Caledonia Mining has started the direct sale of gold produced from the Blanket Mine to a refiner outside Zimbabwe.

Prior to this arrangement, the company had been selling gold to the Fidelity Printers Refineries owned by the Reserve Bank of Zimbabwe.

Owing to this development, gold held by FGR is now exported to a refinery outside Zimbabwe with the receiving foreign refinery undertaking the final refining process and selling the gold on behalf of Caledonia.

Caledonia would then receive the proceeds of the gold sales directly into its bank account in Zimbabwe within a few days of delivery to the final refinery.

Blanket pays a royalty of 5% of its production while 75% of its revenues are received in US$ and the balance in local currency.

Mark Learmonth, Caledonia’s chief executive, said: “This arrangement is a big milestone for Caledonia and further demonstrates the pragmatic approach of the Zimbabwe authorities to resolve commercial issues facing gold producers.

“This new arrangement should be seen in the context of Caledonia’s planned expansion in Zim, initially at Bilboes and thereafter at Motapa and Maligreen: this new marketing arrangement should make it easier for Caledonia to arrange debt facilities with funders outside Zim.”