Caledonia Mining Corporation has signed an interim financing agreement of up to US$150 million with eight Zimbabwean banks to keep construction of its Bilboes gold project moving while it finalises long-term project finance, the company said on 5 November.
The borrower is Caledonia Holdings Zimbabwe, the group's local subsidiary. Bilboes, in Matabeleland North, is expected to become Zimbabwe's biggest gold mine once it is built, according to Reuters.
How the facility works
“The support received from banking institutions and international capital markets investors reflects confidence in the quality of Bilboes.” — Mark Learmonth, CEO, Caledonia Mining
Stanbic Bank Zimbabwe, part of the Standard Bank Group, and CBZ Bank, acting through CBZ Capital, are the mandated lead arrangers. The syndicate also includes Central African Building Society (CABS), FBC Bank, FBC Crown Bank, First Capital Bank, NMB Bank and ZB Bank.
The facility runs for 36 months from its effective date, with an option to extend by a year. It has two parts. Facility A is a revolving credit line of up to US$50 million priced at SOFR plus 8.10% a year; Caledonia said first use of it depends on conditions that include putting additional gold hedging in place. Facility B is a term loan of up to US$100 million at SOFR plus 7.90%, with an accordion that could add a further US$50 million. It has an 18-month availability period with no capital repayments, after which drawn amounts are repaid quarterly.
Three of four funding pillars in place
Caledonia describes the facility as the third pillar of a four-part funding plan for Bilboes. In December 2025 it bought put options on 3,000 ounces of gold a month through December 2028, setting a floor of US$3,500 an ounce on part of Blanket Mine's output. In January 2026 it completed an upsized US$150 million convertible notes offering that raised about US$130 million net. The fourth pillar, long-term project finance from regional and international lenders, is still under negotiation, with due diligence running alongside the new facility.
Reuters reported that Bilboes is expected to cost US$584 million in total, with a peak funding requirement of US$484 million, and to produce about 200,000 ounces a year from 2029. Blanket, Caledonia's producing mine, delivers about 80,000 ounces a year.
Construction timeline
Initial ground works are under way at Bilboes, and main construction is planned for 2027 and 2028. Caledonia said the project remains on track for first gold in October 2028.
Chief executive Mark Learmonth said the backing from banks and international investors "reflects confidence in the quality of Bilboes, our development approach and the broader outlook for Zimbabwe's gold mining sector." He thanked Stanbic and CBZ as lead arrangers, along with the other six lenders.
Why it matters
A US$150 million syndicated loan from local banks is a large vote of confidence in Zimbabwean mining from the country's own financial sector. It comes as Zimbabwe's gold output hit a record 46.7 tonnes in 2025, up from 36.5 tonnes in 2024, according to Reuters. If Bilboes reaches 200,000 ounces a year, it would take Caledonia's total output to more than three times today's level and add materially to national gold exports, jobs and royalties in Matabeleland North.