Nyanzaga Gold Project

80% owned by Perseus

Project Overview

The Nyanzaga Gold Project is located in north-western Tanzania, south of Lake Victoria within the Sengerema District of the Mwanza Region, approximately 60 kilometres southwest of Mwanza (Tanzania’s second largest city).

The Project is located on the north-eastern flank of the Sukumaland Archaean Greenstone Belt of the Lake Victoria Goldfield, approximately 60 km east of the Geita Gold Mine and 35 km northeast of the Bulyanhulu Gold Mine. The Project area covers Nyanzian greenstone volcanic rocks and sediments typical of the greenstone belts of the central craton.

The Nyanzaga Gold Project’s Mineral Resource Estimates1 consist of a Measured and Indicated resource of 24.2 Mt grading 3.64 g/t Au for 2.8 Moz Au and an Inferred Resource of 5.8 Mt grading 2.4 g/t Au for 0.5 Moz Au. It has a Probable Ore Reserve Estimate1 of 40.1 Mt grading 2.01 g/t Au for 2.6 Moz Au.

The above-mentioned estimates were released by OreCorp in ASX releases dated 12 September 2017 titled “MRE Update for the Nyanzaga Project Increasing Category and Grade”, 5 May 2022 titled “DFS Completion and Kilimani Mineral Resource Estimate update within the Nyanzaga Special Mining Licence – Tanzania”, and 22 August 2022 titled “Nyanzaga DFS Delivers Robust Results”.

Perseus is conducting an independent review of these estimates and the Nyanzaga Gold Project as a whole, with inaugural Mineral Resources and Ore Reserves estimates expected during Q1 CY2025. It is advancing other work streams in anticipation of a Final Investment Decision (FID) for Nyanzaga’s development. 

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Nyanzaga Project

OVERVIEW OF WORK PROGRAMS

Perseus has commenced its review of the geology, mining engineering and mineral processing studies of the Nyanzaga Gold Project. A comprehensive review of all aspects of the project is planned to produce Perseus’s Mineral Resource estimate and Ore Reserve estimate for Nyanzaga in Q1 CY2025. Geotechnical and Mineral Processing testwork and analysis is also under review to ensure optimal value is extracted during development of the project by Perseus.

Drilling is planned to commence as soon as possible for the purposes of resource definition, exploration drilling and sterilisation for key infrastructure.

The FEED work program is focussed on right sizing the process plant throughput to align with the resource technical interpretation from the Perseus feasibility work, incorporating the Perseus lessons learnt from our existing operations and detailed project execution planning.

Perseus is also continuing work under the RAP in the impacted villages. The RAP provides a comprehensive and widely consulted framework and strategy for the resettlement of people and households affected by Project land acquisition. The resettlement planning has been finalised, including the development of a valuation report and compensation schedules, in compliance with Tanzanian legislation and approved by the Chief Valuer. Compensation agreements have been signed with about 93% of project-affected persons so far. Critical next steps include finalising building permits, commencing construction of replacement housing, finalising the planning for the relocation of a cemetery, layout and design of a school and health dispensary as well as the continuation of livelihood restoration training activities.

Table 1: Nyanzaga Project Measured and Indicated Mineral Resources6,7
DEPOSIT DEPOSIT TYPE MEASURED RESOURCES INDICATED RESOURCES MEASURED + INDICATED RESOURCES
QUANTITY GRADE GOLD QUANTITY GRADE GOLD QUANTITY GRADE GOLD
Mt g/t gold ‘000 oz Mt g/t gold ‘000 oz Mt g/t ‘000 oz
Nyanzaga1,3 Open/Underground 4.6 4.96 738 16.2 3.80 1,977 20.8 4.06 2,715
Kilimani2,4,5 Open Pit – – – 3.4 1.09 119 3.4 1.09 119
TOTAL 4.6 4.96 738 19.6 3.33 2,096 24.2 3.64 2,834
Table 2: Nyanzaga Project Inferred Mineral Resources6,7
DEPOSIT DEPOSIT TYPE INFERRED RESOURCES
QUANTITY GRADE GOLD
Mt g/t ‘000 oz
Nyanzaga1,3 Open/Underground 2.9 3.8 358
Kilimani2,4,5 Open Pit 2.9 1.0 94
TOTAL 5.8 3.64 452

1) Based on September 2017 Mineral Resource estimate by CSA Global Pty Ltd.

2) Based on May 2022 Mineral Resource estimate by CSA Global UK Ltd.

3) Reported at a 1.5 g/t Au cut-off.

4) Reported at a 0.4 g/t Au cut-off.

5) Open pit resources constrained to US$1,500/oz pit shell.

6) Rounding of numbers to appropriate precision may result in summary inconsistencies.

7) Mineral Resources are reported inclusive of Mineral Reserves.

Table 3: Nyanzaga Proven and Probable Mineral Reserves1,5,6
DEPOSIT DEPOSIT TYPE PROVEN PROBABLE PROVEN + PROBABLE
QUANTITY GRADE GOLD QUANTITY GRADE GOLD QUANTITY GRADE GOLD
Mt g/t gold ‘000 oz Mt g/t gold ‘000 oz Mt g/t ‘000 oz
Nyanzaga2,3 Open Pit – – – 25.7 1.35 1,110 25.7 1.35 1,110
Kilimani3 Open Pit – – – 2.04 1.05 70 2.04 1.05 70
Sub-Total – – – 27.7 1.32 1,180 27.7 1.32 1,180
Nyanzaga4 Underground – – – 12.4 3.57 1,420 12.4 3.57 1,420
TOTAL – – – 40.1 2.01 2,600 40.1 2.01 2,600

1) Based on Mineral Reserve Statement 22 August 2022.

2) Variable gold grade cut-offs depending on rock type, ranging from 0.44 g/t to 0.52 g/t.

3) Pit designs are based on US$1,500/oz gold metal price.

4) Based upon cut-off of 0.5 g/t Au for development and 2.0 g/t Au for stoping.

5) Mineral Reserves were prepared in accordance with the JORC Code (2012 edition). See item d) below.

6) Rounding of numbers to appropriate precisions may have resulted in apparent inconsistencies.

Geology

The Nyanzaga and Kilimani deposits occur within a sequence of folded Nyanzian sedimentary and volcanic rocks. The current interpretation of the Nyanzaga deposit recognises a sequence of cyclic (C1, 2 etc) mudstone, sandstone and chert units folded into a northerly plunging anticline. The Kilimani deposit, located 450 m northeast of Nyanzaga, is developed in the fold hinge of an interpreted west-northwest striking double plunging anticline. The bulk of the Kilimani deposit occurs in the heavily weathered zone, within 140 m from surface.

Gold mineralisation at Nyanzaga is concentrated at the intersection point of the north-west trending Nyanzaga Fault Zone (Far Eastern and Eastern Faults); the Axial and Central Faults; and the north-northwest structures plunging Nyanzaga Anticline. The higher-grade mineralisation occurs in lodes associated with mid to late stage, sub-vertical second order north-west to north-northwest and/or reactivated north to north-northwest structures (Axial Fault Zone) relating to the second phase of deformation (D2) deformation.

Preferential grade enhancement occurs in selected altered units such as the thick cherts, silica-dolomite altered medium grained sandstones, brecciated silica-carbonate altered mudstones, or along the margin of late quartz veins as free gold.

Mineralisation at the Kilimani deposit is currently mostly defined in the oxidised to partially oxidised profile and implies secondary enrichment. The mineralisation style at Kilimani appears similar to the Nyanzaga, fault-controlled mineralisation. The mineralisation has an AuMo-As-Sb-Mn-Ba geochemical association, which is characteristic of the fault-controlled early-stage carbonate replacement mineralisation observed at Nyanzaga. It is reasonable to assume that the fluids between Nyanzaga and Kilimani are interconnected. Kilimani may have been a higher-level development of the Nyanzaga system now structurally juxtaposed.

Sustainable Development

The Project area is located within Igalula Ward where the primary source of livelihood for most households is subsistence farming with approximately 12% depending on other sources, including artisanal mining, fishing, salaried employment, general labour, livestock keeping and small trading. A resettlement policy framework has been developed by Digby Wells as part of the resettlement planning for the Project. Land delineation and asset valuations have already been completed in close consultation with the GoT and host communities. A detailed resettlement action plan and livelihood restoration plan is under development. An environmental and social impact assessment (ESIA) was undertaken and submitted to the National Environment Management Council (NEMC) for approval in late 2017. The ESIA was conducted in compliance with the NEMC requirements and prescribed format. NEMC granted an Environmental Certificate to NMCL for the Project in February 2018. This has subsequently been re-registered and transferred to SMCL. To support the Project’s potential application for funding from International Finance Institutions OreCorp engaged ERIAS Group to conduct a review of the ESIA against the Equator Principles and current, relevant, International Finance Corporation (IFC) Performance Standards on Environmental and Social Sustainability (IFC, 2012) and World Bank Group standards and guidelines. The gap analysis identified several areas for improvement, which are being addressed and results will be incorporated in a revised ESIA document.

Water SUPPLY

Project water make-up supplies will be extracted from Lake Victoria, with the water balance indicating an average flow rate of 300 m3 /hr will be required, once the decant return water supply becomes available from the tailings storage facility. The raw water will be pumped to the plant site via a buried pipeline for use in the process plant and mine. Power and control for the extraction pumps will be via an overhead power line.

1NI43-101 disclosure: The Historical Estimates have been prepared in accordance with JORC (2012 edition) and have not been reported in accordance with NI43-101. A Qualified Person has not done sufficient work to classify the resource estimate as current in accordance with NI43-101. Please refer to further disclosure required by NI43-101 together with a more detailed resource table at the conclusion of this announcement. OreCorp Mineral Reserve and Mineral Resource estimates are stated on 100% basis.

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DISCLAIMER

a) The information provided in relation to these Historical Estimates is extracted from the OreCorp Feasibility Study which was prepared in accordance with the JORC Code (2012 edition) and announced on 22 August 2022. 

b) The OreCorp Feasibility Study includes key assumptions for commodity prices, gold mining and processing costs, and there has been no material changes in assumptions. The OreCorp Feasibility Study in its current form is considered to be a comprehensive compilation of all available data applicable to the estimation of Mineral Resources and Mineral Reserves. A summary of key assumptions and methods used to prepare the Historical Estimate include: 

  • Resource Estimation calculated using Ordinary Kriging and Localised Uniform Conditioning methods.
  • Economic assumptions include (i) a US$1,500/oz gold price, (ii) US$896/oz gold average total cash cost, (iii) US$954/oz gold average all in sustaining cost, (iv) 88% metallurgical recoveries, and (v) a 7.3% government royalty including inspection fee and service levy.
  • The estimates are based on 269,116 metres of RC and core drilling in 2,027 drill holes across both the Nyanzaga and Kilimani projects. 

c) As at the date of this announcement, the Historical Estimates reported by OreCorp and referenced by Perseus herein have not been superseded by any later estimates and Perseus is not in possession of any new information. 

d) Perseus believes the resource classification categories reported in line with the JORC Code (2012 edition) are similar to categories for CIM compliant Mineral Resource and Mineral Reserve estimates to be reported under NI 43-101. Perseus considers the Historical Estimates to be material to Perseus, given its intention, through the acquisition of OreCorp, to contribute funding to continued exploration activity and advancement of the asset through additional drilling, future mineral resource estimation updates and economic studies. 

e) Perseus also believes that the Historical Estimates are relevant to Perseus shareholders as they provide an indication of the current mineralisation and the potential of the Nyanzaga Gold Project at this date. 

f) Based on the information received by Perseus to date in relation to the Nyanzaga Gold Project, physical inspection of the project sites, discussions with OreCorp’s technical and administrative personnel and assessment of the key criteria, the reliability of the Historical Estimates has been addressed in the due diligence completed by Perseus. Perseus therefore believes that the Historical Estimates are sufficiently reliable with estimation methodologies and data compilation work acceptable for methodologies used at the time of their estimation to provide the basis for a decision to assess the property to have merit for further exploration expenditure. 

g) It is Perseus’s intention to undertake an evaluation of the data and initiate further exploration work planned for the Nyanzaga Gold Project to underpin a Mineral Resource estimate and Mineral Reserve estimate in accordance with NI 43-101 that will include selective infill drilling to increase confidence in Mineral Resources. Future Mineral Reserve estimates will include an updated mine plan (optimisation, design and scheduling).

h) It is Perseus’s intention to undertake a review of the capital and operating costs to be consistent with latest market conditions, complete additional geotechnical, hydrological and comminution studies to further optimise infrastructure and mine design, review water supply and power options, including the use of renewable solar energy, complete further tailings storage facilities studies to optimise design and maximise water recovery, optimise grind size and CIL recovery methods, complete further sterilisation drilling in the areas of infrastructure as part of a FEED Study to reduce risk and/or improve technical and financial outcomes.

i) The Mineral Resource and Mineral Reserve work in items g) and h) will take approximately 6 months to complete. The Mineral Resource work can be completed simultaneously with the FEED study leading to a FID expected in the December Quarter of 2024.

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