Caledonia Mining Corporation has extended the timeline for completing the Feasibility Study (FS) on its Bilboes gold project to allow for a more thorough assessment of key optimisation opportunities that could enhance project economics and reduce upfront capital requirements.
By Ryan Chigoche
The FS, which was initially set for completion in Q1 2025 and is being conducted with support from DRA Projects (Pty) Ltd and other technical consultants, is a critical step in shaping Bilboes into a cornerstone of Caledonia’s future growth.
The FS will replace the Preliminary Economic Assessment (PEA) released on June 3, 2024, which highlighted Bilboes’ strong financial potential and outlined a mine plan capable of tripling Caledonia’s gold production.
Given the project’s attractive fundamentals and the backdrop of a strong gold price, Bilboes remains a highly compelling and financeable opportunity. However, the company is taking a disciplined approach to ensure the project is developed in the most efficient and cost-effective manner.
One of the key optimisation areas under review is the potential sale of concentrate, which could allow Caledonia to defer the capital expenditure required for a BIOX processing circuit in the initial years of production. By engaging with authorities on this option, the company aims to significantly lower upfront investment while maintaining strong financial returns.
Another major consideration is the possible relocation of the Tailings Storage Facility to a more efficient site, potentially within Caledonia’s Motapa property, adjacent to Bilboes.
The topography of this site could lead to lower initial construction costs, further improving project economics. At the same time, exploration results from Motapa have been highly promising, revealing new mineralised zones within a few hundred meters of the proposed Bilboes processing plant.
This has led the company to explore integrating Motapa into the Bilboes FS, with additional exploration and development work planned for the year.
If Motapa’s resource potential continues to be validated, it could significantly enhance the long-term economics of a combined Bilboes-Motapa operation. The ability to leverage existing infrastructure while expanding the project’s mineral base would strengthen Bilboes’ financial outlook and reinforce Caledonia’s position as an emerging intermediate gold producer.
Commenting on the development, Mark Learmonth, Chief Executive Officer of Caledonia, emphasised the importance of this process, stating:
“Bilboes has the potential to be truly transformative for Caledonia, and the work we are doing now is about making sure we get it right. We are encouraged by the results to date and are taking a disciplined approach to optimisation, both to enhance returns and to ensure we can fund the project in the most efficient way possible.
“With strong exploration results at Motapa, promising developments at Blanket, and supportive market conditions, we remain confident in Bilboes’ ability to significantly reshape Caledonia’s growth profile.”
Beyond Bilboes, Caledonia is also reviewing near-term revenue opportunities across its portfolio to support the project’s funding.
Notably, high-grade mineralisation recently identified at the Blanket Mine could provide a meaningful contribution to Bilboes’ initial capital requirements, offering greater financial flexibility as the company advances its development plans.
Caledonia’s Board remains focused on maximising shareholder value by ensuring Bilboes is optimised both technically and financially.
Ongoing discussions with funding partners and Zimbabwean authorities are aimed at securing the best possible outcome for the project. The company expects to provide an update on the FS timeline in due course as the optimisation work progresses.
By extending the FS timeline, Caledonia will be positioning itself to unlock the full potential of Bilboes while ensuring the project is developed in a financially sustainable and strategically advantageous manner.
Additionally, the extra time taken to optimise key aspects of the project could ultimately lead to greater long-term value for shareholders and a more resilient, scalable gold mining operation.
