Promising results at Caledonia’s Bilboes project

Sikhulekelani Moyo, [email protected]

CALEDONIA Mining Corporation Plc, which owns Gwanda-based Blanket Mine, has said the feasibility study for its Bilboes gold mining project, 75km North of Bulawayo, continues to show positive fundamentals, which may benefit the group.
Blanket Mine is already one of Zimbabwe’s biggest gold producers, having produced 76 656 ounces last year.

In 2023, Blanket Mine managed 75 416 ounces. Caledonia’s long-term vision is to become a multi-asset gold producer in Zimbabwe.

In an update statement, Caledonia said it was making good progress on the feasibility study with the support of DRA Projects and other technical consultants.

While the feasibility study was initially targeted for completion in the first quarter of 2025, Caledonia has extended the timeline to explore fully the several material optimisation opportunities.

It said the opportunities have the potential to enhance project economics and reduce upfront capital requirements.
The company said the feasibility study supersedes the Preliminary Economic Assessment released on June 3, 2024, which outlined attractive project economics and a mine plan capable of tripling Caledonia’s gold production and positioning the company as an intermediate gold producer.

“Encouragingly, ongoing work continues to confirm the project’s attractive fundamentals. Against the backdrop of a strong gold price, Bilboes remains both compelling and financeable,” said the company.

“Key areas of optimisation currently under review include engaging with the authorities to explore the potential sale of concentrate, which could significantly reduce upfront capital expenditures by deferring the capital expenditure on a BIOX processing circuit, at least in the first few years of production, and evaluating the potential relocation of the Tailings Storage Facility to a more efficient site, including on Caledonia’s Motapa property adjacent to Bilboes, where the topography could lead to lower initial construction costs,” it said.

Caledonia also said it was incorporating near-term opportunities at Motapa into the Bilboes feasibility study, following strong exploration results in 2024 and the additional exploration and development work planned at Motapa this year.

The giant gold producer also said the exploration at Motapa had been particularly promising, indicating the presence of new mineralised zones within a few hundred metres of the proposed Bilboes processing plant.

“Demonstrating significant resource additions at Motapa has the potential to materially improve the long-term economics of a combined Bilboes-Motapa project,” the Toronto Stock Exchange and Victoria Falls Stock Exchange group said.
Caledonia continues to assess near-term revenue opportunities across its portfolio.

In particular, high-grade mineralisation recently identified at the Blanket Mine could make a meaningful contribution to initial capital requirements for Bilboes through further flexibility around funding.

“The board remains fully committed to maximising shareholder value: this means ensuring that Bilboes is optimised both technically and financially, while continuing discussions with funding partners and relevant authorities in Zimbabwe.

“The optimisation work is advancing well, and the company will provide a further update on the expected timing of the feasibility study in due course,” the company said.

Caledonia chief executive officer Mr Mark Learmonth said Bilboes could be transformative for Caledonia, pointing out the group was working to make sure the requisite funding is secured.

“We are encouraged by the results to date and are taking a disciplined approach to optimisation — both to enhance returns and to ensure we can fund the project in the most efficient way possible,” he said.

“With strong exploration results at Motapa, promising developments at Blanket and supportive market conditions, we remain confident in Bilboes’ ability to significantly reshape Caledonia’s growth profile.”

In January 2023, Caledonia acquired Bilboes Gold Limited for US$53,2 million, as part of its strategy to become a multi-asset gold producer in Zimbabwe, with the goal of producing more than 250 000 ounces of gold annually.