Aim-listed Caledonia Mining Corporation’s Blanket mine, in Zimbabwe, produced 76 656 oz of gold for the year ended December 31, in line with guidance of producing between 74 000 oz to 78 000 oz, while slightly exceeding 2023 production of 75 416 oz. 

Mine activity resulted in a record 797 000 t milled for the year, with 89 727 t hoisted in December, exceeding milling capacity.

The company says production for 2024 excludes an estimated 700 oz of unrecovered gold contained in an 8 400 t stockpile, which provides a strong start for this year. 

Yearly gold sales amounted to 76 271 oz.

Meanwhile, Caledonia notes that the 2025 capital expenditure (capex) programme totals $41.8-million, with $34.9-million allocated to the Blanket mine and $5.8-million to the Bilboes and Motapa projects.

Caledonia says these investments are aimed at modernising operations and improve mining efficiency at Blanket, stating that, while there will be short-term cost pressures, the long-term goal is to reduce costs, improve profitability and ensure the continued success of the mine.

All expenditure will be funded from cash generation and cash reserves with no anticipated impact to the dividend.

Key projects include Blanket development, with $6.6-million allocated to carry out planned development of 4 663 m including an additional 590 m to improve flexibility and access higher grade areas; and efficiency improvements of $3.4-million for energy-saving initiatives at the mine.

Regarding operational resilience, $4.8-million will be allocated to complete the tailings storage facility and $700 000 for IT upgrades as the business continues to modernise its systems and processes. 

Additionally, the company will embark on exploration and project development, with $5.8-million allocated for exploration at Motapa, building on promising 2024 results and to complete the feasibility study at Bilboes.

CEO Mark Learmonth notes that Caledonia’s investment in Blanket over the past seven years has nearly doubled production and has substantially increased the resource base, with the mine’s life now extending to 2034 based on reserves.

Learmonth says the 2025 capital budget addresses immediate operational needs and includes strategic investments to enhance the mine’s operating resilience and efficiency.

“We continue to make strategic investments in our people and technology which, in due course, I am confident will result in operating efficiencies. The transition of key functions to a new office in Bulawayo will provide synergies with our next mine, the Bilboes sulphide project.”

He notes that the company continues to progress the revised feasibility study for the Bilboes sulphide project, which is scheduled for completion later in the first quarter of this year.  

“Following the publication, in November 2024, of encouraging exploration results at Motapa, the 2025 capital budget includes provision for further exploration on targeted sites with the most geological potential and the opportunity for early synergies with the Bilboes project,” he says.

PRODUCTION GUIDANCE

Caledonia has set the production guidance for its Blanket mine at 73 500 oz to 77 500 oz for this year. This reflects the current mine scheduling, which anticipates that the mine will continue to mine lower-grade areas.

The operation’s on-mine cost is forecast at $1 050/oz to $1 150/oz – up from $950/oz to $1 050/oz in 2024 – while the all-in sustaining cost is expected to be in the range of $1 690/oz to $1 790/oz – up from $1 450/oz to $1 550/oz in 2024.

The company explains that cost guidance for 2025 reflects higher labour, human resource and IT expenses and increased sustaining capex.

The 2025 on-mine cost includes $20/oz of environmental, social and governance (ESG) cost.

Caledonia says the 2024 ESG cost of $1.3-million – about $17/oz – was not part of the guidance range for 2024. 

“We are systematically building a mid-tier Zimbabwe-focussed gold producer with multi-asset profitable production, while doing so with a focus on capital allocation and building per share value,” says Learmonth.