The Sunday Mail
. . . sector hauls 18 tonnes . . . Govt heightens monitoring
THE country’s gold production leapt 33,8 percent to 18,6 tonnes in 2015 from a year earlier, helping surpass the targeted output by more than 2 tonnes, official statistics show.
The sector had set a target of 16,7 percent.
In 2014, production of the yellow metal topped 13,9 tonnes.
Last year, large-scale miners contributed 11,1 tonnes while small-scale miners weighed in with 7,5 tonnes on increased capital investments and heightened monitoring.
Production has been on an upward trajectory since 2008.
But notably, last year’s production is 8,4 tonnes shy of the record 27 tonnes realised in 1999.
This year, Government has set a target of 24 tonnes.
Mining contributes more than 52 percent of the country’s export receipts.
Fidelity Printers and Refiners acting chief executive officer, Mr Fradreck Kunaka told The Sunday Mail Business last week that this year’s target is achievable considering the interventions that were made by Government, particularly in the 2016 National Budget.
“The target of 24 tonnes is achievable. Considering the incentives given to the gold mining sector which include reduction of royalties as well as the promised review and or rationalisation of the various statutory fees during the first quarter of 2016, the 24 tonnes are achievable,” said Mr Kunaka.
In order to ensure the viability of gold producers who were increasingly bearing the brunt of falling international metal prices, Government downwardly reviewed the royalty rate on gold produced by primary producers from 7 percent to 5 percent in October 2014.
Furthermore, incentives in the 2016 National Budget include slashing the royalty rate to 3 percent on incremental output of gold “using the previous year’s production as a base year” beginning this month.
Mr Kunaka noted that affordable funding and enforcement of compliance with marketing requirements is critical to the continued growth of the gold sector.
“Funding at competitive rates remain key for the continued growth of the gold mining industry. There is need for various arms of Government to collaborate in the gold mobilisation efforts.
“The compliance enforcement units need support in the form of both material and financial resources for them to ensure that almost all the gold is disposed by miners on the formal channels.
“The increase from the 18,6 tonnes to 24 tonnes will come mainly from enforcement of compliance with the gold marketing arrangements and new mine production,” said Mr Kunaka.
Current production levels are expected to be augmented by production at new mines and at large-scale mines such as Freda Rebecca and Metallon Corporation’s How Mine, Shamva, Mazowe, Arcturus and Redwing mines.
Increases from small-scale miners are forecast to come from improved ore processing efficiencies.
Government arms such as the Ministry of Mines and Mining Development, Reserve Bank of Zimbabwe and Fidelity Printers and Refiners as well as the various miners’ associations are being urged to collaborate to avoid duplication of efforts, thus thinly spreading the available resources.
The Gold Mobilisation Technical Committee, established by the Minister of Mines and Mining Development at the beginning of last year, has been mandated to ensure the set target is achieved.
The RBZ believes Zimbabwe can realise about US$1,5 billion from gold exports beginning 2020.
Pickstone Peerless targets 500kg of gold
Africa Moyo
CHEGUTU-based Pickstone Peerless gold mine plans to produce over 500 kilogrammes of gold this year, spurred by a $17 million capital investment made in recent years.
The mine is projected to produce a minimum of 40kg of gold per month this year.
The gold mine, which is jointly owned by Dallaglio Investments — a special purpose vehicle established between Vast Resources (former ACR) and Grayfox Investments, a consortium of local investors — last year sunk more than $7 million in the construction of a brand new mine and working capital at the mine.
Over $10 million has been invested in exploration between 2006 and 2014.
Last week, Pickstone Peerless’s mine manager, Mr Dennis Mtombeni told The Sunday Mail Business that production is already underway.
“We are already producing and obviously this year we want to produce more, it was already in our plans.
“On average, we plan to do a minimum of 40kg a month and we can raise production from there, but 40 kg per month is what is in our initial plans.
“Basically, in December (2015) we were drilling to get ore, so December and a bit of January we are still drilling to get samples (and now), we are doing reverse circulation to access the ore,” said Mr Mtombeni.
It is feared that a sharp decline in international gold prices might scupper plans to raise production.
“If prices come down significantly, that will be a challenge because costs will be rising.
“But we are very hopeful that the gold price will rise, especially with everything going down, the gold price normally goes up because people hedge in gold,” added Mr Mtombeni.
Gold prices shot up to US$1 107,10 per ounce last Wednesday, gaining $17,20 from the previous day.
The metal’s peak price was in August 2011 when it hit US$1 921,41 per ounce.
Late last year, gold prices retreated to just under US$1 100, their lowest in more than five years as sellers in China offloaded the metal.
China is the top consumer of gold in the world.
Pickstone Peerless, which employs 200 people, does not anticipate major disruptions from power outages since it has a dedicated line.
The gold mine resumed operations last August while gold sales commenced in September.
Dallaglio Investments acquired Pickstone Peerless after failing to bag Falgold Zimbabwe’s Dalny Mine as the proposed US$8 million transaction had taken too long to conclude.
The mine used to produce 400 000 ounces in the past.
Vast Resources has numerous other operations in Zimbabwe including the Gadzema Gold Project, Chishanya Phosphate Project, Perseverance Nickel Project, One Step Gold Project, Chakari Gold Project and Marange Diamond Project.
Government has set a target of 24 tonnes of gold this year, almost 5,5 tonnes more than last year’s total haul.
Policies such as slashing the royalty rate for small-scale gold miners have improved the viability of the sector.
Gold output has since risen from three tonnes in 2008 to 18,6 tonnes last year.
The gold sector employs many people and the mineral’s extraction is not as complex and expensive when compared to other minerals such as platinum and diamonds.
