RioZim’s gold output eases by 9% in Q3 2020 due to low production at Group’s gold mines

0
315
  • Only Renco recorded positive gold production
  • Murowa Diamonds’ output declined by 2%
  • Delayed payment of gold receipts affected working capital and cash flows and hampered production

Harare- RioZim’s gold production contracted by 9% in the quarter ended 30 September 2020 (Q3 2020) owing to low production at the Group’s Cam and Motor Mine.

Output at the Mine eased by 8% from prior comparative period as the Mine continued with processing low grade ores from its One Step Mine throughout the quarter.

The Group’s Dalny Mine also recorded a decline in production in the period under review owing to multiple breakdowns from its ageing plant.

Output slumped by 37% compared to the same period last year.

Of the Group’s three gold mines, only Renco Mine registered positive production which rose by 5% due to improved milling throughput.

“The mine benefited from its ‘high volume low grade’ strategy which was implemented throughout the quarter which resulted in increased gold production”, the Group said.

Gold price which continued its upward trajectory in the period under review helped to partly absorb the negative impact of the Group’s low gold production and increased costs during the period.

Prices averaged US$1 879/oz for the quarter, which was 29% above the average price of US$1 457/oz for the same period last year.

RioZim’s associate Murowa Diamonds Limited recorded in a 2% decline in production compared to Q3 2019.

The Group attributed the decline in diamond production to processing ore from K1 pits which are of low grade while in the same period last year, the Mine was processing from high grade K2 pits.

RioZim’s Empress Nickel Refinery (ENR) remained under care and maintenance throughout the quarter.

The Group still bemoans the delay on the payment of the Company’s gold receipts by the Reserve Bank of Zimbabwe (RBZ) which carried on throughout the quarter which severely strained its working capital and cash flows and greatly hampered production.

Meanwhile, the Company said it is pursuing various funding options for its BIOX project albeit in a difficult operating environment which has been compounded by the uncertainties brought about by the COVID-19 pandemic as lenders and financiers are taking a conservative approach on lending.

Civil works and steel fabrications for the BIOX plant project progressed timidly in Q3 as delivery of structural and steel components from the project’s contractors in South Africa faced significant delays due to lack of foreign currency funding.

Equity Axis News

LEAVE A REPLY

Please enter your comment!
Please enter your name here