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Jubilee future rosy: Harmanis

Michael Quinn


Tuesday, July 27, 2004
JUBILEE Mines' excitable executive chairman Kerry Harmanis has forecast a full year's profit at the top of an analysts' range of $85-95 million, and dismissed the "knockers" that believe the high grade Cosmos operation is on its last legs, claiming that the area north of Leinster will be producing nickel for "many, many years".

On current reserves Jubilee has a mine until 2008. The operation has to date produced 570,000 tonnes grading 8.75% nickel yielding 46,000t of nickel.

Exploration targets mentioned by Harmanis included up and down-dip of Cosmos Deeps ("particularly down plunge"), the new 1200 target, Anomaly 1 and various targets north and south along strike from the Cosmos operation.

He particularly highlighted the 1200 target, saying Jubilee is likely to make a decision on developing a drive over from Cosmos Deeps to the 1200 target in the next 6-8 weeks. Harmanis said around 350t of nickel would warrant the development, and that all going to plan, the drive should reach 1200 by Christmas.

Hits at 1200 have included 2.9m grading 8.4% nickel and 1.6m at 3.2% nickel. Significantly, Harmanis said the mineralised body may have the same orientation as the Cosmos and Cosmos Deeps deposits.

Meantime Harmanis said the large, low grade Anomaly 1 deposit may ultimately be developed via an open pit, with some potential for underground mining. Mineralisation at Anomaly 1 starts around 60m below surface. A feasibility study was recently put on hold, but Harmanis said the project is "alive and well".

A 15-20,000t per annum nickel in concentrate operation could cost around $130 million to develop.

Jubilee will spend $12 million on exploration over the next 12 months, including $9 million in the Cosmos environs.

On the back of the healthy profit, Harmanis forecast a generous dividend to shareholders, with a payment ratio of between 53% and 70%.

Shares in Jubilee were up 3c to $4.20 following the Diggers and Dealers presentation.