Message #5 From:
TheMachine Date: May 29, 2009 12:00:21 AM
Mining Stock News : CALVF Caledonia Mining Report on 2009 AGM and Shareholder Update
TORONTO, ONTARIO -- (Marketwire) -- 05/28/09 -- Caledonia Mining
Corporation ("Caledonia") (TSX: CAL)(OTCBB: CALVF)(AIM: CMCL) announces
that all resolutions proposed at the 2009 Annual and Special Meeting of
Shareholders held on May 20, 2009 were passed. Copies of the
presentation made to the meeting by the Chief Executive and the Chief
Financial Officer have been posted on Caledonia's website.
The key messages to shareholders as set out in the presentation and the subsequent discussions include the following:
- The ramp-up of production at Blanket Gold Mine in Zimbabwe to the
24,000 ounces per annum level continues but is dependant primarily on a
continuous electricity supply.
- Electricity outages continue to impact negatively on production.
Management is engaged with ZESA, the electricity supplier, and the
Zimbabwean Government to try and secure a reduction in the level of
outages and greater predictability on the timing of these outages so
that operations can be scheduled to minimise the impact on production.
Blanket has sufficient operational flexibility to mitigate the impact
of scheduled outages.
- Working capital facilities have been secured to facilitate
increasing levels of production. Stock levels of consumables, and
critical spares and parts, are being rebuilt as quickly as possible to
enhance Blanket's operational integrity.
- Blanket is in discussions with various banks regarding the
provision of a short-term financing facility to allow the rapid
completion of the No. 4 Shaft Expansion (at a cost of approx US$2.25m).
This will allow production capacity to be increased progressively to
40,000 ounces of gold per annum. The use of debt rather than
internally-generated cash flows would allow this expansion to be
completed more rapidly, with a consequential enhancement in Blanket's
NPV.
- In the medium term, Blanket will focus on exploration and
development opportunities within the existing mine area and in
neighbouring areas. The timing and scope of further developments will
be determined by the availability of funding and exploration progress.
- Exploration will continue during the remainder of 2009 at the Nama
Cobalt Project in Zambia, and will focus on the promising ore-shale
horizon with the objective of finding additional resources of cobalt
and copper rich ores that are capable of economic hydrometallurgical
processing.
- Work continues on finalising the joint ventures with Mitsubishi Corporation in respect of Rooipoort and Mapochsgronde.
Commenting on the outlook for Caledonia, Stefan Hayden, Chief
Executive Officer said: "We are excited by the return of Blanket to
gold production. Whilst the environment in Zimbabwe remains
challenging, we welcome the recent improvements in operating
conditions. We are optimistic that as stability returns to Zimbabwe,
Blanket will achieve its target of becoming a 40,000 ounce per annum
gold producer. Thereafter, we believe that Blanket can continue to
expand further based on its existing exploration and development
opportunities."
At the Board Meeting held after the AGM, Mr Robert Liverant
submitted his resignation from the Board referring to his wish to
reduce his commitments. Mr Liverant joined the Board of Caledonia on
January 18, 2007. Caledonia's Board and Management acknowledge and
thank Mr. Liverant for his contributions to Caledonia during his time
as a Director.
