Approximately one and a half years after Barrick subsidiary Bulyanhulu Gold Mine Limited (“Buly”) acquired six licences surrounding the core Tembo Gold Corp. licence (TSX-V: TEM; FSE: T23), systematic exploration progress is being made. With the closing of the transaction in April 2022, Buly had committed to invest US$9 million in exploration over four years. As Tembo Gold now announces, Buly’s expenditure to date currently amounts to US$936,000. According to the contract, Buly will therefore have to invest more than US$ 8 million over the next two and a half years. Barrick Gold (NYSE: GOLD) has been a shareholder of Tembo since the acquisition of the Tembo licences and holds 5,518,764 shares in Tembo Gold.
In recent months, large-scale reconnaissance mapping and geophysical surveys have led to an update of the camp-scale geological model. Barrick geologists have identified targets along structural trends in favourable host lithologies that have been prioritised for follow-up, Tembo Gold reports. In Q4 2022, 230 km of Gradient Array Induced Polarisation (GAIP) and 18.85 km of Dipole-Dipole Induced Polarisation (DPDP) were completed. This work has confirmed the high-grade potential of the area. Sampling of quartz veins returned values including 39.5 g/t Au and 38.7 g/t Au as well as lower grade samples of 1.5 g/t and <0.4 g/t.
Aircore drilling initiated
Recent activities included a 10,000 metre aircore drilling programme (50m drill hole interval along 400m long lines). 57 holes totalling 1479 metres were completed in Q3 2023. The timely completion of this drilling depends on the start of the rainy season in the fourth quarter. A single 251.50m diamond drill hole was drilled in an area of interest to confirm the geological structure. No significant results were obtained.
Hendrik Meiring, Tembo’s Exploration Manager, commented: “The work carried out by Buly’s exploration team will lead to a better understanding of the camp-scale model with the aim of increasing the proven gold resource in the area. “
David Scott, President & CEO of Tembo, said: “We are encouraged to see that work on the licences Tembo has sold to Barrick is beginning to accelerate with approximately 90% of the US$9,000,000 still to be spent.”
Conclusion: While Tembo Gold has temporarily suspended its own exploration work on the remaining Tembo licence, Barrick geologists are systematically working through their exploration plan on the surrounding licences. The pace and intensity of this work is expected to accelerate significantly in the future. Over the next two and a half years, Buly will have to invest more than US$ 8 million in exploration. A discovery by Buly would immediately pay off financially for Tembo Gold. The agreed maximum payment in the best-case scenario is US$ 45 million. But even so, the additional work around the Tembo core licence is likely to increase its value. Firstly, the understanding of the mineralisation is growing and secondly, some of the interesting discoveries are directly adjacent to the Tembo licence or continue there.
Meanwhile, Tembo itself is working purposefully on its transformation from explorer to prospective producer. Tembo has recently acquired the advanced projects Imwelo and Dora, located approximately 12 kilometres from AngloGold Ashanti's flagship Geita gold mine. Added to this is the strategic partnership with the Taifa Group. Taifa is Tanzania's largest private mining company with more than 30 years of experience. The Taifa Group intends to become a major shareholder in Tembo and, linked to the milestones in the acquisition of Imwelo and Dora, has committed a total of CAD 11.2 million. The first instalment of C$ 3.25 million arrived at Tembo just a few days ago. We remain convinced that patience will pay off for Tembo shareholders.
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