Milestone: Tembo Prospecting License Converted to Mining License

Canada’s Lake Victoria Gold (TSX.V LVG, Frankfurt A3E4WC) has achieved a true milestone on its Tembo project in northern Tanzania, as the previous prospecting license has been successfully converted into four mining permits!

Over 28 million US dollars have already been spent on exploration of the Tembo project property. Lake Victoria Gold therefore has access to the results of over 50,000 meters of drilling from core and reverse circulation drilling, as well as numerous soil samples and a wealth of geophysical data. The focus of previous investigations has been on three zones.

The Ngula 1 deposit is a 250-meter wide zone with multiple sub-parallel mineralized shear structures that extends over a strike length of at least 600 meters and remains open at depth and along strike. Particularly attractive drill intersections include 3.13 g/t gold over 25.89 meters, 8.50 g/t gold over 5.14 meters, 22.18 g/t gold over 15.00 meters, and 8.17 g/t gold over 11.05 meters.

The second deposit of great interest is located near the village of Nyakagwe. Several south-dipping mineralized structures have been identified here with a strike length of 600 meters. Particularly high gold grades were drilled here with 78.1 g/t gold over 1.00 meter, 24.72 g/t gold over 1.45 meters, 16.57 g/t gold over 3.55 meters, 27.88 g/t gold over 3.88 meters, and 12.96 g/t gold over 5.54 meters.

As the third outstanding zone, Nyakagwe East impresses with 300-meter wide quartz veins and sulfide mineralization. They contain 6.5 g/t gold over 7.46 meters, 19.1 g/t gold over 3.00 meters, 10.25 g/t gold over 3.50 meters, 9.73 g/t gold over 3.40 meters, and 8.44 g/t gold over 1.30 meters.

Lake Victoria Aims to Realize Tembo’s Exceptional Potential As Quickly As Possible

All of this results in an exceptional mining potential. It is confirmed by both historical and current drilling results. The geologists at Lake Victoria Gold believe that there is potential for an open-pit mine that could later transition into an underground operation. However, further drilling would be needed to confirm this.

By converting the prospecting license into mining permits, Lake Victoria Gold now has the legally guaranteed right to develop the Tembo project and establish a production facility on the project. Each of the four licenses is valid for ten years and includes the option to be extended for another ten years.

Accelerated Path to Production?

Another advantage of the project is its diversity, as it offers both short-term and medium to long-term production opportunities. Several areas within the mining licenses that contain near-surface high-grade mineralization suitable for potential development are of short-term interest. As processing facilities of other companies are located nearby, there is the possibility to accelerate production by utilizing these facilities.

Lake Victoria Gold is currently conducting a review to determine the most efficient development plan. This also includes examining the potential for establishing its own processing plant in the medium term. And regarding the current deposits, the final word is far from being spoken, as there is further potential and the chance to increase the resource further is high.

Drilling Program in Planning

To quickly realize this potential, Lake Victoria Gold is planning a new drilling program. It will consist of reverse circulation drilling and aims to convert the historically identified high-grade sections into resources and later into reserves in the medium term.

A GoldSpot study commissioned by the company some time ago identified 38 priority exploration targets, impressively underlining the great potential that Tembo also has at the district level. Future field work, including trenching, excavations, and near-surface RAB drilling, is planned to identify further interesting zones for expanding the gold mineralizations.

Can the Cooperation with Barrick Gold be Expanded?

The possibility of entering into a cooperation with Barrick Gold, which operates the Bulyanhulu mine not far away, is currently being intensively examined. Various forms of collaboration could be considered. Joint ventures, for example, would be possible, as well as financing partnerships. A solid foundation for such potential partnerships was already laid in December 2021, when the then Tembo Gold concluded a strategic transaction with Bulyanhulu Gold Mine Limited, a joint venture between Barrick Gold and the Government of Tanzania.

A potential closer cooperation with Barrick Gold would be interesting not only because Barrick is a financially strong partner. Barrick Gold’s geological and technical expertise would also greatly benefit the project and thus the shareholders of Lake Victoria Gold.

Against this background, the successful conversion of exploration licenses into mining licenses represents not only an important intermediate step but also a reason for celebration. In our view, it reveals several opportunities for Lake Victoria Gold to increase the company’s value in the short, medium, and long term.