Caledonia Mining completes acquisition of multi-million ounce Bilboes gold project in Zimbabwe

Welcome to Kitco News' 2023 Outlook Series. Uncertainty continues to dominate financial markets as central bank monetary policies push the global economy into a recession to cool down inflation. Stay tuned to Kitco News to learn from the experts on how to navigate turbulent financial markets in 2023.

(Kitco News) - Caledonia Mining (NYSE: CMCL) today announced that it has completed the acquisition of the Bilboes gold project in Zimbabwe.

According to a company press release, the total consideration payable is, subject to adjustment, 5,123,044 shares representing approximately 28.5 per cent of Caledonia's fully diluted share capital and a 1 per cent net smelter royalty on the project's revenues.

Caledonia Mining said that based on the last trading day's closing share price on NYSE American of US$12.82 per share, the value of the maximum number of new shares that could be issued as consideration if there is no adjustment is currently US$65,677,424.

The company noted that Bilboes is a large, high grade gold deposit located approximately 75 km north of Bulawayo, Zimbabwe. Historically, it has been subject to a limited amount of open pit mining.

The project has NI43-101 compliant proven and probable mineral reserves of 1.96 million ounces of gold in 26.64 million tonnes at a grade of 2.29 g/t, measured and indicated mineral resources of 2.56 million ounces of gold in 35.18 million tonnes at a grade of 2.26 g/t, and inferred mineral resources of 577,000 ounces of gold in 9.48 million tonnes at a grade of 1.89 g/t.

CEO Mark Learmonth commented, "Completion of the transaction is the cornerstone in Caledonia's strategy to create a mid-tier, multi-asset gold producer focussed on Zimbabwe.

"Bilboes is a large, high-grade sulphide deposit which is amenable to low-cost, open-pit operations. A feasibility study on the Bilboes project which has been prepared by the Bilboes vendors envisages production of approximately 168,000 ounces of gold per annum over a 10-year life. Now that the Transaction has completed, Caledonia will commission its own feasibility study to identify the most appropriate way to commercialise this asset having regard to the availability of funding with the objective of maximising Caledonia's net present value per share. I anticipate the feasibility study will take 12 to 14 months to complete."