StockMarketWire.com - Caledonia Mining said it had installed 6 megawatts of extra backup diesel generator capacity at its Blanket gold mine in Zimbabwe to insulate it from electricity supply outages.

The company said it was also evaluating a project to install solar photovoltaic generating capacity at Blanket to further reduce dependence on the electricity grid.

Blanket experienced electricity disruptions during the month of July and in early August, relying heavily on its installed diesel generator back-up capacity of about 12.5 megawatts.

That previous amount of capacity was sufficient to run the entire mine at full capacity, but insufficient to sustain both the mine and the central shaft project.

The additional 6 megawatts worth of generators were now on site and currently being installed.

They were expected to be operational within the month of October after which Blanket's operations would be 'fully insulated from the risk of unstable electricity supply', Caledonia Mining said.

Installing solar PV generating capacity could also reduce operating costs and ensure a more environmentally sustainable electricity supply, it added.

Caledonia Mining said the electricity supply situation at Blanket had improved substantially in late August and September thanks largely to a response from Zimbabwean government agencies.

Electricity was now priced in US dollars at a cost which was slightly lower than the pricing structure prior to the recent monetary devaluation, the company said.

'The electricity supply authorities have also implemented an uninterrupted power supply agreement for the mining industry in an effort to support the sector and electricity supply has stabilised following these changes,' it added.


At 1:54pm: [LON:CMCL] Caledonia Mining Corp share price was 0p at 565p



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