Caledonia welcomes gold discount reduction

Walter Muchinguri Assistant Business Editor
Caledonia Mining Corporation has commended the reduction of the discount on gold sales to 1,25 percent as another step by Government to assist the mining industry. Fidelity Printers and Refiners Limited last week amended their pricing and payment terms which apply to the Blanket Mine from a discount on gold sales of 1,5 percent to 1,25 percent

Caledonia CEO Steve Curtis said: “The Company welcomes all encouraging movements from the Zimbabwean Government towards further supporting the nation’s mining industry,” he said.

He added that Fidelity’s announcement would also improve Caledonia’s cost efficiency in future gold sales. The measures come as Government also reduced gold royalties.

Blanket Mine produced 10 482 ounces of gold during the last quarter to December 31, 2014. The gold mine produced 11 429 ounces in the last quarter of 2013.

A total of 41 836 ounces of gold was produced in 2014, which was 8,1 percent lower than 45,527 ounces that was produced in 2013.

The total production for last year was however 4,6 percent higher than the production target of 40 000 ounces for 2014. Blanket Mine’s target for this year is approximately 42 000 ounces.

The move comes as Government has already reduced gold royalties from 7 percent to 5 percent from October and completely removed presumptive tax for small scale gold producers.

The move was welcomed by most gold producers with Mwana Africa chief executive Mr Kalaa Mpinga commending Government for taking their concerns into consideration.

“We have actively engaged with Government on this issue and it is very pleasing that in a spirit of understanding and co-operation, it has recognised the challenges inherent in the gold mining industry at present.

“The reduction in the gold royalty rate will provide a welcome financial boost to the mining sector in Zimbabwe,” Mr Mpinga said at the time.