Caledonia remains confident over Blanket Mine

GOLD miner Caledonia on Tuesday said it remains confident that the investment plan for its local mining unit, Blanket Mine, will push down production costs while raising cash generation.

In 2014, Caledonia, announced a revised investment plan for Blanket Mine, under which production is expected to rise to approximately 80 000 ounces of gold by 2021.

The plan will see Caledonia invest at least $45 million in Blanket Mine between 2015 and 2017.

Announcing a quarterly dividend of one and three eighths United States cents (US$0,01375) on each of the company’s common shares, Caledonia chief executive officer Steve Curtis said the miner was also confident that it could implement its stated growth strategy without the need to raise third party finance.

“I am confident that, as gold production continues to increase at the Blanket Mine, as a result of our investment plan, the cost per ounce of gold produced will continue to fall, with a commensurate improvement in cash generation,” he said.

Last month, Caledonia reported full year 2016 production of 50 351 ounces at an All-in sustaining cost of $912 per ounce.

“Caledonia remains committed to distributing cash to shareholders whilst simultaneously retaining a robust balance sheet to enable us to take advantage of further opportunities.”

Caledonia has set itself a target to produce 60 000 ounces of gold this year, up from 50 000 ounces last year.

The firm earned $1 232 per ounce last year, up from a comparative $1 187 per ounce.