Caledonia Mining Corporation (AIM:CMCL) said surface exploration at its Blanket mine in Zimbabwe has uncovered a gold mineralised zone that has never been exploited by the underground operation.
The Zimbabwe-focused gold producer's K-Pits target sits roughly 200 metres east of the nearest projected underground orebody, suggesting a separate mineralised system rather than an extension of known workings.
Drilling confirmed both oxide and sulphide mineralisation, with highlights including 16 metres at 6.04 grams per tonne in sulphide material and 23 metres at 2.61 grams per tonne in oxide material.
The oxide zone is the more immediate opportunity, potentially suited to low-cost heap leaching rather than underground extraction.
Metallurgical test work on the oxide material is underway, and Caledonia said preliminary results are encouraging.
Chief executive Mark Learmonth said the company intends to launch a trial heap leach operation on an initial 10,000-tonne sample in the second half of 2026, subject to acceptable recovery rates from the ongoing test work.
"The potential to develop a low-cost processing route for this near-surface mineralisation could provide an attractive opportunity to complement Blanket's existing underground operations and unlock additional value," Learmonth said.
Caledonia expects to publish an updated Blanket resource statement in August, incorporating both the surface exploration results and recent underground drilling, alongside separate exploration work at its Motapa property.
Further drilling from surface and underground platforms is planned to test the mineralisation's extent at depth.
News Intelligence what this means for the company
Caledonia has identified a previously unknown gold mineralised zone (K-Pits) at Blanket, located 200 metres east of existing underground workings, with oxide material suited to low-cost heap leaching rather than underground mining. The company plans a 10,000-tonne trial heap leach in H2 2026 pending metallurgical test work, and will incorporate these results into an updated resource statement in August alongside recent underground drilling—a potential near-term production boost to complement Blanket's existing ~75,000–80,000 oz/year output.
The discovery of a separate, near-surface oxide zone amenable to cheaper processing could extend Blanket's mine life and improve unit economics without requiring underground capex, though the investment case hinges on metallurgical recovery rates and the scale of the oxide resource, both still being tested.
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