Caledonia Mining Corporation, already operating the Blanket gold mine in Zimbabwe, is setting its sights on a new project: the Bilboes mine.
This potential game-changer could become the country’s largest gold mine, producing at least 170,000 ounces annually.
To secure funding for the estimated $250 million project, Caledonia is looking towards African development banks.
While Zimbabwe boasts rich mineral resources, economic instability and past property seizures have discouraged foreign investment.
Caledonia, backed by established investors like BlackRock, is one of the few braving this challenging environment.
The company has already begun discussions with “the most likely lenders,” according to CEO Mark Learmonth.
Learmonth identified African development banks as the frontrunners, citing their strong interest in the project.
Debt financing will likely be the primary source of funds.
“Debt funding will be the most cost-effective option,” Learmonth explained, postponing any exploration of non-debt financing until a clearer picture of debt capacity emerges.
Assuming funding is secured within the optimistic timeframe of one year, construction is estimated to take two years after financial approval.
However, a recent dip in Caledonia’s operating profit, down 62% in 2023 compared to the previous year, highlights the need for a successful Bilboes project to bolster the company’s financial standing.
