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Tanzanian Royalty Re-Purchases Rights to Kigosi Property in Tanzania
Vancouver, Canada (ots/PRNewswire) - Tanzanian Royalty Exploration Corporation is pleased to announce that it has negotiated the repurchase of its rights to the Kigosi property, including all related camp and equipment, along with the purchase of a non-associated property, the Dongo, from AngloGold-Ashanti in a transaction valued at USD$900,000.
The price of the acquisition will be satisfied by the issuance to AngloGold Ashanti of 180,148 common shares of Tanzanian Royalty Exploration Corporation, based upon the weighted average trading price of the common shares over the five trading days preceding the date of execution of the agreement. Issuance of the common shares is subject to all required regulatory and stock exchange approvals.
Jim Sinclair, Chairman and CEO of Tanzanian Royalty Exploration said, "It has always been our view that exploration work undertaken on the Kigosi property supports our pre-agreement conclusion that Kigosi is a valuable exploration asset - even more so for a company our size with a unique royalty business strategy.
"As soon as the current drilling program is completed at our Luhala Gold Project, the Company's drill rig will be moved to Kigosi to begin drilling on the reef that was previously exploited by artisanal miners dating back almost a century."
The Kigosi Project Area encompasses approximately 1,095 square miles and includes 15 individual Prospecting Licenses immediately southwest of the Ushirombo Belt in the Sukumaland Greenstone Terrain of northwestern Tanzania. The area consists essentially of granite with greenstones in the northwest and east.
As reported previously by the Company in its news release of March 18, 2004, the licenses cover at least three gold-bearing vein occurrences, two of which are located at the north end of a three kilometre long northwest trending structure that may have concentrated the high grade gold values reported previously at the northern and southern limits of this prominent geological feature.
One of the strongest gold occurrences identified by the Company, Luhwaika, returned grab samples ranging from 0.01 to 233 grams (7.5 ounces) gold per tonne. The numerical average for 25 samples taken at this site by the Company was 11.8 grams (0.38 ounce) per tonne, while the average excluding the high-grade value (233 grams) was 2.5 grams (0.08 ounce) per tonne. A swarm of narrow veins has been discovered 300 metres away at Luhwaika West, which the Company believes could represent a bulk tonnage gold deposit target.
Grab samples taken by the Company at Igunda, a shear-hosted, steeply dipping narrow vein occurrence three kilometres southeast of Luhwaika, ranged from 0.02 to 35.6 grams (1.1 ounce) per tonne. Nineteen grab samples from this occurrence returned a numerical average of 3.58 grams (0.12 ounce) per tonne, while the average excluding the high-grade value (35.6 grams) was 1.7 grams (0.05 ounce) per tonne.
Grab samples collected proximal to artisanal pits by the Company yielded gold values in the range of 5-10g/t and included the high grade sample of 233g/t Au.
"We are also pleased that Anglogold-Ashanti has offered us its Dongo property, which will augment our exploration portfolio with an asset that fits our investment criteria as a junior explorer and supports our ultimate objective of deriving royalty income from producing assets," Sinclair stated.
Fire assays were conducted by SGS Laboratories in Mwanza, Tanzania.
For further details on the Kigosi property and information on other projects in the Company's exploration portfolio, please visit our website at: www.TanzanianRoyaltyExploration.com.
"James E. Sinclair"
James E. Sinclair
Chairman and Chief Executive Officer
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Cautionary Note to US Investors - The United States Securities and Exchange Commission permits US mining companies, in their filings with the SEC, to disclose only those mineral deposits that a company can economically and legally extract or produce. We use certain terms on this news release, such as "measured", "indicated", and "inferred" "resources" that the SEC guidelines strictly prohibit US registered companies from including in their filings with the SEC. US Investors are urged to consider closely the disclosure in our Form 20-F, File No. 0-50634, which may be secured from us, or from the SEC's website at http://www.sec.gov/edgar.shtml.
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