May 22, 2024
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Zimbabwe to Build Biggest Gold Mine in the Country

Caledonia Mining Corp (CALq.L) is actively pursuing options to secure $250 million in funding for the development of its Bilboes project, potentially transforming it into Zimbabwe’s largest gold mine.

Maurice Mason, Caledonia’s Vice President of Corporate Development, told Reuters that the company, backed by investors like Cape Town-based fund manager Allan Gray, aims to raise the capital through a mix of debt, internal reserves, and equity.

The Bilboes project has the potential to yield approximately 170,000 ounces of gold annually, which, when combined with Caledonia’s Blanket gold mine, could elevate the company’s total bullion output to around 250,000 ounces. Caledonia plans to construct the Bilboes mine over a two-year period and is currently exploring strategies to reduce upfront capital requirements, pending the outcome of feasibility studies.

Mason emphasized the significance of the Bilboes project, stating, “It will be Zimbabwe’s biggest gold mine by far.” Despite challenges posed by Zimbabwe’s economic uncertainties, including intermittent power cuts, U.S. dollar scarcity, and hyperinflation, Caledonia remains committed to expanding its gold operations in the country.

The scarcity of foreign currency has posed challenges for investors, hindering the repatriation of profits. Mason highlighted the importance of investor confidence in policy stability and profit repatriation. Caledonia, known for paying dividends from its Blanket mine, continues to navigate these challenges and secure support for its quality projects.

The Bilboes project, Caledonia has been actively exploring gold deposits at the Motapa and Maligreen projects, showcasing its commitment to further enhancing Zimbabwe’s gold production.

This venture signifies Caledonia’s determination to bolster Zimbabwe’s gold mining sector, a vital source of foreign currency alongside tobacco and platinum metals, contributing significantly to the nation’s economy.

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