Business Reporter
Bindura based gold producer Freda Rebecca is considering reviewing its tailings retreatment project due to prevailing depressed gold prices on the world market, the company’s managing director Mr Toindepi Muganyi said. World gold prices are currently hovering at around $1 200 per ounce and in 2013 the economic potential of recovering gold from Freda Rebecca’s tailings dumps was evaluated and the company initiated the construction of a pilot recovery plant.
The pilot plant was commissioned and tested to see if it was economically viable to recover gold from the tailings.
“We are reviewing the current strategy with regards to concerns over the prevailing gold prices on the market,” said Mr Muganyi.
In the first half of this year gold prices were at about $1 300 per ounce but due to subdued demand on the market, the prices have continuously been on a dip.
It is estimated that Freda Rebecca had accumulated about 13 million tonnes of gold-bearing tailings in its three main storage facilities within the mine lease area.
The tailings project was aimed at raising output to 100 000 ounces or four tonnes annualised by 2015.
The project was being evaluated on a pilot basis to see the viability and economic potential of recovering gold from the tailings dumps.
Most mines in Zimbabwe are currently operating slightly above 50 percent of their capacities due to lack of finances for recapitalisation and this according to the Chamber of Mines is expected hamper growth in the sector.
Mr Muganyi said growth in the gold sector is set to be moderate due to the lack of capital investment in
mineral development and exploration.
He said gold producers through the Chamber of Mines are currently engaging Government with regards to the reduction energy tariffs in line with current gold prices.
“The gold producers are paying electricity at a higher tariff of 14 cents per kilowatt hour while the rest of the industry including domestic consumption being around 10 cents per kilowatt hour.
“So if mining is going to spur any growth it is important that we revisit our priorities and make sure that affordable electricity goes to the gold miners,” said Mr Muganyi.
He said the move to reduce tariffs then implies that the gold miners become more sustainable and increase their production on the back of declining gold prices.
Mr Muganyi said reduction in royalties is a welcome development and a reprieve to the gold mining sector as subdued gold prices continues to take a toll on gold miners.
He said in terms of the growth in the gold sector, growth is premised on investments in terms of capital equipment.