Zimbabwe’s largest gold producer Metallon Gold Zimbabwe plans to grow output seven fold within the next two years to 70 000 tonnes per month after spending as much as $12 million to increase production capacity, management has said. The 70 000t will be largely driven by underground mining, Metallon Corporation CEO Ken Mekani on Monday told The Herald Business after a tour of the company’s multimillion dollar Mazowe plant.
“We should spend about $11 million to $12 million, which should see us realise about 70 000t per month. Of that, 40 000t will be from underground and 30 000t will be from surface because when the dump runs out in five years we should have a source for feeding into the new plant,” Mr Mekani said.
“We have invested in this plant from 2014 up to now. We believe the mining sector in Zimbabwe has a bright future and we are investing right now so that when things stabilise, we will reap the benefits,” he added.
Metallon Gold Zimbabwe consultant metallurgist Joseph Chifamba said the company is working on a dump containing 5 million ounces of gold over five years. The project has an in situ value of $160 million.
He said the project is expected to record nominal profits of $61 million, $37 million in the first two years and $24 million from the third to sixth year.
Giving an update of the sands plant which was commissioned in September last year, Mr Chifamba said the company has suffered down time of about half a month due to electricity supply challenges.
He said production costs are higher than estimates due to equipment modifications, lack of spares and adverse weather.
Mines and Mining Development Minister Winston Chitando said Metallon Zimbabwe’s project shows the massive potential the mine has in terms of up scaling its production and making a significant contribution to the economy.
He said Government will deliberate and come up with solutions on problems affecting the company and the mining industry in general.
The Minister also said Government was working on measures to ease foreign currency shortages and fund the gold sector.
“In the medium long term, the issue of foreign currency will mainly be addressed by increasing production. In the short term Government, through the Reserve Bank of Zimbabwe, is working on establishing lines of credit which can enable the mining sector to jump start their production, upscale their level of mining activity. This will provide necessary working capital.”