the $1 billion club/article

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Cosmos launches Jubilee into the billion-dollar club

JOHN PHACEAS





Kerry Harmanis' nickel miner, Jubilee Mines, joined WA's most exclusive club yesterday, as its market worth raced past $1 billion on the back of its spectacular exploration and operational success at the Cosmos nickel mine near Leinster.

On a day that China's revaluation of the yuan sent mining stocks soaring, Jubilee shares added 11¢ to close at $7.88 and a tidy market valuation of $1.004 billion.

The rise values the 17.7 per cent stake held by Mr Harmanis, both Jubilee's chairman and a co-founder, at more than $177 million.

Mr Harmanis was chuffed his company had joined the top echelon of WA companies alongside such salubrious names as Woodside Petroleum, Wesfarmers and Alinta, but said it would not mean the company could relax.

"It's a number, and its a good one that puts us in the spotlight of the index funds and things like that, but we've got to keep delivering which is what we plan to do," he said.

Like oil explorer and fellow billion-dollar-club member Hardman Resources, Jubilee has grown on the back of its reputation as an explorer.

Coincidentally, for companies which listed within three months of each other on either side of the 1987 stockmarket crash, their journey has taken a similar course.

Where Hardman found fame on the back of its pioneering discoveries in deep water off Mauritania, Jubilee struck it rich with its discovery of the Cosmos nickel deposit, 60km north of Leinster, in 1997.

Blessed with grades in excess of 6 per cent nickel, the 12,000 tonnes a year mine is now considered one of the world's most profitable on a pound-for-pound basis.

And where there had been doubts about its long-term prospects once the Cosmos Deeps deposit is mined out around 2008, the project has gone from strength to strength over the past 18 months with the discovery of at least three major new deposits, most notably the Prospero find just 4.5km to the south.

Already twice the size of the original Cosmos discovery, though slightly lower grade and deeper below ground, the latest numbers put the resource of just over one million tonnes grading 5.72 per cent nickel containing 60,600 tonnes of metal.

At current nickel prices of $US14710 per tonne, the deposit has a notional in ground value of more than $1.16 billion.

An exploration decline to the Prospero deposit is already being built, while development of the high-grade Alec Mairs and Anomaly One deposits is also under way and numerous targets remain to be tested.

Mr Harmanis said Jubilee's passage through the billion-dollar mark was a tribute to the effort of the company's employees and management team, especially its geology department.

In its June quarter report yesterday, Jubilee revealed sales of $230.6 million on payable nickel production of over 11,000 tonnes in 2004-05, leaving it with cash reserves of $132 million.

from:

http://thewest.com.au/20050723/business/tw...-sto131796.html

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