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Caledonia Mining Corporation’s Blanket Mine has registered an 18% increase in gold production to 9,743 ounces.
The Toronto listed company said improved efficiencies in its underground mining operations had spurred the growth
“The increase in production was achieved following the completion of work to address the remaining constraints to underground production and included the commissioning of a new ore pass at the end of July, which substantially improved the efficiency of underground operations and reduced ore handling costs,” chief executive, Stefan Hayden
“We expect that Blanket Mine will operate sustainably at this level of production,” he added.
Hayden said its cost production per ounce of gold at the mine had decreased to $583 compared to $585 in the preceding quarter and $651 in the comparative quarter.
“The cost per ounce of labour and electricity was lower than the previous quarter as these are largely fixed costs and were amortised over the higher production,” the mining executive said.
Caledonia recorded a gross profit of $9,4 million compared to $1,6 million the comparative quarter.
“The increase in profit was primarily achieved due to the 18 percent increase in gold production and the 15 percent increase in the average price of gold sold compared to the second quarter of 2011,” Hayden said.
“This is almost a six-fold increase on the comparative quarter and is the seventh consecutive quarterly increase in gross profit,” he said
The company recorded net profit before tax of $8,4 million compared to $742,000 in the comparative quarter which represents an 11-fold increase.
“The culmination of the investment programs at the Blanket Mine over the past 30 months has substantially transformed Caledonia’s financial and operating performance as demonstrated by these third quarter results,” said Hayden.
Caledonia said it had secured an average price received per ounce of gold sold of $1,737 compared to $1,241 in the comparative quarter.
The mining company which had its operating licence suspended and reinstated by Indigenisation minister Saviour Kasukuwere over its indigenisation plans said talks were on-going.
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