Caledonia Mining Corporation PLC (AIM:CMCL, NYSE-A:CMCL) exploration update from its Motapa project in Zimbabwe is encouraging says house broker Panmure Liberum, especially with it earmarked to play a key part in the miner’s growth prospects.
Motapa is immediately adjacent to the Bilboes project with historical open pits on Motapa North just a few hundred metres from the planned sulphide process plant.
Significant high-grade results were obtained in “numerous” areas at Motapa - in particular, the Jupiter, Pluvious and Mpudzi sections, which will be the focus for follow-up drilling aimed at defining an open-pit mineral resource.
Historical gold production from Motapa (until 1990) is estimated by Caledonia at 300,000 oz from 2.4Mt of ore averaging 5.4g/t.
A feasibility study for the Bilboes sulphide plant is on track for completion in the first quarter of 2025 and this latest drilling suggests there should be significant synergies from integrating the deposits, PanLib suggests.
Elsewhere, production guidance for the Blanket mine was reiterated, but teh forecast for on-mine cost and All-In Sustaining Cost (AISC) was upped, which has prompted the broker to trim its share price target to 1,416p (from 1,554p) though the ‘buy’ rating remains.
Shares down 2.5% at 1,140p.