HomeGoldMwana Africa could return to profit

Mwana Africa could return to profit

A Mwana Africa mining
project in Zimbabwe
London, England — MININGREVIEW.COM — 05 February 2009 – Mwana Africa – a pan-African resources company with exploration and producing activities in Zimbabwe, Ghana and DRC – could return to profit in Zimbabwe if new bullion rules proposed by the country’s central bank are confirmed.

“Mwana will start production in four to five months at its Zimbabwe gold mine if the company can sell bullion on the open market,” CEO Kalaa Mpinga said in an interview here with Bloomberg News. “The initial intention is to produce at a rate of 40 000 ounces a year, accelerating to 80 000 ounces within four months,” he added.

“I see that we are going to be allowed to export our gold directly, which means the gold industry – which was basically killed because of the previous foreign exchange policy – can now restart,” Mpinga continued. “The gold picture in Zimbabwe in the next six months will be very different.”

Reserve Bank of Zimbabwe governor Gideon Gono revealed earlier this week that mining companies in Zimbabwe would no longer have to sell gold through Fidelity Printers and Refiners Ltd., a unit of the central bank that refines the metal. “Producers will be able to sell their bullion wherever they wish and keep 92.5% of their foreign currency earnings,” he added.
Bloomberg News reports that there is no guarantee that Gono’s plan will be carried through. Over the past year, for instance, the Reserve Bank of Zimbabwe has repeatedly changed rules regarding access to foreign currency, the agency says.

“If we can export our gold, and if we have control of the revenue that is generating from our gold, it will take us about four months to start mining,” Mpinga said. “If we can get our gold mine going, the company will then be back in a cash positive situation.”