TanGold Achieves Low Cash Costs and Significant Gross Margin on Gold Sales Reports Second Quarter Results
TanGold Achieves Low Cash Costs and Significant Gross Margin on Gold Sales
Reports Second Quarter Results
FOR IMMEDIATE RELEASE – April 14, 2022
TORONTO, April 14, 202 2 (GLOBE NEWSWIRE) - Tanzanian Gold Corporation (TSX:TNX) (NYSE
American:TRX) (TanGold or the Company) today announced results for the second quarter of 2022 (“Q2
2022”). Financial results for Q2 2022 will be available on the Company’s website and will be filed on SEDAR
and provided on EDGAR on April 14, 2022.
Q2 2022 was a significant milestone for the Company as, on account of gold sales, it was the first quarter
in the Company’s history in which it recorded: (i) revenues; (ii) a significant gross profit margin; (iii) low cash
cost1 of $796 per ounce of gold; and (iv) positive operating cash flow. These positive results, on just 1,812
ounces of gold sold, demonstrate the immense opportunity for the Buckreef Gold Project to generate
significant revenues and cash flow as the Buckreef Gold Project continues to develop. It also sets the stage
for the Company’s sustainable business p lan in which cash flow from operations funds value creating
activities, including exploration and sulphide project development.
Q2 Accomplishment and Highlights
• Achieved Low Cash Costs and High Gross Margins: The Company achieved low cash cost1 of $796
per ounce of gold and a significant gross margin of 57%. TanGold was operating cash flow positive
($1.5 million) in the quarter, the first time in the Company’s history. This was achieved on just 1,812
ounces of gold sold.
• Successful Processing Plant Expansion: The Company successfully ramped-up the first 360 tonne
per day (tpd) mill installation at Buckreef Gold to nameplate capacity. This is the first phase of 360 tpd
for the planned 1,000+ tpd processing plant. The 360 tpd expansion phase was completed on time and
on budget (capital cost of $1.6 million). The Company continues to expect production to be 750-800 oz
of gold per month2 at a total average cash cost1 of US$725-825/oz, in line with previous guidance, until
the larger oxide ore processing plant is commissioned. The larger 1,000+ tpd oxide processing plant is
expected to be completed in calendar Q3 2022 and is forecast to produce 15,000 – 20,000 oz of gold
per year.
• Advancement of Sulphide Development Project : Buckreef Gold has commenced the long -lead
items for de-risking of the Sulphide Development Project, including: (i) geotechnical characterization to
determine the ultimate pit slopes of the 2 km long open pit; and (ii) the variability metallurgical study for
the first 5-7 years of potential production of the Sulphide Development Project. To date a total of 19
metallurgical holes (2,367 meters) have been completed along the entire strike of the Buckreef Main
deposit and the holes have been logged and are in preparation for shipment for metallurgical testing.
• Recommenced Exploration: Buckreef Gold has d rilled 17 holes representing over 5,500 meters in
the northeast extension of Buckreef Main Zone. Buckreef Gold has finalized the planning for a 10,000
meter (approximate) infill drill program to: (i) upgrade Mineral Resources currently in the Inferred
category in Buckreef Main, and (ii) commence infill drilling at Buckreef West. This program is expected
to start in Q3 2022 . It is also the Company’s intention to begin exploration drilling at the newly
discovered Anfield Zone this year.
“We are off to the races! The Q2 results demonstrate our ability to drive significant, profitable sustainable
growth at Buckreef Gold, after achieving low cash costs and significant gross profit margins on just 1,812
ounces of gold sold. The processing plant is currently being expanded and will triple in size to 1,000+ tpd
in the coming months . We have also started advancing the technical work for the much larger sulphide
development project with the goal of exceeding all the metrics as outlined in the 2018 PFS, particularly
yearly annual production. Exploration has recommenced in the Buckreef Main northeast extension and
overall exploration activities will accelerate across the entire Buckreef Gold project over the next year. We
are in the process of resetting the long-term vision for the Buckreef Gold project with the goal of a much
larger project than was originally envisaged in the 2018 PFS. I would like to thank all of my colleagues on
a great year and a milestone quarter.” noted Stephen Mullowney, Chief Executive Officer of TanGold.
Pictured Below: Buckreef Gold Open Pit, Drill Rig in Northeast Extension, 360 tpd Processing Plant
and Two New 360 tpd Ball Mills Arriving at Buckreef Gold
About Tanzanian Gold Corporation
TanGold along with its joint venture partner, STAMICO is advancing a significant gold project at Buckreef
in Tanzania. Buckreef is anchored by an expanded Mineral Resource published in May 2020. Measured
Mineral Resource is 19.98 million tonnes (“MT”) at 1.99 gr ams per tonne (“g/t”) gold (“Au”) containing
1,281,161 ounces (“oz”) of gold and Indicated Mineral Resource is 15.89 MT at 1.48 g/t gold containing
755,119 oz of gold for a combined tonnage of 35.88 MT at 1.77 g/t gold containing 2,036,280 oz of gol d.
The Buckreef Gold Project also contains an Inferred Mineral Resource of 17.8 MT at 1.11g/t gold for
contained gold of 635,540 oz of gold. The Company is actively investigating and assessing multiple
exploration targets on its property. Please refer to the Company’s Updated Mineral Resources Estimate for
Buckreef Gold Project, dated May 15, 2020 and filed under the Company’s profile on SEDAR and with the
SEC on June 23, 2020 (the “Technical Report”) , for more information. Buckreef is being advanced in a
value accretive sustainable manner through:
Expanding Production Profile: A 360 tonne per day (“tpd”) processing plant is being expanded to 1,000+
tpd, enabling a near term production profile of 15,000 - 20,000 oz of gold per year. Positive operating cash
flow will be utilized for value enhancing activities, including exploration and Sulphide Project Development.
Exploration: Continuing with a drilling program with the goal of expanding resources, discovering new
resources and co nverting resources to reserves, by: (i) step -out drilling in the northeast extension of
Buckreef Main; (ii) infill drilling to upgrade Mineral Resources currently in the Inferred category in Buckreef
Main; (iii) infill drilling program of Buckreef West; (i v) developing an exploration program for the newly
discovered Anfield Zone; (v) upgrading historical mineral resources at Bingwa and Tembo; (vi) identifying
new prospects at Buckreef Gold Project, and in the East African region.
Sulphide Development Project: Unlocking the value of the Sulphide Project in which the ‘sulphide ore’
encompasses approximately 90% of the Resources. It is the goal of the Company to exceed all metrics
as outlined in the Technical Report, including annual production and strip ratio.
For further information, please contact Stephen Mullowney, CEO, or Michael Leonard, CFO at
[email protected], or visit the Company website at www.tangoldcorp.com
Andrew M. Cheatle, P.Geo., the Company’s COO and Director, is the Qualified Person as defined by the
NI 43-101 who has reviewed and assumes responsibility for the technical content of this press release.
The Toronto Stock Exchange and NYSE American have not reviewed and do not accept responsibility for
the adequacy or accuracy of this release.
Endnotes
1 The Company has included certain non -IFRS measures in this news release. Refer to the Company’s
MD&A for the three and six month periods ended February 28, 2022 (“Q2 2022 MD&A”) for an
explanation, discussion and reconciliation of non -IFRS measures. The Co mpany believes that these
measures, in addition to measures prepared in accordance with International Financial Reporting
Standards (“IFRS”), provide readers with an improved ability to evaluate the underlying performance of
the Company and to compare it to information reported by other companies. The non-IFRS measures are
intended to provide additional information and should not be considered in isolation or as a substitute for
measures of performance prepared in accordance with IFRS. These measures do not have any
standardized meaning prescribed under IFRS, and therefore may not be comparable to similar measures
presented by other issuers. Cash cost per ounce of gold sold was determined by dividing the cost of gold
sold of $1.443 million for the three months ended February 28, 2022 calculated in accordance with the
IFRS per the Company’s financial statements divided by the number of ounces of gold sold (1,812).
2 The 360 tpd Plant estimates have not been prepared in accordance with the r esults of the Company’s
2018 Pre-Feasibility Study, reflected in the Company’s May 15, 2020 Technical Report. The 18 -month
mining plan estimates are based upon an internal mine model reviewed by SGS Canada Inc and cost
inputs as validated by actual mining and processing costs from the 120 tpd test plan over the 9 months
ended May 31, 2021. No assurance can be given that the 18-month mining estimate (Monthly Average)
will reflect actual results. See “ Disclosure and Cautionary Statement Regarding Forward Looking
Information” in the Q2 2022 MD&A.
Forward-Looking Statements
This press release contains certain forward-looking statements as defined in the applicable securities
laws. All statements, other than statements of historical facts, are forward-looking statements. Forward-
looking statements are frequently, but not always, identified by words such as “expects”, “anticipates”,
“believes”, “hopes”, “intends”, “estimated”, “potential”, “possible” and similar expressions, or statements
that events, conditions or results “will”, “may”, “could” or “should” occur or be achieved. Forward-looking
statements relate to future events or future performance and reflect TanGold management’s expectations
or beliefs regarding future events and include, but are not limited to, statements with respect to the
continued operating cash flow, expansion of its process plant, estimation of mineral resources,
recoveries, subsequent project testing, success, scope and viability of mining operations, the timing and
amount of estimated future production, and capital expenditure.
Although TanGold believes the expectations expressed in such forward-looking statements are based on
reasonable assumptions, such statements are not guarantees of future performance. The actual
achievements of TanGold or other future events or conditions may differ materially from those reflected in
the forward-looking statements due to a variety of risks, uncertainties and other factors. These risks,
uncertainties and factors include general business, legal, economic, competitive, political, regulatory and
social uncertainties; actual results of exploration activities and economic evaluations; fluctuations in
currency exchange rates; changes in costs; future prices of gold and other minerals; mining method,
production profile and mine plan; delays in exploration, development and construction activities; changes
in government legislation and regulation; the ability to obtain financing on acceptable terms and in a
timely manner or at all; contests over title to properties; employee relations and shortages of skilled
personnel and contractors; the speculative nature of, and the risks involved in, the exploration,
development and mining business. These risks are set forth in reports that Tanzanian Gold files with the
SEC. You can review and obtain copies of these filings from the SEC's website at
http://www.sec.gov/edgar.shtml .
The information contained in this press release is as of the date of the press release and TanGold
assumes no duty to update such information.