New export rule boosts New Dawn Mining

Shares of New Dawn Mining (ND-T) surged 24.4% to 56¢ in mid-day trading in Toronto on news of more positive policy changes afoot in Zimbabwe.

Under a new Short Term Emergency Recovery Program, or STERP, the government will no longer retain revenue from export sales, New Dawn reported today.

In January the government said its retention of revenue from export sales would be cut from 15% to 7.5%, but now that percentage has been eliminated entirely, the company says.

“The result is to allow gold producers to continue to market their gold directly and to now retain 100% of the proceeds from such gold sales in foreign currency,” New Dawn outlined in a press release.

“At the same time, the STERP proposes to review taxation and royalty structures to bring them in line with international standards.”

Earlier this month, New Dawn chief executive Ian Saunders said the company was taking its 100%-owned Turk gold mine out of care and maintenance and putting it back into production after the Reserve Bank of Zimbabwe changed its monetary policy in late January, allowing gold producers to market and sell their gold directly to customers overseas rather than to Zimbabwe’s Central Bank.

New Dawn put its Turk mine on care and maintenance last October because it had not been paid for gold it had deposited with the central bank.

For the years 2006 and 2007, production from underground operations averaged 1,100 oz. gold a month, or 13,200 oz. gold per year, at an average adjusted cash cost of less than US$380 per oz.

The Turk mine is 55 km north of Bulawayo, Zimbabwe’s second-largest city.