African development banks expected to fund Caledonia's new Zimbabwe mine, CEO says
African development banks are seen as the most likely funders of Caledonia Mining Corporation's planned $250-million gold mine in Zimbabwe, the mining company's CEO Mark Learmonth said on Wednesday.
Caledonia, which already owns the Blanket gold mine in Zimbabwe, is updating a feasibility study ahead of the planned construction of a new mine at Bilboes to produce at least 170 000 oz/y, making it potentially the country's biggest gold mine.
The southern African country has significant mineral resources, including platinum group metals, gold and lithium, but has struggled to attract investment due to economic instability and jitters over property rights after the government seized white-owned farms at the turn of the century.
Caledonia, backed by investors including BlackRock and Cape Town-based fund manager Allan Gray, is one of the few foreign investors - along with Anglo American Platinum and Impala Platinum - to brave Zimbabwe's tough economy marked by foreign currency shortages and episodes of hyperinflation.
The company is in preliminary talks with the "most likely lenders", Learmonth said during a conference call.
"They are going to be African development banks who have indicated a high degree of interest in this project," he said.
Learmonth said debt would form the bulk of the funding for the Bilboes project.
"We will not be approaching the market for any non-debt funding until we've got a better idea of what the debt capacity is because, frankly, nothing is going to be as cheap as debt funding," Learmonth said.
He said once funding was in place, "optimistically" a year from now, construction of the mine would likely take two years after financial close.
Caledonia's operating profit plunged 62% to $15.18-million in 2023, from $40.28-million a year earlier, mainly due to higher administrative and production costs.
Comments
The
content
you are trying to access is only available to subscribers.
If you are already a subscriber, you can Login Here.
If you are not a subscriber, you can subscribe now, by selecting one of the below options.
For more information or assistance, please contact us at subscriptions@creamermedia.co.za.
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation