In 2000, Eureka Mine in Guruve stopped operations after Delta Gold left Zimbabwe. In 2018, Dallaglio, the mining arm of Pdenga Holdings, took over and invested over US$50 million. In 2021, the mine was brought back to production for the first time in two decades. Padenga used to rely on crocodile skins, but mining now accounts for most of its revenue.
Gold production for Dallaglio rose by 200% in the nine months to September last year, as Eureka’s gold output fully came on stream. The company is also expanding its other mine, Pickstone Peerless, near Chegutu.
What’s coming next for Dallaglio? Here, Dallaglio CEO Marc Nicolle, aged 41, speaks on the turnaround, plans for the company, and his views on Zimbabwe’s investment environment.
Can we have a brief background about yourself and how you ventured into mining?
I grew up in Gwanda, the home of Caledonia’s Blanket Mine. My family has been there since the late 1890s. Being a gold mining town, mining was always adjacent to everything we did and therefore a regular part of life. I really enjoyed chemistry at school thanks to some great teachers and when I wasn’t sure what to study, I did some assessments and ended up studying chemical engineering. Chemical engineering then led me to a processing career in the mining industry.
What is Dallaglio’s strategy when it comes to mining growth and development in Zimbabwe? Are there any plans for the company to add more mines to its portfolio?
There is definitely hunger from our shareholders and from the management to grow the business, but we want to grow the business in a very responsible way. There is evidence across the world of mining companies that do too much too soon. We want to be very credible, and all our focus today is to build that credibility.
Building the plant at Pickstone Peerless was a big investment step for our early shareholders in 2014. That investment brought Pickstone back to life in 2015. With the success of Pickstone, Dallaglio acquired Eureka in 2018 which was a dormant asset and brought that back to full operations in the second half of 2021. The group continues to look for opportunities to grow but we want to do that with a strong balance sheet and with a very credible production track record.
Pickstone Peerless Mine is currently moving from open pit mining to underground as well as adding heap leaching, how is this development going to increase production at the mine?
Pickstone underground will increase the grade that we can feed our mills. It is harder ore and because it’s harder ore, we will have to increase the milling capacity at Pickstone in 2023. That higher grade will increase our production from the current 40-50kg per month to an average of 80kg per month. The heap leach is a project that we will detail more in 2023 with the possibility of making an investment in 2024 if the numbers come back as positively as they currently look. With heap-leaching, we are targeting an additional 30 to 40kg per month on top of the 80kg per month from the underground.
Eureka Mine is currently conducting open-cast mining, are there any plans to go underground?
There is a potential to go underground. We have over 860 thousand ounces at 3.7g/t in the underground portion of the Eureka resource, that’s an orebody that we have defined to 650 metres below the surface and is open at depth beyond that. Our plan is to mine the first 300 metres from an open pit, and the balance from underground. That underground planning is on the radar to be defined in 2023 and early 2024. It will take a significant time and investment to get underground at Eureka, and therefore our view at the moment is that it may add to the life of the Eureka mine in time.
In the next few years, what are Dallaglio’s plans in terms of investment specifically in Pickstone Peerless and Eureka Mine?
At Pickstone we are very excited about the underground which is in the old Pickstone trend. Our initial phase focuses on the shallower portions of the ore body while the subsequent phase after we are in operation targets ore down to 14 level. An investment into that deepening of the Pickstone mine is very exciting for us. In addition to Pickstone, 500 metres North we have the Peerless trend. Peerless is another ore body that we mined from the open pit at surface. From our experience of mining Peerless from the surface, it is a wider ore body, and we are doing some conceptual work to see how best to mine that from underground.
At Eureka, we have the beginnings of the underground as we spoke about earlier, so we have that portion below the open pit that is open at depth to consider for underground mining. In addition to that, we have done some test work on ore sorting. This test work has shown good potential to increase the grade of ore fed to the mills which will allow us to mine faster and achieve quicker returns.
Zimbabwe is generally relegated as a risky investment destination. As a company operating in Zimbabwe, what are your comments on the experience?
I am a Zimbabwean and I’m very satisfied to be back in Zimbabwe applying my trade, my skills and leading a team of keen Zimbabweans as we do our bit to help make this country what it can be. That said, I also understand the international community’s view of Zimbabwe as an investment destination. Capital in mining is scarce and it must chase the best return. My experience in being back is that there is a willingness from the government and all stakeholders to make it work, but it must work in a way that is good for everyone.
It must work for communities, it must work for the government, and it must work for the investor. I think that the Unhu-Ubuntu aspect of Zimbabwean mining is something that once the industry fully adopts, we will see an even more positive change. My experience has therefore been positive, there have been decades of under-investments in the Zimbabwean mining industry and those decades lead to many opportunities that no longer exist elsewhere in the world.
What would you want to see changing in Zimbabwe mining?
Zimbabwe is sitting on assets that can be world-class and the platinum industry here has proven this over many years. When a business can deploy capital and confidently get a good return on it, our industry will continue to grow.
Besides mining, what’s Marc Nicolle into?
My family, I’m married to Sofia and we parent four great children together. I enjoy cricket and rugby very much and I enjoy hiking and business in general. I enjoy seeing people grow and overcome challenges. I really enjoy interesting conversations with diverse people, it’s always nice to test my assumptions and beliefs when talking to people about their views and experience.