New Tanzania Gold Could Boost Ranking

New discoveries of Tanzania gold deposits are helping to confirm the country’s current status as one of the fastest-emerging gold producers in Africa and could, in fact, transform the country into the largest producer of the precious metal on the continent.

Currently, Tanzania represents the third largest gold producer in Africa, behind South Africa and Ghana with estimated gold reserves that have been calculated at a conservative total ofmore than 1000 tons.

According to a recent report by the East African Business Week (EABW), the recently discovered gold deposits have been located in the southern portion of the country in the districts of Lindi and Nachingwea.

Prior to this discovery, the country’s southern region was not seen as having the potential to be a gold bearing zone.

This will, therefore, be the first gold mining venture to take place in Tanzania’s southern districts.

According to the EABW report, Douglas Lake represents the latest in a series of recent gold mining ventures in the country, having spent over USD 2.1 million in the past 16 months of exploration in order to establish a joint venture on the Mkuvia project area.

Douglas Lakes joint venture was officially established in July 2008 and the company is currently n the final stages of applying for their mining license.

The EABW report went on to indicate that, in November 2009, a joint venture agreement was made between Ruby Creek Resources, a USA firm, and Douglas Lake Minerals for the development of gold mining in Mkuvia Maita’s gold project area, where mining operations are expected to begin next year.

In addition, the EABW also reported that according to the joint venture agreement Ruby Creek Resources has acquired the right to purchase and develop a portion of the Douglas Lake’s Mkuvia Gold Project.

The portion of land included in the agreement is reportedly 125 sq km of the 380 sq km southern Tanzania Mkuvia Gold Project.

According to the agreement, over a period of 3 years, Ruby Creek will purchase a 70% interest for USD 3 million.

During a site visit to the Mkuvia property in April 2008 the president of Ruby Creek, Rob Slavik, indicated that he was encouraged by the progress of the property.

“In April, 2008 while on a tour reviewing resource property opportunities in Tanzania […] We observed many artisanal miners having great success recovering gold, using only hand tools in all surface areas of the property that we viewed. Deeper diggings revealed coarser gold,” Slavik said in the EABW report, “I have continued to follow the progress of the property and have been greatly encouraged by the work and results produced to date.”

According to the EABW report, after having completed its technical report, reserve estimate, feasibility study and mining plan, Douglas Lake is currently awaiting the pending environmental impact assessment report after which time, it will file for its first mining license application.

This first license is expected to receive approval during the first quarter of 2010, with the second license to follow in the early third quarter of 2010.