HomeBusiness DigestIndigenisation ministry to take over Falgold

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According to documents seen by businessdigest, Falgold registered a company, Great Punch Investments, on April 14 last year, which listed as its directors New Dawn’s current chief executive Ian Robert Saunders and finance director and company secretary Qubeka Nkomo.

The documents outline that on October 3 last year, the board resolved to transfer its interests in the base metal block of claims to its subsidiary Great Punch Investments, as an operational reorganisation at nil consideration.  The 151 claims, named Chiutsa, are registered under three blocks at the Mining Commissioner’s and are situated in the Kandeya Communal Lands in Mt Darwin.

Under the revised Indigenisation and Empowerment Act revised regulations, all mining companies with a net asset value of US$1 and above are supposed to be indigenised. According to government, by putting a nil consideration to the transfer of the claims, Falgold sought to avoid this requirement.
Last week President Robert Mugabe said the door for negotiations over indigenisation compliance for mining companies had been closed and there was no more room for discussions. He called upon Indigenisation minister Saviour Kasukuwere to urgently implement the programme without hesitation.

New Dawn owns 100% of the Turk and Angelus mines, the Old Nic Mine and the Camperdown Mine. In addition, New Dawn has an approximately 85% equity interest in Dalny Mine, the Golden Quarry Mine and the Venice Mine, and a large portfolio of prospective exploration hectarage in Zimbabwe
New Dawn is one of the few companies that has a number of its mines operating at full or near capacity in the country as it has access to foreign capital through its majority shareholders in Canada.

 

The mines have a combined milling capacity of 2 000 tonnes per day. The company has vast mining claims and proven gold reserves estimated at more than 2 million ounces.  

In addition to gold production, New Dawn is also actively exploring on highly prospective ground, employing modern exploration techniques and deploying capital in Zimbabwe, a country that is proven to be geologically rich, highly prospective, and significantly under explored.

New Dawn reported consolidated gold production for the quarter ended December 31, 2011 of 9,095 ounces (8,399 ounces attributable to New Dawn, after adjusting for the minority interests’ share of gold production), as compared to consolidated gold production for the quarter ended December 31, 2010 of 4,808 ounces (4,577 ounces attributable), an increase of 89.2% (83.5% increase on an attributable basis).

As compared to consolidated gold production for the previous quarter ended September 30, 2011 of 8,814 ounces (8,212 ounces attributable), consolidated gold production for the current quarter ended December 31, 2011 increased by 3.2% (2.3% increase on an attributable basis).

Consolidated gold sales for the quarter ended December 31, 2011 totalled US$15,440,766 (US$14,238,642 attributable) at an average sales price per ounce of gold of US$1,684, as compared to US$6,458,735 (US$6,184,661 attributable) for the quarter ended December 31, 2010 at an average sales price per ounce of gold of US$1,370, an increase of 139.1% (130.2% increase on an attributable basis).

As compared to consolidated gold sales for the previous quarter ended September 30, 2011 of US$14,059,739 (US$13,145,209 attributable), consolidated gold sales for the current quarter ended December 31, 2011 increased by 9.8% (8.3% increase on an attributable basis).

At December 2011 month-end, an additional 2,337 ounces of gold awaited export documentation for sale in South Africa, and will be included in January 2012 sales.

With December 2011 total gold production of 3,252 ounces, equivalent to annualized gold production of 39,024 ounces, the company achieved its production target of 38,000 to 40,000 ounces of annualized gold production within its projected timeframe, despite four public holidays in Zimbabwe during December 2011.

Efforts to obtain comment from New Dawn on the government’s acquisition were unsuccessful as the company had not responded to emailed questions by time of going to press.

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