Caledonia Mining Corp. has agreed to buy one of Zimbabwe’s biggest gold mining projects as it seeks to expand in the southern African country.

Jersey-based Caledonia will buy Bilboes Gold for about $53.3 million in shares, plus a royalty on revenues, it said in a statement on Thursday. The purchase could make Caledonia Zimbabwe’s biggest gold producer, with the potential to more than double its annual output to over 200 000 ounces.

“We are delighted to have signed an agreement for the purchase of Bilboes, the premier gold development project in Zimbabwe, and indeed one of the best gold development projects in Africa,” Caledonia Chief Executive Officer Mark Learmonth said in the statement.

Bilboes, which owns the Isabella-McCays-Bubi mines in northwest Zimbabwe, can potentially produce about 168 000 ounces of gold, Caledonia said. The operations have been mothballed as the company’s owners searched for new investors and Caledonia will conduct further studies to determine the “most judicious way” to exploit the deposit, it said.

Caledonia, which has Cape Town-based fund manager Allan Gray as one of its biggest shareholder, already operates the Blanket mine in the southwest of Zimbabwe.