Caledonia Mining decides not to exercise option over Connemara North prospect

CALEDONIA Mining Corp. has decided not to exercise an option over Connemara North, saying in its March quarter announcement that the exploration property didn’t meet its “commercial objectives”.

The Zimbabwean gold miner said in December 2020 it had secured an option over Connemara North, a previously worked prospect in Gweru district. The mine was shut in 2001 by then operator First Quantum Minerals.

“We continue to evaluate historical information at the Maligreen exploration property with a view to publishing a revised resource statement,” said Caledonia in respect of other exploration properties it was assessing.

As it drew towards conclusion of its $60m Blanket central shaft expansion project, the company has increasingly been talking about developing other assets, primarily through brownfields and greenfields development work.

Steve Curtis, CEO of Caledonia Mining, said at an investment conference in 2020 that the company would prioritise expansion once it had completed the Blanket project. “We recognise that being single asset won’t move the needle. We see our way with two or three projects of about 350,000 to 500,000 oz a year,” he said.

Caledonia reported adjusted share earnings of 62.5 cents a share which compares to 51.6 cents/share for the corresponding period of the previous financial year. Net cash generated totalled $10.2m (2021: $2m) while cash on hand and cash equivalents increased year-on-year to $14.4m.

Caledonia announced it would pay a 14 cents/share dividend – a 27% increase from the 11 cents/share it paid last year for the first quarter.

Production for 2022 from Blanket is forecast to be between 73,000 and 80,000 oz.