Gold mining company Shanta Gold (AIM:SHG) recently announced that indicated gold resources at its Ilunga satellite deposit at the New Luika Gold Mine increased by 409%, from 40,352 ounces (oz) gold to 205,347oz.
Accordingly, the total Ilunga resources (indicated and inferred categories) upgraded from 73,940oz to 257,965oz.
Toby Bradbury, CEO at Shanta, commented: “The deposit is a good grade, close to the plant and is likely to contribute to a meaningful increase in the mining reserve which in turn enhances shareholder value. We expect that the majority of the Ilunga ounces will form part of a new high grade underground operation that would start as the Luika deposit is depleted in around 2020. At this stage, the Company envisages developing Ilunga using cash generated from operations and to utilize existing equipment and personnel to take the new development in its stride. “
New Luika is an active gold mine in the Mbeya region in Southwest Tanzania and its Ilunga deposit is located 2.5km northeast of the New Luika central processing facility.
The mine is fully owned by Shanta Gold, which started gold extraction in 2012. In 2015, the company produced 81,873oz of gold out of New Luika.
Gold reserves in Tanzania are estimated at about 45m oz with gold exploration centered mostly on the greenstone belts around Lake Victoria.
Gold production in Tanzania stands at around 50t per year which makes it the 4th largest gold producer in Africa after South Africa, Ghana and Mali.