As uncertainty continues to hang over Newcastle, with the future of ArcelorMittal South Africa’s Newcastle Works still unresolved, a separate investment development is now moving forward in the town.
The company further stated that it had already advanced the full subscription amount to enable LBR to conclude the imminent US$1.36 million acquisition of Newcastle’s Karbochem Industrial Park.
As previously reported by Newcastillian News in December 2025, Metals One agreed to inject approximately R30.8 million at the time, into LBR, a newly formed private company targeting the development of a centralised gold concentrate roasting and cogeneration facility in Newcastle, KwaZulu-Natal, with the Karbochem Industrial Park identified for the project.
Now, three months later, Metals One has confirmed that it intends to exercise its option to convert the CLNs into the most favourable class of shares in LBR’s capital immediately after LBR acquires the plant.
Once converted, Metals One said its holding in LBR will amount to 30% of the company’s issued share capital on a fully diluted and enlarged basis.
“Until converted, the CLNs are secured, inter alia, by first ranking security over the assets of LBR,” Metals One stated, adding that it has also entered into a shareholders’ agreement with LBR’s shareholders.
Metals One further explained that LBR is a South African private company established last year to create a vertically integrated South African gold business.
It is currently jointly owned by Lions Bay Capital Inc. (LBI) (TSX-V: LBI), in which Metals One holds 19.1%, and the Salamander Mining management team, headed by Graham Briggs, Non-Executive Chairman and former CEO of Harmony Gold, South Africa’s largest gold producer, together with Lloyd Birrell, CEO and founder, and former CEO of Theta Gold (ASX:TGM).
Against this backdrop, Metals One said LBR will use the funding to settle the outstanding US$1.36 million balance required to acquire the fluidised bed cogeneration plant, with the aim of restarting the production of steam and power.
“The Plant was inspected and verified by TerraVista Solutions P. Ltd in October 2025 and ascribed a replacement value of US$39.6 million,” the company said in an official statement.
Building on this, Metals One added that, subject to confirmatory research and studies, the plant may later be reconfigured to include a gold concentrate roasting complex. This, the company noted, could provide an alternative to exporting gold-bearing concentrate from South Africa to Asian smelters at a significant discount to the contained gold value.
At present, the plant includes the following specifications and associated infrastructure:
2 x 30 tonnes per hour (TPH) Thermax combustion boilers
6 MW GE-Triveni steam turbine
Configuration to use coal from local dumps and biomass as feedstock
Boiler house, turbine, control room and motor control centre
Compressed air plant and electrical sub-station
Inclined conveyor to six silos of 1,500m³ each
Looking ahead, Metals One stated that the plant has three potential revenue streams: the production of electricity, the production of steam, and gold roasting.
“Subject to receipt of a competent person’s report, it is expected that the Plant will require approximately US$4.5 million of investment to restart production of steam and power,” the company said.
In a further update, Metals One also provided details on LBR’s offer for all the assets of the Vantage Goldfields Group.
Vantage entered Business Rescue after a crown pillar collapse at the Lily mine in 2016. The group comprises a number of mining leases in the Barberton region of South Africa, with a historical resource inventory of 4.5 million ounces of gold, as well as a central metallurgical complex and extensive underground development.
Furthermore, Metals One stated that, after several months of negotiations, LBR — in which Metals One is set to become a 30% shareholder once the CLNs are converted — has now agreed a plan in principle with the Business Rescue Practitioner (BRP) for the acquisition of the Vantage assets.
“The BRP is expected to sign and publish the plan imminently at which point Metals One will announce further details including the final terms of the plan. An updated CPR over the Vantage mining assets is planned, and likely a condition, to securing the project financing offers currently being considered by LBR. Any further substantive investment in the project by Metals One will also be subject to approval by its shareholders,” the company explained.
Metals One added that the Vantage acquisition could ultimately provide the gold-bearing concentrate feed required for LBR’s proposed gold roaster project in Newcastle, should the plant be reconfigured for that purpose.
The company also noted that LBR is considering whether the Newcastle plant could feed power into the local grid, with that electricity potentially made available for use at the Vantage mines through South Africa’s wheeling charge system.
“This may have advantages including avoiding periodic load shedding customary in South Africa and above-inflation power price increases,” Metals One stated.
Daniel Maling, Managing Director of Metals One, said the company’s vertically integrated South African gold business strategy was now beginning to take shape alongside its key partners.
“With our key partners, the Company’s vertically integrated South African gold business development strategy is now being implemented. LBR has secured the cogeneration plant in Newcastle which could play a key role in unlocking value in our targeted mining assets, including Vantage, as a source of cheap power initially, and as a gold roaster in the longer term,” he said.
Maling additionally stated that, through the efforts of the LBR team, a plan had now been agreed to acquire the Vantage assets through the Business Rescue process.
“We believe these assets will be potentially transformational for LBR, and to Metals One as a 30% owner, and look forward to providing further updates as the Plant acquisition and Vantage plan progress. Metals One’s significant cash and liquid investments held on its balance sheet have enabled it to position itself, and LBR, as front runners in the Vantage Business Rescue process. LBR is now in the position of considering several offers for project level financing for the balance of cash required to complete the Vantage asset acquisition and mine startup capital,” Maling emphasised.
For Newcastle, the development could prove important at a time when the town continues to face industrial uncertainty.
The acquisition of the Karbochem Industrial Park and the planned restart of steam and power production may help support industrial activity, create employment opportunities and provide work for local suppliers, while reinforcing Newcastle’s relevance in energy and mining-related infrastructure.
Longer term, the project could also place Newcastle in a stronger strategic position if the plant is successfully expanded to include gold roasting and wheeled power supply. Should those elements materialise, the town may find itself playing a more prominent role in supporting both energy resilience and mineral processing activity linked to the wider South African gold sector.
With all of this in mind, what are your thoughts? Be sure to let us know below.
What has Metals One confirmed about the Karbochem Industrial Park deal?
Metals One confirmed that it has finalised an agreement to subscribe for up to US$1.8 million in convertible loan notes in Lions Bay Resources and has already advanced the full amount to support LBR’s imminent US$1.36 million acquisition of Newcastle’s Karbochem Industrial Park.
What is Lions Bay Resources planning for the Newcastle site?
LBR is targeting the development of a centralised gold concentrate roasting and cogeneration facility in Newcastle. In the shorter term, the funding is intended to help acquire the plant and restart the production of steam and power, while longer-term plans may include a gold concentrate roasting complex.
What stake will Metals One hold in LBR?
Metals One said it intends to convert the loan notes into shares immediately after LBR acquires the plant. Once that happens, the company expects to hold 30% of LBR’s issued share capital on a fully diluted and enlarged basis.
Why is the Vantage Goldfields deal important to the Newcastle project?
According to Metals One, the proposed acquisition of Vantage could provide the gold-bearing concentrate feed needed for LBR’s proposed gold roaster project in Newcastle. The company also indicated that the Newcastle plant could potentially feed power into the grid for use at the Vantage mines through South Africa’s wheeling system.
What could this mean for Newcastle’s economy?
The development could help support industrial activity, jobs, local suppliers, and broader economic stability in Newcastle at a time of ongoing uncertainty around ArcelorMittal South Africa’s Newcastle Works. Longer term, it may also strengthen the town’s role in energy and mining-related infrastructure.
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