Blanket Mine set for indigenisation

Caledonia said in February it had signed an MOU with Indigenisation minister Saviour Kasukuwere pursuant to which Caledonia agreed that locals would acquire an effective 51% ownership interest of Blanket Mine for a paid transactional value of US$30,09 million.

Under the agreement, 16% would be sold to the National Indigenisation and Economic Empowerment Fund, 10% would be taken up by management and employees, 10% would be donated to the Blanket –– Gwanda community Trust. In addition, the group would donate US$1 million to the Trust after it has been set up.

The 15% remainder would be sold to private investors who were identified on the basis of being able to add value to operations. The two private investors are made up of an individual who will represent the region (Matabeleland) and one who has interest in mining.

In the year-to-December, Blanket’s mine gold production increased 102% in the full year to December to 35 826ounces from 17 707 ounces in 2010.

Gold production in the fourth quarter was up 8,1% to 10 533oz against 9,743 ounces produced in the third quarter and a 69% increase on the 6,227 ounces produced in fourth quarter of 2010. This was the seventh consecutive quarterly increase in production and marginally exceeded the 10 000oz target the group had set.

During the period, payments to government, inclusive of taxes, licence fees, levies and other payments, were US$5,024 million against US$3,847 million in the previous quarter, bringing the total payments to US$13,614 million from US$2,236 million in 2010.

Cash operating costs were down to US$521 per ounce of gold produced from US$583 in the previous quarter and US$791 in the comparative quarter a year ago. The group said the reduction was due to improved operating efficiency and the benefits of economies of scale.  Cash costs for the full year were US$581 per ounce compared to US$751 in 2010.

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