Pan African Mining injects $11,5m in operations

via Pan African Mining injects $11,5m in operations | The Herald October 29, 2014

Gold producer Pan African Mining said it has injected $11,5 million in its operations in the past 12 months which has translated into improved output. The mining firm operates the Ayrshire and Muriel Mines in Mutorashanga, Mashonaland West Province.

PAM chairman Victor Gapare told New Ziana that a total of $11,5 million had been injected into the company by shareholders.

“We have injected $11,5 million into PAM in the last 12 months with $9 million having been injected into the company in April this year,” he said.

He said production at Ayrshire, as a result, has surged from 5 kg-20 kg per month while output at was now up to 17kg from around 10kg in June.

Mr Gapare said the miner was, however, still in need of capital injection amounting to $20 million.

“PAM requires another US$20 million to ensure that exploration and development is carried out, obsolete equipment replaced and working capital regularised. We are in the process of talking to our shareholders and debt markets for this additional funding. However, the Zimbabwe risk is driving away foreign direct investment. We need to improve the investment environment as a country to ensure that we can compete for FDI,” he added.

Mr Gapare said the miner would in the long term consolidate its business and grow it into a mid-tier gold producing business with a minimum production of 200 000 ounces per year.

Earlier this year it was also reported that PAM had power supplies disconnected over a $1 million bill. Mr Gapare said high electricity tariffs charged by the Zimbabwe Electricity Transmission and Distribution Company on gold producers was impacting negatively on production.

“The electricity tariff at 13 cents per kilo watt hour is too high. The target should be nine cents, which everyone else in the economy is paying. “

There is no justification for ZETDC to be charging 13 cents to gold producers when everyone else pays nine cents,” he added.

Mr Gapare also said five percent royalties charged by the Government was too high and must be reduced to at most three percent.

In 2013, the country’s gold output marginally fell by two percent to 12,66 tonnes after Government banned all mining activities along river banks to halt environmental degradation. – New Ziana.