Business Enquirer Issue 117 | TRX Gold | September 2023

A BUSINESS WORTH ITS WEIGHT IN GOLD

TRX GOLD

A BUSINESS WORTH ITS WEIGHT IN GOLD

TRX GOLD PROJECT DIRECTED BY: GLEN NEWTON ARTICLE WRITTEN BY: LAURA WATLING

Found in Africa’s fourth largest producer of gold, Tanzania, the Buckreef Gold Project comprises five active prospects - Buckreef, Bingwa, Tembo, Eastern Porphyry, and the recently discovered Anfield. In 2021, Tanzania accounted for 1.3% of the world’s total global gold production.

Led by TRX Gold (headquartered in Toronto, Canada) in partnership with Tanzania’s state mining corporation (STAMICO), the project, which is fully licensed for the mining and extraction of gold, is currently undertaking considerable expansion.

CEO Stephen Mullowney, who has been at the company for 18 months, speaks to Business Enquirer about the exciting project, its discoveries, and the next steps.

The lay of the land

“Over the last 16 months, we’ve been focused on creating shareholder value by discovering, investigating and expanding the known gold zones at Buckreef Gold,” explained Stephen.

Measures that the company is undertaking to fulfil this include step-out drilling in the northeast and southwest extensions of Buckreef Main, and infill drilling at Buckreef West.

TRX Gold also plans to undertake infill drilling to upgrade Mineral Resources in Buckreef Main.

Buckreef, the flagship site of the Buckreef project, encompasses three main mineralised zones - Buckreef South, Buckreef Main and Buckreef North.

Additionally, TRX Gold will seek to upgrade historical mineral resources at Eastern Porphyry, Bingwa and Tembo, as well as develop an exploration program for the newly discovered Anfield Zone.

“The project is undergoing a very exciting period of expansion,” said Stephen, “We’re currently processing 360 tonnes of ‘ore’ (economic gold bearing rock) per day, but by the end of August 2022, this will triple to 1000 tonnes per day. Put another way, every month we are currently producing over 750 troy ounces of gold, but with the expended plant this will grow to approximately 2,000 troy ounces a month. With gold selling at around $1,750 per ounce, this makes for an exciting start to our business”.

Reinvestment to aid growth

TRX plans to use cash-flow generated from its current production to expand its exploration programme, as well as to advance the metallurgical study of its Sulphide Development Project.

“The work we are doing within the Sulphide Development Project will help evaluate the possibility for a high return, large scale project,” explained Stephen, “variability metallurgical studies are currently underway, which is set to be the first 5-7 years of this much larger project”.

The discovery of the Anfield Zone offers yet more opportunity for TRX.

“Our plans for this year include drilling the Anfield Zone and extending the Eastern Porphyry Zone,” shared Stephen.

Most recently, in June 2022, TRX Gold announced a 250 metre northeast extension of the Buckreef Gold Main Zone, to a total strike length of 1.8 kilometres.

Solo Resources

Smaller cost effective plants - the way forward?

With its focus on bringing smaller processing plants to fruition, Solo Resources has experienced wide ranging success in this arena. Many of the smaller enterprises fail to get off the ground due to high capital costs.

According to Craig Naude, MD of Solo Resources, “There exists a niche market worldwide, but particularly in Africa, for smaller, cleverly designed and affordable mineral processing plants. This is where our vison for cost effective solutions comes to the fore.”

As a reliable and innovative resource solutions provider, Solo Resources boasts an outstanding track record and a commitment to excellence. Being a premier provider of innovative resource solutions, the two-decade old company is built on a foundation of expertise, dedication, and an understanding of the industries they serve. With

years of experience under their belt, they have established themselves as leaders in delivering solutions that drive success.

“Ranging from the supply of a selection of standalone high-quality metallurgical processing equipment to turnkey projects, Solo provide solutions that are cost effective, durable, efficient and tailored to specific requirements” according to Johan du Plessis, the General Manager.

“Our team of experts ensures seamless integration and optimal performance, contributing to increased productivity and safety”

Solo Resources are equipped to serve clients around the world. Based in South Africa, ease of communication and travel ensure their reach extends well into Africa as well as other continents, allowing them to bring their expertise and solutions to diverse markets and environments.

We are a solutions driven team

Every metallurgical process design matters

We consult on, design, fabricate, supply and commission turnkey mineral processing plants. There exists a niche market, especially in Africa, for smaller and affordable processing plants. Too large capital expenditure loses investor appetite, particularly for start-up companies or owners of small but lucrative deposits. That is where Solo Resources plays a key part as we focus on cost effective solutions to realise the recovery of valuable mineral at affordable prices for our clients. From the supply of single piece equipment to the installation of turkey plants and everything in-between, Solo Resources can provide the solution you’ve been looking for.

The drill rig is now exploring the southwest area of the Main Zone.

“With the combined expansion and development, we will be able to expand the scope and scale of the Buckreef Gold project,” said Stephen.

The Most Valuable Asset

With ambitious development over the next year, TRX Gold has had to grow its human resource to match.

“We’ve added an additional 200 staff to the mine site in the last year. I’m really excited by how knowledgeable, industry experienced and hardworking the Tanzanian people are,” shared Stephen.

The additional staff takes TRX Gold’s headcount to 300 at the mine site - 100 of TRX Gold’s own employees and a further 200 contractors.

“Finding human resources and financial capital are both a challenge at the moment. However, the economy is rebounding and both the tourism and mining industries in the country are starting to see a positive shift,” the CEO said.

As part of the business’ sustainability programme, TRX Gold runs educational programmes and classroom building in partnership with the local community. It hopes, in turn, it will be able to hire additional staff through this initiative.

Stephen believes company culture will play an important role in a future recruitment drive, ensuring prospective employees consider TRX Gold as an exciting and attractive place to work, on a corporate and ground level.

“Both respect and collaboration are key,” said Stephen

Stephen, who joined the business 18 months ago, comes from a financial background, having worked at PwC for 10 years.

“My experience at PwC enabled me to be well traveled and included work with governments, it has equipped me well to transition to TRX Gold,” he said.

Framed by Good ESG Practices

The development of the Buckreef Gold project comes at a time when sustainable mining couldn’t be more newsworthy.

“The Buckreef Gold Project started at the same time that the UN launched the Decade of Action for Sustainable Development Goals,” explained Stephen, “everything that we do is framed by TRX Gold’s Sustainable Development goals. ESG is central to our business”.

TRX Gold’s philosophy is that its projects should benefit the local community in which it is exploring. As such, almost 100% of positions at the mine site are filled by Tanzanian people, and as locally as possible.

“We keep our procurement as local as possible too, from the produce used in the kitchen through to the contractors. This has been integral to help keep our carbon footprint low, and has also benefited us in a time when supply chains have been significantly disrupted globally,” shared Stephen.

The project is connected to the local electrical grid which already has a large hydro-electric component. Once the Julius Nyerere Dam is completed in a few years’ time it will be predominantly renewable energy. The project is also recycling 100% of its wastewater.

Time to deliver

“Thanks to the project’s rather simple metallurgy and low-cost nature, current gold production has been able to achieve a 90% gold-recovery rate and a 73% gross profit margin at the end of our Q3,” explained Stephen.

With its processing plant capacity increasing to 1000 tonnes per day, the project's gold yield is set to reach 20,000 oz per year. This gives TRX Gold the required investment opportunities to deliver on its development and expansion aims, whilst also implementing its ESG programme.

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