Katoro Gold PLC Update on Tanzanian Assets (9800C)

TIDMKAT

RNS Number : 9800C

Katoro Gold PLC

14 February 2020

Katoro Gold plc (Incorporated in England and Wales )

( Registration Number: 9306219)

Share code on AIM: KAT

ISIN: GB00BSNBL022

   ("Katoro" or  "the   Company") 

14 February 2020

Katoro Gold plc ('Katoro' or the 'Company')

UPDATE ON TANZANIAN ASSETS

Katoro Gold plc (AIM: KAT), the gold and nickel exploration and development focused company , has recently provided updates in respect of its Blyvoor gold production joint venture ('the Blyvoor JV') where good progress has been made to date and where multiple work streams are underway at present. Further updates in respect of the Blyvoor JV will be provided as material developments occur.

We would like to take this opportunity to update shareholders, with regard to the Company's primary Tanzanian assets, being its interests in the Imweru Gold Project and Haneti Polymetalic Project.

IMWERU GOLD PROJECT

-- On 22 August 2019, the Company announced that it had agreed a term sheet for the potential disposal of the Company's 100% owned subsidiary Reef Miners Limited, which holds 100% of the Imweru and Lubando gold projects in northern Tanzania in a transaction with Lake Victoria Goldfields Limited ('LVG') for a total staged cash consideration of up to US$1.0 million and a 1.5% n et s melter r oyalty (the 'Transaction') ;

-- As previously announced, the Company granted various extensions to LVG to complete the Transaction, with Katoro receiving 700,000 LVG shares with a value of AUS$70,000 (approximately US$47,230) in recognition of the extensions;

-- On 1 November 2019, the Company announced that LVG had not yet completed on the Transaction and that the Company had decided to not grant a formal extension to the exclusivity period, though it agreed to continue working with LVG whilst also considering potential interest from other third parties;

-- The Company is pleased to confirm that good progress has been made with LVG and that, whilst there is no guarantee, the board of Katoro ('Board') hopes to be able to conclude the Transaction; and

-- The Company confirms that if the Transaction does proceed, it will be subject to Katoro shareholder approval pursuant to Rule 15 of the AIM Rules for Companies.

HANETI PROJECT

-- On 8 October 2019, Katoro provided an update to shareholders in respect of the Haneti Polymetalic Project in central Tanzania;

-- Haneti is a polymetallic system with identified potential for nickel (sulphide and laterite), Platinum Group Metals ('PGMs'), copper, gold, lithium and rare earth elements ('REEs');

-- Within the approximately 5,000 sq. km project area, the principle target zone is an 80 km long ultramafic belt with grades from surface sampling of up to 13.6% nickel and 2.33 g/t combined platinum and palladium ;

-- Within the 80 km ultramafic belt is the principle target, Mihanza Hill, where 2015 geophysical work identified significant extensions to nickel sulphide prospective target rock formations and geochemical interpretation has identified prospectivity for chonolith type nickel-copper-PGM mineralisation;

-- Mihanza Hill is believed by the Company, based on desktop work undertaken, to have the potential to host a similar style of mineralisation to the Sipa Resources Limited (ASX:SRI) Akelikongo nickel project in Uganda;

-- Katoro has been developing, subject to funding, plans to implement a drill programme at Haneti, focused on nickel sulphide and PGM targets at Mihanza Hill and Mwaka Hill, the two priority targets;

-- The Company continues to explore all funding options for the advancement of Haneti, which may include further join ventures or farm-ins; and

-- The recent feedback received at the Mining Indaba conference in Cape Town, South Africa in early February 2020, included considerable interest in large scale nickel exploration projects, from mid-tier and Tier 1 mining companies, and demonstrated to the Board the strategic value of Haneti.

Current Haneti Project Ownership Structure

Katoro has a 75% interest in Haneti. Development of Haneti is being advanced in tandem with its joint venture partner, Power Metal Resources plc (LON:POW) ('Power Metal'), which has the remaining 25% interest in Haneti and a right to acquire a further 10% interest from Katoro to increase its interest to 35%, through a cash payment of GBP25,000 to Katoro, until 15 May 2020.

The Company looks forward to keeping shareholders updated on progress across its Tanzanian assets and will make further announcements as appropriate.

Louis Coetzee, Executive Chairman of Katoro, said: " I am immensely proud of the work undertaken by the Katoro team in what we all believe is an exciting and potentially transformational phase for the Company.

"As we sit today, we have, subject to funding being secured, the Blyvoor JV offering the prospect of significant revenues from future gold production, the potential to monetise our interests in our Lake Victoria gold interests and upside from future exploration in respect of our Haneti Polymetallic deposit.

"These opportunities have been created and advanced during incredibly difficult market conditions and the Board believes the Company is well positioned for a recovering sector environment with business interests of substantial value and potential for shareholders. "

This announcement contains inside information as stipulated under the Market Abuse Regulations (EU) no. 596/2014.

**ENDS**

For further information please visit www.katorogold.com or contact:

 
 Louis Coetzee         [e-mail]   Katoro Gold plc         Executive Chairman 
 Richard Tulloch       [phone]         Strand Hanson Limited   Nominated Adviser 
  Ritchie Balmer        3494 
  Georgia Langoulant 
 Nick Emmerson         [phone]        SI Capital Ltd          Broker 
  Sam Lomanto           500 
 Isabel de Salis       [phone]         St Brides Partners      Investor and Media 
  Beth Melluish         1177                    Ltd                     Relations Adviser 
 

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February 14, 2020 02:00 ET (07:00 GMT)