Businessman Tawanda Nyambirai is set to invest $12 million in Arcturus Mine, which he acquired from Metallon Gold Zimbabwe, amid revelations he is planning further investments into mining with exploration for Greenfield projects in Kadoma already underway.
Arcturus Mine had been under care and maintenance after running into a financial problems some of which caused its closure in 2016.
Nyambirai told BusinessWeekly that he had moved into mining, but was not looking for more brownfield assets after buying Arcturus.
“We also have some Greenfield gold assets in Kadoma that we are currently exploring. Our hands are currently full. We will not be in a hurry to look for more mines,” said Nyambirai.
A due diligence exercise conducted on Acturus Mine had concluded that the mine was closed because, exploration and development lagged exploitation.
Reluctantly, Arcturus mined out while staff costs were sustainably high and were not related to productivity. Electricity costs were also too high, driven by old and inefficient equipment.
Total investment into the gold mine is expected to be in the region of $12 million, after factoring in the costs of acquiring the gold mine, taking over its legacy debts, retrenching old staff, capital expenditure and operating expenditure to rejuvenate operations.
To get Arcturus back to viability, Nyambirai said they had invested in exploration equipment, including a brand new Boyles C6C surface diamond drilling rig with capacity to drill 1 200m NQ and is acquiring new electric equipment with voltage of 380 instead of 520.
“We are building our milling capacity to a minimum of 60 tonnes per hour. We are building a floatation plant in order to reduce the quantity and therefore cost of chemicals used by the cyanidation plant.
“If we put together the costs of acquiring the mine, taking over the debts, retrenching old staff, capital expenditure and operating expenditure to relaunch of operations, we estimate the total investment to approximately $12 million,” said Nyambirai.
He added that it would take time to get it into full production at Arcturus Mine.
Asked why he had decided to venture into the mining sector, which has been under care and maintenance. Nyambirai said the due diligence on Arcturus exercise concluded that the mine was a good asset that could be turned around and was reasonably priced.
In terms of the timelines for the re-opening of the mine, he said, “Although we have a target of six months, we might be delayed due to the unavailability of foreign currency that we need to import critical equipment, including the flotation plant.”
Arcturus Mine has been operating since 1907 and after dollarisation the mine failed to operate at full capacity due to antiquated equipment and poor global mineral prices.
The gold mine was placed under care and maintenance in 2009 and resumed operations in 2013. Arcturus Mine comprises four underground mining operations which are Venus, Gladstone, Ceylon and Viceroy.
At Arcturus Mine, ore was being processed through conventional crushing, milling, gravity recovery and a combination of carbon-in-solution and pulp processes.