CALEDONIA Mining Group (Caledonia) says it will this year focus on becoming a multi-asset gold producer following the completion of the Blanket Mine expansion project last year.
In a statement this week, the company’s chief executive officer, Steve Curtis, said the mining firm was continuing to evaluate investment opportunities in Zimbabwe.
“Now that the Central Shaft is complete, the company can focus on other areas of its growth strategy, predominantly de-risking the business from being a single asset producer.
“Last year, we announced the acquisition of Maligreen, one of the more significant exploration opportunities in Zimbabwe. We see huge geological potential in Zimbabwe and we continue to evaluate other investment opportunities in the country.
“I am very excited with the opportunity that we have to evolve our business, with Blanket Mine as the foundation for our growth.
“This marks a strategic pivot in the future direction of Caledonia as it pursues its strategy to become a multi asset company,” Curtis said.
He further said that the board of directors had declared a quarterly dividend of US$0,14 cents, a 104 percent increase from 6,875 cents since October 2019.
This year, Curtis said Caledonia targets to produce between 73 000 and 80 000 ounces of gold.
For the quarter ended September 30, 2021, Caledonia Mining reported record quarterly production of 18 965 ounces of gold at Blanket Mine.
The record gold haul pushed production at the mine in the nine months to September 30 2021, to 48 872 ounces, 14 percent more than the 42 887 ounces produced in the prior year.
Curtis said he was delighted with the production levels that set a new record as Blanket begins to reap the rewards of the substantially increased capacity following the commissioning of the Central Shaft in March 2021.
“The ramp-up in production towards our quarterly target of
20 000 ounces has met our best estimate and, consequently, we have been able to narrow our annual production guidance from
61-67 000 ounces to 65-67 000 ounces,” he added.
Curtis said when Caledonia acquired Blanket from Kinross in 2006, initial production in the third quarter of 2006 was 6 475 ounces.
He also said that the anticipated increase in production following the successful commissioning of the Central Shaft earlier in 2021 gives Caledonia confidence to further increase the dividend payment in addition to providing funding for investment in new projects, including exploration prospects at Maligreen and Connemara North.
The company only has the Gwanda-based Blanket Mine in its portfolio, but it has been actively pursuing expansion plans to grow into a multi-asset operator.
Caledonia announced last year that it had purchased mining claims over the Maligreen project, which is situated in the Gweru mining district, from Pan African Mining (Private) Limited, a privately-owned Zimbabwean company, for a total cash consideration of US$4 million.
Since 2014, Caledonia’s production has almost doubled and its market capitalisation has increased more than four-fold.
The Central Shaft project at Blanket Mine has been the defining feature of Caledonia.
This project commenced in February 2015 and the shaft was successfully commissioned in March 2021.