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Did you know? Falcon Gold Zimbabwe’s history

17 Jan, 2020 - 00:01 0 Views

eBusiness Weekly

Fradreck Gorwe

Zimbabwe Stock Exchange-listed gold mining company, Falcon Gold Zimbabwe, was  founded in 1991. It is currently subsidiary to New Dawn Mining Corporation (NDM), a Canadian company listed on the Toronto Stock Exchange and involved in the exploration, development, extraction, processing and reclamation of precious metal deposits in many countries including Zimbabwe.

Subsidiaries include Dalny Mine located in Chakari, Venice Mine in Kadoma, and Golden Quarry Mine located in Shurugwi. Others included Turk Mine, Angelus Mine, Camperdown and Wanderer Mine. It has four mines and two production  facilities.

Actual mining history of the deposits started on the Chakari Gold Belt in ancient times before the Portuguese entered the deposits in the fifteenth and sixteenth centuries.

Dalny Mine was first pegged by the Rhodesian Exploration and Development Company in 1905 and has in fact a production history dating back to the 1940s.

Mines under the Dalny Complex included Arlandzer, Turkoise, Dalny, Stella, Pixie and Dawn Brilliant. Those under the Venice Complex were Venice, Nando, Pinkun, Mascot and What Cheer. Venice Mine was later temporarily closed in 2002.

Falcon Mines Limited (Falcon), a company registered in Luxembourg, took an interest in the Chakari Gold Belt in 1945.

It subsequently purchased the Turkoise and Dalny mines from their claim holders. Golden Quarry Mine, then Lulu Mine, was sold by its claim holder, one Hewit, in 1988 to Falcon Mines Limited.

Falcon was a subsidiary of the Central African Gold plc, (CAG), then a United Kingdom based gold exploration company.

In 2007, CAG had to capitalise on this involvement to acquire 84,7 percent shareholding in Falcon Gold (Falgold) Zimbabwe and 100 percent interest in Olympus Gold Mines.

These two new subsidiaries to CAG then in 2008 placed Dalny, Golden Quarry, Camperdown and the Old Nic Mines on care and maintenance status in 2008.

The above deposits, which formed part of CAG’s mining properties were, and are located in the most geologically favourable gold producing Archean Greenstone terrains of Zimbabwe that had been extensively prospected for gold and other mineral deposits.

In 2010, CAG became reluctant about financing and recapitalizing its Zimbabwean operations, resulting in Falcon Gold devising own strategies to source new funders to undertake the required plant and machinery refurbishment.

At the time a portion of the Golden Quarry Mine was run through a tribute agreement with another part (the tributor), who worked the claims subject to payment of a monthly fee. The agreement was to expire in December 2011.

On June 16, 2010, and pursuant to a share swap, NDM acquired 88,68 percent shareholding in CAG’s Falcon Gold. New Dawn had long existed in Zimbabwe through its subsidiary, Casmyn Mining Limited, the owner of Turk Mine in Bulawayo.

In 2012, New Dawn Mining Corporation acquired CAG’s remaining 15 percent stake in Falcon Gold under a scheme of arrangement. Consequentially, Falcon Gold became a wholly owned subsidiary of NDM.

Pursuant to the development, Dalny Mine operations were revived in August 2010 while the refurbishment of Golden Quarry Mine was scaled up.

The projects formed part of the newly implemented three phase strategic recovery programme comprised of stabilisation and Re-organisation; Recovery and Growth. The third phase was to stretch beyond 2014.

However, with the temporary fall in gold prices and mounting electricity arrears that drove the power utility to issue a notice of disconnection, Dalny Mine was again shut down in 2013.

Adding to the misfortunes, Venice Mine posted a $1,6 million loss for the half year to March 31, 2015, resulting in Falcon Gold disposing of its 62,5 percent stake in the  subsidiary.

During the year again, a rental agreement was entered with an undisclosed company for Dalny Mine’s care and maintenance costs. The processing plant at Dalny was in 2016 rented to another mining company under a toll treatment agreement.

To date, the company is engrossed with the task to recapitalise and resuscitate mining operations as well as to establish a single processing unit at Golden Quarry Mine, the nucleus of Shurugwi gold deposits.

Market capitalisation stood at $3 334 954 with a share price 3,00 cents as updated January 14, 2020.

 

Ian Saunders is the group chief executive officer.

 

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