CALEDONIA Mining increased full-year production guidance to between 55,000 to 58,000 ounces from a previous guided range of 53,000 to 56,000 oz despite disruptions earlier in the year owing to Covid-19 disease.
Commenting in a third quarter production announcement, it also said that commissioning of its Blanket mine expansion in Zimbabwe would be about three months late as a result of the pandemic.
The firm currently expected that Blanket’s central shaft would be equipped before the end of 2020 with commissioning set for the first quarter of 2021.
As a result of this delay, the build-up in production will also be affected: gold production in 2021 is now expected to be in the range of 61,000 to 67,000 oz. There would be no change to the production target of 80,000 oz of gold from 2022 onwards, it said.
Gold production for the three months ended September totalled 15,155 oz which compares to 13,646 oz in the third quarter of the 2019 financial year. Year-to-date production was at 42,887 oz (2019, 38,306 oz).
There was an increase in third quarter all-in sustaining costs (AISC) of some 28% year-on-year owing to one-off items including the cost of operating diesel generators. Caledonia said power interruptions remained a feature of operations. The firm has procured a 13MW solar plant at a project cost of $12m which will provide 27% of Blanket’s total daily electricity demand.
Caledonia ended the quarter with net cash and cash equivalents of $21.6m.
In October, Caledonia approved its third dividend increase of the past 12 months, announcing it would pay out 10 US cents per share owing to declining capital expenditure obligations from 2021, and an improved gold price.
