AMN - ZIMBABWE: Blanket on track to meet gold guidance

Caledonia Mining Corporation produced 11,948 ounces of gold from the Blanket project in Zimbabwe during the March quarter. The company remains on track to meet its 2019 full year production guidance of 53,000 to 56,000 ounces.

The Blanket operation also remains on track with progress towards the annual target of 75,000 ounces in 2021 and 80,000 ounces by 2022.

Quarterly production was lower than the 12,924 ounces produced in the corresponding period of 2018 and lower than the 14,952 ounces of the previous quarter.

Caledonia has a 49 per cent interest in the project and in November 2018, announced that it had signed a legally binding agreement to increase its shareholding in Blanket to 64%, subject to the receipt of, amongst other things, regulatory approvals.

The company's chief executive officer Steve Curtis said: “Production in the first quarter of 2019 was slightly below our target and below the comparable quarter in 2018, albeit at a level which allows us to maintain our 2019 production guidance of 53,000 to 56,000 ounces for the full year.

"Continued difficulties with unstable electricity supply and grade dilution which we experienced in 2018 had an adverse effect on production, but improved drilling and blasting practices have been put in place in pursuit of improved grade control and I am pleased to say that efforts to minimise dilution are proving successful.

“Our technical team has worked tirelessly to mitigate the effects of electricity supply interruptions and we continue to work closely with the Zimbabwean electricity supply authorities to address these challenges as well as investing internally to improve our resilience to this issue.

“The sinking of the central shaft continues according to plan; we are now only months away from the completion of the shaft sinking phase of the project and are set to commence shaft equipping from mid-2019.

"We look forward to commencing production from the central shaft from mid-2020 which is expected to deliver the company’s growth plan to achieve 75,000 ounces in 2021 and 80,000 ounces by 2022.”

As of December 31, 2018, Caledonia had cash of approximately US$11.2 million.

www.caledoniamining.com