Tanzanian Gold Corp. [TNX-TSX; TRX-NYSE American] announced that gold production has reached commercial level at the oxide ore processing plant at the 55%-owned Buckreef Project in north-central Tanzania. Under a Heads of Agreement concluded with the state-owned company, Tanzanian Royalty has the right to earn a 55% interest in Buckreef with state-owned Stamico holding 45%.
First bucket at the oxide open pit was on April 6, 2020. Since then oxide ore has been stockpiled at a ROM pad. Construction of the plant ended on May 28, 2020. The plant successfully completed both cold and hot commissioning and has now reached commercial production and is being operated 24/7 under two 12-hour operating shifts per day
A public tender for an increase in the treatment capacity of the oxide gold processing plant was recently completed. The company is planning to start construction to increase the processing capacity of the oxide plant capacity by approximately 200% in the fourth quarter of this year.
“I am delighted that we have achieved this important milestone in our gold production growth plan,” said James E. Sinclair, Executive Chairman. He went on to say that, “We are now well positioned to increase the production of gold significantly; and to accelerate our final feasibility on bringing a second, much larger plant on-line to produce more gold from processing the sulphide ore.”
An ongoing drill program has, to date, more than doubled the size of Measured and Indicated Resources to 2.036 million ounces. NI 43-101 compliant exploration mining targets have the potential to add up to another 2 million ounces. The company is rapidly advancing on three value-creating tracks, simultaneously: 1) Production from an oxide processing plant to operate as a separate, stand-alone plant for the full life of the larger sulphide mining and processing operation; 2) The company moves to Final Feasibility for the sulphide operation and now envisions a plant substantially larger than previously modelled, which could produce 150,000 to 175,000 ounces of gold annually. 3) The company has begun Ultra-Deep Drilling and completed a Level 1 stope design to consider an underground gold mining component at Buckreef and will start infill drilling to upgrade ounces currently in the Inferred category.
In June 17 trading, shares of Tanzaian Gold gained $0.09, or 8.3%, to $1.17 on a volume of 87,400 shares traded.