Caledonia Mining (LSE: CMCL) has added to its portfolio one in every of Zimbabwe’s greatest gold mining initiatives after finishing the acquisition of Bilboes Gold, proprietor of the namesake asset, the U.Ok.-based miner mentioned in a information launch Friday.
The shares plus royalty transaction, introduced final yr, will assist the corporate greater than double its annual output, probably making it Zimbabwe’s high gold miner.
The Bilboes gold mission, a big, excessive grade gold deposit positioned about 75 km north of Bulawayo, additionally makes Caledonia a multi-asset, mid-tier producer.
In keeping with the most recent feasibility examine, the asset has the potential for an open-pit gold mine producing a mean of 168,000 ounces per yr over a 10-year mine life.
Caledonia mentioned it plans to conduct its personal feasibility examine to find out the “most even handed approach” to commercialize the deposit. One method that might be thought-about is a phased improvement, which might decrease the preliminary capital funding and scale back the necessity for third get together funding, the corporate mentioned.
Ore manufacturing from the Bilboes oxides will begin in early February, chief govt officer Mark Learmonth mentioned within the launch. Caledonia anticipates starting to get better gold from the heap leach in March.
As soon as the complete manufacturing charge is achieved, the web smelter royalty would generate round US$2.6 million a yr for the corporate at present gold costs, the miner mentioned.
The entire consideration payable for the Bilboes acquisition is 5,123,044 shares representing roughly 28.5% of Caledonia’s absolutely diluted share capital and a 1% internet smelter royalty (NSR) on the mission’s revenues, topic to adjustment.
Primarily based on the final buying and selling day’s closing worth for Caledonia shares on the NYSE of US$12.82 per share, the worth of the utmost variety of new shares that could possibly be issued as consideration if there isn’t a adjustment is presently US$65.7 million.
