Caledonia Mining Corporation Plc has completed fully equipping the central shaft at Blanket Mine from the base to the surface collar while the commissioning of the shaft is expected to be done in the first quarter of 2021, the company has announced.
The central shaft will provide access for further deep-level exploration which, if successful, may extend Blanket Mine lifespan beyond 2034.
“This has been completed considerably below budget and within a time frame to underpin the company’s expectation of delivering production of 80,000 ounces of gold in 2022,” Caledonia said in a statement.
The central shaft project started in August 2015 and has seen 1,850 fatality free shifts with only two lost time injuries (LTI) and it has been 920 shifts since last LTI.
The scope of the Central Shaft project was extended from an initial target depth of 1,089 meters to a final depth of 1,204 meters. It is self-funded and is owner-built by Blanket crews with supervision from Sinking Engineering Mining Construction.
During shaft sinking, more than 1,800 metres of infrastructure development was completed including mid-shaft loading and the capital cost to date is approximately US$60 million, compared to initial sinking contractor quotes received of about US$100 million.
“Over the last five years we have built a solid foundation for the Company, we have a healthy balance sheet, a strong gold price and a highly cash generative asset with free cash flow expected to increase significantly with the rise in production,” chief executive Steve Curtis said.
The central shaft is expected to increase production by around 45 percent from approximately 55,000 ounces of gold in 2019 to the target rate of 80,000 ounces from 2022.
Economies of scale and operational efficiencies arising from the central shaft are expected to reduce the all-in sustaining cost per ounce of gold from US$8 551 in 2019 to between US$700 and US$800 per ounce.
The erecting and fixing of the headgear is due to be completed by the end of 2020.