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Note 18 - Property, Plant and Equipment

12 Months Ended

Dec. 31, 2023

Disclosure of property, plant and equipment [text block]

18	Property, plant and equipment

Cost

Land

and Buildings

Right of

use assets

Mine development, infrastructure and other

Assets under construction and decommissioning assets

Plant

and equipment

Furniture and

fittings

Motor vehicles

Solar

Plant^&

Total

Balance at January 1, 2022

14,435

543

73,914

35,476

64,319

1,342

3,169

1,940

195,138

Additions*

–

31,711

3,049

243

147

12,198

47,348

Impairments^@

–

(8,518

)

–

(998

)

–

(9,516

)

Reallocations between asset classes

759

–

15,886

(20,734

)

4,089

–

Acquisition of Bilboes oxide assets (Tribute) (note 5)

–

872

–

872

Foreign exchange movement

–

(18

)

–

(22

)

–

(16

)

Balance at December 31, 2022

15,194

525

82,154

46,453

70,485

1,563

3,314

14,138

233,826

Balance at January 1, 2023

15,194

525

82,154

46,453

70,485

1,563

3,314

14,138

233,826

Additions*

–

28,276

538

335

294

163

29,606

Impairments^~

–

(872

)

–

(36

)

–

(908

)

Disposals

–

(33

)

–

(33

)

Reallocations between asset classes

1,492

–

37,116

(39,099

)

491

–

Reallocate to assets held for sale

–

(14,301

)

(14,301

)

Foreign exchange movement

–

(24

)

–

)

–

(37

)

–

(66

)

Balance at December 31, 2023

16,686

501

118,398

35,628

71,445

1,861

3,605

–

248,124

*	Included in additions is the change in estimate for the decommissioning asset of $1,962 (2022: ($468))
^@	Included in the 2022 impairments are development asset costs of $8,518 that predominantly relates to prospective areas above 750 meters at Blanket which are not included in the LoMP. Also included in the 2022 impairments are generator cost of $791 and loader bottom decks at a cost of $101; these assets were no longer in working condition. The carrying amount for these impaired assets were impaired to $Nil.
^&	The solar plant was fully commissioned on February 2, 2023 and the sale agreement between Caledonia Mining Corporation Plc and Caledonia Mining Services (Private) Limited was concluded for the sale of the solar plant. Depreciation on the solar plant commenced on February 2, 2023 and the power purchase agreement, between Caledonia Mining Services (Private) Limited and Blanket Mine, became effective. From September 28, 2023 the solar plant is classified as held for sale. In December 2022, the Caledonia board approved a proposal for Caledonia Mining Services (Private) Limited (which owns the solar plant) to issue loan notes pursuant to a loan note instrument (“bonds”) up to a value of $12 million. The decision was taken in order to optimise the capital structure of the Group and provide additional debt instruments to the Zimbabwean financial market. Refer to note 30.2 for more information on these loan notes.
^~	On June 27, 2023 the decision was taken to place the Bilboes oxide mine on care and maintenance as the cost related to removing the waste and accessing the orebody could exceed the benefit from the gold revenues to be received. The impairment loss that was recognised amounted to a carrying value of $851 on impairing the Bilboes oxide asset classified under mine development, infrastructure and other. Mining and metallurgical processing continued at the Bilboes oxide mine until the end of September 2023 when the contract miner's notice period came to an end. Leaching of material that has already been deposited on the leach pad will continue while the revenue from these activities contributes to the cost of the asset. Oxide mining and processing will resume when the stripping of the waste for the sulphide project commences and can be economically justified.

18	Property, plant and equipment (continued)

Accumulated depreciation and Impairment losses

Land and
Buildings

Right of
use assets

Mine
development,
infrastructure
and other

Assets under
construction and
decommissioning
assets

Plant and
equipment

Furniture
and
fittings

Motor
vehicles

Solar
Plant

Total

Balance at January 1, 2022

7,335

8,910

600

25,505

958

2,631

–

46,036

Depreciation for the year

1,015

137

3,990

4,527

163

216

–

10,141

Accumulated depreciation - impairments

–

(532

)

–

(775

)

–

(1,307

)

Foreign exchange movement

–

)

–

(21

)

–

(27

)

Balance at December 31, 2022

8,350

230

12,368

693

29,257

1,100

2,845

–

54,843

Balance at January 1, 2023

8,350

230

12,368

693

29,257

1,100

2,845

–

54,843

Depreciation for the year

1,012

124

5,459

6,573

185

258

782

14,486

Accumulated depreciation for assets reallocated to assets held for sale

–

(782

)

(782

)

Accumulated depreciation - impairments

–

(21

)

–

(10

)

–

(31

)

Foreign exchange movement

–

)

–

(30

)

–

(41

)

Balance at December 31, 2023

9,362

345

17,806

786

35,820

1,255

3,101

–

68,475

Carrying amounts

At December 31, 2022

6,844

295

69,786

45,760

41,228

463

469

14,138

178,983

At December 31, 2023

7,324

156

100,592

34,842

35,625

606

504

–

179,649

18	Property, plant and equipment (continued)

(a)

Impairment considerations

At year end management identified indicators of impairment at the Blanket CGU. The Blanket CGU excluded the Solar plant that is classified as held for sale at December 31, 2023. No impairment indicators were identified at other CGUs nor at a consolidated level, excluding the Blanket CGU. In calculating the recoverable amount, of the Blanket CGU, the recoverable amount significantly exceeded the carrying value. Management used the following assumptions as their best estimate:

●	Gold price per ounce ranging from $1,748 to $2,034.

●	Life of mine (“LoM”) to 2041 (that is inclusive of inferred resources and it based on an internal estimate representing management’s best estimate of the LoM inclusive of the latest drilling results).

●	grade ranging between 3.14g/t to 3.29g/t.

●	Production ounces between 77,822 and 81,446 per annum over the LoM.

●	On mine cost of between $892 to $1,427 (real) over the LoM.

●	Peak capex of $30.8 million.

●	Weighted average cost of capital of 15.4%.

●	Income tax of 25.75% on taxable income.

Items of property, plant and equipment are depreciated over the LoM, which includes planned production from inferred resources. These inferred resources are included in the calculation when the economic recovery thereof is demonstrated by the achieved recovered grade relative to the mine’s pay limit for the period 2006 to 2018. The pay limit is 2.10 g/t (2022: 2.10 g/t) while the recovered grade has ranged from 2.96 g/t to 3.24 g/t over the period. All-in-sustaining-cost has remained consistently below the gold price received over this period resulting in economic recovery of the inferred resources.

(b)

Change in estimate

In April 2023 management performed an operational efficiency review of its mining related equipment, which resulted in changes in the expected useful life of some of the assets included under mine, development, infrastructure and other and plant and equipment asset classes.

(i)

Mine, development, infrastructure and other

In August 2015 the Blanket Mine announced the construction of a new central shaft going down to 1,200m from surface, providing access for horizontal development in two directions on three levels below 750m. The aim was to increase production to annual levels of 75,000 to 80,000 ounces per year and extend the LoM. The Company commissioned the central shaft in the first quarter of 2021.This shaft is used for hoisting ore and people. Prior to commissioning of the central shaft, men were hoisted through the existing Jethro shaft which was constructed around 2009. With the commissioning of the central shaft, there will be a gradual decrease in the usage of the Jethro shaft for hoisting until decommissioning. The Jethro shaft is expected to be decommissioned in March 2025. Future economic benefits are expected to flow to the entity until the shaft is decommissioned.

The Company estimates Blanket will produce 160,000 ounces until the Jethro shaft is decommissioned, previously estimated over the LoM.

18	Property, plant and equipment (continued)

(b)

Change in estimate

(ii)

Plant and equipment

In carrying out a comprehensive asset’s useful life assessment, the following factors were considered in determining the useful life of an asset:

●

expected physical wear and tear, which depends on operational factors such as the number of shifts for which the asset is to be used, the current repair and maintenance programme, and the care and maintenance of the asset while idle; and

●

the expected usage of the asset.

An analysis of the various asset categories for which exceptions were identified during the assessment process are generators, load haul dump machines (“LHDs”), dump trucks, rock breakers and drill rigs. Previously estimated with a ten-year useful life, this plant and equipment is now estimated to have a useful life of five years from April 1, 2023.

Notwithstanding any future addition to the above-mentioned assets, the effect of the change in useful life on actual and expected depreciation expense, effective for the year ended December 31, 2023, is as follows:

Increase in depreciation expense from April 1, 2023 to December 31, 2023
Mine, development, infrastructure and other			856
Plant and equipment			1,302
			2,158

The above results are a change in estimates and applied prospectively from April 1, 2023.

(c)

Non-cash items excluded from acquisition of property, plant and equipment:

	2023			2022

Net property, plant and equipment included in prepayments		329			(4,445	)
Net property, plant and equipment included in trade and other payables		583			(1,876	)
Bilboes oxide project payable (note 29)		–			(872	)
Change in estimate for decommissioning asset - adjustment capitalised in property, plant and equipment (note 18)		(1,962	)		468
		(1,050	)		(6,725	)

(d)

Capital commitments

The amount of contractual commitment for the acquisition of property, plant and equipment at December 31, 2023 amounted to $2,035 (2022: $4,066).