Chronicle Editor
Sikhulekelani Moyo, [email protected]
VICTORIA Falls Stock Exchange (VFEX)-listed Caledonia Mining Corporation Plc got off to a strong start in 2024, producing 17 050 ounces of gold in the first quarter of 2024 from Blanket Mine alone, a six percent increase from the same period in 2023.
The positive performance is anchored on the significant investment by the group at Blanket Mine in Gwanda over the past seven years and completion of the Central Shaft, which has nearly doubled production, extended the mine life and allowed the restart of underground exploration in 2023.
In a statement accompanying the company’s first quarter production and financial results, the company said it realised an increase in gross profit to US$13,8 million from US5,8 million recorded during the same time last year due to higher gold revenue of US$38,5 million and lower production costs.
Caledonia chief executive officer, Mr Mark Learmonth, said the first quarter of 2024 started on a strong footing with an increase in production and profit, supported by a favourable gold price, which has continued through April and into May.
He said 17 476 ounces of gold were produced in the quarter against 16 141 ounces of which 17 050 ounces were produced at Blanket and 426 ounces at the Bilboes oxide mine.
“Gold produced at Blanket was a six percent increase from Q1 2023 due to higher tonnage and grade and improved gold recovery,” said Mr Learmonth.
“We were highly encouraged by the results from the underground exploration programme, which has yielded excellent results indicating that the Blanket, Eroica and AR South ore bodies have better than expected grades and widths at depth.
“The results of this drilling programme are being incorporated into a new technical report summary for Blanket Mine, which we will announce shortly. It will show a meaningful increase in the life of the mine at Blanket.”
Mr Learmonth said work to refresh the existing study for the large-scale sulphide project at Bilboes is well-advanced, adding that management was considering various options for developing Bilboes with a view to optimising capital allocation and maximising the uplift in value for Caledonia shareholders.
He said the work on the selected development route will be upgraded to a feasibility study. This activity will take place in parallel with a process to secure debt finance for the project.
The mining house has it on record that it is eyeing consolidating its strategy of becoming a multi-asset gold producer by acquiring several lucrative mining assets.
Over the years, the firm has been creating a solid base at becoming a multi-asset gold producer by making significant investments in operations. For instance, in 2022, the resource group expanded its footprint by purchasing Motapa Mining Company UK Limited and signed a US$53,2 million agreement to buy Bilboes Gold Limited as part of its expansion drive.
Bilboes Gold is a gold mining entity that owns three major gold mines in Matabeleland North and was once ranked among the country’s 10 biggest gold producers.
It has, however, been under care and maintenance with effect from October. Added to that, to be energy sufficient, in 2020 Caledonia announced that it was constructing a US$14 million 12,2 MWac solar power as part of efforts to address electricity constraints that have over the years affected the mining industry. —@SikhulekelaniM1
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