Falgold to resume explorations

HARARE - Zimbabwe Stock Exchange-listed resources group Falcon Gold (Falgold) said it is planning to resume exploration works it had stopped last year due to the country’s worsening economic condition.

The group’s executive chairman, Ian Saunders, said there were chances that Falgold could perform better in 2017.

“Notwithstanding the fact that the group had previously stopped all exploration and new project developments during fiscal 2016, efforts are now in place to carry out some limited exploration activities and to implement previously planned and mooted projects for commissioning during the current fiscal year and beyond,” he said.

Saunders, however, noted that the pace at which this can be done will be accelerated by the proceeds from the sale of Dalny Mine.

In mid-2016, Falgold reached an agreement to sell its Dalny Mine, which has been under care and maintenance since 2013, to RioZim.

The agreement involves the purchase of Falgold subsidiary, Palatial Gold Investments which owns the Dalny Mine Complex.

The complex includes the mine, a gold processing plant, several surrounding gold claims as well as equipment and a mining compound.

RioZim has been leasing the complex under a nine-month agreement signed in April.

The two miners did not disclose the financial details of the agreement but back in 2014, Falgold sold Dalny Mine to African Consolidated Resources for $8 million.

The deal collapsed after the UK-based miner failed to raise the funds.

This is not the first time that Falgold has disposed its assets as it sold off the majority of its shareholding in Venice Mine near Kadoma in June 2015.

Falgold, which is 84,7 percent owned by Canadian-listed New Dawn Mining Corporation, however, still owns Turk Mine near Bulawayo and the Golden Quarry Mine in Shurugwi.

Saunders noted that although the group remains in distress, management believes that during fiscal 2017 the efforts being pursued have the potential for the group to realise an improved operating performance and subsequent financial position, with the possibility of arriving at more than a cash neutral position by the end of the fiscal year.

“These efforts will include serious attention to controlling costs and a continuing focus on increasing production and, subject to the trends in the price of gold revenues,” he said.

“Surviving the initial months of fiscal 2017 is requiring a concerted partnership with creditors and support from all staff as the group strives for survival.

“After that, however, the group is hopeful that the worst will have been overcome and that the Group can operate on an even keel,” he added.

Post a comment

Readers are kindly requested to refrain from using abusive, vulgar, racist, tribalistic, sexist, discriminatory and hurtful language when posting their comments on the Daily News website.
Those who transgress this civilised etiquette will be barred from contributing to our online discussions.
- Editor

Your email address will not be shared.