The main objective for African Gold in the coming year is to increase output and improve grade control at its gold mines in Zimbabwe, the company's chairman, Dr John Teeling said yesterday.
He said that if sufficient progress is made in terms of output and grade improvements, the company will be able to return significant profits.
For the year ended to March 31 African Gold made a loss of £56,080, mainly caused by the decline in gold prices, according to Dr Teeling.
He was speaking at an information meeting for Irish shareholders in Dublin, which followed its annual general meeting in London on Thursday.
Dr Teeling said he would like to see an average of five grams of gold per tonne of ore being produced at most its seven mines in the coming year. He said the only way to do this is to have greater tunnel development at the mines. "We simply have to get up to about 400 tonnes a day from the mines otherwise we will not be able to compete against the low gold price," said Dr Teeling.
At present the four mines at Beehive have a capacity of 300 tonnes per day while the three mines at Inez are capable of producing 200 tonnes per day.
He said one way to expand output is to extract non-refractory ore from the Beehive mine. About 30 per cent of the reserves at Beehive are non-refractory and capable of being treated without flotation, but this can take several months.
Dr Teeling said a refinery nearby will be needed to do the work but the end result should be extra ore.
If the output and grades are improved African Gold may consider acquiring other mines in Zimbabwe which are currently becoming available, said Mr Teeling.
Some shareholders complained about the company's low share price which is currently at 3p. Mr Teeling replied that gold producers around the world were all suffering from the market decline. "We are no better or worse than anyone else," he said.
Another shareholder said Dr Teeling was involved in too many companies and may not be able to concentrate sufficiently on African Gold. Dr Teeling said he was "vigorous" enough to pursue his various business interests.
