Mining ZimbabweLatest Mining News, Policy and Industry Updates

CALEDONIA Mining Corporation lifted gold output at Zimbabwe-based Blanket Mine by 17% last year, after scaling up throughput at the “game-changing” Central Shaft, an underground operation that blasted off its first bullion in April, according to chief executive officer Steve Curtis.

In a shareholder update on Tuesday, Curtis said the firm scaled up output to 67 476 ounces (oz) during the review period, above its 2021 target of between 61 000oz and 67 000oz, giving impetus to directors’ long cherished ambition to reach 80 000oz by the end of this year.

On a quarterly basis, Blanket bolstered output by 24% to 18 604oz during the fourth quarter ended December 31, 2021, compared to 15 012 ounces of gold mined during the prior comparable period in 2020, Curtis said.

“This has been an outstanding performance and a tremendous team effort…we were able to exceed our revised annual production guidance.

“The commissioning of the Central Shaft, record gold production, along with a continued commitment to safety, all in one year, is an outstanding achievement and testament to the quality of the Caledonia technical team. Now that the Central Shaft is complete, the company will focus on other areas of its growth strategy, as we continue to evaluate investment opportunities, with a vision of becoming a multi-asset gold producer,” said Curtis.

Central Shaft represents one of the most recent significant gold mining investment projects in Zimbabwe that is a game-changer to Caledonia’s local interests.

The asset performed to expectation during the review period, underpinning most of the growth figures released on Tuesday which were in line with the combined sector output announced by government last week.

For Caledonia, 2020 was a tricky period highlighted by continuing tough foreign currency retention thresholds imposed by the central bank.

These were compounded by the effects of heavy rains which flooded shafts at the beginning of the year.

Central Shaft is expected to further ramp up Blanket’s gold production this year, trim overheads and help the firm build fresh capacity to undertake further exploration and development.

Blanket represents part of Caledonia’s bigger Zimbabwean ambition.

Curtis last year announced plans to pounce on at least two more gold assets and expand Caledonia’s Zimbabwean presence.

Before that, Bloomberg had reported that the firm was interested in buying one of Zimbabwe’s largest gold operations as it embarked on an aggressive programme to acquire more assets in the country.

The report said the Jersey-based gold producer was weighing the acquisition of Bilboes Gold’s Isabella-McCays-Bubi mines in northwest Zimbabwe.

The mines can potentially produce more than 200 000 ounces of gold.

Most of the Isabella-McCays-Bubi operations were at the time mothballed as the owners scouted for investors.

The firm listed on the Victoria Falls Stock Exchange (VFEX) in December 2021.

Caledonia hopes to leverage on the forex-indexed VFEX to fund-raise for its ambitious expansion in Zimbabwe.

Newsday

DEFUNCT steel-manufacturing giant, Zisco, has completed the adjudication process for potential investors expected to spearhead the revival of the Redcliff-based firm.

Names of the prospective investors have since been submitted to Cabinet for approval.

In an interview, Zisco group chief executive officer Dr Farai Karonga dismissed social media reports suggesting that a decision has already been made on the investor to take over the company’s operations.

“We have noted with concern some reports doing rounds on some social media platforms that we have already nominated a company to take over at Zisco. Such information is misleading and should be disregarded.

“The reality is that we have concluded the adjudication process and forwarded the names to Government and we await Cabinet approval,” said Dr Karonga.

Of late, there has been social media reports insinuating that Kuvimba Mining House has been given the nod to take over operations at Zisco.

Kuvimba Mining House is a joint venture between the Government and a consortium of international investors. Government is the majority shareholders with a 65 percent stake.

Its impressive assets include Shamva Gold Mine, Freda Rebecca Gold Mine, Jena Mine, a stake in the Darwendale Platinum project trading under the Great Dyke Investments, Bindura Nickel Corporation, Zimbabwe Alloys Limited,
“There is nothing official yet, we await the Government’s decision. Yes, we have done our part and it is not our duty to be announcing who won the tender before we get a directive from Government,” said Dr Karonga.

The adjudication process for prospective investors at the largest steel plant north of Limpopo began late last year after the Government in April had announced that it was in a fresh hunt for strategic partner to resuscitate Zisco.

In their expression of interest, bidders for the Zisco revival deal were among others, required to submit information on their financial performance and position, attaching a three-year audited financial statement, ownership structure, names of directors as well as information pertaining their position on the need to evaluate Zisco before the investment.

Seven bids from potential investors from which one would be selected were received.

In recent years, Zisco has been a subject of foreign investor interest with companies such as Essar Africa Holdings, a unit of India’s Essar Group having acceded to investing US$750 million into the Redcliff-based steel producer in 2011, during the era of the inclusive Government.
However, the deal hit a brick wall in 2015.

Again, in late 2019 discussions for a US$1 billion resuscitation deal between Zisco and R& F of China, which had shown much interest to revive operations at the local firm collapsed.

Zisco ceased operations in 2008 due to poor management and lack of capital to recapitalise. At its peak in 1999, Zisco produced up to one million tonnes of steel annually and the entity was among Zimbabwe’s major foreign currency earners.

It is hoped that the resuscitation of Zisco, a strategic company to Zimbabwe’s economy would be a step in the right direction under the country’s development agenda.

Following decades of economic collapse, the Second Republic, which came into power in November 2017 led by President Mnangagwa has vowed to rebuild the economy starting with the successful two-year Transitional Stabilisation Programme (TSP) implemented between October 2018 and December 2020.

Riding on the macro-economic stability brought by the TSP, the country has now moved from economic recovery to stimulating productivity under the National Development Strategy 1 (NDS1).

NDS 1, which builds to Zimbabwe’s envisaged upper middle-income economy status by 2030 is a five-year macro-economic policy running between 2021 and 2025 anchored on increasing production across all sectors of the economy, employment creation, and uplifting the living standards of citizens, among other fundamentals.

The Chronicle

AT least seven people were seriously injured after a machete-wielding gang reportedly aligned to former Zanu PF youth league provincial chairperson for Mashonaland West, Vengai Musengi, ran amok and attacked fellow party youths in a fight over mining claims in Chegutu East.

Police in the province could not immediately confirm the clashes yesterday, but victims of the violent attacks said the clashes occurred last week.

The victims said they could identify the assailants, but were afraid to name them since they were known criminals in the province who were already on the police wanted list.

Zanu PF youths have been fighting over the gold claims, with Musengi reportedly using his closeness to chefs to ride roughshod over others.

“ln 2018, Musengi came with Tendai Chirau, Zanu PF acting youth league secretary, and removed Zuva Rabuda Empowerment Trust. He left Gidi Seven Mining Co-operative led by a youth who was fronting him,” a source close to the developments said.

“That youth was not getting anything from 2018, and he now wants to come to where the rest are and work with Zuva Rabuda. He also alleged that Gidi Seven Mining was not paying people, but he took the money claiming that he was taking it to some chefs.

“Chirau has since distanced himself from Gidi Seven Mining saying he acted without getting proper information from Musengi.”

The source added that an arrangement was made to unite Zuva Rabuda and the community, including members of the Zanu PF main wing and the youth wing in the province.

“We set up an executive to replace the one left by Musengi and that is when all hell broke loose,” the source said.

They said they served a notice of their new executive to all government departments and demanded meetings with the Chegutu East Zanu PF leadership, who endorsed the new structures.

“The gang became violent when the new structures were being installed. The night after the meeting, a gang came armed with machetes and started beating up everyone they came across. They used axes and destroyed tuckshops and small operations in the mining area,” the source added.

A police report was made. However, acting provincial police spokesperson for Mashonaland West province Assistant Inspector Ian Kohwera said he had not yet received the report on the violence. “I’m not aware of the incident. I haven’t received the report yet, and if I get something, I will get back to you,” he said.

Chegutu East MP Webster Shamu said he was yet to gather more information on the matter.

“I am yet to gather more on that, but obviously we condemn all forms of violence. Our President Emmerson Mnangagwa has been very clear, including at the last politburo meeting, that we do not want violence as a party and this should stop,” Shamu said.

Musengi has been fingered in most violent clashes in Mashonaland West, including the chaos that rocked provincial elections where he was also a contestant, but lost to Mary Mliswa-Chikoka.

In a related matter, a Zanu PF provincial co-ordinating committee meeting in Masvingo had to be aborted yesterday after rival youths clashed, resulting in one person being injured.

The clashes happened between supporters of the Masvingo Provincial Affirs minister Ezra Chadzamira and those of Zaka North MP Robson Mavhenyengwa.

Chadzamira lost the provincial chairmanship to Mavhenyengwa.

The meeting, the first after the provincial elections, was supposed to be held at the Great Zimbabwe University’s Robert Mugabe School of Education in the industrial area.

But riot police had to be called in to contain the situation as rival bussed-in youths engaged in running battles.

The disagreements were over the party structures that constituted the district electoral college, which should consist of 40 people in the youth wing, 40 from the women’s league, and 40 from the main wing.

Masvingo provincial police spokesperson Inspector Kudakwashe Dhewa referred all questions to national police spokesperson Assistant Commissioner Paul Nyathi, who could not be reached for comment.

Zanu PF politburo member and party secretary for security Lovemore Matuke said the meeting was deferred to a yet to be decided date.

“Some hired youths, who may not be party members, came to disrupt the elections. It’s unfortunate that some party members do not want to accept the reality and move on. After all, the politburo and our President said those with grievances should follow proper party procedures if they have grievances,” Matuke said.

NewsDay

CHINESE mining company, Monaf Investments has given villagers in Muchesu ward 12, Binga, three months’ notice to vacate their ancestral land after it was granted a permit to extract coal in the area.

This is not the first group of Binga villagers to be ordered off their ancestral land to pave way for Chinese coal mining projects.

Last year, government flexed its muscles and ordered villagers in Dinde to relocate to allow for a similar project in their area after they had resisted.

“Due to economic challenges, they only did the exploration process, where sample holes were drilled in 2010 and they went back. Now under President Emmerson Mnangagwa’s vision 2030, they were given the greenlight to carry on with their investment and they came last year in October and resumed the project. They started by drilling a four-square metre hole which measures almost 64 metres deep and this is called a shaft,” he said.

“Then the eviction starts here. There are 14 homesteads on top of the coal belt, but not under the same village head. Some are under Siamulamfu, others under Ncheme 1, some under Siabutale. The meeting was held last week on Thursday January 12, 2022 in the presence of the Monaf Investments, ZimParks [Zimbabwe Parks and Wildlife Management Authority], district development co-ordinator, council, the President’s Office, EMA [Environmental Management Authority] and Ministry of Health representatives.”

Mudimba said the main agenda was preparation for resettlement of those affected and they were given a three-month notice to leave the area.

“All this will be done under Phase 1, but Phase 2 will be in two to five years’ time, we will see almost half of the ward being evicted, mostly Zuka village, and this village has two schools. The purpose is to build a power plant and other projects on the site, according to Monaf,” he said.

Mudimba said villagers were not happy with the evictions although the company promised to create jobs for the youth in the area.

“Each village head in the affected area has been given a period to go and look for a good resettlement site where houses will be built for the affected people, boreholes will be drilled and installed. This was a promise from the company. Good sanitation will be a task of the health sector,” he said.

“There are divisions among the villagers. Some wanted to resist the project, but since unemployment is a major economic challenge, almost half are in support of the project.”

A villager from Muchesu said Monaf was just making empty promises so that they could leave the area.

“We have seen a lot of people suffering as a result of these resettlements. It is impossible that this company will build houses for us or create jobs here. We are just going to suffer. It’s hard to leave our land. Things are not being done according to our will. Government does what it desires with our land,” said Simoni Mudenda.

Local councillor Mathias Mwinde confirmed the development, adding that they were holding a meeting to discuss the issue.

“Some arrangements are being made to resettle villagers. We are expecting to hold a meeting and discuss the concerns of the villagers because they are not really happy about being moved,” he said.

NewsDay

De Beers pushed through one of its most aggressive diamond price increases in recent years as the world’s biggest producer of the stones cashes in on a buying frenzy for uncut gems.

De Beers raised prices by about 8 percent at its first sale of the year, according to people familiar with the situation who asked not to be identified because the information is private. The biggest increases were for smaller, cheaper stones.

The diamond industry was one of the surprise winners as the global economy rebounded from the first effects of the pandemic. Consumer demand for diamond jewelry is expected to have grown strongly last year, while supply remained constrained.

De Beers raised prices of rough diamonds throughout much of 2021 as it sought to recover from the first year of the pandemic when the industry came to a near halt. Yet most of those price rises were focused on larger and more expensive diamonds, while the emphasis now is on cheaper stones.

As this week’s sale in Botswana, De Beers raised the price of larger stones by about 5 percent, the people said, while some smaller rough diamonds saw prices hikes of as much as 20 percent.

A spokesman for De Beers, a unit of Anglo American Plc, declined to comment.

Smaller diamonds, used in cheaper jewelry sold in places like Walmart Inc., struggled for years amid over-supply.

However, they rallied strongly toward the end of 2021 as supply tightened and higher quality goods went up in the price.

That led to a frenzy of buying in the secondary market, where accredited De Beers and Alrosa buyers sell to other gem manufacturers. Thatspurred De Beers to respond by raising its own prices.

Bloomberg

INVICTUS Energy (IVZ) has increased its securities purchase plan (SPP) to $4 million due to strong shareholder demand.

The company initially set out in December to raise up to $2 million to assist with the funding of its 80 per cent owned and operated Cabora Bassa project in Zimbabwe.

Due to high demand, Invictus would then in early January decide to allow SPP over-subscriptions for an extra $1 million, bringing the revised SPP total to $3 million.

Funds for the project will assist with drilling costs of the Muzarabani-1 well targeting prospective resources of 8.2 trillion cubic feet (Tcf) and 247 metres barrels of conventional gas condensate.

The company also said strategic Zimbabwe institutional investor Mangwana Opportunities Fund has agreed to increase its investment in Invictus by $500,000.

Shares will be issued to Mangwana Opportunities Fund at 10 cents per share with one for two attaching options, 14 cents exercise price expiring January 31, 2025.

The Mangwana shares issued under the placement are to be escrowed for
a period of 3 months from the date of issue.

Invictus Managing Director Scott Macmillan is pleased with the support for the company’s SSP.

“Due to this support we have elected to close the SPP early to avoid retaining shareholder funds that cannot be effectively utilised,” he said.

The SPP will close on January 18 with the issue of securities to take place on January 21.

NewZimbabwe

Cement maker, Lafarge, which reported the collapse of the roof on one of the Company’s mills on 11 October 2021 says it is still working on the restorative works necessary so that normal operations “may resume as soon as possible.”

In a cautionary statement released on Friday, company secretary Faithful Sithole said “the disruption of cement production as well as the cost of the ongoing repairs will have a negative effect on the financial results of the Company for Quarter 1, 2022.”

“In the circumstances, shareholders should continue exercising caution when dealing in the Company’s securities until a further announcement is made,” Sithole said.

She however said investigations and assessment of the damage caused by the collapse of the roof had been completed.

In March last year, Lafarge commenced the new Vertical Cement Mill, its last of projects commenced in 2019, under the US$25 million expansion programme.

Under the expansion plan, the company installed the new US$2,2million automated dry mortars (DMO) plant, which saw production capacity increasing from 7 000t per annum to 100 000t per annum.

The installation work for the new vertical cement mill started in March 2021 and is expected to be commissioned in March 2022.

Under the US$25 million expansion initiative, Lafarge would more than double its market share and annual production capacity.

According to the company’s trading update to May 2021, the business achieved volume growth leveraging on the growing market demand in the Individual Home Builder segment as well as the ongoing major infrastructure development projects led by the government.

Cement volumes for the period increased by 23,7 percent compared to prior year in spite of the Covid-19 national lockdown instituted in the first quarter.

“In the same period dry mortar products volumes grew by 105 percent compared to the same period last year.

“The Binastore retail franchise recorded a remarkable 555 percent growth in volumes compared to the same period in prior year.

“This growth in the retail franchise business was further strengthened by the growth in purchases made on the Binastore e-commerce site facilitating business continuity during lockdown periods,” said the company.

The company noted that as a result of strategic changes in product portfolio mix the average selling price was favourable against budget.

Business Weekly

For gold bulls, these are frustrating times. In rand terms, gold bumped up a mere 4,1 percent in 2021, but dropped 4,3 percent in US dollars.

Investors lavished with triple digit returns in cryptos may find this rather unappealing, but gold tends to do well in times of higher inflation, such as is expected in 2022.

The Gold Outlook 2022 report from the World Gold Council gives a glimmer of hope to those holding, or planning to acquire, gold in their portfolios.

“Gold has historically performed well amid high inflation. In years when inflation was higher than 3 percent, gold’s price increased 14 percent on average. Further, in the long run, gold has outpaced US inflation and moved closer in pace to money supply, which has significantly increased in recent years,” says the report.

The US Federal Reserve has indicated that it may hike interest rates three times this year while reducing the size of its balance sheet, but the World Gold Council cautions that previous cycles where interest rates were hiked ended up being less aggressive than originally expected.

“Financial market expectations of future monetary policy actions — expressed through bond yields — have historically been a key influence on gold price performance.

Consequently, gold has historically underperformed in the months leading up to a Fed tightening cycle, only to significantly outperform in the months following the first rate hike,” adds the Council.

Other central banks are less enthusiastic about raising interest rates, which could support a stronger US dollar. Steady or decreasing interest rates may underpin gold demand across the world. The council warns that inflation may linger a while longer than expected due to Covid-19 related supply chain disruptions, tight labour markets resulting in more people leaving their jobs for better paid opportunities, high commodity prices and higher average savings which have contributed to lofty valuations in various financial markets.

Stock market pullbacks remain a risk as new Covid-19 variants manifest in an environment of rising geopolitical risks and frothy equity valuations incubated in an ultra-low interest rate environment. Gold is likely to face headwinds from higher nominal interest rates and a potentially stronger US dollar in 2022. Offsetting these headwinds are high, persistent inflation, market volatility linked to Covid-19 and geopolitical events, and robust demand from sectors such as central banks and jewellers. – Moneyweb.

THE National Railways of Zimbabwe (NRZ) has expressed concern over the increase in illegal mining activities along its railway lines amid fears that this may cause accidents.

Gold panners have of late been digging around the NRZ properties and the most affected areas are Esigodini, Cement Siding, Concession, Tatagura, Bindura, Mazoe, Jumbo Siding,

Kwekwe, Shurugwi, Gedo, Chomvuri and Adams.

NRZ spokesperson Martin Banda said 18 650m of rail has been affected by illegal goldpanning activities that have seen some encroachment into rail leading to the ballast on tracks falling into the pit while some panners were digging uncomfortably close to NRZ houses.

“Let me hasten to mention that there are some people who are seen digging for gold along the railway lines as well as under the railway lines while some are ploughing along the railway line, a move which is highly dangerous and risky to the movement of passengers and freight trains throughout the country, particularly during the rainy season as it causes wash ways that have resulted in the derailment of trains,” said the spokesperson.

He said they arrested 14 illegal gold miners in a joint anti-gold panning operation in December last year.

The 14 were remanded in custody and are set to reappear in court this year. He said there was a surge in the illegal gold mining actives along railway lines and called for collective action to stop the illegality.

He noted that the parastatal continued to face operational and revenue generation challenges and the illegal mining activities along railway lines and reserve land was leaving NRZ in a position where it would be unable to pick up business on offer and compete against road transport in even terms.

Mr Banda appealed to members of the public to desist from such retrogressive acts and report such cases to the nearest police or railway security stations.

“Indeed, gold panning and acts of vandalism are a danger to the nation. We appeal to the general public to desist from such retrogressive acts and report such cases to nearby law enforcement agents,” he said.

The Sunday