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Caledonia’s first quarter gold output hits a slump

CALEDONIA Mining Corporation Plc first quarter of 2023 gold output recorded a slight slump at its two mines owing to mechanical breakdowns and inconsistent grades among other factors.

In an update this week, the top miner said production at Blanket Mine was 16,036 ounces, 13% lower than the quantity produced in the first quarter of 2022.

The decline was attributed to mechanical breakdowns and logistical issues which have now been resolved, with production in the early part of April 2023 having been better than expected.

Caledonia CEO, Mark Learmonth however said the trend is common during this time of the year.

“Gold production at Blanket is usually lower in the first quarter of each year and increases in the following quarters.

“This trend is in evidence this year, albeit production in the first quarter of 2023 was below our target due to a series of issues including equipment failures and logistical issues. These issues have been resolved and production to date in April has been higher than expected,” he said.

In the same period, Bilboes commenced production of gold from oxides derived from pre-stripping works in the last few days of the quarter, producing 105 ounces of gold.

Commencement of oxide production at Bilboes has been slower than anticipated, having been adversely affected by inconsistent grades, mechanical breakdowns and the unavailability of spare parts and alternative equipment.

As highlighted in the production guidance dated January 13, 2023, the on-mine cost of Bilboes oxide production was expected to be $1,200-1,320 and is hence a relatively low margin activity primarily justified by the parallel benefit of pre-stripping in anticipation of the development of the Bilboes sulphide project.

The Company is reviewing the initial evidence of this activity given some of the initial challenges and relative to the larger sulphide project, for which a feasibility study is being updated.

“Accordingly, going forward, we will report actual production achieved each quarter at the oxides project as part of the pre-stripping activities and, accordingly, have withdrawn guidance on the low-margin oxide production,” added the company. – (New Zimbabwe)

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