RioZim shareholders negotiate rights issue

HARARE - RioZim Limited says it is still negotiating with shareholders over plans to embark on a rights issue to raise funds to resuscitate its Cam & Motor gold mine.

The Kadoma-based mine — once Zimbabwe’s largest gold producer — was mothballed in 1968, and RioZim says it still has capacity to produce 4000 ounces per month.

“The company… seeks funding from shareholders in the form of a rights issue,” the Zimbabwe Stock Exchange-listed resources group advised shareholders, but did not disclose the amount required.

Early this year, trials were done on the mine’s waste, with impressive results while a deep drilling programme was commenced in April 2010 to determine resources between the 100 and 400 metre depth.

A new plant to replace the current out-dated one is being designed in China.

RioZim also plans to switch to open cast mining from the underground concept Cam & Motor used.

In June, the miner said it had secured $45 million targeted at settling its $40 million bank debt.

About two years ago, RioZim owed $91 million, including $60 million in accrued interest.

In this year’s first quarter, the miner’s gold production declined due to heavy rains that affected its Masvingo-based Renco Mine.

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