Caledonia to spend US$34 million on capital expenditure

The Victoria Falls Stock Exchange (VFEX) listed resources group, Caledonia Mining Corporation Plc, has budgeted US$34,4 million capital expenditure for the group in 2024 as the group looks at enhancing production efficiencies.

Chief executive officer, Mark Learmonth, indicated this will include planned exploration at Motapa and further work on the Bilboes feasibility studies.

“Anticipated group capital expenditure of $34,4 million includes approximately $20 million of sustaining investment (which is included in all-in sustaining cost guidance) and $14,4 million of expansion expenditure, which includes investment in a new tailings storage facility with a life of approximately 12 years and further underground development.

“Expansion expenditure also includes $2 million on preliminary exploration at Motapa and $3,5 million on further work on the Bilboes feasibility studies,” said Learmonth.

On-mine costs are expected to be consistent with costs incurred in 2023.

Caledonia continues to work on the feasibility studies in respect of the Bilboes sulphide project to determine the optimal implementation strategy for the project.

According to the group, this work includes updating the existing feasibility study for a project producing approximately 170,000oz of gold per annum and work on an alternative phased approach to the project.

Management at Caledonia has also maintained the group’s long term plan of becoming a myulti-asset gold mining firm in Zimbabwe, and the group wants to achieve this through further exploring opportunities in the country.

“Our wider capital expenditure programme continues to focus on unlocking value and delivering our multi-asset growth pipeline in Zimbabwe with Motapa and Bilboes, whilst maintaining a disciplined focus on cost and capital allocation.

“We continue to progress our feasibility studies for the Bilboes sulphide project with a view to determining the best option for Caledonia stakeholders, and I look forward to providing an update in due course,” said Learmonth.

Meanwhile, its local unit, Blanket Mine met its projected annual gold production for the financial year 2023 (FY23), despite a slow start to the year.

Statistics from the group show that the Gwanda based mine produced 75,416 gold ounces against a target of between 74,000 and 78,000 ounces for the year to December 31, 2023.

“I am pleased that, after a challenging first half, we successfully met production guidance for the year, producing 75,416 gold ounces.

“Our 2024 guidance of 74,000 to 78,000 ounces assumes that Blanket will broadly maintain the production rate achieved in 2023 and reflects the prudent decision to suspend mining in lower margin areas which include lower grades and volumes, and higher costs,” said Learmonth.-ebusinessweekly