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 for 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, four-compartment shaft, which will eventually be sunk to 1 080 m below surface, providing access to the current inferred mineral resources below 750 m and allowing for further exploration, development and mining in these sections along the 3-km-long Blanket strike.

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
Gold production at the Blanket mine increased by 4.7% quarter-on-quarter to 10 424 oz in the second quarter of 2015, Caledonia Mining has reported.

Although this is a 7.1% contraction on the 11 223 oz of gold produced in the three months to June 2014, the company has confirmed that it is on track to deliver its target of 42 000 oz of gold for the full 2015 year.

The mine has also completed the sinking of the No 6 Winze shaft, which remains on track to start production in January 2016, while work has started on equipping it prior to the start of horizontal development towards the orebodies.

The mine has also started the presink at the Central shaft, with shaft sinking to resume once the shaft collar is concreted.

“We are confident that the revised investment plan, which was announced on November 3, 2014, will result in progressive increases in production from 2016 . . . when we expect to see the first production from below 750 m – initially from the No 6 Winze and subsequently from the Central shaft,” Caledonia CEO Steve Curtis has said.

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.