Padenga splurges US$21m on mining expansion

RYAN CHIGOCHE

 

VFEX-listed diversified firm, Padenga Holdings, will invest US$21m  on gold  mining  expansion projects this year as it seeks to capitalise on booming gold prices due to the Russia-Ukraine war, CEO Mark Nicolle has said.

Padenga through its gold investment vehicle, Dallaglio, operates Pickstone Mine in Chegutu district, Mashonaland West Province  and Eureka Mine in Guruve district, Mashonaland Central Province.

‘This current geopolitical situation (Russia-Ukraine conflict)  is very interesting for us because firstly, it destabilises the world (and) drives capital into gold which is a safe haven.  Gold prices therefore increase,” Nicolle told Business Times.

He added: “So it does benefit our revenue line and with the huge expansion plan that we have on the table we want to accelerate the project  to bring further production just to add to the topline.

“We have set aside US$21m this year for capital expansion projects  taking advantage of the firming commodity prices.”

Nicolle said the bulk of the money will be spent on the redevelopment,  re-equipping and refurbishment of the Pickstone Peer Mine, which has an underground that extends down more than 740metres.

Zimbabwe’s  gold producers have been raking up revenue as a result of high commodity prices.

The current gold prices per ounce is US$1 874 and the price is expected to continue rising.

Nicolle expects high grade ores  from Pickstone Mine.

“The company believes that the ore coming from there will hit our mills at a very high grade. It’s quite an exciting project for us and we are focusing on it very much this year,’’ he said.

Nicolle also disclosed that Padenga will in future look to acquire  more gold mines but only after the company maximised the capacity of two mines-Pickstone and Eureka.

“Zimbabwe has a very attractive resource base that is something that we at Dallaglio want to move to develop over time.

“We want to expand and I believe Zimbabwe is a very great market to expand in gold production. But, our main focus in the short term is bedding down Eureka which is a huge addition to our stable and making sure that have are predictable, repeatable businesses in our operations before we chase expansion,’’ he said.

He added: ‘’The team has a target to reach stable production for both gold mines which is a great opportunity for us to build on going forward in the Zimbabwe market.’’

Padenga is also a leader in crocodile farming.

 

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