By ETimes
HARARE – Kavango Resources, the Southern Africa-focused metals exploration company, says the recent drill assays and Induced Polarisation survey results from its Hillside project are advancing towards its objective of developing western Australia-style open pit gold mines in Zimbabwe.
Western Australian bulk mining has become a dominant style of mining and that has seen gold production rise rapidly. However, this has not taken place in Zimbabwe, despite sharing a very similar geology.
In hard rock mining, much of the world’s annual output of copper, gold, and iron ore comes from open-pit operations.
The London-based firm has designated four priority prospects at the Hillside project, intending to discover one or more larger-scale gold deposits that are suitable for modern bulk mining.
Last month, Kavango revealed that assays from drilling at Hillside Prospects 2 and 4 had returned wide areas of significant gold at shallow depths. Highlights from our first two holes included 7.2 metres at 9.95 g/t at Prospect 2 and 2.53 metres at 29.08 g/t at Prospect 4.
The results have also shown what Kavango has interpreted to represent a series of shears. In each case, these shears are hosted within a broad area known as a “shear zone.” The shear zones could host a large mineralised ore body prospective for an open-pit mine and bulk mining.
“Zimbabwe’s geology mirrors that of Western Australia and the country has a rich history of high-grade gold mining across its greenstone belts. However, Zimbabwe’s potential to host a multitude of large-scale, bulk minable gold deposits remains largely undeveloped. This presents the nation with an immense economic opportunity,” Kavango’s chief executive officer, Ben Turney said.
“Kavango has identified a strong pipeline of claim packages covering historic high-grade gold mines. We are now applying modern exploration and drilling techniques across three of these to assess their open pit potential and develop bulk mining operations.”
The mining sector has set goals to grow into an industry valued at US$12 billion as part of its contribution to Vision 2030. Gold, platinum, diamonds, coal, hydrocarbons, chromium, and lithium are the main minerals that will drive the mining industry’s expansion.
“In doing so, our objective is to contribute to the 2030 Vision of turning Zimbabwe into an upper middle-income economy,” Turney added.
The most advanced is at Hillside prospects 2 and 4, but the remaining prospects, along with Nara and Leopard, could also present opportunities.
Gold production in April was just over 1kg, representing a second consecutive profitable month.
Meanwhile, Kavango announced that it has agreed updated terms for exercise of the Hillside Call Option with the vendors of the Hillside Project and Leopard South Project.
Sale and purchase agreements for Hillside and Leopard South were signed by the sellers with Kavango on April 30, with what Kavango considers to be improved commercial terms.
The main components comprise:
- – US$600,000 cash consideration to be paid to the sellers of Hillside.
- – US$50,000 cash consideration to be paid to the sellers of Leopard South.
- – Option on Leopard North extended to June 30, 2025, which Kavango may exercise in return for payment of US$$100,000 and the issue of 34,125,000 shares in the company. A further US$$1,000,000 of shares are to be issued by the company in the event that a code compliant resource in excess of 200,000 oz gold is defined.
- – Kavango to assume responsibility for up to US$350,000 of debt owed, which is repayable at US$10,000 per month.
- – Kavango has granted a royalty of 5% of gold production on the properties, capped at a value of US$1,500,000, which Kavango may, at its option, buy out within 12 months for an issue of 63,125,000 shares in the company.
Completion is subject to satisfactory transfer by the sellers of the mining claims into Kavango’s Zimbabwe subsidiary and by the company paying the Zimbabwe Special Capital Gains Tax due on the transaction.
Over 4,000 gold discoveries have been identified in Zimbabwe, almost all of which are situated on historic workings. The country is still underexplored for gold deposits.
Zimbabwe has more than 90% of the world’s richest greenstone belts, which are linked to the country’s gold reserves.
Kavango comes into the picture at a time when there is increased competition from the top large-scale gold miners in Zimbabwe, such as Fredda Rebecca, Blanket Mine, Rio Zim, Metallon Corpoation, Sabi Gold Mine, Falcon Gold Mine, and Pickstone Peerless, just to mention a few.