Name and Location
Blanket gold mine expansion project, Zimbabwe.

Client
Caledonia Mining Corporation.

Project Description
A revised investment plan and production projection have been announced for the Blanket mine.

The revised plan aims to improve the underground infrastructure and logistics and allow an efficient and sustainable production build-up.

The infrastructure improvements will include the development of a tramming loop and the sinking of a new 6-m-diameter Central shaft from surface to 1 080 m.

The increased investment pursuant to the revised plan is expected to increase production from inferred resources of about 70 000 oz in 2015 to 75 000 oz in 2021, in addition to projected production in 2021 from proven and probable mineral reserves of about 6 000 oz.

The revised plan is also expected to improve Blanket’s long-term operational efficiency, flexibility and sustainability.

Net Present Value/Internal Rate of Return
The mine currently has a net present value of $147-million, with an internal rate of return of 267%.

Value
$50-million is expected to be spent from 2015 to 2017 and about $20-million from 2018 to 2020.
All capital expenditure is expected to be funded from Blanket’s in-house cash flows and existing facilities.

Duration
Production is expected to start in 2021.

Latest Developments
Caledonia has announced an increase and upgrade to the gold resource base at its 49%-owned Blanket mine.

The company has added 538 000 t to the 2.9-million tonnes of reserves and indicated resources, representing a tonnage increase of 17.4% and a 20.5% hike in contained gold.

This follows an upgrade of 491 000 t from the inferred to the indicated category, and the addition of 47 000 t of new inventory to the indicated resource following drilling completed at depths below the AR Main and Blanket sections over the past year.

“This upgrade reflects an increased focus on resource development at the Blanket mine. The rate of exploration drilling has increased and will increase further when the new drill machines, which have already been ordered, are delivered and commissioned,” Caledonia CEO Steve Curtis has said in a statement.

The increase has led to the improvement of the resource split to 62% in the measured and indicated category and to 38% in the inferred category, from the previous 55:45 split outlined in the preliminary economic assessment completed in late 2014.

“I am confident that the life-of-mine will be further supplemented by resource additions and upgrades, as a result of the increased exploration activity at Blanket and . . .  satellite projects,” concludes Curtis.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
Caledonia Mining, tel +1 416 369 9835 or email info@caledoniamining.com.