Tanzanian Gold (TSX: TNX; NYSE: TRX) believes a three-pronged approach to developing its 2-million-ounce Buckreef project could lead to Tanzania's next national mining success story, CEO Stephen Mullowney tells The Northern Miner.
Situated about 45 km to the west of Barrick Gold's (TSX: ABX; NYSE: GOLD) Bulyanhulu gold mine and nearly 35 km south from AngloGold Ashanti's (NYSE: AU; JSE: ANG) flagship Geita mine in north-central Tanzania, Tanzanian Gold is looking to expand its current 360 tonnes per day processing plant to 1,000 tonnes per day by the end of the year, increasing the yield capacity from about 9,000 oz. of gold to more than 15,000 oz. per year.
In the past year, subsidiary Buckreef Gold continued to operate the 5 tonnes per hour oxide test plant on the 1600-hectare property. It plans to apply the cash flow to expand its exploration program this year and to advance the metallurgical study of its sulphide development project. The company believes about 90% of Buckreef's gold resource is held in sulphide material.
"I don't know many mining assets in this kind of a position," Mullowney said in an interview. "There are many good projects, but they are funded from treasuries. We are getting in a position where we can fund it from operating cash. It's not a large production, but it's enough to do a lot of work."
In December, Buckreef produced 533 oz. of gold through its 360 tonnes per day processing plant. The two other ball mills required to upgrade the plant's capacity to 1,000 tonnes per day have arrived in the port city of Dar es Salaam, which according to Mullowney, was the most time-consuming aspect of the expansion project.