LONDON (ResourceInvestor.com) -- AIM listed junior Jubilee Platinum [JLP] late last week detailed the discovery of ‘significant’ Gold deposits at its Ambonitra prospect in central Madagascar. This is less than a fortnight after the market was first stirred by news of Jubilee’s PGM, nickel and copper strike at the Londokomanana project, also in Madagascar.
The news appears to have arrested the stock’s downward drift since the start of the year.
Samples obtained from a newly exposed gold bearing vein in old artisanal workings contained very high grade showings. The company believes that the area will yield a large extension to identified gold reserves.
Jubilee Platinum now intends to undertake more detailed mapping and sampling of the ground in order to select sites at which to begin trenching and drilling. Preliminary surveys indicate that the deposits cover a significantly larger geographical area than previously thought.
Jubilee chief executive Chris Bird called the discovery “very encouraging” and cited it as vindication of the company’s operations in Madagascar. The island is under-explored because of previous isolation and recent political upheavals.
Some have suggested that the Londokomanana concession may be a geological extension to the PGM rich Bushveld basin in South Africa.
Lab results on the Lavatrafo find show metal values of up to 1.97 grams per tonne platinum, 1.91g/t palladium and 1.17g/t gold. The company says nickel and copper also showed well at 1.21% and 0.69% respectively.
Jubilee recently appointed a new non executive director to assist with development of its two South African subsidiaries, Maude Mining & Exploration, and Dullstroom Platinum, which each have interests in the Bushveld complex. Chris Molefe brings valuable black empowerment (BEE) credentials from his previous tenure as chief executive at Royal Bafokeng Resources.
Earlier this year the company concluded a deal to satisfy BEE legislation, in which it transferred ownership of its two subsidiaries into a new company, Jubilee Platinum SA, which will in turn be part owned by the New Africa Mining Fund and black owned firm K-Plats.
The Madagascar discoveries increase the prospect of a takeover bid for Jubilee Platinum. Some discounting would apply though because of the country risk and daunting logistical problems.
Potential predators include the platinum majors Impala Platinum, Anglo Platinum, Lonmin, and Aquarius, who will all now be paying closer attention to Jubilee’s potential.
The platinum sector as a whole is taking steps to diversify outside of South Africa, and to this end has increased expenditure outside the country in recent years.
Companies are keen to escape an onerous regulatory environment preoccupied with boosting black participation in industry in general and mining in particular, as well as a surging rand that has crushed margins for locally priced operations with dollar revenues.
Jubilee also has interests in Canada and Sierra Leone, though it is primarily focused on South Africa. That could all change if Madagascar keeps delivering.
