Home » Court » Metallon to Spend U.S $300 Million On Expansion

PREMIER bullion producer Metallon Gold will spend close to $300 million in the next four years on expansion and production ramp-up.

Metallon said capital expenditure is to be funded from internal cash flows and local bank facilities.

Metallon Gold, which is owned by South African mining tycoon Mr Mzi Khumalo boasts five gold mining operations in Zimbabwe – How Mine, Shamva, Arcturus, Mazowe and Redwing mines.

The 2015-2019 investment will go towards consolidating the mining giant’s position as the biggest bullion producer in the country.

“Detailed capital expenditure at each operation is available while expansion plans and CAPEX requirements still require detailed feasibility studies.

“Most capital expenditure will be funded by operating profit. 2015-2019 total capital expenditure is $297 million,” said the company in its corporate presentation for February 2015.

The gold price used by the company in forward looking assumptions is $1 200 per ounce.

How Mine’s 2015-2019 CAPEX has been pegged at $69 million aimed at increasing throughput and plant expansion to treat up to 80ktpm. The investment will also go towards How Mine’s south shaft sinking and capital development.

Shamva Mine will spend about $54 million that will go towards upgrading shafts and plant expansion among other projects.

Mazowe for the next four years will spend $52 million, Arcturus $46 million while Redwing will spend $73 million that will go towards underground development and exploration activities.

Metallon this year has set aside a capital expenditure budget of $34 million for this year, giving impetus to production forecasts of about 30 percent above last year’s projections.

Metallon Gold expects production to shoot above 130 000 ounces from underground operations helped by the resumption of mining operations at Redwing Mine and the setting up of re-treatment plants at Mazowe Mine.

Mining operations at Redwing Mine in Penhalonga were suspended due to flooding but de-watering is continuing and the mine is expected back in production.

Redwing Mine averages about 30 000 ounces per annum at full capacity. The company is putting up tailings re-treatment plants at Mazowe Mine.

Last year, Metallon Group forecast to produce 100 000 ounces but fell short by about 1 per- cent.

Source : The Herald