Modern Mining April 2016

MINING News

Metallon’s production marginally down in 2015

UK-based Metallon Corp, which owns five underground goldmines in Zimbabwe, has reported a total gold production of 96 530 ounces for FY 2015, 2,4 % lower than the figure for 2014. The group says that gold production was lower than expected due to equipment breakdowns at four of its mines (How, Shamva, Mazowe and Arcturus), increased power interruptions and a delay in commissioning its Mazowe sands retreatment project as a result of unforeseen equipment delays. C1 and C3 costs for 2015 were US$818 and US$1 017 per ounce respectively. Compared to 2014, C1 costs were 5,4 % higher due to lower production and C3 costs were 9,8 % higher as a result of spending on new projects and replace- ment capex. Metallon says that in 2016 its focus will be on completing the Mazowe sands retreatment plant and the Mazowe and Shamva tailings facilities in Q2 2016 and on resource exploration across the group with a budget of US$1,6 million commit- ted to upgrading resources from inferred to measured and indicated. The majority of the planned exploration will be under- ground and near surface at Mazowe mine and at surface at Shamva Hill. At Mazowe – and depending on the results of the exploration programme – the sands retreatment plant will be upgraded to process ore from both near surface and underground from 2018. Redwingmine has successfully resumed operations and produced 814 ounces in 2015. Ramp up will continue over the next six months to bring themine to full produc- tion. At steady state Redwing will deliver approximately 1 600 ounces per month. Dewatering will continue to open up more

Metallon’s Redwing mine – one of Zimbabwe’s historic mines – is located 20 km north-east of Mutare. It was reopened towards the end of last year (photo: Metallon).

reserves in the lower levels of the mine. According to Metallon, the reopening of Redwing – which discontinued opera- tions in 2008 – will bring many major social and economic benefits to the local region and the country. Employment is one of these benefits, with the mine hav- ing 484 employees at opening. This figure will increase to over 700 once it reaches installed capacity in H2 2016. Construction of the Mazowe sands retreatment project is almost complete and commissioning is expected in Q2 2016. The new tailings facilities at both Mazowe and Shamva are progressing well and these should also be ready for use in Q2 2016. Comments Ken Mekani, Metallon’s CEO: “2015 was an exciting and promising year ing of alluvial diamonds, the processing and manufacture of river sands and kimberlite projects. The Oena project consists of an 8 800‑ha mining right and corresponding infra- structure and all associated processing equipment. It is located along the Orange River in a well-established alluvial diamond mining province known to produce high quality and large sized diamonds. In connection with the agreement with

for Metallon and the management team have been focused on making significant improvements to the business. Despite gold production for 2015 being margin- ally below that of 2014, we believe that advances made during the year will ensure Metallon is well positioned for future pro- duction growth. This is demonstrated by record monthly gold production in December 2015. Notably, Metallon spent over US$15 million on capital expenditure over the last 12 months and will also have repaid US$8 million of net debt by the end of Q1 2016. This establishes our commit- ment to reducing our net debt position and reinvesting in the business. The reopening of Redwing mine in Q4 2015 has been a tremendous achievement and we look for- ward to increased production in 2016.”  Bothma for the purchase of African Star, Tango has entered into a binding term sheet and sale and acquisition agreement – contracting (Stage 1 Agreement) whereby Bothma will continue the alluvial diamond bulk-sampling programme at the Oena project. Following that, it will enter into a Stage 2 agreement whereby Bothma will complete the acquisition of African Star. Tango will receive a minimum of 15 % of the proceeds of all diamond sales “for a term of the longer of 12 months and/or until a Section 11 approval is obtained”. 

Tango receives offer for Oena diamond mine Tango Mining, a company listed on the TSX Venture Exchange, reports it has received a binding offer from Bothma Diamante CC, an unrelated third party company registered in South Africa, to acquire African Star Minerals (Pty) Limited , which owns 100 % of the Oena mine (in which Tango has a 51 % inter- est) for US$3 million (payable in traches). Bothma is well known in the Northern Cape and Free State and has worked as contractor on various projects for the min-

April 2016  MODERN MINING  11