https://www.miningweekly.com
Gold|PROJECT|Underground|Operations
Gold|PROJECT|Underground|Operations
gold|project|underground|operations

Canadian miner said to be in talks to buy Zimbabwe gold project

24th May 2019

By: Bloomberg

  

Font size: - +

JOHANNESBURG – Canada-based B2Gold is considering buying an idled Zimbabwean gold mine – if it can be exempted from a law that requires producers to sell all the metal to the country’s central bank, people familiar with the situation said.

Securing an exemption may open the way for further investment by gold producers in the southern African nation, where a number of companies have closed mines because of the sales requirements and Zimbabwe’s economic crisis.

If a transaction with owner Metallon is concluded, B2Gold will invest $150-million to $200-million developing the Shamva gold mine, one of the people said. The Vancouver-based company will pay about a third of the book value for the mine, which was last assessed at about $167-million seven years ago, the person said, without giving further detail.

John Mangudya, the central bank governor, was unavailable to comment, according to his office. A B2Gold spokesperson had no immediate comment when reached by phone, while a spokesperson for Metallon declined to comment.

STRUGGLING SECTOR
The purchase would be an unusual investment in Zimbabwe’s struggling gold sector, with the two biggest producers, Metallon and RioZim, suing the central bank over its payment arrangements. By law, gold miners in the country must sell their gold to a unit of the central bank, which then pays them back partly in dollars and partly in a local quasi-currency that cannot be traded outside Zimbabwe. Both companies have sued the central bank over the currency they are remunerated in and over late payments.

Earlier this year RioZim suspended its gold mines temporarily because it wasn’t getting paid and Metallon shuttered three operations last year for the same reason, leaving it with a single mine. A large portion of Zimbabwe gold is produced by artisanal miners and much of it is smuggled out the country. Zimbabwe is in the midst of an economic crisis with shortages of fuel, medicine and foreign currency being commonplace.

B2Gold officials have visited Zimbabwe several times in a bid to conclude the sale, one of the people said.

Shamva gold mine, about 90 km northeast of the capital Harare, is an underground operation that produced 21 061 ounces of gold in 2016, according to Metallon’s website.

Edited by Bloomberg

Comments

Showroom

Condra Cranes
Condra Cranes

ISO-certified Condra manufactures overhead cranes, portal cranes, cantilever cranes and crane components: hoists, drives, end-carriages, brakes and...

VISIT SHOWROOM 
Universal Storage Systems (SA)
Universal Storage Systems (SA)

South African leader in Steel -Racking, -Shelving, and -Mezzanine flooring. Universal has innovated an approach which encompasses conceptualising,...

VISIT SHOWROOM 

Latest Multimedia

sponsored by

Hyphen, Eva mine, ferrochrome price make headlines
Hyphen, Eva mine, ferrochrome price make headlines
27th March 2024
Resources Watch
Resources Watch
27th March 2024

Option 1 (equivalent of R125 a month):

Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format

Option 2 (equivalent of R375 a month):

All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.

Already a subscriber?

Forgotten your password?

MAGAZINE & ONLINE

SUBSCRIBE

RESEARCH CHANNEL AFRICA

SUBSCRIBE

CORPORATE PACKAGES

CLICK FOR A QUOTATION







sq:0.102 0.136s - 92pq - 2rq
Subscribe Now