Katoro Gold plc (AIM:KAT), the Tanzania focused exploration and development companyprovides an update to its announcement of 30 September 2019, regarding the proposed acquisition of the Imweru gold project ('Imweru' or 'the Project') by Lake Victoria Gold Limited ('LVG').
Katoro have been working closely with the LVG team to finalise the proposed Imweru acquisition. The proposed acquisition, on completion, will combine two strategicgold assets in LVG, increasing the project footprint and in-situ gold resource, which the Board of Katoro ('Board') believes will allow a considerably faster route to gold production.
As the deadline for completion of the proposed acquisition was 31 October 2019, LVG has requested an extension to finalise the acquisition and for the payment of the first tranche of monies due to Katoro under the term sheet of US$50,000 and the Board is considering the request. Notwithstanding this request, the Board believes that seeking to complete the disposal of Imweru to LVG is in the Company's best interests at this time.
The Company further notes thatthere has recently been interest expressed in Katoro's Lake Victoria gold interestsby other third parties. Whilst the Company's focus for now remains on working with LVG, the Board will consider other proposals should they be appropriate.
Further announcements will be made as appropriate.
Louis Coetzee, Executive Chairman of Katoro Gold, said:"The operating environment for gold companies in Tanzania is experiencing some recovery and investor sentiment toward the gold sector in-country is improving. We note that Barrick Gold recently announced its return to operations in Tanzania following an amicable settlement of its dispute with the Tanzanian Government.
This improved sentiment is evident through the level of interest shown by other gold mining companies in Katoro's Tanzanian gold projects. We are encouraged by the emerging optionality that the increasing interest in our gold interests provides. So, whilst we would like to see the LVG acquisition complete, and we expect that to occur, there are possible alternative value generative routes available. In addition, the current gold price has moved in the Company's favour, at US$1,495/oz, the gold price is up 17% year-to-date, its best performance since 2010.
I look forward to providing further updates on the LVG acquisition at the appropriate time in due course."
This announcement contains inside information as stipulated under the Market Abuse Regulations (EU) no. 596/2014.
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