Tanzanian Gold Corporation is pleased to announce that it has closed a flexible financing agreement for up to US$14 million with RiverFort Global Capital Ltd. (“RiverFort”) and [Yorkville Advisors] (the “Financing”).
Recent Gold Pour At Buckreef
The Financing will be structured in multiple tranches (i) US$7.0 million will be advanced between close and the filing of a registration statement with the Securities Exchange Commission (“SEC”), and (ii) US$7.0 million will be advanced over time at the company’s election upon reaching certain milestones.
Gold Smelting
The proceeds of the Financing will be utilized for a significant expansion of the Buckreef Project oxide mining and processing operation, general corporate purposes, the advancement of a Feasibility Study for the larger sulphide mining complex, and the continuation of multiple drilling programs.
Tanzanian Gold has developed a scope of the project to expand the oxide processing plant to the range of 40tph as the basis for discussion with Staminco and regulatory approval. Details of the plant expansion will be announced in the immediate future. Details of the plant expansion will be announced in the immediate future.
Mr. James E. Sinclair, Executive Chairman of The Company, commented “The past 18 months of work from a talented team at Buckreef and our entire organization represent an incredible period of progress and value creation for our company. We have dramatically grown our resource base at very low cost, increased the scale and scope of what we now feel will be the next world-class mine in Tanzania and have begun to unlock the tremendous blue-sky potential that exists with our continuing exploration and development programs.”
Mt Sinclair goes on to state “Critically, we have now become a gold producer. The Financing announced today will ensure rapid expansion of oxide gold production, and by the end of the term of this agreement, we should reach our goal of becoming cash-flow positive.”
Mining Team Safety Induction For Large Equipment
Main Features of the Financing Agreement
The first tranche of US$ 7.0 million is essentially a low-cost equity financing as the Investors will seek to convert the debenture into common shares. To help maintain an orderly market for the company’s shares, there are limitations on the number of shares the Investors can trade at any given moment. The second tranche is essentially a low-cost unsecured debt financing as dilutive conversions of the debentures into common shares are at the discretion of the company. Investors can convert at any time at the Fixed Conversion Price.
The company expects that the size of the first tranche will fund orders of long lead items for the oxide plant expansion. The additional tranches provide the company with additional financial support and flexibility to complete the plant expansion and other related expenditures. Furthermore, the company believes that this approach to funding an expansion helps de-risk the project for the company’s shareholders without diluting a significant upside.
Buckreef Gold Mine training
About Tanzanian Gold Corporation
Tanzanian Gold Corporation is building a world-class gold mine at the Buckreef Project in Tanzania. The company achieved commercial production at its oxide plant in June 2020. The company is now moving ahead to significantly expand its oxide plant’s processing capacity. An ongoing drill program has, to date, more than doubled the size of Measured and Indicated Resources to 2.036 million ounces. NI 43-101 compliant exploration mining targets have the potential to add up to another 2 million ounces. The company is simultaneously advancing on three value-creation tracks:
- Commencing production from an oxide processing plant that will be expanded; to operate as a separate, stand-alone plant for the full life of the larger sulphide mining and processing operation;
- Advancing Final Feasibility for the sulphide operation utilizing a plant substantially larger than previously modeled, which could annually produce 150,000 to 175,000 ounces of gold;
- Considering an underground gold mining component at Buckreef. The company has started ultra-deep drilling and completed a Level 1 stope design. The company will start infill drilling to upgrade ounces currently in the Inferred category.
The Financing allows TanGold to continue building shareholder value as the company enters substantial new phases in the process of building a world-class mine at the Buckreef Project.
