Caledonia Mining Corporation has reported record quarterly gold output from its Blanket Mine after production jumped 24% in the last quarter of 2019 and helped the miner beat annual targets.
Better power supply plus improved grades and tonnage drove the higher output, Caledonia said in a report on Monday.
Blanket produced 16,876 ounces of gold in the quarter to December, beating the previous production record of 16,425 ounces set in the final quarter of 2017. Production in the quarter was 24% higher than the previous quarter and was 13% higher than the corresponding final quarter of 2018.
Total gold production during 2019 was approximately 55,182 ounces, ahead of revised production guidance of 50,000 – 53,000 ounces. Caledonia projects gold production for 2020 to be between 53,000 and 56,000 ounces.
Commenting on the announcement, Steve Curtis, Chief Executive Officer, said: “An improvement in the electricity supply and vigilant focus on grade control and production tonnage have resulted in an excellent production result for the final quarter of which our entire operational staff can be justifiably proud.
“I am also pleased to see that we have not lost this momentum as we start 2020 with the mine continuing to perform very well into the new year. With the improved operational performance and the current buoyant gold prices leading to healthy operating margins we expect Caledonia to continue its track record of strong cash generation.”
The company expects to commission a new central shaft in the last quarter of 2020, which is expected to ramp up production to 80,000 ounces per year.
“I expect 2020 to be a landmark year for our business: we look forward to commissioning the Central Shaft later in 2020 which we anticipate will then deliver increased operating cash flows and reduced capital expenditure will follow. In early January 2020 we announced a 9.1% increase in Caledonia’s quarterly dividend; the anticipated improvement in free cash flow is expected to enable the Board to review future dividend distributions as appropriate.”