Shanta Gold Ltd said it was awarded a maiden mining licence covering the Porcupine South resource area of the Lupa Gold Fields, about 22 kilometres from its New Luika gold mine (NLGM) processing plant in Tanzania.
"Porcupine South is an orebody that was newly discovered in 2020, taking the known deposits at NLGM to twelve, each of which has the potential to increase in size,” said chief executive Eric Zurrin.
“With the award of this maiden mining licence plus extendable periods all-in totalling 30 years, Porcupine South will become the central piece to a district play covering highly prospective surrounding prospecting licences also owned by Shanta.”
The mineralisation remains open at depth and along strike. The current strike length is 500 metres.
AIM-traded Shanta said the licence was an economically feasible trucking distance from the NLGM processing plant.
The new mining licence is for an initial 10 years and is renewable for two further 10-year periods.
Existing Shanta-owned JORC-compliant resources total 114,000 ounces, grading 1.94 grammes a tonne (g/t).
“Past exploration by 3rd parties in licences adjacent to Porcupine South has resulted in over 320,000 oz of additional NI 43-101 compliant resources including underground potential with NI 43-101 resources of 158,000 oz grading 5.0 g/t,” said Zurrin.
“The award of this mining licence is a major catalyst towards consolidating this district in what would otherwise be an area of stranded uneconomic ounces with no access to a processing plant. Forecasts are now being updated to convert resource ounces into mineral reserves leading to an extension of the life of mine at NLGM.”