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Business Reporter
TORONTO Stock Exchange-listed Caledonia Mining Corporations says gold production at its 49 percent owned associate, Blanket Mine, grew by 4.7 percent to 10,424 ounces in the six months to June this year.

But the performance in the second quarter of this year was 7.1 percent below the 11,223 ounces achieved in the same period last year.

In his 2015 National Budget Finance Minister Patrick Chinamasa said Zimbabwe, which has applied for readmission to the London Billion Market, targeted 15 tonnes of gold this year from the 13 tonnes achieved last year. The LBMA requires minimum gold production of 10 tonnes.

Commenting on the production for quarter two of 2015, Steve Curtis, Caledonia’s chief executive officer said: “The increased production reflects improved management control over grade and tonnage.

“It’s anticipated that production will increase somewhat in the second half of 2015 following completion of the tramming loop on 22 Level in June.”

The Caledonia CEO said the tramming loop will increase underground haulage capacity and allow for an increase in development activity, which is expected to result in an increase in future production of the mine.

First quarter output was 9,960oz. Production in the second quarter is based on mine assays subject to adjustment following third party assays.

Curtis said sinking of the number 6 Winze has been completed and work has commenced on equipping the completed shaft prior to the start of horizontal development toward the ore bodies. Start of initial production from the No 6 Winze remains on target for January 2016.

“The pre-sink at Central Shaft has commenced and the shaft collar is being concreted after, which shaft sinking can resume,” said Curtis.

“We’re confident that the revised investment plan, which was announced on November 3, 2014, will result in progressive increases in production,” Curtis said, adding the group targeted 42,000oz this year.

It is expected that growth was expected from 2016 onwards when TSX listed mines expect to see the first production from below 750 metres, initially from the No 6 Winze and subsequently from the Central shaft.

Caledonia said that it was debt-free and as at March 31, 2015 had cash of $26,1 million.

Blanket Mine is a low-cost gold producer and in 2014 the mine’s on-mine costs were $652 per ounce of gold produced and its all-in sustaining cost was $969 per ounce of gold produced.