Caledonia Mining Corporation yesterday said gold production for the third quarter ended September 30 this year at its Blanket mine reached a record 14 396 ounces, 15 percent higher than the previous quarter. Production for the period under review at Blanket mine, which is located in Gwanda, Matabeleland South province, was also seven percent higher than the same period last year.
“The increased production was primarily due to higher grades, which was due to the improved mine flexibility as a result of the measures taken in previous quarters,” the company said. The higher gold production resulted in higher revenues and a substantial increase in profit. Net profit attributable to shareholders in the quarter was $3,1 million — almost three times higher than the third quarter of 2016 and over four times higher than the preceding quarter.” Caledonia said the all-in sustaining cost fell sharply in the quarter to $773 per ounce compared to $855 per ounce in the previous quarter and $1 004 per ounce in the third quarter of 2016.
The reduction, Caledonia said, was due to higher gold production, which means that fixed costs such as general and administrative costs were spread across more ounces. The export incentive paid out to Caledonia by Government also played a part in offsetting operational costs during the quarter.
“Cash from operating activities in the Quarter was $10,1 million which allowed further investment at Blanket, of approximately $8 million and net cash at the end of the Quarter was $11.8 million compared to $10,8 million at the end of June 2017,” it said. Going forward, Caledonia intends to extend the Central Shaft at Blanket by a further 240 metres to a depth of 1 330 metres, to access deeper resources that have been identified.
“The extension to the Central Shaft will cost $10 million and is expected to extend Blanket’s life of mine by a further four years to 2031 and should allow Blanket to maintain its target production rate of 80 000 ounces from 2021 until at least 2029 based on the existing resources,” the company said. — New Ziana.