Caledonia Mining Corporation has approved the development of the Bilboes Gold Project in Matabeleland North after a feasibility study confirmed robust economics, strong gold reserves and a viable path toward mid-tier producer status.
The company said front-end engineering design would begin immediately, paving the way for construction to start once funding arrangements are finalised. Caledonia acquired Bilboes in 2023 for US$65 million in shares and a 1 percent smelter royalty.
Chief executive officer, Mr Mark Learmonth, described the project as transformational.
“The finalisation of the feasibility study and the decision to implement the project is a defining moment for Caledonia in our journey to become a mid-tier gold producer,” he said.
“This feasibility study confirms that the project has robust economics, delivering 1,55 million ounces (Moz) over 10,8 years with first production expected in late 2028.”
Bilboes hosts 1,749Moz ounces of proven and probable reserves at an average grade of 2,26 grammes per tonne (g/t), supported by a further 532 000 oz of measured and indicated resources and nearly one million ounces inferred.
The ore is refractory, and the miner has selected Metso’s BIOX technology for pre-treatment before conventional leaching.
At full capacity, Bilboes is expected to process 240 000 tonnes of ore per month for the first six years, dropping to 180 000 tonnes thereafter. The mine is forecast to produce around 200 000 oz of gold in its first full year, which is tipped to be 2029.
The feasibility study sets the project’s capital cost at US$584 million with a peak funding requirement of US$484 million. Using a long-term gold price forecast of US$2 548/oz, the project carries a post-tax net present value (NPV) of US$582 million, an Internal Rate of Return (IRR) of 32,5 percent and a 1,7-year payback.
At the September 2025 spot price of US$3 648/oz, the project’s NPV rose sharply to US$1,234 billion.
Caledonia expects most of the financing to come from non-recourse senior debt, supplemented by internal equity from Blanket Mine and flexible instruments such as royalties or streams. The company has also hedged 3 000oz per month from Blanket for three years to support cash flows during construction.
Mr Learmonth said Bilboes would deliver substantial benefits to Zimbabwe through foreign currency earnings and tax receipts, while the company intends to replicate community ownership structures similar to those at Blanket Mine. – Herald
