Senior Business Reporter
Southern African-focused metals and exploration firm Kavango Resources Plc said its entry into Zimbabwe's mining industry was a significant milestone that presented opportunities to invest in the lucrative local gold sector.
Gold is Zimbabwe's single largest export earner while the mining industry accounts for more than 75 percent of the country's annual shipments.
In 2023, the Southern African nation produced 30,1 tonnes of the yellow metal while the Government has set a target of 40 tonnes for 2024.
Gold exports are expected to generate US$4 billion annually for Zimbabwe from next year from around US$3 billion currently.
Kavango Resources, which entered the country's mining space last year, has investments in various minerals, including copper in neighbouring Botswana.
"During the year we acquired options over three projects in Zimbabwe, where we commenced work at a rapid pace.
"The greenstone belts in Zimbabwe host prospective rocks for bulk-mineable gold deposits, based on Kavango's internal review and analysis.
"Many of these belts share notable similarities with some of Australia's most prolific gold-producing regions.
"Zimbabwe was therefore seen as a high-potential destination for Kavango to invest into, and in June 2023 we were pleased to announce our entering into a two-year option agreement for the Nara project, covering 45 gold claims in western Zimbabwe (Matabeleland region)," said the company in a statement accompanying financial results for the year ended December 31, 2023.
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In May this year, Kavango, which is listed on the London Stock Exchange was reported to be in the market to raise £3,08 million (US$3,86 million) from 257,11 million new ordinary shares issued at 1,2 pence per share through an underwritten accelerated bookbuild.
The capital raise was meant to fund the company's Zimbabwe and Botswana projects.
The company has since entered into a strategic partnership with Pambili Natural Resources Corporation, which is listed on the Toronto Stock Exchange in Canada, to revive operations at Golden Valley Mine near Bulawayo.
In November last year, Pambili entered into a share purchase agreement to acquire the Golden Valley project, a gold-producing mine from White Satin Investments (Private) Limited, further signifying the firm's growth.
Meanwhile, Kavango plans to list on the United States dollar-denominated bourse, the Victoria Falls Stock Exchange (VFEX), a move expected to give Zimbabwe-based investors an opportunity to participate in the firm's exploration and mining development opportunities.
In return, this would provide the company with access to an enlarged pool of capital and shareholder base and meet its strategic objectives of fostering strong local ownership in its projects.
The VFEX was established in 2020 to spearhead the development of the International Financial Services Centre in Zimbabwe and is operating in a Special Economic Zone in Victoria Falls.
