Caledonia Mining Corporation, which operates the Blanket Mine in Gwanda, Zimbabwe, has revised its operational cost projections for 2024 due to rising labor and electricity expenses. On-mine costs are now expected to range between $950 and $1,050 per ounce of gold, a notable increase from the previous forecast of $870 to $970 per ounce.
CEO Mark Learmonth attributed the cost rise to higher labor and electricity expenses, with Zimbabwe’s unreliable power supply driving the mine to rely more on alternative, costlier energy sources. In response, Caledonia has integrated renewable energy into operations, including a 12.2MWac solar plant, which now supplies around 20% of the mine’s energy needs and is expected to reduce reliance on expensive alternatives.
In addition to managing electricity costs, the company is working to streamline its labor costs through efficiency measures. Despite these challenges, Caledonia is committed to meeting its 2024 gold production target of 74,000–78,000 ounces, and has increased its inventory levels by $2.3 million to safeguard against potential disruptions.
While production for the quarter decreased to 18,992 ounces, compared to 21,772 ounces in the same period last year, the company has produced 56,815 ounces for the nine months, slightly higher than the previous year’s 55,244 ounces.
Learmonth remains optimistic about the future of Blanket Mine, emphasizing the company’s commitment to cost-management strategies and growth through ongoing exploration activities
