Metallon Corporation, the Zimbabwean gold miner, reported a 15% decline in gold production for Q1, 2016 (compared to Q1, 2016) as a result of power interruptions.

Metallon’s Q1, 2016 gold production was 20 672 oz, down from 24 386 oz in the corresponding period.

Power interruptions saw the company lose 324 hours of production in the quarter, which equated to approximately 4 275 oz.

In Q1 2015, Metallon lost half the number of hours – 167 – to power interruptions. The company states however that it is is progressing well with regards to possible solutions for supplementing grid power supply.

Further production shortfalls were a result of:

  • Breakdowns at the primary mill and north shaft hoist at How mine in January and February 2016. Tonnage throughput is stabilising and the focus is on achieving target feed grade to make up for lost ounces.
  • Ore generation challenges at Shamva mine due to equipment breakdowns underground. Equipment has been replaced and management is currently working to ensure maximum capacity utilisation of the process plant.
  • Breakdown of the Symons crusher at Mazowe mine in March 2016, which has now been repaired.
  • The suspension of operations at Arcturus mine in March 2016.

The Group C1 costs and C3 costs for Q1, 2016 were US$884/oz and $1 081/oz respectively. Costs were higher than expected due to the production shortfalls as well as increased expenditure.

As production and cost efficiencies improve throughout the year with new equipment and increased capacity, Metallon expects these costs to reduce further.

2016 programme

For the 2016 year, Metallon will be focusing on upgrading and refurbishing mining equipment and processing plants across the Group operations. This will reduce breakdowns, increase efficiencies and lead to lower costs.

Metallon will also be upgrading the Inferred section of the 9.6 Moz resource into the measured and indicated category. Exploration has commenced at Mazowe mine and will continue over the next six months.

[quote]This exploration and investment across Metallon’s mines is positioning the company for increased production over the next five years.

Redwing mine continues to increase production since the resumption of operations in November 2015. In March 2016, gold production reached over 1 000 oz.

Efforts are now focused on ramping up production to the plant capacity of 22 000 tpm by June 2016. At this capacity, Redwing mine will employ over 700 employees.

Construction on the new Mazowe processing plant and the new tailing facilities at both Mazowe and Shamva mine are progressing well.

Target commissioning is expected in Q3, 2016. The new Mazowe processing plant will increase capacity at the mine to 70 000 tpm, therefore the mine will be producing approximately 22 000 ozpa. The new plant will create approximately 100 direct jobs and additional employment opportunities.

Gold production target for 2016 is approximately 120 000 oz

“This year we will be investing in our assets by refurbishing and upgrading operations and expanding capacity which will deliver economies of scale and significantly lower costs. This investment and the exploration taking place will put Metallon on course to increased production over the next five years,” says Metallon CEO Ken Mekani.

“Metallon is committed to mining in Zimbabwe and we are especially pleased with the tremendous progress at Redwing mine since the resumption of operations in November 2015. All mining operations made a profit in March 2016 and Metallon now looks towards the future with a production target of 120 000 oz in 2016.”

  • Photograph shows Metallon’s Mazowe headgear in Zimbabwe