Caledonia Mining (cal-t, cmcl-l) says total gold production for 2011 more than doubled at its Blanket mine in southwestern Zimbabwe, pushing its stock up nearly 9%.
For 2011 the company produced 35,826 oz., a 102% increase compared to the previous year. About 10,533 oz. of last year’s total was recovered in the fourth quarter of 2011, representing an 8.1% boost in production over the third quarter, and a 69% jump from the year-ago period.
For this year, the company expects to generate 40,000 oz. from its only producing gold mine, located 130 km south of Bulawayo, the country’s second largest city, and 15 km northwest of Gwanda, the provincial capital of Matabeleland South.
The Blanket mine consists of 225 claim blocks covering 25.4 sq. km in the northwestern limb of the Gwanda greenstone belt, which once hosted more than 250 producing gold mines.
The Africa-focused company embarked on a few initiatives to improve operations at the Blanket mine which has been in operation, on and off, since 1906, and has since produced more than one million oz. Caledonia acquired the mine from Kinross Gold (k-t, kgc-n) in April 2006.
During the fourth quarter of 2011, the company continued working on the 14, 18 and 22 level underground haulages, which is expected to be completed by this March.
It pressed ahead with maintenance work on the mine’s No. 4 shaft, which it started last November and should wrap up this February. Once the work is completed, the hoisting capacity is expected to increase.
It also installed an automatic-cyanide measuring and dosing system on the carbon-in-leach circuit to reduce cyanide usage per tonne, and added a belt scale on the No.1 conveyor belt to record tonnages delivered from different ore sources.
The company says it is still in talks with the Zimbabwean government regarding an indigenization plant for the gold mine.
As of Dec. 31, 2010, reserves at the mine, including stockpiles, stood at 3.8 million tonnes grading 3.78 grams gold per tonne for 467, 200 oz. It has another 510,000 tonnes at 3.79 grams gold for 62,100 oz. in the measured and indicated category. The estimate used a gold price of US$1,100 per oz.
On the 2011 operating results, Caledonia gained 8.7% to close Jan. 24 at 12.5¢, within a 52-week range of 6¢-15¢.
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