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Business Reporter

Caledonia Mining Corporation says gold production for the year 2022 reached 80,775 ounces (oz) compared to 67,4760z in 2021 largely driven by record annual production at Blanket Mine, resultantly positioning the company to achieve its long-term production target.

During the fourth quarter 2022, Caledonia completed the acquisition of a company owning the mining lease for Motapa, a property contiguous to the Bilboes gold project with the potential of gold processing synergy. The company in an update for the year ended December 31, 2022 said production guidance for 2023 ranges between 87,500 oz to 97,000oz comprising 75,000oz-80,000oz coming from Blanket Mine while 12,500oz-17,000oz will come from oxide operation at Bilboes.

The Bilboes gold project is a large high-grade gold deposit. 

The project has NI 43-101 compliant proven and probable mineral reserves of 1,96 million ounces (“Moz”) of gold in 26,64 million tonnes (“Mt”) at a grade of 2,29 grams per ton (“g/t”).

It also has a measured and indicated mineral resources of 2,56 Moz of gold in 35,18Mt at a grade of 2,26 g/t and inferred mineral resources of 577,000oz of gold in 9.48Mt at a grade of 1.89 g/t. 4

In February the Company released an update to the NI 43-101 compliant mineral resources and reserves at Blanket Mine.

The total measured and indicated mineral resources inclusive of mineral reserves has increased from the most recently published estimate by 52 percent to 1,095,000oz of gold in 10.72Mt at a grade of 3.18 g/t and the total mineral reserves increased by 1 percent to 395,000oz of gold in 3.94Mt at a grade of 3.12 g/t5 .

Commenting on the update, Mark Learmonth, the chief executive officer said operationally, the last 12 months have marked a turning point for the business.

He said the last couple of years have seen a tremendous amount of change in the Company as it pivot the direction of the business towards becoming a multi-asset gold producer in Zimbabwe.

“We have always seen huge geological potential in the country and are very excited about the portfolio of attractive new assets that we 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 that 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 168,000oz per year over a 10-year life of mine,” he said.

He noted Caledonia has commissioned its own feasibility study to identify the most judicious way to commercialise the project to optimize shareholder returns.

One approach that the Company has considered 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 – 17,000oz for 2023.

“In November 2022, the Company’s 12,2MWac solar plant was connected to the Blanket grid and the mine has since been receiving 27 percent of its energy from solar.

“The solar power will displace power from the grid and from the diesel generators and is expected to reduce Caledonia’s consolidated cost per ounce of gold produced by approximately $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,” Learmonth said.

He said the quarterly dividend continues to be an important part of the Company’s strategy and during the Year we paid a quarterly dividend of 14 US cents a share, providing a healthy yield to our shareholders.