Caledonia's Blanket Mine hits ambitious gold outpu...

Caledonia's Blanket Mine hits ambitious gold output target

Zim Now Writer

Caledonia Mining Corporation says its Zimbabwe-based gold mine, Blanket Mine near Gwanda in Matabeleland South Province, recorded 80 775 ounces of gold in 2022, operating and financial results for the year ended December 31, 2022.

With this output, the company achieved its long-term production target, surpassing the 67 476 ounces recorded in 2021.

Caledonia Mining Corporation chief executive officer, Mr Mark Learmonth, while presenting the results said the company has seen a tremendous amount of change.

“Operationally, the last 12 months have marked a turning point for the business, and I am delighted that we hit our long-term target of just over 80 000 ounces. The last couple of years have seen a tremendous amount of change in the company as we pivot the direction of the business towards becoming a multi-asset gold producer in Zimbabwe,” said Learmonth.

He said they have always seen huge geological potential in the country and were very excited about the portfolio of attractive new assets that they have acquired.

“In November we purchased Motapa, an asset we consider to be highly prospective and strategically important in our growth ambitions, as it is a large exploration property which is contiguous to the Bilboes gold project. In January 2023, following the satisfaction of conditions precedent, we closed the acquisition of the Bilboes Gold Project. A feasibility study prepared by the vendors indicates the potential for an open-pit gold mine producing an average of 168 000 ounces per year over a 10-year life of mine,” added Learmonth.

He said in order to optimise shareholder returns, Caledonia has commissioned its own feasibility study to identify the most judicious way to commercialise the project. Learmonth said one approach is a phased development which would minimise the initial capital investment and reduce the need for third-party funding.

“The Company has also restarted the oxide operations at Bilboes providing immediate cash-flow and has given guidance of between 12 500 and 17 000 ounces for 2023.”

He said the company’s 12.2-megawatt solar plant that was connected to the Blanket grid and the mine in November 2022 has since been receiving 27 percent of its energy from solar.

Learmonth said the solar power will displace power from the grid and from the diesel generators and is expected to reduce Caledonia’s consolidated cost of production per ounce of gold by approximately US$37.

“This completion happily coincides with an improvement in the supply of power from the Zimbabwe grid which has substantially reduced the amount of diesel consumed. We are confident that we will continue to see an ongoing meaningful reduction to our diesel usage month on month, fully justifying our investment in solar power and delivering on our Environmental Social Governance strategy.”

Learmonth said the quarterly dividend continues to be an important part of the company’s strategy and during the year and they paid a quarterly dividend of 14 cents a share, providing a healthy yield to our shareholders.

He added that they believe the dividend, coupled with their growth strategy, makes them an attractive investment and sets them apart from their industry peers.

“I would like to thank the Caledonia team for their continued hard work, and I look forward to updating shareholders of our progress.”

The gold miner’s financial highlights for 2022 include gross revenues of US$142 million, gross profit of US$61.8 million and dividend paid of 56 cents per share.