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Ta nz an ia

A supplement to Mining Journal

INTRODUCTION

CONTENTS

Introduction Country Overview Geology Exploration and Mining Profiles: Great Basin Gold Ltd Gulf Resources Ltd Helio Resources Corp MDN Inc Midlands Minerals Corp Western Metals Ltd Sub-Sahara Resources NL Uranex NL 2 3 4-5 6-9 10 11 12 13 14 14 15 16

Setting sail

Mineral exploration interest in Tanzania has doubled in the past year, with over 500 licences now issued per month

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CONTACTS

Ministry of Energy and Minerals, 754/33 Samora Av, PO Box 2000, Dar es Salaam, Tanzania Hon William Ngeleja Minster for Energy and Minerals Tel: +255 22 2112791 Fax: 22 212850 E: [email protected] Hon Adam Malima Deputy Minster for Energy and Minerals Tel: 22 2110426 Fax: 22 2130899 E: [email protected] Mr Arthur Mwakapugi Permanent Secretary Tel: 22 2112791 Fax: 22 2128250 E: [email protected] Dr Dalaly Kafumu Commissioner for Minerals Tel: +255 22 2137142 Fax: 22 2123688 E: [email protected] Mr Gray Mwakalukwa Director General State Mining Corp, 417/418 UN Road, PO Box 4958, Dar es Salaam, Tanzania Tel: +255 22 2150029 Fax: 22 2150243 E: [email protected] Prof Abdulkarim Mruma Chief Executive Geological Survey of Tanzania, PO Box 903, Dodoma, Tanzania Tel: +255 26 2322401 Fax: 26 2323020 E: [email protected] Mr Emmanuel Ole-Naiko Executive Director Tanzania Investment Centre, Shaaban Robert Street, PO Box 935, Dar es Salaam, Tanzania Tel: +255 22 2113365 Fax: 22 2116330 E: [email protected] Mr Gidion Nasari Managing Director National Development Corp, Development House, PO Box 2669, Dar es Salaam, Tanzania Tel: +255 22 2111460 Fax: 22 2113618 E: [email protected]

OCATED in East Africa, with a coastline on the Indian Ocean, the United Republic of Tanzania has a population of just over 38 million and a land area of some 945,000km2. During the past ten years, foreign investment in the mining sector has amounted to over US$2.5 billion, and the sector contributes some 4% to GDP. Tanzania consists of the mainland, formerly called Tanganyika, and the islands of Zanzibar. The country is bordered by Kenya and Uganda to the north; Rwanda, Burundi and the Democratic Republic of the Congo to the west; and Zambia, Malawi and Mozambique to the south. The mainland got its name in the second half of the 19th century when European explorers linked the area to Lake Tanganyika, derived from the Swahili words tanga, meaning `sail', and nyika, meaning `wilderness'. In 1885, Germany established a protectorate in the area, named German East Africa. During Germany's tenure some infrastructure was developed, including the railway from Dar es Salaam to Kigoma on Lake Tanganyika. After its defeat in World War I, Germany's territory in eastern Africa was divided among the victorious powers under the Treaty of Versailles (confirmed by a League of Nations mandate in 1922). The largest segment was transferred to British control, with what is now Rwanda and Burundi passing to Belgium, and the small Kionga Triangle to Portuguese Mozambique. The name

Tanganyika was adopted by the British for its part of the former German East Africa. British rule in turn came to an end in 1961 after a relatively peaceful transition to independence. At the forefront of this process was Julius Nyerere, a former schoolteacher. In 1953, Dr Nyerere was elected president of Tanganyika African Association (TAA), a civic organisation that he had helped found while a student at Makerere University. In 1954, he transformed TAA into the politically-oriented Tanganyika African National Union (TANU). TANU's main objective was to achieve national sovereignty for Tanganyika. A campaign to register new members was launched, and within a year TANU had become the leading political organisation in the country. Dr Nyerere became minister of British-administered Tanganyika in 1960, and continued as president when Tanganyika became officially independent in 1961. Soon after independence, president Nyerere's administration took a turn to the `left' with the Arusha Declaration, which codified a commitment to Pan-African socialism and ujamaa (familyhood). Farms were amalgamated as community ventures, and banks and many large industries were nationalised. After a revolution overthrew the sultan in neighbouring Zanzibar (which had become independent in 1963), the island merged with mainland Tanganyika to form the United Republic of Tanganyika and Zanzibar on April 26, 1964. This nation was renamed later the same year as the United Republic of Tanzania. In 1996, the government offices were transferred from Dar es Salaam to Dodoma, the country's political capital. However, Dar es Salaam remains Tanzania's principal commercial city.

Message from the Minister

DEAR INVESTORS, In the past decade, Tanzania has become a favourite investment destination for mineral exploration and mining, especially in precious metals and gemstones. Once again, let me welcome you to Tanzania for long-term stable investment. Tanzania is greatly endowed with a variety of metals, including gold, silver, copper, nickel, lead, niobium, cobalt and platinum group metals. In addition to these endowments, Tanzania has a variety of other minerals, including kaolin, limestone, bauxite, coal, phosphate, gypsum, dimension stones, feldspars and beach sands. The mining sector is firmly establishing itself in the country. Over the past ten years, six largescale mines have come on-stream, five of them gold mines and one tanzanite mine. Together with the famous Williamson diamond mine (which opened in 1940), Tanzania currently has seven large-scale mines in operation. Another gold mine (the Buzwagi project) should pour its first gold at the end of 2009, and a nickel mine is scheduled to come on stream by 2011 in Kabanga, northwestern Tanzania. Uranium exploration is increasing, and several companies are optimistic of being able to start uranium mining in Tanzania by 2012. PGM exploration is also active, and there is potential for the establishment of an iron and steel industry in the country. A conducive legal and fiscal regime that was put in place in 1998 is key to this success story. Properly to continue serving the mining industry, Tanzania has established a Mining Cadastre Information licensing system that is set to deliver mineral rights to investors. This licensing system is based on a first-come-first-served principle. The Geological Survey of Tanzania has also been transformed into an autonomous government agency that now maintains an up-to-date geological database for promotion of exploration activities in the nation. I hope this supplement tells a mining story that Tanzania is a new mining Mecca worth considering for investment. Please come and create value from minerals in the wonderful land of the Ngorongoro crater, the Serengeti plains and the fascinating Kilimanjaro mountain. You are warmly welcome, Hon William Ngeleja (MP), Minister for Energy and Minerals

Published in August 2008 by: Mining Communications Ltd Albert House, 1 Singer Street London EC2A 4BQ Tel: +44 (0)20 7216 6060 Fax: +44 (0)20 7216 6050 E-mail: [email protected] Website: www.mining-journal.com Supplement editor: Chris Hinde Design and production: Tim Peters, Karen Leverington Printed by Stephens & George, Merthyr Tydfil, UK © Mining Communications Ltd 2008

An Aspermont company

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August 2008 Mining Journal special publication Tanzania

COUNTRY OVERVIEW

Melting pot

DEMOGRAPHICS

Tanzania's 38 million people are distrubted extremely unevenly, with the density varying from one person/ km2 in arid regions through 51/km2 in the mainland's well-watered highlands to 134/km2 on Zanzibar. More than 80% of the population is rural, and Tanzania still has a very high unemployment rate (about 67%). Dar es Salaam is the largest city and is the commercial capital, with Dodoma (located in the centre of the country) being the capital. Zanzibar Town houses the Zanzibar Parliament. The African population consists of more than 126 ethnic groups, of which the Sukuma and Nyamwezi, the Hehe and Bena, the Gogo, the Haya, the Makonde, the Chagga and the Nyakyusa each have more than 1 million members. Other groups include the Pare, Sambaa or Shambala and Ngoni. The majority of Tanzanians, including such large ethnic groups as the Sukuma and the Nyamwezi, have Bantu origins. Groups of Nilotic, or peoples of related origin, include the nomadic Masai and the Luo, both of which are found in greater numbers in neighbouring Kenya. Two small groups speak languages of the Khoisan family peculiar to the people of the Kalahari in southern Africa. Cushitic-speaking peoples, originally from the Ethiopian highlands, reside in a few areas of Tanzania. Other Bantu groups were refugees and immigrants from nearby countries. Although much of Zanzibar's African population came from the mainland, one group (known as AfroShirazis) claims to be related to the island's early Persian settlers. Non-African residents account for 1% of the total population. In the 1960s and 1970s, thousands of Asians emigrated, frequently under duress. Many emigrated to the UK, which is home to 100,000 Tanzanians. An estimated 70,000 Arabs and 20,000 Europeans still reside in Tanzania. Tanzania has more than 126 tribes, and each ethnic group has its own language. No language is de jure official, but Swahili is the de facto official national language, used for inter-ethnic communication and for official matters. The political reforms that turned Tanzania away from a closed and socialist environment have inevitably resulted in an opening up of the country. The attendant growth of the private sector has led to the English language becoming of increased importance. Many schools use English as the medium of instruction, as do all universities. Other spoken languages are Indian ones, especially Gujarati, and Portuguese (both spoken by Mozambican blacks and Goans).

Mt Kilimanjaro

Revision of the political system and an improving economy have helped to open up this country of mixed peoples and geography

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ANZANIA'S president (currently Jakaya Mrisho Kikwete) and the members of the National Assembly are elected by direct popular vote for five-year terms. The president appoints a prime minister who serves as the government's leader in the National Assembly. The president selects his cabinet from among National Assembly members. The constitution empowers the president to nominate ten non-elected members of Parliament, who also are eligible to become cabinet members. Elections for president and all National Assembly seats were last held in December 2005. The National Assembly has 295 members, which include the attorney general, five members elected from the Zanzibar House of Representatives, 48 special women's seats (comprising 20% of those that a given party has in the House), 181 constituent seats from the mainland and 50 seats from Zanzibar. Also in the list are the ten nominated members. Zanzibar's semi-autonomous relationship with the mainland is a relatively unusual system of government. Zanzibar's House of Representatives has jurisdiction over all non-union matters.There are currently 81 members in the Zanzibar House of Representatives, comprising 50 seats elected by the people, ten appointed by the president of Zanzibar, 15 seats reserved for women, five ex-officio members and an attorney general appointed by the president.The terms of office for these representatives, and Zanzibar's president, are five years. Tanzania has a five-level judiciary, combining the jurisdictions of tribal, Islamic and British common law. Appeal is from the primary courts through the district courts, resident magistrate courts, to the high courts and court of appeals. Judges are appointed by the chief justice, except those for the court of appeals and the high court, who are appointed by the president.

The country's court system parallels the legal system of the union, and all cases tried in Zanzibari courts, except for those involving constitutional issues and Islamic law, can be appealed to the court of appeals. A commercial court was established in September 1999 as a division of the high court.

GEOGRAPHY

Tanzania is the world's 31st-largest country, is comparable in size to Nigeria, and is slightly more than twice the size of California. Tanzania is mountainous in the northeast, where Mount Kilimanjaro (Africa's highest peak) is situated. To the north and west are the Great Lakes of Lake Victoria (Africa's largest lake) and Lake Tanganyika (Africa's deepest lake, and known for its unique species of fish). Central Tanzania comprises a large plateau, with plains and arable land. The eastern shore is hot and humid, with the islands of Zanzibar lying just offshore. Tanzania contains many large and ecologically significant wildlife parks, including the famous Ngorongoro crater and Serengeti national park in the north, and the Selous game reserve and Mikumi national park in the south. Tanzania is a considerable wildlife habitat, and includes large-scale annual migrations across the Serengeti plain.

ECONOMY

The economy of Tanzania is based largely on agriculture, which accounts for more than half of GDP, provides around 85% of exports and employs some 80% of the work force. However, the topography and climate limits cultivated crops to only 4% of the total land area. Industry is mainly limited to processing agricultural products and light consumer goods. Nevertheless, Tanzania has vast natural resources, including significant deposits of gold and diamonds. Tanzania is known for the unique gemstone tanzanite, and hosts commercial quantities of natural gas on the island of Songo Songo in the Indian Ocean (off the Rufiji delta). Output commenced in 2004, with the gas being pumped to Dar es Salaam. A new gas field is being developed in Mnazi Bay. The country's economy suffered in the late 1970s from falling commodity prices and the sharp spike of oil prices. Faced with economic turmoil in the 1980s, the government agreed to accept conditional loans from the International Monetary Fund, and to undergo a structural adjustment that was tied to the financing. This adjustment included a large-scale liquidation of the public sector, deregulation of the financial and agricultural markets, and cuts in education and health services. Dr Julius Nyerere, the first president of Tanzania, retired in 1985 and his policies fell out of favour. From the mid-1980s through to the early 1990s, under the government of president Ali Hassan Mwinyi, Tanzania's GDP grew modestly. Unfortunately, poverty continued to

REGIONS

Tanzania is divided into 26 regions (mkoa) ­ 21 on the mainland and five in Zanzibar (three on Unguja, two on Pemba) ­ and 98 districts (wilaya), each with at least one council. Of the 114 councils, 22 are urban, which are further classified as city councils (Dar es Salaam and Mwanza), municipal councils (Arusha, Dodoma, Iringa, Kilimanjaro, Mbeya, Morogoro, Shinyanga, Tabora and Tanga) or town councils (the remaining 11 communities). Tanzania's regions are Arusha, Dar es Salaam, Dodoma, Iringa, Kagera, Kigoma, Kilimanjaro, Lindi, Manyara, Mara, Mbeya, Morogoro, Mtwara, Mwanza, Pemba North, Pemba South, Pwani, Rukwa, Ruvuma, Shinyanga, Singida, Tabora, Tanga, Zanzibar Central/ South, Zanzibar North and Zanzibar Urban/West.

worsen and, under various measures, human development fell. Revision of the political system led to the establishment of multi-party politics by 1992, and president Benjamin Mkapa was elected in 1995. The new government was committed to improving all sectors of the economy, and recognised the importance of mining in developing the country's industrial base. Since the mid1990s, the economy has been improving. Recent public sector and banking reform, and new legislative frameworks, have helped increase privatesector growth and investment. However, further economic progress will depend on curbing corruption, and cutting back on unnecessary public spending.

August 2008 Mining Journal special publication Tanzania

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GEOLOGY AND MINERAL POTENTIAL

Prospective terrain

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ANZANIA is underlain mainly by Archaean and Proterozoic rocks, mostly exhibiting ages of greater than two billion years (>2,000Ma). The Archaean rocks date from 2,500Ma to 2,800Ma and form the Tanzania Craton, a component of the African Plate, one of the world's largest slabs of continental crust. These ancient terrains host some of the richest base and precious metal deposits in the world. The Tanzania Craton of East Africa comprises granite-related lithologies (granites and graniterelated gneisses) intruding and separating greenstone belts, both large and small. It is presumed to be underlain by the Uganda Basement Gneisses, which have been dated at 3,300Ma and which, in turn, are thought to be equivalent to the West Nile Complex farther to the west. The uncertainty arises from the poor exposure of the contact between the craton and the underlying gneisses on its northern boundary. The east and southeast limit of the craton is marked by the Lower to Middle Proterozoic Usagaran belt, dated at 2,000Ma, and by the Late Palaeozoic (900-500Ma) Mozambique collisional belt. To the southwest, the 2,000Ma Ubendian belt marks the edge of the craton, whereas to the west the boundary is marked by the Late Proterozoic Karagwe-Ankolean belt and the early Palaeozoic Bukoban system. Completing the boundary in the northwest is the Ruwenzorian belt of Uganda. The precise relationships between the craton and the surrounding younger rocks are difficult to determine because of the lack of exposure and the amount of surface weathering. The Archaean of Tanzania can be divided into three units: the Dodoman gneisses of central Tanzania, the Nyanzian granite-greenstone terrain of the north and the overlying Kavirondian system of the Lake Victoria region. The latter lies unconformably upon the Nyanzian and is derived from it. There is some speculation as to the relationship between the Dodoman and the Nyanzian. The Dodoman is regarded by some as equivalent to the Nyanzian, having been subjected to higher degrees of metamorphism, migmatisation and `digestion'. Consisting of hornblende gneisses, amphibolites and haematitic quartzites (possibly meta-banded ironstones), they appear to increase in metamorphic grade southwards where extensive charnockitegranulite facies gneisses are observed. They are similar to the Ugandan basement series and consequently may represent a lower crustal level to the Nyanzian. The Proterozoic Ubendian and Usagaran systems (2,100-1,800Ma) surround the Archaean and are composed of highly metamorphosed gneisses of largely reworked Archaean material. The Ubendian comprises mainly amphibolite-grade gneisses of igneous and sedimentary origin containing rare marbles. It is intruded by minor mafic and ultramafic rocks, and by late granites displaying a structural trend to the northwest. The Usagaran system forms the south and east margin of the craton. The main rock types are granulites and biotite gneisses of pelitic origin, with quartzites also common. Granulite facies metamorphism is attained in a number of areas.

The high-grade metamorphism, rock type and geological setting have occasioned comparison with the Grenville Province of Canada. The structural trend is to the southwest. The Karagwe-Ankolean system of Proterozoic age outcrops in northwest Tanzania along the borders with Uganda, Rwanda and Burundi, with subsidiary outcrops on the eastern shore of Lake Tanganyika. The system contains weakly-metamorphosed rocks of shallow-water origin, including argillites, phyllites and quartzites. Granites intruded into sediments form oval-shaped domes preserved by the resistant quartzites that surround them. In the northern part of the system, ultramafic rocks contain magmatically-segregated nickel, cobalt and copper sulphides. Located between the Karagwe-Ankolean system and the craton, a series of Palaeozoic sediments forms the Bukoban system, extending from Lake Rukwa to the Ugandan border. The Bukoban comprises weakly deformed sandstones, quartzites, shales, red beds, dolomitic limestones and lavas. The southeastern part of Tanzania is underlain by the Late Permian to Jurassic Karroo series.This system is prevalent all over southern Africa, reaching its northernmost outcrop in Tanzania. Essentially a series of coarse sandstones, shales and siltstones, it represents a continental sequence often accompanied by coal deposits. It rests unconformably on the underlying Proterozoic. North of Dar es Salaam, the series continues as a marine sequence.

The Upper Mesozoic is represented by limestones, sandstones and shales, with local gypsum and salt in the coastal regions and calc-alkaline volcanics on the Tanzania Craton. Cenozoic events saw the incipient dislocation of the African Plate with rupturing occurring in the West and East African rift systems. In Tanzania, the Western rift is marked by Lakes Nyasa and Tanganyika, while the Eastern, or Gregory, Rift passes through Lake Natron before joining the Western Rift south of Lake Nyasa. Subsidiary rifts are found in the Selous Basin and at Lake Rukwa, where some Karroo rocks are preserved. Other Cenozoic-to-Recent events include the intrusion of kimberlites, principally in the north-central part of the craton. Many are diamondiferous, including the Mwadui pipe, which is the largest (in area) known kimberlite in the world. A number of the kimberlites were emplaced less than 50 million years ago. Recent events include the development of laterite, silcretes and calcretes resulting from the tropical weathering of bedrock. These units are economically important as they can concentrate precious metals and diamonds, phosphates above carbonatites, nickel over ultra-mafics and gemstones over high-grade metamorphic rocks. Some of the material in this supplement has been taken from an earlier publication by Mining Communications Ltd on Tanzania, and from a contribution by Zacharia Makka Bongole.

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August 2008 Mining Journal special publication Tanzania

GEOLOGY AND MINERAL POTENTIAL

Political debate

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INFRASTRUCTURE

Tanzania is well served by its Mineral Resources Department (Madini), part of the Ministry of Energy and Mines. Dodoma-based Madini is the repository of over 70 years of geological and mineral records, including the results of mineral exploration and geological investigations. Also available are geological and topographic maps, and LandSat and aerial photographs. During the late 1970s, an airborne geophysical survey was undertaken, with over one million line metres being surveyed at a spacing of 1km. The resulting 322 maps (with nine separate measurements, including aeromagnetics) are also available from Madini. The magnetic survey revealed 600 dipole anomalies with signatures similar to known kimberlites. To promote mineral exploration, Madini established a Mineral Occurrences database that contains records of over 600 mineral occurrences and is linked to digital map records. In addition, a Mineral Title database has been established to facilitate the issuance of licences, and to aid regulatory supervision, monitoring and compliance. Three examples of Tanzanite

N THE presidential elections of December 2005, Jakaya Kikwete won 80% of the vote. Mr Kikwete had served for ten years as Tanzania's foreign minister, after retiring from the military with the rank of lieutenant-colonel. In his inauguration speech, president Kikwete said he will make improving relations with the semi-autonomous islands of Zanzibar a priority, and added that he would continue the free-market policies of the outgoing president, Benjamin Mkapa. However, in November 2007, president Kikwete announced that the government would follow in the footsteps of the Democratic Republic of the Congo and review all mining contracts. In July this year, Tanzania's 12-member Mining Contracts Review Committee recommended that the government should own 10% of the shares of all mining companies in the country. The government is also being advised that mining royalties on metals should be increased from 3% to 5%, and that tax relief on fuel imports for gold mines should be stopped. The royalty on rough diamonds and gemstones (including tanzanite) should increase from 5% to 7%, while that for cut stones should rise from zero to 3%. Newspaper reports said that the committee had recommended that a fuel tax should be levied on mining companies, with the money to be spent on road building. These recommendations follow a huge increase in the number of companies seeking licences for mineral

exploration. According to energy and minerals minister William Ngeleja, an average of 500 licences was issued every month in the 2007/08 financial year. The previous financial year had an average of 240 per month. The minister attributes this success partly to reforms in the licensing department, which have increased efficiency and transparency, but also to the country's "great potential mineral wealth". In fact, he added in July, "there are some areas whose huge potential has only been scratched on the surface, or not touched at all". Mr Ngeleja noted, however, that these resources are not inexhaustible. Therefore, "we must never lose sight of the fact the gold, diamonds and tanzanite buried underground could easily be completely exhausted if we allow extraction with gluttonous abandon". He also noted that "not all exploration results in mining, and could just end up wreaking havoc on the environment. The government must, therefore, not hurriedly issue licences to all manner of extractors, leading to a depletion of our resources in the shortest time possible." In a debate last month in the National Assembly, minister Ngeleja confirmed that all income gained from mineral resources is directed "to the Union government, to benefit all Tanzanians". He added that "despite the fact that mineral resources are not included on the list of Union matters, the income obtained from minerals is directed to the main treasury which is used to finance activities of the government of the United Republic".

August 2008 Mining Journal special publication Tanzania

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EXPLORATION AND MINING

Mineralisation

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ANZANIA is highly prospective for a number of commodities, particularly gold, diamonds and base metals. The lack of modern exploration (except recently in selected areas) offers the opportunity for major new finds. The current exploration boom was stimulated by a review in 1990 of Tanzania's investment regulations. However, much of the country has still to be investigated using the multi-disciplinary approach that is the hallmark of technology-driven exploration. A summary of the prospective Tanzanian geological systems follows. DODOMAN Very few mineral deposits have been found within the Dodoman system. Regarded as older and at a deeper structural level than the overlying Nyanzian, the surviving mineralising systems are related to later events or areas of lower metamorphic grade. However, the presence of relic banded ironstones may indicate the possibility of gold or base-metal mineralisation. The Dodoman remains relatively unexplored largely on account of its Late Tertiary and Quaternary cover. NYANZIAN AND GRANITE-GNEISS TERRAIN The Nyanzian is the geological grouping for the greenstone belts that occur in the northern part of the Archaean Craton, south of Lake Victoria. The greenstone belts are not clearly defined owing to limited exposure, and nowhere is the basement exposed. The Nyanzian greenstones are thought to represent an upper layer resting on the granite-gneiss, which in turn lies above the Ugandan basement. As the granites are less dense than the greenstones above, they may have been subjected to diapiric uprise. There are eight major greenstone belts in the Nyanzian, all of which display abundant gold mineralisation. By contrast, little such mineralisation is associated with the granitoids. Two types of gold mineralisation have been determined in the Tanzanian greenstone belts. Shear- and vein-hosted gold mineralisation is the most abundant type in mafic and felsic volcanics of the Nyanzian, and to a lesser extent in the overlying Kavirondian conglomerates. Replacement-type gold-pyrite mineralisation in the banded iron formations (BIF) is less common, but deposits tend to be larger. In some belts, for example the Sukumaland, the greenstones are arranged in a circular pattern with the inner belt consisting of iron-rich basalts, andesites and graphitic schists. The basalts display little chemical variation along strike. The outer belt is characterised by felsic volcanic flows and pyro-clastics and a laterally consistent oxide BIF, tectonically thickened by thrusting and tight folding to 500m. In addition to gold mineralisation, the Nyanzian hosts volcanogenic massive sulphides (VMS). Although in general the system is base-metal poor, the Bulyanhulu and Samena deposits in Tanzania and the MacCalder mine in southwest Kenya are gold-rich VMS deposits. The prospects for further discoveries, particularly in the Cenozoic-covered southern part of the craton, are good. The Nyanzian also hosts a large number of diamondiferous kimberlites, including Mwadui. Over 300 kimberlites have been identified, of which about 20% are known to be diamondiferous. About half of these occur

QT Quaternary, Tertiary and Quaternary basins, evaporites, authigenic minerals, coal, local hydrothermal systems Kimberlite and diamond provinces Other mineralised area, as indicated Carbonatites (phosphate, rare earths, niobium) Major mines, as indicated

in clusters in the region between Mwanza and Shinyanga (a distance of 250km), and a second cluster occurs around Singida, a further 100km to the south. Another group, located east of Lake Nyasa, was found to be lacking in diamonds although a number of alluvial

diamond occurrences in the south, northeast and southwest of Tanzania may represent the weathering of unknown diamondiferous kimberlites. The clustering of kimberlites in Tanzania is reminiscent of Archaean diamond deposits elsewhere in the world.

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August 2008 Mining Journal special publication Tanzania

EXPLORATION AND MINING

UBENDIAN AND USAGARAN These Proterozoic systems surround the east, west and southern margins of the Archaean Craton. Covered mainly by Cenozoic sediments, they are relatively unexplored. The Usagaran hosts deposits of semiprecious and precious stones, particularly in the highgrade gneisses. The most famed of these is tanzanite, a violet-blue variety of the mineral zoisite. Tanzanite is recovered mainly from the Arusha region in the northwest of the country. Also in this area of the Usagaran is the Marelani graphite mine. Rubies, sapphires and emeralds have been recovered from high-grade granulite gneisses that occur throughout the Ubendian and Usagaran. The only significant base-metal producer was the Mukwamba mine, near Mpanda in the east of the country. Producing nearly 2Mt of ore grading 2.4% Pb, 0.6% Cu and 1.45g/t Au over an 11-year period from 1950, this underground mine was forced to close owing to low metal prices. Other base metal occurrences include the Pare copper mine, hosted in shear zones in granulites, the Lufusi copper prospect, 35km west of Kilosa, and the Sango area, where over 100 occurrences are noted. Gold in the Ubendian is found at Mpanda associated with a suite of metamorphosed sediments, intruded by granites and stockworks.The mineralisation is found within northwest-trending shear zones adjacent to the granites. At nearby Lupa, gold is found in shear zones near acid and basic intrusions. The mineralisation is in lodes and secondary deposits, the latter hosting most of the 24t recovered from over 80 sites. Mining began in the area in the 1930s. The Lupa area is of greenschist-amphibolite metamorphic grade, considerably lower than the majority of the Ubendian, and may be considered to be reworked Archaean greenstones. The secondary alluvials are cut by streams in the area. In fact, without these incisions the mineralisation would remain buried beneath the later cover. Other gold occurrences, such as those at Igawa and Kitowero within the Palaeozoic, need careful reappraisal in the light of the Lupa mineralisation. KARAGWE-ANKOLEAN The most important mineralisation of these Late Proterozoic schists and quartzites is hosted in ultrabasic rocks intruded into the low-metamorphic gradesediments. The ultrabasic rocks, typically pyroxenites, periodotites and meta-gabbros, occur in lenses up to 1.5km long and 300m thick. These lenses contain disseminated and massive nickel-bearing sulphides. The zone of intrusions, mapped by aeromagnetic surveys, extends from the border with Burundi in the southwest to that with Uganda in the northeast of the Karagwe-Ankolean outcrop. At Kabanga in the southwest, a resource of over 500,000t of contained nickel has been identified. Other lenses lie to the north. Tin-tungsten mineralisation in the far northwest of the outcrop occurs adjacent to granite intrusions. Artisanal production has been around 14t/y. BUKOBAN The Palaeozoic sediments of the Bukoban are host to a number of stratiform copper-silver occurrences that are thought to follow the Copperbelt or Kupferschiefer model of syngenetic chemical precipitation of copper ores in shale bands overlying sandstones. An example of this type of mineralisation is the Kigugwe deposit in the Nyamori Hills, east of Kigoma. Copper values in the shales are usually 1-3%, although higher concentrations have been determined in nodules (up to 40%). The extensive nature of the shale horizons makes the area highly prospective. KAROO The principal economic resource in the Karoo is coal, found in the southwest, with mining at Kiriwa near the Malawi border. A number of prospects have been explored in the Karoo systems, including the Ruhuhu basin and the Ketewaka-Mchuchuma coalfield. MESOZOIC AND CENOZOIC Like kimberlites, carbonatites are deep-sourced carbonate igneous rocks found predominately in stable Archaean cratons. Tanzania has over 20 carbonatites, including the rare active Oldoinyo Lengai, north of Ngorongoro crater. Carbonatites offer economic concentrations of phosphate from the silicate apatite (as at Mbalizi and Minjingu, near Arusha) or niobium (at Panda Hill, west of Mbeya). Rocks of these ages host a number of industrial minerals, including a white marble deposit in the Morogoro region, kaolin at Pugu Hill, and evaporite and saline deposits in the rift valley lakes.

Precious potential

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INCE the early 1990s, more than 50 multinational companies and over 250 local companies have acquired mineral rights in Tanzania. Many of these have been gold prospects, which represent some of the best investment opportunities in Tanzania. The metal is produced in many parts of the country, sometimes with silver and copper as by-products. The areas of highest potential for discoveries include the various Archaean greenstone belts in the Lake Victoria district (including Geita, Rwamangaza, Musoma-Mara, Kilimafedha, Kahama, Iramba-Sekenke and Nzega; see map) and in the Proterozoic rocks of southern Tanzania (containing the Lupa and Mpanda goldfields). In July 2008, Toronto-listed Helio Resource Corp announced that it had completed the latest phase of diamond-drilling at the SMP gold property, in which it is earning a 100% interest. The holes tested the main Porcupine target, where gold mineralisation has been outlined over 1km of strike. Helio's management said the newlydiscovered Porcupine zone is one of 11 targets. Dundee Resources Ltd (and an affiliate) acquired a 20% stake in Helio at the start of this year following the purchase of seven million treasury shares at C$0.75 each. Helio said the funds were to be used on the SMP project. Also in July, Colorado-based Lake Victoria Mining Co announced the start of exploration on the 80%-owned Kalemela gold project, 125km east of Mwanza. The company's president, Roger Newell, said that the company had signed an exploration services agreement with its partner Geo Can Resources Co (a subsidiary of Nevada-based Kilimanjaro Mining Co) to provide the initial exploration programme. The 71km2 property lies within Prospecting License PL2747.

In June, Randgold Resources Ltd confirmed that it is to continue to the second phase of its joint-venture agreement with African Eagle Resources plc on the Miyabi gold project. Under the agreement, Randgold will now earn a 51% interest in the project by solely funding all further project costs up to completion of a prefeasibility study. On completion of the prefeasibility study, African Eagle can elect to retain a 49% interest in the Miyabi project by co-funding a definitive feasibility study. African Eagle previously outlined a JORC-compliant indicated resource of 7.9Mt at an average grade of 1.45g/t Au, and an estimated inferred resource of 4.5Mt at 1.01g/t Au (using a cut-off grade of 0.5g/t). Also in June, a Chinese consortium, led by Tianjin Institute of Geology and Mineral Resources (TIGMR), made a C$6 million equity investment in Douglas Lake Minerals Inc. The transaction gave TIGMR a 30% stake in Douglas Lake, with the funds being earmarked for exploration and development of the company's gold tenements in Tanzania. In April, Great Basin Gold Ltd completed the acquisition of Rusaf Gold Ltd, paying US$14.4 million (in 4.9 million shares) for the outstanding 63% stake. Apart from US$8 million in treasury, Dar es Salaam-based Rusaf's assets include the Kurils project in Iturup, Russia, and three exploration properties in Tanzania. The latter comprises ground in the Lupa and Lupa South goldfields, and in the Geita Archaean Greenstone Belt. African Precious Minerals Ltd was established in 2004 and apart from its four `flagship' projects (in South Africa at Evander, South Rand and Jeanette-Hilton; and in Mozambique at Monarch) has exploration projects in Mali and Tanzania.

Effective from January this year, Tanzanian Royalty Exploration Corp realigned its management structure to facilitate a "multi-phased exploration programme" on its Kigosi gold project. Immediately ahead of the announcement, the company had received what it described as "record high assay results" from reverse-circulation drilling at Kigosi. The newly-discovered Goshawk shoot, which is contained within the Luhwaika main shear zone, produced gold values of 7-36g/t. In July last year, Iamgold Corp said that it had outlined over 1Moz of gold in an updated resource estimate for its Buckreef gold deposit. Measured resources were estimated at 3Mt at an average grade of 2.7g/t, indicated resources at 12.9Mt at 1.8g/t and inferred resources at 10.9Mt at 2.4g/t. Iamgold said the majority of the new resources were generated by drilling to the north and south of known mineralisation at the Buziba deposit. The Buckreef property covers over 260km2 of the Rwamagaza Greenstone Belt but has 5-15m of overburden, which masks the underlying rocks and any mineralisation. According to Iamgold, this area has not been fully explored with modern methods. Recent work has confirmed the potential for an openpit mine at Buckreef, defined two new high-grade underground zones (one beneath the Buckreef deposit and the other 500m to the north), identified a significant open-pit prospect at Busolwa-Buziba (20km east of Buckreef), and increased the inferred resource from 1.15Moz to 1.93Moz of gold. Midlands Minerals Corp has gold and diamond exploration projects in the Lake Victoria area. The company's main focus is the Itilima gold and diamond project located just outside Shinyanga on the Geita-

August 2008 Mining Journal special publication Tanzania

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EXPLORATION AND MINING

Bulyanhulu-Sekenke trend. Sub-Sahara Resources NL is also active in the Lake Victoria Greenstone Belt. The company recently completed more than 3,000m of drilling at its Mabale Hills project, targeting the Simba and Dhahabu prospects that are part of the joint venture with Currie Rose Resources Inc. The company is also active on the Nyamirembe project, 100km to the northwest. Sub-Sahara's other main Tanzanian joint ventures include the Nyanzaga JV with Barrick Exploration Africa Ltd (BEAL). This includes the Tusker prospect, which has a JORC-compliant indicated and inferred total resource of 123Mt at 1.15g/t Au, containing 4.5Moz gold. Sub-Sahara is also in a joint venture with Resolute Mining at Nyakufuru, which is situated 150km from Mwanza. The properties that make up the JV are grouped into three separate project blocks (Mkweni, Mwagi Magi and Kanegele). Sub-Sahara's other involvement with Resolute is on the Kahama JV that comprises a number of tenements located on the western extent of the Nzega Greenstone Belt, 30km west of Resolute's Golden Pride gold mine. Platinum group metals are known to exist in layered maficigneous intrusives at Kabanga, Kapalagulu and Zanzui. Other prospective areas are Kabulyanwele, Mwahanza Hill, Garauja-Basuto, Twamba, Nkenza, Itiso, Haneti and in the Uluguru Mountains. Over 300 kimberlites have been identified in SingidaIramba, Shinyanga, Nzega and Mbeya provinces, of which 20% are diamondiferous. OTHER METALS PROSPECTS Geologically, both the Archaean and the Proterozoic are prospective for base metals. In western Tanzania, the Mukwamba deposit contains lead-copper-gold-silver at sub-economic grades, in the Sango area in the north of the country, a zone of copper mineralisation some 13km in width has been recognised, extending for 90km northwest of Kamarapaka on Lake Victoria. In the northeast, there is the Pare copper deposit in Usangi. Copper occurs at Kidete, Lufusi, Winza and Tambi in the Mpwapwa and Kilosa districts. German prospectors mined these areas in the 1950s. Gulf Resources has commenced a pre-scoping copper study at Pare in the northeast of the country, and has gold projects at Manga Handeni and Iringa. The company is also evaluating Tan Resources Ltd's Liweta and Mbamba Bay coal deposits. Numerous iron-ore deposits have been identified in Tanzania's Proterozoic rocks. Titaniferous magnetic bodies associated with anorthositic gabbro occur at Liganga in southwest Tanzania, and are within 80km of the Ketewaka-Mchuchuma coal resources. There are seven known pyrochlore-bearing carbonatite occurrences in Tanzania, of which only two (Mbeya and Oldonyo Dili) are considered as potential sources of niobium. The carbonatite at Wigu Hill is a potential source of rare earths. Tanzania's coal resources may be as high as 1,500Mt. The deposits of Katewaka-Mchuchuma in the Ruhuhu basin and Songwe-Kiwira probably offer the best development potential. Uranium occurs in sandstones in Karoo rocks, mainly in the Karoo and Bukoban supergroups. The Mkuju River drainage area, underlain by Karroo sediments, is highly prospective, and sandstone-type uranium deposits are being targeted in the Luwegu Basin. Another prospect within the Karoo sandstone is at Madaba. Other known areas of uranium potential include Ndala, Itigi and Iseke in calcrete-related secondary environments in Quaternary deposits. Elsewhere, uraninite occurs within certain pegmatites in the Usambara and Ukaguru mountains, and in the Mpanda district. Uranium associated with zircon and pyrochlore has been found in river and beach sands. On the corporate front, Uranex NL is progressing exploration, resource definition and development in two separate provinces within Tanzania: at Bahi in the centre of the country, and at Mkuju/Songea in the south. The company recently announced an inferred resource of 14Mt averaging 218ppm U3O8 for Bahi (at a cut-off grade of 150ppm U3O8). Sub-Sahara Resources' interests in Tanzania also extend into uranium, where it has a 15% contributing interest in the Madaba-Mkuju JV with unlisted Canadian company Tanganyika Uranium Corp. The property, situated 225km southeast of Dar es Salaam, was explored by Uranerzbergbau GmbH between 1978 and 1981. Australia's Western Metals Ltd is currently completing a 12,000m drilling programme in Tanzania following initial success with its Mtonya joint venture, which comprises 3,400km2 of territory prospective for sandstone-hosted uranium mineralisation. Two nearby projects, Ruhuhu and Ruvuma, bring the company's total southern Tanzanian uranium-property holdings to almost 14,000km2. In the middle of last year, Denison Mines Corp gained a controlling stake in OmegaCorp Ltd. The Canadian uranium producer had targeted OmegaCorp because of its uranium projects in Tanzania, Mozambique, Zambia and Zimbabwe. The company also has a heavy mineral sands project in Tanzania. Recent nickel exploration has revealed extensive nickel-cobalt-copper mineralisation associated with ultramafic rocks of the Karagwe-Ankolean system in northwest Tanzania. The Kabanga nickel project, a joint venture between Xstrata and Barrick Gold, is among the world's most attractive nickel projects. According to Barrick Gold's former chief executive, Greg Wilkins, the project has the potential to become a "world-class" nickel-sulphide deposit. Xstrata gained control of Kabanga when it took over Falconbridge in 2006 (Falconbridge and Barrick had signed a joint venture over Kabanga in April 2005). The company subsequently spent more than US$50 million to update the resource model and to prepare Kabanga for the prefeasibility study, which commenced early last year. At the start of this year, Continental Nickel Ltd received drilling results from its 70%-owned Nachingwea nickel-suphide project (30%-owned by IMX Resources NL). The company said the drilling programme identified six new near-surface nickel-copper sulphide zones at the property, of which one or more has the potential to be developed into a significant deposit. A C$7 million diamond-drilling programme commenced at the site in July. Some 15,000m of drilling will be completed, initially focusing on the testing of a number of high-grade nickel-copper sulphide zones discovered in 2006-07 at the Ntaka intrusion.

Mining success

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OLD was exported from Tanzania following the penetration of Arab traders during the 16th to 19th centuries. However, the first commercial mines were developed in 1909 by German colonists at Sekenke in the Lake Victoria goldfields. Following World War I, gold production grew steadily for about 30 years, but then declined. By 1967 output had all but ended as a result of the fixed gold price. There has been a strong revival in gold mining recently based on modern geological models, technologicallyadvanced recovery methods and strategic investment. Gold production last year reached 1.75Moz, making Tanzania the third-largest gold producer in Africa. Tanzania's other important mined product is diamonds. Like gold, alluvial diamonds were recovered in earlier times but it was not until the discovery of the Mwadui kimberlite by Dr John Williamson in 1940 that industrial processes were brought to bear. Other historically-mined products include coloured gemstones, in particular rubies, sapphires and tanzanites. Tanzania's mining industry has experienced a boom

over the past ten years, and there are over 200 mediumto large-scale mining licences in issue. Indeed, since 1998, annual gold production has risen from less than 1t to about 50t. Over the same period, mining has become the second-fastest growing sector of the economy after tourism. Mining's contribution to GDP has doubled from only 2% in 1998, and cumulative direct foreign investment in mining since then exceeds US$2.5 billion. Since the mid-1990s, seven large-scale mines have come on stream. Six have been gold mines, the largest of which is AngloGold Ashanti Ltd's Geita mine, which has a capacity of over 600,000oz/y, while Barrick Gold Corp owns 100% of the 300,000oz/y Bulyanhulu mine, 70% of the 100,000oz/y Tulawaka gold mine (through Pangea Minerals Ltd, with MDN Inc owning the balance) and the 200,000oz/y North Mara gold mine (following the acquisition of Placer Dome in mid-2003). Resolute Mining Ltd owns the 150,000oz/y Golden Pride open-pit mine. Meremeta Ltd opened the 80,000oz/y Buhemba mine but the company subsequently went into liquidation, and the assets are now held by Tangold Ltd.

Barrick Gold's Bulyanhulu mine returned to full production in December 2007 after the company replaced the 1,300 workers it sacked when they walked off the job in October. The striking workers had demanded higher salaries and improved healthcare.

ARTISANAL TRAGEDY

A flash flood at the end of March killed 66 artisanal miners in a warren of interlocking small-scale tanzanite mines on B block in the Merelani area. Following the accident, in the north of the country, the government pledged to improve safety in the region's artisanal mines, the only place in the world where the blue gemstone tanzanite is mined. The tragedy occurred in workings adjacent to TanzaniteOne Ltd's Merelani mine, with flood water penetrating the company's Bravo shaft. TanzaniteOne temporarily closed the shaft, and used it to provide access for rescue workers.

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August 2008 Mining Journal special publication Tanzania

EXPLORATION AND MINING

Barrick Gold's North Mara mine comprises three open-pittable orebodies, one of which has been exhausted, one is being mined, and the third is in development. The Canadian company's Buzwagi project (operated through Barrick Gold Tanzania Ltd) is due to become the country's next gold producer, with output scheduled for the beginning of next year. The US$400 million operation will be Tanzania's largest open-pit mine and its secondlargest mining operation. Alexander Davidson, Barrick's executive vice-president of exploration, said the project would enter production at cash costs of less than US$300/oz. The project should produce up to 260,000oz of gold in its first five years of production, and have a total mine life of about ten years. In October 2007, the government announced that it wanted a higher share of the wealth being generated by AngloGold's Geita mine. The push for extra revenue came on top of a renegotiated agreement with the company whereby AngloGold agreed to waive tax breaks and start paying levies. AngloGold will begin paying corporate tax at 30% on the mine by 2011, four years earlier than planned. Like other gold miners, AngloGold must also pay annual levies of US$200,000 directly to local authorities for each mine operated. AngloGold is lifting output at Geita to 340,000oz this year, compared with 326,852oz in 2007. The company announced in April that it may spend up to US$64 million on operations in Tanzania, of which US$10 million is allocated to upgrade the mill and smelter operations at Geita. Gold output at the mine reached a peak of 618,571oz in 2005 but has since declined owing to a series of technical problems, including pump failures at its two mills and a slope collapse in February last year. The failure of the intermediate footwall zone in the Nyankanga pit (one of four open pits at Geita) cut access to a high-grade ore zone, which reduced gold production and necessitated a revised mine plan. AngloGold operates three other open pits at Geita: Geita Hill, Lone Cone and Matandani. Perth-based Resolute Mining, which operates the 150,000oz/y open-pit Golden Pride mine, announced that it did not believe the government's push for extra money was related to the higher gold price. Chief executive Peter Sullivan said AngloGold was following the lead of other gold miners which had already renegotiated terms with the Tanzania government. He added that his own company's renegotiations meant an extra US$10-15/oz in Aerial view of AngloGold Ashanti's Geita mine production costs, amounting to "a few million dollars a year". Resolute Mining last year announced that the expansion plan for its Golden Pride mine was being revised due to "equipment issues and increased costs". This meant that the plan to upgrade the pit and expand the life of the operation by eight years (with an increase in the potential gold resource of 700,000oz) was delayed. Instead, Resolute will proceed with a less-costly smaller pit design with a lower stripping ratio. The revised pit design will contain about 670,000oz of gold at a projected average cash cost of US$375/oz, resulting in a six-year extension to the life of the operation. The pit also contains 110,000oz of inferred resources. During the 2007 financial year the operation produced 138,421oz (145,043oz the previous year) at a cash cost of US$403/oz. Gold production was adversely affected by the poor delivery of ore from the open pit, and the slow leach nature of the fresh ore. The Buhemba mine in the Mara region now belongs to Tangold, which took over the assets of Meremeta after the company was liquidated. Twelve people were arrested in July over pilfering from the mine, which has remained idle despite an injection of funds from the Bank of Tanzania. Meanwhile, some 800 former workers say they were not paid when the project was prematurely shut down after a brief spell of production. In other sectors, Williamson Diamond Mine Ltd operates the 220,000ct/y capacity Mwadui diamond mine, owned jointly by De Beers (75%) and the government (25%). The blue-violet gemstone tanzanite is unique to Tanzania's Simanjiro district near Mt Kilimanjaro. In 1990, the government demarcated the tanzanite mining area into four blocks ­ A, B, C and D ­ measuring 5x2km in total. TanzaniteOne Ltd owns the mining licence for Block

C (the largest block at the centre of resource), and operates the Merelani mine near Moshe. Tanzanite is located within a relatively complex geological environment and is found within a `chocolatetablet' boudin structure, typically located in the hinges of isoclinal folds. A conservative estimate of TanzaniteOne's resource is 63-83Mct, with an average price of US$12/ct (rough). The mining industry in Tanzania now employs more than 8,000 people in large-scale operations, compared with about 2,000 in the early 1990s. Mineral exports have risen substantially since 2000, and total mineral exports in 2006 were valued at US$857 million, of which gold contributed US$640 million, tanzanite US$44 million and diamonds US$26 million. Official exports of copper in 2006 totalled 7.24Mlb (3,285t), valued at US$19.9 million. Silver is produced as a co-product of gold mining, and 15t, valued at US$5.5 million, were exported in 2006. Other minerals exported included nonferrous metals, industrial mineral, gemstones and building materials. Apart from a favourable geological environment, the successes achieved in Tanzania's minerals sector are due in large part to the major economic reforms that have been undertaken since the mid-1980s, including a new mineral policy and the enactment of internationallycompetitive fiscal and legal regimes for the mineral sector. Political stability has, of course, also been a factor. At present, the government is implementing policy strategies aimed at turning artisanal and small-scale mining from being a threat to an opportunity.

www.helioresource.com

Helio Resource Corp, a well-financed junior gold exploration company focused on developing the SMP Gold project in Tanzania, invites applications from suitably qualified and experienced candidates for the following position:

Reporting to the company's Country Manager, the successful candidate will be responsible for QA/QC work, and database management and maintenance. This is a field-based position in a remote location of southwestern Tanzania. The position also entails: · Updating all GIS and geological models; · In-house resource calculations; · Drafting maps and figures for presentations; and · General IT support for the camp. Minimum requirements: · Geologist with a background in exploration preferred; · Two or more years establishing and maintaining databases and processing geological, geophysical and geochemical data; · Resource estimation experience, preferably on gold projects; · High level of personal energy and enthusiasm; · Ability to work individually and as part of a diverse team; · Attention to detail; · Excellent English communication skills, both written and spoken; and · Amenable to living with diverse group of people for long periods of time. The company offers a competitive salary and benefits package commensurate with experience and qualifications. Start date: Immediately Applications including salary expectations accepted via e-mail to Mr R Sheets at: [email protected] NB. Only shortlisted candidates will be contacted.

DATABASE MANAGER / RESOURCE GEOLOGIST

August 2008 Mining Journal special publication Tanzania

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PROFILE

Great Basin Gold: rich diversity of assets

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ANCOUVER-BASED Great Basin Gold Ltd is developing mining assets in two of the world's richest gold environments (the Witwatersrand Basin of South Africa and the Carlin Trend of Nevada, US), has an exploration project on the Russian island of Iturup, and prospective land holdings in two regions of Tanzania. Chief executive Ferdi Dippenaar says the company is set to grow substantially in value as it heads towards its goal of becoming a low-cost mid-tier gold producer. Leading the way is Great Basin's Hollister property on the prolific and highly-developed Carlin Trend in Nevada. The Hollister Development Block (HDB) within the property is expected to yield an average 150,000oz/y gold equivalent for six years. Production was initiated in May with the processing of the first HDB ore at Newmont's Midas mill, 32km from Hollister. Earlier this month, Great Basin announced further results from underground drilling at HDB which better define the resources within the Clementine and Gwenivere vein systems. Mr Dippenaar said: "We are making good progress with the US$14.4 million exploration programme, the focus of which has been to upgrade our resources from the inferred to the measured and indicated categories". In June, the company announced that surface drilling had discovered a previously unrecognised vein system in the Hatter Graben area, 2km from the current decline at HDB. Mr Dippenaar said the new vein system "has exceeded our expectations as this could have a significant impact on the size of the Hollister resource". The HDB deposit has an in-situ gold grade of 36g/t (1.05oz/ston), and a technical report completed in April 2007, followed by a feasibility study three months later, indicated production from a gold-equivalent resource of 2Moz. This was increased in February to 2.3Moz, with 1.6Moz in the measured and indicated category. As indicated in the feasibility study, the operation will have an estimated cash cost of US$214/oz. A 75% stake in the Hollister property (formerly known as the Ivanhoe gold property) was acquired in 1997 from Newmont for US$6 million. Two years later, the company acquired the remaining equity from Touchstone Resources. In mid-2002, Great Basin entered into an agreement with Hecla Mining Co, which could earn a 50% working interest in HDB by spending US$21.8 million on exploration and development. In February last year, Great Basin entered into an agreement with Hecla whereby the company bought Hecla's earned-in interest for US$45 million in cash and US$15 million in shares. GBG now owns 100% of the Hollister Property. Great Basin also has a well-advanced development on South Africa's Witwatersrand Basin. The company

Left: Exploration in Tanzania. Above: Due diligence at Lupa objective of delivering measured and indicated resources by the end of this year. Several other exploration projects are also under way at Lupa; these should produce at least two new drill targets by the end of September. Kikugwe (centralsouth), where an exploration programme is being mobilised, and consists of extensive aircore drilling and soil sampling. Elsewhere, exploration on the island of Kurils focuses on intensive drilling aimed at bringing the main project area to measured and indicated status.

acquired the right to buy South Africa's Southgold Exploration Ltd (which had rights to the Burnstone gold property) in November 2002. The two-stage acquisition was completed in January 2004, for a total consideration of US$3.25 million in cash, 21 million shares, 10.5 million warrants and US$1.5 million in expenditure. The mineral resources at Burnstone were updated in February. Although the undiluted average grade fell 16% to 6.9g/t, total contained gold in the measured and indicated resources rose 41% to 11Moz. At a cutoff grade of 400cm g/t (equivalent of 4g/t over 1m), 3.2Moz of gold have been added to the total measured and indicated resources, and 2.0Moz to the inferred resources. An optimised feasibility study, completed in June 2007, for an initial operation in Area 1 and a small portion of Area 2 at Burnstone, indicated an annual average of 254,000oz of gold for 19 years at a cash cost of US$283/oz. Substantial additional resources are available for later phases of development. Great Basin has no hedging commitments, and is adequately financed (following a capital raising in May 2007) to deliver development of these two projects, as well as its other exploration projects, particularly in Russia and Tanzania. Its other assets include a 15% stake in Kryso Resources plc, which has projects in Tajikistan.

EXPLORATION UPDATE

One of the two drill programmes in Lake Victoria was completed in the quarter to end-June, with the second one still in process. Results received from both to date remain positive, and it is expected that a measured resource will be declared by October 2008 on both of the two drill targets in Lake Victoria. Extensive soil sampling was also concluded in the second quarter, and results from these have allowed the development of a very focused and target-driven exploration programme for the Lupa goldfield. The rest of 2008 will be utilised to complete current drilling programmes and to collate record, process and interpret data from the various exploration programmes. Competent Persons Reports for the areas on which resource declarations are expected will also be procured.

CONTACTS

Ronald Thiessen, chairman Ferdi Dippenaar, president and CEO Johan Oelofse, chief operating officer Lou van Vuuren, chief financial officer South Africa office: 138 West Street, Ground Floor Sandown, 2196, PO Box 78182 Sandton, South Africa 2146 Vancouver office: 1108-1030 West Georgia Street Vancouver, BC, Canada,V6E 2Y3 South Africa: Tsholo Serunye Tel: +27 11 301 1800 Canada: Michael Curlook Tel: +1 888 633 9332 US: Barbara Cano (Breakstone Group): Tel: +1 646 452 2334

TANZANIAN ASSETS

In April 2008, Great Basin completed the acquisition of Rusaf Gold Ltd, paying US$14.4 million (in 4.9 million shares) for the outstanding 63% stake. Apart from US$8 million in treasury, Dar es Salaam-based Rusaf's assets include the Kurils project in Iturup, Russia, and three exploration properties in Tanzania. Rusaf holds ground in the Lupa and Lupa South goldfields in southwestern Tanzania, and in the Lake Victoria region of the country's Geita Archean Greenstone Belt. The current exploration programme consists of three projects: Lake Victoria (northwest), where, apart from several early-stage exploration activities, the company is undertaking extensive drilling on two deposits with the objective of advancing both to measured and indicated status by the end of 2008. Lupa (southwest), where the Nkolwisi deposit is currently subject to extensive drilling, also with the

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August 2008 Mining Journal special publication Tanzania

PROFILE

Taking a strategic position

Gulf Resources Ltd is a development and investment company that crosses the divide between Africa and Asia Pacific. Gulf's strategic position is designed to maximise the natural development synergies between the two regions

WHO'S WHO

Board of Directors: Scott Reid, Executive Chairman; Philip Treisman, Deputy Chairman; Wayne Kernaghan, Finance Director and Company Secretary; Greg Duncan, Technical Director Senior Management Group: Vic Fitzmaurice, Head of Africa Projects; Fharhaad Ali Moosa, Head of CTL Projects; Derek Anderson, Senior Consulting Geologist ­ Africa private partnership (PPP) for development of the Liweta and Mbamba Bay coal fields in southwestern Tanzania. Under the agreement, Gulf is entitled to buy a 60% interest in Liweta and Mbamba Bay subject to approval by Gulf following an initial technical study. Gulf has entered into an MoU with the Tanzania Ports Authority jointly to determine the potential of a PPP for the development, modernisation and expansion of the Mtwara port, including regulating the associated export processing zones and free port facility. The port of Mtwara is one of the three major ports owned and managed by Tanzania Ports Authority (the others are Dar es Salaam and Tanga). The deep-water port was built between 1948 and 1954. The average annual cargo throughput at Mtwara during the past five years has been 100,000t, which is only 25% of its capacity of 400,000t/y. Initial investigations show that the port could handle up to 750,000t/y (with the same number of berths) if additional equipment was put in place for handling containerised traffic. Mtwara is part of the Mtwara Development Corridor, which will also include development of power generation and transmission, transport infrastructure, telecommunications, water, agriculture, mining (including iron ore and coal), tourism, forestry and fisheries. Gulf plans to become involved in a number of these related projects upon securing the port redevelopment. Gulf knows that its long-term success, especially in Tanzania, depends on creating value for its local partners, project communities and shareholders. From the very start of a project, Gulf formulates a specific management plan to develop, operate and exit a project in a manner that improves the lives of everyone associated, in a safe and environmentally responsible way.

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ITH an established base in Tanzania, Gulf is set to develop projects of major significance in Tanzania and the surrounding countries. Gulf, which listed on the Australian Stock Exchange in August 2006 (ASX: GLF), has active operations in Vietnam (a coal to liquid CTL joint venture with Geleximco), Australia (gold exploration projects in Queensland and the Northern Territories) and Tanzania. Gulf has experienced management, finance and technical teams ready to implement its growth strategies in Tanzania. Team members have successfully funded and managed mining and exploration projects in Africa, Asia, South America and Australia. Most importantly, the Gulf team has operational, development and exploration expertise in Tanzania, Botswana, South Africa, Zambia, Ghana, Burkina Faso and Namibia. Gulf also has expertise and experience in raising finance (debt, equity and private capital) from various capital markets around the world. Mining and energy are two of the fastestgrowing sectors in Tanzania, contributing roughly half the foreign exchange and around 3.5% of GDP. Critically linked to the mining, energy and agriculture sectors is Tanzania's transport infrastructure, which is one of the investment drivers the government is focused on improving. Gulf is actively seeking a role in developing the key transport infrastructure in Tanzania, and over the past 18 months has developed important relationships with a number of Tanzanian partners. These include National Development Corp of Tanzania (NDC) and the Tanzanian Port Authority. Through these relationships, Gulf has begun a process of project assessment and acquisition that meets the Tanzanian Investment and Development Plan that is aimed at improving infrastructure to unlock the value of undeveloped mineral resources in the country.

were established to extract ore, and a total of 247t of ore was extracted (at an average grade of 10.2% Cu). A pre-scoping study has commenced that includes a review of available information.

Gulf has also entered into a joint venture with Kadolo Investments Ltd to earn up to 70% of the Manga Handeni/Bagamoyo gold project by spending US$700,000 over three years (after spending US$150,000, Gulf will have earned 51%). The project is situated at Manga in the Handeni and Bagamoyo district, and is contained within Prospecting Licence PL4164/2007, which covers some 123km2.

MANGA HANDENI/BAGAMOYO

Gulf has signed an MoU with the NDC to asses the Pare Mountains copper project in the northeast of the country. The copper mineralisation was first reported in 1955, and in the late 1950s limited trenching and diamond drilling was completed. Two small open pits

PARE MOUNTAINS

IRINGA SAMPLING RESULTS

Pit 1 2 3 4 5 Depth (m) 5 5 15 7 43 Sample number MS/01 MS/02 MS/03 MS/04 MS/05 Assay results (g/t Au) 9.69 9.74 14.16 8.20 138.65

Gulf has signed an MoU with Msichesta Mining Co over its Iringa gold leases (PML 720, 721 and 722) in central Tanzania. The area has a history of gold mining, and previous work includes tonnage and grade estimates based on trenching and substantial pitting. Although not in compliance with the JORC code, the exploration work revealed four reef systems at depths varying from 5m to 43m. Results of recent channel sampling of the mineralised system are presented in the table at bottom left. Initial appraisal indicates that the mineralised zone is open in all directions, and previous exploration work has only tested up to 200m of an estimated 1.5km zone. Two site visits have been made, and plans are under way for a more substantial sampling programme later this year.

IRINGA

CONTACTS

Gulf Resources Ltd Level 10, Gold Fields House 1 Alfred Street, Sydney NSW 2000 PO Box R745 Royal Exchange NSW 1225, Australia Tel: +61 (02) 8247 5333 Fax: +61 (02) 9247 7722 Website: www.gulfresources.net.au

Gulf has signed an MoU with Agri Min Ltd, which holds several prospective gold licences (PL 4453, 4454 and 4768) in eastern Tanzania. Negotiations are continuing. Gulf has also signed a heads of agreement with Tan Resources Ltd to evaluate the potential of a public

OTHER PROSPECTS

August 2008 Mining Journal special publication Tanzania

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PROFILE

Developing a major resource at the SMP Gold Project

Helio Resource Corp has been actively exploring the SMP Gold Project since late-2005

Drilling at the SMP Gold Project

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HE SMP Gold Project lies in southwest Tanzania within the Lupa Goldfields. The Lupa Goldfields was an important gold-producing region during colonial times, but is also an area which has received very little modern, systematic exploration since. The New Saza Mine (the eastern section of which is within the SMP Project), which operated between 1939 and 1956, was Tanzania's second-largest gold producer. Over the past two-and-a-half years, Helio has formed partnerships with two Tanzanian small mining companies ­ Thorn Tree Minerals and Dhahabu Resources ­ which allows Helio, through its 100%owned subsidiary BAFEX Tanzania Ltd, to explore an area of about 200km2, and covers a 30km strike of the region's main gold-bearing structure: the Saza Shear Zone. Helio can earn a 100% interest in the project, subject to a royalty to the partners. The project area encompasses four colonial-era gold producers: the New Saza, Gap, Kwaheri, and Razorback Mines. In addition, Helio, via its exploration activities, has identified numerous new targets, many of which have never before been drill-tested. To date, Helio has covered the entire project area with soil sampling and high-resolution magneticradiometric surveys, and also completed IP geophysics and geological mapping over selected areas.

Kenge Target ­ SMP Gold Project In addition, 11 discrete targets have been drilltested, all of which intersected bedrock gold mineralisation. The most advanced targets to date are Kenge and Porcupine.

KENGE

The Kenge target comprises five mineralised zones, namely Kenge NW, Kenge Main, Kenge SE, Mbenge and Snakebite. Drilling results from these targets have been very encouraging, including up to: 18m @ 2.7g/t Au from Kenge NW; 22m @ 6.9g/t Au at Kenge Main; 21.5m @ 3.6g/t Au at Kenge SE; 39.6m @ 2.6g/t Au at Mbenge; and 8m @ 21g/t Au at Snakebite. The Kenge target has a known combined strike length of about 2km, and most of the zones are open along strike and to depth. They all outcrop at surface, and are therefore amenable to open-pit mining. Helio has five diamond drill rigs working at the SMP Project, and is aggressively working towards publishing a resource estimate for the Kenge and Porcupine Targets, with an anticipated date of November,2008. The company recently closed a bought-deal financing for US$5.1 million, and has US$9 million in the treasury, much of which is budgeted for the SMP Gold Project.Initial metallurgical results have been received from the Kenge target: these show very good recoveries in excess of 95% through combined gravity and cyanidation, coupled with very low cyanide consumption rates.

PORCUPINE

The Porcupine Target was discovered in 2007 through soil sampling. Follow-up work led to the discovery of outcropping mineralisation over a strike length of at least 1km. The mineralised zones, where best exposed, were up to 40m wide at surface, and contained individual quartz veins up to 10m thick. Helio tested the target with one reversecirculation drill hole in late 2007, which intersected 42m grading 2g/t Au ­ an exceptional start! To date, five diamond drill-holes have been subsequently completed, with the best intercept to date of 52.24m grading 3.3g/t Au from 15.8m depth.

CORPORATE INFORMATION

Helio's board of directors comprises Grenville Thomas (chairman), Richard Williams (CEO), Christopher MacKenzie (COO), Clifford Davis, Stephen Leahy and Colin Jones.

CONTACTS

Helio Resource Corp 580-625 Howe Street Vancouver BC,V6C 2T6 Canada Contact: Irene Dorsman, marketing manager E-mail: [email protected] Tel: +1 (604) 638 8007 (direct) Ticker: TSX-V: HRC

ACTIVITIES, DEVELOPMENTS AND PLANS FOR 2008

Drill results from the Kenge and Porcupine targets alone confirm management's belief that the SMP Project has the potential to host a very significant gold resource.

12

August 2008 Mining Journal special publication Tanzania

PROFILE

MDN: a success story

The mill at Tulawaka

CORPORATE STRENGTH

MDN is operated by an experienced team, with a proven record in terms of development, project management and discoveries. The directors, composed of well-known industry players, and the entrepreneurial team work in synergy to reach the highest business goals. Highlights for the quarter to end-June 2008 include: Net revenue of C$8.39 million Net income of C$6.65 million, compared with a loss previously. Tulawaka produced a record total of 67,032oz of gold from an average grade of 23g/t. Total cash costs were US$180/oz. MDN's long-term debt was fully repaid, and royalty payment obligations, based on the selling price of gold, were terminated during the quarter.

M

DN Inc's presence in Tanzania "is a success story", states the company's president and chief executive, Paul-A Girard, as he remembers the day in 1997 when he committed the company's destiny to the country. Mr Girard says that the decision has proven to be not only quite fortunate for MDN and its shareholders, but also for the Tanzanians, their well established democratic institutions, and in particular the Tanzanian Ministry for Energy and Natural Resources, with whom MDN has developed "a strong synergy and working relationship". MDN became a gold producer in Tanzania on March 15, 2005, with the start of production at the Tulawaka gold mine. MDN has a 30% stake in the mine, which is operated by Barrick Gold Corp (owner of the remaining 70%) through its local subsidiary Pangea Minerals Ltd. Because of the success of Tulawaka, MDN is debt free and has been profitable (for the first time) since the beginning of this year. MDN has invested US$55 million in Tanzania, funded through public equity financing and debt. Because of what is a significant investment for a small company, MDN's management has focused all its energies in developing the great mineral potential of its Tanzania properties. Mr Girard notes that "A bet to invest such a sum in Tanzania was risky, albeit under a close and constant scrutiny and control. However, never during the past 11 years have we had any doubt that our investment, or our future, in this proud country was threatened." Mr Girard adds that "on the contrary, our experience is that Tanzanian's institutions strongly support mining investors, the infrastructure of a roads and services is

"MDN's support for the local community is driven by the company's mission of helping and respecting people located near its operations"

good, and there is an abundant access to efficient labour." MDN currently holds 28 exploration licences in the area surrounding the Tulawaka gold mine, and two additional exploration licences in the Ikungu area. MDN is active on several of these permits, and is especially optimistic that exploration expenditure on the Isambara and Viyonza properties will generate additional resources. MDN employs some 50 Tanzanians, including three local geologists, to support its exploration activities. The local operation is headed by Tanzanian geologist and director, Edwin Mchihiyo. MDN's support for the local community is driven by the company's mission of helping and respecting people located near its operations. Richard Corbo, advisor to the CEO, stated: "At MDN, we strive to be not only good corporate citizens, but we also want to make a difference, and ultimately to improve the quality of life in the communities in which we operate". Investments have been made, for example, in the construction of medical clinics, schools and police stations. MDN has also concentrated on the transfer of

skills, and given assistance in clean drinking-water initiatives, the repair of roads and funds dedicated for environmental conservation. The first chapter of the MDN story in Tanzania is now history, according to Mr Girard, and management and staff are starting a new, second, chapter by reinvesting the profits generated by the Tulawaka gold mine in Tanzania. Mr Girard's main concern, however, "is the presence of legal and illegal local prospectors operating in surrounding areas, which makes it very difficult for us to commit on investment in exploration programmes, or even to invest additional money in the development of a project. In this context, we need the support of the governmental authorities which must be unequivocal, and supportive of the industry members which invests massively in their country".

CONTACTS

MDN Inc Place du Canada, Suite 680 1010, de la Gauchetiere Street West Montréal, Québec, Canada H3B 2N2 Tel: +1 514 866 6500 Fax: +1 514 866 3799 E-mail: [email protected] Website: www.mdn-mines.com Ticker: MDN (TSX)

Aerial view of the open pit at Tulawaka

August 2008 Mining Journal special publication Tanzania

13

PROFILE

African explorer

Midlands Minerals aims for a multi-million-ounce gold deposit on its Ashanti Gold belt properties

M

IDLANDS Minerals Corp is a growth-oriented, value-based exploration company focused on growing its highly-prospective gold and diamond assets in Ghana and Tanzania, two of the safest and best countries in which to operate in Africa. Midlands trades on the TSX Venture Exchange under the ticker symbol MEX, and holds a diversified portfolio of gold and diamond projects. The primary focus is on

Right and below: Midlands drilling at operations in Tanzania the Sian and Kwahu Praso projects in Ghana, two contiguous gold projects forming a 160km2 gold district. Sian is a fully-permitted project with a 30-year mining lease that was an open-pit gold producer until recently. The deposit is located on the prolific Ashanti Gold Belt, just 30km northeast of Newmont Mining's 8.7Moz Akyem gold deposit. Plant, power, roads, buildings and water are already in place. The Sian mineralisation is similar to that found at Akyem, and Midlands is focused on increasing the gold resource at Sian in the short term. The project is expected to be back in production by the end of 2010. Midlands' Tanzania projects are in the Lake Victoria goldfields, which are home to gold-mining companies with over 40Moz in reserves. The company's main focus is the Itilima gold and diamond project located just outside Shinyanga on the Geita-BulyanhuluSekenke trend. Midlands has a highly-qualified management and technical team, with extensive experience in the countries in which the company operates.

CONTACTS

Midlands Minerals Corporation 1210 Sheppard Avenue East, Suite 302 Toronto, Ontario Canada M2K 1E3 Contact: Kim Harris (President and CEO) E-mail: [email protected] Websites: www.midlandsminerals.com www.agoracom.com/ir/MidlandsMinerals Ticker: TSX-V: MEX

Tanzania U3O8 trends

Forging a position in one of the world's emerging uranium provinces, Western Metals is spending its considerable cash reserves in aggressive exploration

W

ITH increasing success, Australia-based Western Metals has invested more than A$4 million in projects in Tanzania's Karoo formation, known to host significant uranium deposits. During the second half of 2008, Western Metals is completing 12,000m of drilling across a suite of prospects, following initial success with its Mtonya joint venture in Tanzania. Western Metals is keen on multiple bull's-eye anomalies along the Mtonya trend. The company has been well rewarded for its efforts here, drilling programmes identifying multiple mineralised zones within four prospects. In the past three months it has drilled along 1.4km of strike of a fifth prospect. From the commencement of its Mtonya exploration programme in August 2006, Western Metals has followed outstanding trench results with impressive drilling intersections, identifying near-surface mineralisation over a 7kmx2km trend. Trenching produced figures of 1.2m at 7,723ppm U3O8, including 0.4m at 2.13% U3O8, and similar intervals at 4,773ppm and 2,393ppm. In addition, visible uranium mineralisation was exposed within two targets of the one prospect. Drilling results include: 7m at 1,233ppm

U3O8,; 3m at 863ppm U3O8,; 3m at 447ppm U3O8,; and 6m at 178ppm U3O8,. Mtonya comprises 3,400km2 of territory prospective for sandstone-hosted uranium mineralisation, but two nearby projects ­ Ruhuhu and Ruvuma ­ bring the company's total southern Tanzanian uranium holdings to almost 14,000km2. A team of ten Tanzanian national employees, including six geologists, manages the projects from a company office in Dar es Salaam, supported by geosciences, commercial and mining personnel in Western Metals' Perth headquarters. In terms of its mineral resources, Tanzania has been

CONTACTS

Western Metals Unit 7, 100 Railway Road Subiaco WA 6008 Australia E-mail: [email protected] Website: www.westernmetals.com.au Tel: +61 (0)8 6380 3600 Ticker: ASX: WMT & WMTO

known mostly for its diamonds, gold and base metals, but Western Metals has been heartened by strong government support for its pioneering uranium industry and is determined to add this valuable energy source to the list. The company's unfolding Tanzanian tale appears similar for all uranium explorers in the area ­ numerous anomalies, laudable strike rates and multiple thick zones of near-surface mineralisation. "The discovery pace and development of this new uranium province is remarkable," Western Metals' managing director George Bauk said. "Western Metals has led the charge, undertaking the first substantial drilling programme for uranium in southern Tanzania. We have plenty to do, but have an excellent team, A$25 million cash-in-hand and good relationships ­ all solid support to ultimately move towards production."

14

August 2008 Mining Journal special publication Tanzania

PROFILE

JV focuses on Tanzania

The lure of gold keeps Sub-Sahara Resources in Africa

T

HE East African nation of Tanzania may be considered in some quarters as a highrisk speculative investment destination, but, for Australia-based gold explorer Sub-Sahara Resources NL, it is an address worth pursing. Tanzania is one of Africa's most stable democracies, and attracts some of the world's largest gold miners. Sub-Sahara, which has been operating in the country for the past 12 years, has every intention of continuing its exploration activities.

WHY TANZANIA?

If the prestigious Canadian think tank, the Fraser Institute, is anything to go by, Tanzania ranks alongside Ghana and Zambia on the African continent as the most favourable jurisdictions for mining. Indeed, this East African nation has provided Sub-Sahara with sufficient confidence and optimism to pursue its mineral exploration activities, and ultimately to fulfil its aspirations of becoming a gold producer. In terms of the country's security situation, which to a large extent dictates mining investment, 14% of companies surveyed by the Fraser Institute last year considered Tanzania as a country that encouraged investment. A further 50% felt it was not a deterrent to investment ­ ranking the country ahead of the Democratic Republic of the Congo, where 31% of respondents would not pursue investment. Sub-Sahara might be a junior when it is ranked alongside some of its peers, but the company has the unique distinction of having a number of well-established gold players as its partners in an address that is noted for its gold endowment ­ the area south of Lake Victoria. The company's joint ventures are in the gold-rich Nyanzian undifferentiated region of the Lake Victoria Greenstone Belt that hosts gold resources of almost 40Moz. This includes Barrick Gold Corp's Bulyanhulu deposit (12.9Moz), 55km south of Lake Victoria and about 125km from the city of Mwanza, and AngloGold Ashanti Ltd's Geita operations (14.6Moz). Only recently, Sub-Sahara reported that it had completed more than 3,000m of rotary air blast (RAB) and reversecirculation (RC) drilling as part of a Stage 1 programme at its Mabale

Hills project, less than 50km northeast of Bulyanhulu. The drilling campaign, according to Sub-Sahara managing director Michael Griffiths, was technically successful, with 46 RAB holes drilled on the Simba prospect, where five RC holes returned significant gold intercepts which included 1.18g/t gold over 1m from 82m. At the Dhahabu prospect, where previous drilling identified significant gold mineralisation, including 5m at 4.40g/t gold from 9m, three RC holes were completed for 450m. Mr Griffiths said, that while no significant gold values were returned by this RC campaign, strong sulphide mineralisation was intersected. Its proximity to the known gold discovery was an encouraging indicator as it was commonly associated with gold deposits on the greenstone belt. He said that Sub-Sahara still had a number of `highorder' targets to process, and with a systematic approach the company was confident the joint venture could capitalise on the current buoyant bullion prices. The Simba and the Dhahabu prospects are part of the joint venture Sub-Sahara has with Canadian gold exploration company Currie Rose Resources Inc, listed on the Toronto Venture and the Frankfurt exchanges. Currie Rose's main focus is exploration projects in the Lake Victoria Gold Fields, and the JV managed by SubSahara covers two project areas: Mabale Hills and Nyamirembe. The Nyamirembe project is about 100km northwest of the Mabale project, and lies west of the Geita Archaean Greenstone Belt that hosts AngloGold Ashanti's Geita gold mine. Sub-Sahara's other main Tanzanian joint ventures include the Nyanzaga JV with Barrick Exploration Africa Ltd (BEAL), which is a subsidiary of the world's biggest gold miner, Barrick Gold Corp. The project is 60km south-southwest of Mwanza city on the northeastern flank of the Sukumaland Achaean Greenstone Belt in central Tanzania. Agreement has recently been reached with BEAL to reverse the earn-in terms of the Nyanzaga JV. Sub-Sahara holds a 49% interest in it and, under the terms of the revised agreement, the company can earn an additional 19% interest in the project by completing a positive bankable feasibility study. This increased interest will give Sub-Sahara a 68% interest, with BEAL holding the balance. Sub-Sahara will take over as manager of the JV. The Tusker prospect, part of the Nyanzaga JV, has a JORC-compliant indicated and inferred total resource of

The Tusker gold deposit (2,486g/t gold) 123Mt at 1.15g/t Au, containing 4.5Moz gold. Sub-Sahara is also in the Nyakufuru JV (with established Tanzanian gold producer Resolute Mining Ltd) which is situated 150km south-southwest of Mwanza city. Earlier this year Resolute completed its initial 51% earnin phase by spending US$275,000, and the company has since elected to earn a further 19% by solely contributing an additional US$5 million over four years (or producing a bankable feasibility study). The properties that make up the joint venture are grouped into three separate project blocks ­ Mkweni, Mwagi Magi and Kanegele. Sub-Sahara's other involvement with Resolute is on the Kahama JV that comprises a number of tenements located on the western extent of the Nzega Greenstone Belt, 30km west of Resolute's Golden Pride gold mine in central Tanzania. As well as its gold-focused joint ventures, Sub-Sahara's interest also extends into uranium, where it has a 15% contributing interest in the Madaba-Mkuju JV with unlisted Canadian company Tanganyika Uranium Corp. The property is situated 225km southeast of Dar es Salaam. The two-stage, success-contingent, work programme consists of data compilation, airborne geophysics, ground geophysics, geological mapping, pitting and drilling at a total estimated cost of C$2.7 million (US$2.6 million) over two years. Sub-Sahara is expected to contribute C$105,000 during the first year and C$300,000 in the second year as part of its JV commitments. The project area covers 9,689km2 and was explored by German uranium explorer Uranerzbergbau GmbH between 1978 and 1981. Uranerz discovered significant `Roll-front' style uranium mineralisation within the Karoo sandstones that form part of the Luwegu-Selous Basin.

Drilling at Mabale Hills

CONTACTS

Sub-Sahara Resources NL 288 Stirling Street, Perth, Western Australia 6849 E-mail: [email protected] Website: www.subsahara.com.au Tel: +61 8 9227 3260 Fax: +61 8 9227 3271 Tickers: ASX: SBS Frankfurt: 895112

August 2008 Mining Journal special publication Tanzania

15

PROFILE

Uranex aims to be Tanzania's first uranium producer

Uranex NL is committed to becoming a recognised uranium producer within two years

BAHI INFERRED RESOURCE ESTIMATES (JUNE 2008)

U 3 O8 Cut off 100 Deposit C1 Playa A Playa E Total C1 Playa A Playa E Total Resource (Mt) 24 10 12 46 8 4 2 14 U 3 O8 (ppm) 163 148 128 151 245 189 166 218 U3 O 8 (Mlb) 8.6 3.3 3.4 15.3 4.3 1.7 0.7 6.7

U

RANEX NL is a highly-focused and technically-experienced uranium exploration company. Concentrated on detailed exploration of its quality uranium assets in Tanzania and Australia, Uranex is committed to becoming a recognised uranium producer within two years. Listed on the Australian Stock Exchange, the company's focus has been founded on extensive technical experience in the mining and resources industry, the high quality of its uranium exploration assets, and a determination to advance towards nearterm uranium production at Bahi in central Tanzania. The company is vigorously progressing exploration, resource definition and development in two separate provinces within Tanzania, at Bahi in the centre, and Mkuju/Songea to the south, with a pre-feasibility study recently commenced at Bahi. Uranex's production strategy of `One Plant ­ Multiple Sources' has been developed to capitalise on the strengths of its prospects, mainly their close proximity and shallow mineralisation, in unconsolidated host material with a low production cost. Further strengthening of the Tanzania technical team is under way to allow simultaneous exploration of the Mkalama, KWA Mtoro and the Makonde tenement areas. Uranex also continues to explore its Australian properties: the Thatcher Soak resource (some 4,900t of contained U3O8 in Western Australia), and the Bremer Basin (WA), Bynoe (NT) and Alligator River (NT) exploration projects.

Playa Lakes (eg D & F) to those already containing estimated resources (ie C1, A and E). These prospects have the potential to be advanced quickly to defined resources, from their current largely reconnaissance exploration status. With the completion of the initial resource estimate, further exploration drilling is planned to both upgrade the quality (JORC Classification), and extend the current estimate to other neighbouring Playa Lakes to further advance the applicability of the company's `One Plant ­ Multiple Sources', near-term, shallow, production strategy. The identified resources are near-surface, located as amorphous mineralisation precipitated in the cracks and on grain surfaces, occurring within the top 20m of unconsolidated Playa Lake sediments. A scoping study looking at the recoverability of the U3O8 mineralisation sediments is currently under way with the initial step investigating the means and processes appropriate to recovering the unbound mineralisation compounds (eg carnotite and schrockingerite) from the porous and permeable open-space within the sediments.

150

Rounding errors may occur

Drill rig in Tanzania

MKUJU/SONGEA

In southern Tanzania, Uranex has two large exploration areas targeting the prospectivity of stacked sandstone sedimentary sequences of the Karoo Basin for large-scale roll-front style uranium occurrences. The company considers the Karoo Basin geological environment has the scope to contain significant occurrences of this style of uranium, both in terms of size and grade. Exploration in both Mkuju and Songea is of an early reconnaissance status, with initial target drilling scheduled for this year.

ENVIRONMENT

Uranex is committed to minimising any impact of its exploration and future development on the surrounding environment. An environmental baseline study of the Bahi region has now begun as a first step in comprehensive monitoring and management of the environment during the progress to production from the Playa Lakes within its Bahi tenements.

BAHI

The first full year of exploration at Bahi has culminated in an inferred resource estimate of 14Mt, averaging 218ppm U3O8 for a contained 6.7Mlb (3,000t) contained U3O8), at a cut-off grade of 150ppm U3O8. Contained U3O8 more than doubles to about 15.3Mlb at a cut-off of 100ppm U3O8. Based on this estimate, a pre-feasibility study has now commenced to evaluate a range of project options including applicable mining methods and metallurgical process routes, product refinement levels and sales alternatives, and social and environmental impacts. In addition to these resources, more widely-spaced and irregularly-assayed sampling suggests the presence of additional uranium mineralisation with an exploration potential of 5-10Mt at a grade of 100-200ppm U3O8. Map of the Uranex is confident that significant Bahi Tenements, scope exists for the location and definition August 2008 of further resources within neighbouring

PEOPLE

Uranex has a strong commitment to the support of the local communities in which it operates. The company strives to maintain good relationships with the local community and employs locally for its office and field exploration work.

CONTACTS

Uranex NL Level 3, 15 Queen St, Melbourne,Victoria, Australia 3000 E-mail: [email protected] Website: www.uranex.com.au Tel: +61 3 9621 1533 Fax: +61 3 9621 1544 Ticker: ASX: UNX

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August 2008 Mining Journal special publication Tanzania

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