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Africa Moyo
ZIMBABWE’S largest gold producer, Metallon Corporation, will hold a crucial board meeting this week at a time the group is involved in a delicate balancing act of rolling out capital projects to improve both output and profitability while tightening purse strings to remain viable.
Encouragingly, Mutare-based low-cost gold producer Redwing, which was put under care and maintenance in 2004, has been revived.
Metallon owns five gold assets in Zimbabwe: How, Shamva, Mazowe, Arcturus and Redwing mines.
How Mine is the group’s flagship and accounts for 52 percent of production. Shamva and Mazowe mines are cutting production costs to improve viability.
Metallon Corporation’s corporate affairs executive Ambassador Zenzo Nsimbi said Redwing shoudl return to full production in the near future.
“Redwing was flooded and three months ago we started producing. When we were de-watering, we did a lot of development work where we were saying ‘let’s explore where the best grades are’ and it is now doing well.
“In terms of the future, we are getting ready to get back to full capacity and we are confident that Redwing should come back to full capacity,” said Ambassador Nsimbi.
Production at Redwing is expected to be ramped up to 83 000 tonnes of ore per month by April next year and 193 000 tonnes per month by October 2018. The mine, which began operations in 1889, is situated about 20km northeast of Mutare.
Between 1966 and 2004, Redwing produced more than 1,1 million ounces of gold.
The mine is a combined underground and sand/slime re-treatment operation, with one processing plant dedicated to underground operations and another to surface sand operations. Ambassador Nsimbi said Shamva, which is the second-best performing mine in their local portfolio, had been “picking-up” since adoption of multiple currencies in 2009.
“It has gone a long way in terms of controlling their production costs. They have really done a lot of work on that and not only that; they have also improved their production quite a bit,” he said.
Mining at Shamva begun in 1893 and between 1910 and 2013, more than 2,45 million ounces of gold were realised.
In 2014, about 24 037 ounces were produced. The mine was projected to produce 31 796 ounces last year.
There is a drive to push production costs at Mazowe mine further down.
Arcturus Mine, which last year posted a loss of US$7 million, has been a major drag on the business. The mine used to produce 31kg per month before it closed in April 2013 after being affected by flooding, and has failed to reach these figures since reopening in October 2013.
Recently, more than 500 workers went on strike over unpaid wages.
A sand reclamation plant that is expected to be operational by the second half of the year has been put up in Mazowe.
There is a huge dump at Mazowe Mine that has been in existence since the 1940s.
“So we are looking at revisiting that area. Treating the sand has a major advantage in that it is a low-cost operation because it’s already drilled, blasted, it’s mined and it’s crushed and is sitting there.
“All we are doing is picking and putting the sand in a floatation plant and extracting what we can and throwing away what has nothing,” explained Ambassador Nsimbi.
The sands re-treatment project is expected to produce approximately 2 000 ounces of gold each month for six years.
In 2014, Metallon was Zimbabwe’s top producer and exporter of gold accounting, for three of the 10 tonnes of gold from large-scale miners that year.
The first half of 2015 saw the miner record six percent growth in gold production to 48 143 ounces compared to 45 524 ounces in the corresponding period due to massive production at How Mine.
How Mine contributed 26 320 ounces of gold in the first half of the year from 25 745 ounces in 2014.
Sources say annual output was 99 000 ounces, unchanged from 2014 when it reported a US$10 million after-tax profit.
The miner’s target is 150 000 ounces per annum but sources say the group intends to reduce the production target by 30 percent in light of the harsh operating challenges and low mineral prices.
Metallon bought the Zimbabwe assets in 2002 and reached peak production of 156 000 ounces in 2005.
It also has exploration assets in Tanzania and the DRC.
Online Reporter