Caledonia Mining Corporation (CALq.L) plans to invest 132 million US dollars in 2026 to launch development of the Bilboes gold mine, which is expected to become Zimbabwe’s largest once operational, the company said on Wednesday, according to Reuters.

The investment forms part of a broader 162.5 million US dollars capital expenditure programme for the year, subject to board approval and funding availability, the company said in a production update. Caledonia already operates the Blanket mine in Zimbabwe, which produces around 80,000 ounces of gold annually.

Bilboes is projected to cost 584 million US dollars in total and is expected to begin production in late 2028. Steady-state output is anticipated at 200,000 ounces per year from 2029, with the initial operational period planned for 10 years.

The company intends to finance the project through a combination of non-recourse senior debt, contributions from existing operations, and specialised financing arrangements such as streaming, where investors provide upfront cash in exchange for future metal supply.

Caledonia’s expansion ambitions have been supported by recent market conditions. Spot gold prices reached a record $4,639.48 an ounce early on Wednesday, driven by rising geopolitical tensions in Iran, questions over the Federal Reserve’s independence, and softer inflation data that increased expectations of potential rate cuts.

The company’s plans also received a regulatory boost last month, when Zimbabwe’s government reversed proposals to double the gold royalty rate and amend the tax treatment of capital expenditure.