Mutapa plans US$152m Shamva gold expansion, output target 200kg monthly by 2028

Mutapa plans US$152m Shamva gold expansion, output target 200kg monthly by 2028

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HARARE — Mutapa Gold Resources says it will spend US$152 million to expand Shamva Mine, a move expected to allow the operation to process its own ore for the first time and raise production to about 200 kilogrammes of gold a month by 2028.

Chief executive Patrick Maseva-Shayawabaya this week presented the plan to stakeholders, describing the Shamva Hill Project as the company’s principal undertaking over the next three years. The expansion includes an open-cast mine of about two million tonnes and a dedicated processing plant at Shamva.

“This is the most important project we will be engaged in,” Maseva-Shayawabaya said. “It will result in Shamva mining and milling its ore at Shamva. There will be no trucking of ore to Freda.”

Shamva currently produces about 66 kilogrammes of gold a month but lacks its own milling capacity. Its ore is transported roughly 30 kilometres to the Freda Rebecca plant, where a 600,000-tonne-a-year line is dedicated to processing Shamva material. The chief executive said motorists on the Shamva–Bindura road regularly see trucks moving ore between the two sites.

Under the new plan, Shamva will stop sending ore to Freda Rebecca once its processing plant is commissioned. Mutapa says the change will underpin a step-up in Shamva’s output to around 200 kilogrammes a month by 2028, about three times current levels.

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The company also pointed to Shamva’s mine life as a key factor behind the investment. Mutapa estimates Shamva has reserves for 14 to 15 years, above the group’s internal threshold of 10 years.

Construction is scheduled to begin in August, with funding structured in phases. Mutapa says a first tranche of US$75 million has already been secured from a syndicate of four local banks, while the remainder is still being negotiated.

According to Maseva-Shayawabaya, domestic lenders have indicated they could provide close to US$90 million in total. “The banking sector in Zimbabwe has risen to the challenge of providing the funding we require,” he said. “At the last count it will probably be about US$90 million that will come from the local banks.”

The Shamva expansion sits within a broader production strategy across Mutapa’s five locations. The group currently produces about 300 kilogrammes of gold a month, mainly from three operating mines.

Freda Rebecca remains the group’s largest producer at about 200 kilogrammes a month. However, Mutapa says Freda’s current life of mine is around four years, and management wants to extend it to at least 10 years while lifting output towards 270 kilogrammes a month. The company also acknowledged that when Shamva stops using Freda’s plant, the freed-up processing capacity will need alternative feed.

Jena Mine in the Midlands produces around 40 kilogrammes a month and is being positioned for growth. Mutapa said a US$2 million injection about a year ago lifted output from around 30 kilogrammes to the low 40s. The company is now scoping a first phase of expansion, expected to start in the final quarter of the financial year, with a target of 100 kilogrammes a month without heavy capital expenditure. Maseva-Shayawabaya called Jena “an unpolished diamond — the quality of that asset is the best we have in the group,” adding that “potentially, Jena is another Freda in the making”.

Mutapa’s other locations include Elvington, which hosts an artisanal-mining initiative, and a cluster of Kwekwe assets under care and maintenance.

Looking ahead, Mutapa projects total output could rise from about 300 kilogrammes a month currently to around 530 kilogrammes a month within two and a half to three years. For the current financial year, the company is targeting 3,400 kilogrammes — about 110,000 ounces — compared with 3,255 kilogrammes last year.

The company says exploration will be central to sustaining production, with a stated aim of lifting every operating unit to at least a 10-year life of mine. It drilled about 46,000 metres in the year to March and has set a target of around 82,000 metres for 2026.

Maseva-Shayawabaya said a softening gold price is the key downside risk to revenue and margins, and that the company’s response is to focus on controllable factors such as costs, mining discipline and plant efficiency.

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