to improved efficiencies and stringent cost control.
Jupiter has over the last 18 months exceeded its benchmark 70% dividend payout ratio, and the significant strengthening in the manganese price over the last two months testifies to the resilience of underlying demand.
The Company expects a continued growth over time in the level of contributions received from its holding in Jupiter.”
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