REG - Shanta Gold Limited - Q4 2021 Production and Operational Update

Shanta GoldAnnouncement

24/01/2022 07:05

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RNS Number : 3045Z  Shanta Gold Limited  24 January 2022

24 January 2022

Shanta Gold Limited

("Shanta Gold", "Shanta" or the "Company")

Q4 2021 PRODUCTION & OPERATIONAL UPDATE

FY 2021 PRODUCTION IN LINE WITH GUIDANCE

 

Shanta Gold (AIM: SHG), the East Africa-focused gold producer, developer and
explorer announces its production and operational results for the quarter
ended 31 December 2021 (the "Quarter", "Q4" or the "Period") for its East
African assets, including New Luika Gold Mine ("NLGM" or "New Luika") and
Singida Project ("Singida") in Tanzania and West Kenya Project ("West Kenya")
in Kenya.

Eric Zurrin, Chief Executive Officer, commented:

"Despite some challenges in 2021, we are pleased to have exited the year in
line with our revised guidance and forecasted production growth for 2022. Our
robust fundamentals that underpin our business continued to strengthen with an
exceptional safety record, strong balance sheet and a self-funded exploration
and development programme. This foundation has enabled us to meet our
commitment to deliver sustainable returns to our shareholders as demonstrated
by the inaugural dividends paid out in April and October 2021.

We remain committed to self-financed growth and with the largest exploration
programme in our history conducted in 2021 yielding record drilling results at
West Kenya and a near-term production asset at Singida set to transform Shanta
to a 100,000+oz producer in 2023, our commitment to long-term, sustainable
returns remains front of mind.

Looking ahead to 2022, we've announced increased production guidance of 68,000
- 76,000 oz, with production weighted towards the second half of the year once
mining of the high-grade Bauhinia Creek crown pillar has commenced.

As a company, we have made it our purpose to ensure we are creating a
net-positive impact for our stakeholders and communities in Tanzania and Kenya
and are rightly proud of the great work we have done to ensure true value from
our investment benefits those on the ground. To ensure that we remain
accountable and responsible in our purpose, in 2021 we conducted a strategic
review of our sustainability strategy and plan to publish our inaugural
sustainability report in H1 2022. We look forward to updating stakeholders on
this further at publication."

 

FY 2021 Highlights

·    Exceptional safety record with TRIFR of 0.88 (2020: 0.97) and zero
LTIs in 2021;

·    Record annual throughput of 834,607 tonnes ("t") milled, which was
approximately 7% greater than budget, following installation of Mill #3 in H1
2021;

·    Total gold production of 55,280 ounces ("oz"), in line with revised
guidance of 55,000 - 57,000 oz announced during the Period;

·   Total VAT refunds of US$7.2 million, plus US$4.3 million verified for
refund by the TRA in January 2022;

·    Gross debt reduced to US$2.4 m, following repayment of the US$10
million convertible loan note in April 2021;

·     All gold sales unhedged and completed at spot price, with average
selling price of US$1,801 /oz during 2021;

·     Adjusted Operating Cash costs of US$1,081 /oz and an AISC of
US$1,439 /oz;

·   Singida's construction remains on track for first production in early
2023, adding a second   revenue stream across the portfolio and further
strengthening our diversified portfolio of assets   in East Africa;

·    Total capital expenditure including prepayments at Singida during
2021 of US$10.9 million;

·    All three of Singida's Mining Licences have now been extended for a
further 10 years to 2032;

·    West Kenya continued to deliver encouraging assay results announced
during the Period with an initial conversion of >100% of Inferred Resources
to Indicated Resources of 117,600 oz grading 7.04 g/t, and work continues on
the conversion of additional resources to the indicated category in 2022;

·   Extension of current reserve life at NLGM to the end of 2026 following
successful exploration drilling programmes carried out throughout the year
with new discoveries at the Porcupine South deposit adding further life to
NLGM once incorporated into the mine plan in 2022;

·  Maiden dividend paid in April 2021 and interim dividend paid in October
2021, totalling approximately US$2.8 million during 2021.

Q4 2021 Highlights

·    Zero Lost Time Injuries ("LTI's"), with no LTI's since Q4 2017
surpassing a landmark 8.2 million man-hours without a Lost Time Injury;

·    Cash, and available liquidity(1) of US$15.9 million ("m");

·    Gold production of 12,244 oz (Q3: 14,194 oz), in line with revised
guidance;

·    West Kenya drilling results announced, highlighting consistently
strong results from the Phase 2 drilling programme across the Isulu and
Bushiangala deposits and regional drilling at Ramula target with an upgraded
mineral resource estimate expected in late February 2022;

·    First blast taken at Singida on 15 October 2021 and commencement of
delivery and installation of crushing circuit at Singida Gold Mine; and

·    Successful exploration drilling at NLGM to increase mineable gold
resources and convert into gold reserves, including hole CSD 251 of 10.56 m
grading 22.67 g/t from 98.0 m at BC East Area 1.

Q4 2021 Financial Summary

·    EBITDA(2) of US$5.7 million excluding West Kenya and Singida
expenditure (Q3: US$4.3 m);

·    Liquidity available for draw down from the Company's Stanbic Bank
US$5 million working capital facility (Q3: US$ nil), of which US$1 million was
drawn under the facility;

·    1,593 oz contained within doré available for sale at the end of the
Period (Q3: 3,914 oz);

·    VAT receivable of US$26.8 m (Q3: US$27.7 m), of which approximately
US$23 million relates to the historical period July 2017-June 2020; and,

·    Positive engagement with the Tanzanian Revenue Authority ("TRA") as
evidenced by US$11.5 million of VAT refunds/offsets/verifications completed
since July 2020, with ongoing discussions regarding the outstanding historical
Tanzanian VAT receivable for the period July 2017 to June 2020.

Q4 Operational Summary

New Luika Gold Mine

·    218,991 t milled (Q3: 228,338 t);

·    Average head grade of 2.0 g/t (Q3: 2.2 g/t);

·    Average recoveries of 87.1% (Q3: 88.6%);

·    Run of Mine ("ROM") stockpile of 150,549 t of ore grading 1.0 g/t
(Q3: 151,645 t grading 1.02 g/t).

·    Underground and surface exploration drilling at the Luika deposit
("Luika") and Porcupine South generated positive results;

·    A total of 4,505 metres drilled covering 17 holes at Bauhinia Creek
Main, Bauhinia Creek East Area 1 ("BC East Area 1"), and Luika; and,

·    Mineralisation at Luika and Porcupine South remains open at depth
with Porcupine South having multiple promising targets that have been recently
identified.

Singida

·    Project construction remains on track for first production in early
2023;

·    Crushing Circuit design and manufacturing completed with Metso Group,
shipment commenced in September with delivery in November and December 2021;
and

·    Tailings Storage Facility Dam design is completed, all permits
received, and approval has been granted by the regulators to commence
construction; and,

·    Key infrastructure including bulk power, water, buildings, and
fencing are progressing on track.

West Kenya

·    West Kenya continued to deliver encouraging assay results with
further results to be announced in Q1 2022;

·    At the Isulu and Bushiangala deposits, visible gold was identified in
7 intersections across 25 holes drilled. Year to date, visible gold has been
identified in 30 intersections across 93 holes drilled; and

·    Regional exploration drilling commenced during Q4 at a third drilling
site - the historical Ramula target - where highly encouraging assays were
reported on the first drill hole including 5 separate mineralised zones of
visible gold and intersections including 7.2 metres grading 8.31 g/t from
155.8 metres and 15.6 metres grading 9.37 g/t from 187.9 metres.

Group Reserves and Resources

·    An updated Reserves and Resources statement will be announced in Q1
2022.

Sustainability

·    Completed strategic review of sustainability strategy, inaugural
sustainability report to be published in H1 2022;

·    Completion of the Mbangala Luika Dam water project providing the
Mbangala village with more than 7,600 residents with year-round access to
clean water;

·    3 classrooms and a toilet block constructed at the Kalanda Primary
School located in the nearby Mbangala village; and,

·    2,000 farmers, up from approximately 150 farmers in 2018, have
enrolled in Shanta's Mining Agriculture Improvement Program ("SMAP") which
provides advice, training, and farming materials to farmers in the local
surrounding Mbangala and Maleza villages.

2022 Guidance

·    Annual guidance of approximately 68,000 - 76,000 oz at AISC(3) of
US$1,050 - 1,250 /oz on a like-for-like basis including development costs, in
line with the World Gold Council ("WGC") definition;

·    2022 gold production is weighted approximately 65% towards H2 2022
reflecting mining of the high-grade Bauhinia Creek crown pillar beginning in
May 2022. The crown pillar consists of approximately 83,000 tonnes grading 8.4
g/t containing around 22,500 ounces. Q1 2022 gold production is forecast at a
similar level to Q4 2021, with quarterly production increasing in Q2 2022 upon
commencement of the crown pillar mining; and,

·    As of January 2022, 82% of planned FY 2022 ounces have grade control
information.

 

Note: 1. Available liquidity has been derived as unrestricted cash, restricted
cash, and the sale value of doré available for sale at the end of the Period
(net of royalties and expected selling costs).

 

Note 2: EBITDA is earnings before interest, tax, depreciation, and
amortisation which has been derived as operating profit exclusive of
depreciation/depletion of tangible assets, amortisation of intangible assets
and one-off exceptional items.

Note: 3. AISC figures published include development costs, in line with the
WGC definition

 

Analyst conference call and presentation

Shanta Gold will host an analyst conference call and presentation today, 24
January 2022, at 10:00am GMT. Participants can access the call by dialling one
of the following numbers below approximately 10 minutes prior to the start of
the call or by clicking on the link below.

UK Toll-Free Number: +44 (0) 800 279 6894

UK Toll Number: +44 (0) 330 336 9600

PIN: 399744

https://events.globalmeet.com/Public/ClickToJoin/ZW5jPVpnY3NLajcvNXFjQW5xTlR6YjErQU5za

Hl1NW5jVGVodEtGUTJ0WFZJNjRZdm5ucS9semowUT09

Participant Passcode: 399744

 

The presentation will be available for download from the Company's website:
www.shantagold.com. A recording of the conference call will subsequently be
available on the Company's website.

 

Investor Conference Call

Shanta Gold is hosting a live investor presentation via the Investor Meet
Company platform today, 24 January 2022, at 11:00am GMT. The presentation is
open to all existing and potential shareholders and questions can be submitted
any time during the live presentation.

Investors can sign up to Investor Meet Company for free and add to meet Shanta
Gold via:
https://www.investormeetcompany.com/shanta-gold-limited/register-investor
(https://protect-za.mimecast.com/s/Z9HnCVmrpNhwlrGCGefj-)

 

Investors who already follow Shanta Gold on the Investor Meet Company platform
will automatically be invited.

 

Enquiries:

 

 Shanta Gold Limited
 Eric Zurrin (CEO)                              +44 (0) 14 8173 2153
 Luke Leslie (CFO)

 Nominated Adviser and Joint Broker
 Liberum Capital Limited
 Scott Mathieson / Ed Thomas / Nikhil Varghese  +44 (0) 20 3100 2000

 Joint Broker
 Tamesis Partners LLP
 Charlie Bendon / Richard Greenfield            +44 (0) 20 3882 2868

 Public Relations
 FTI Consulting
 Sara Powell / Jourdan Webb                     +44 (0) 20 3727 1426

 

About Shanta Gold

 

Shanta Gold is an East Africa-focused responsible gold producer, developer,
and explorer. The Company has an established operational track record, with
defined ore resources on the New Luika and Singida projects in Tanzania, with
reserves of 666 koz grading 3.0 g/t, and exploration licences covering
approximately 1,100 km(2) in the country. Alongside New Luika and Singida,
Shanta also owns the West Kenya Project in Kenya with defined inferred
resources of 1.2 Mt grading 12.6 g/t and licences covering approximately 1,162
km(2). With a strong balance sheet, a growing diversified portfolio and a
maiden dividend paid in 2021, Shanta offers a resilient investment opportunity
for the near and long-term. Shanta is quoted on London's AIM market (AIM: SHG)
and has approximately 1,048 million shares in issue.

 

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulation
(EU) No. 596/2014 as amended by The Market Abuse (Amendment) (EU Exit)
Regulations 2019.

 

Competent Person Statement

The technical information contained in this announcement was reviewed by
Evance Rwiza (the Company's Senior Resource Geologist) who is a Member of the
Australasian Institute of Mining and Metallurgy (AusIMM) and Yuri Dobrotin,
P.Geo. Membership No.0702 (Shanta's Group Exploration Manager), who is a
practicing member of the Association of Professional Geoscientists of Ontario,
Canada (PGO). They have sufficient experience that is relevant to the style of
mineralisation and type of deposit under consideration and to the activity
being undertaken to qualify as a Competent Persons as defined in the 2012
Edition of the 'Australasian Code for Reporting of Exploration Results,
Mineral Resources and Mineral Reserves' and for the purposes of the AIM
Guidance Note on Mining and Oil & Gas Companies dated June 2009, and
National Instrument 43-101 (''NI 43-101).

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulation
(EU) No. 596/2014 as amended by The Market Abuse (Amendment) (EU Exit)
Regulations 2019.

 

Q4 2021 PRODUCTION & OPERATIONAL UPDATE

Safety, Health and Environment

There were no LTIs during the Period and the Company has now surpassed a
landmark 8.2 million man-hours without an LTI. Shanta maintains its track
record of operating among the safest gold mining operations of its peers and
achieved a Total Recordable Injury Frequency Rate ("TRIFR") (per 1 million
hours worked) of 0.88 for 2021, significantly below the industry average. This
represents a sixth successive annual decline in injuries and an 9% reduction
from 2020 (0.97). Shanta's TRIFR for Q4 was 0.00 (Q3: 1.19).

Operational Summary - NLGM

Production Summary

                               FY2021   Q4 2021  Q3 2021  Q2 2021  Q1 2021
 Tonnes ore milled             834,607  218,991  223,338  200,511  191,767
 Tonnes ore milled per day     2,287    2,380    2,428    2,203    2,131
 Grade (g/t)                   2.33     2.00     2.23     2.49     2.67
 Recovery (%)                  88.4     87.1     88.6     88.6     89.1
 Gold (oz)
 Production                    55,280   12,244   14,194   14,201   14,641
 Sales                         57,517   13,538   12,001   16,828   15,149
 Silver production (oz)        66,248   14,270   17,748   16,870   17,360
 Realised gold price (US$/oz)  1,801    1,796    1,790    1,812    1,801

 

Gold production during the period was 12,244 oz. Overall, a total of 177,256 t
of ore grading 2.5 g/t was mined from underground in Q4 compared with 168,507
t of ore grading 2.9 g/t in Q3. A further 32,562 t ore grading 1.3 g/t was
mined from open pits in Q4 compared with 44,913 t of ore grading 1.1 g/t in
Q3. 218,991 t of ore was milled during the period (Q3: 223,338 t). The ROM
stockpile at the end of Q4 was 150,549 t of ore grading 1.00 g/t (Q3: 151,645
t grading 1.05 g/t). Average recoveries of 87.1% were achieved in the plant
during the period (Q3: 88.6%).

During the Period, operational difficulties relating to the supply by a 3(rd)
party vendor of an unreliable emulsion product and underground production
charging units led to a reduction in production guidance for 2021 which was
reduced from a range of 60,000 to 65,000 ounces to a range of 55,000 to 57,000
ounces. This emulsion product quality has been restored and the underground
production charging units have been fixed. No further challenges with this
supplier and equipment have been experienced since this announcement on
December 7(th) and mined underground grades are reconciling around neutral
with the grade control model. An order for an additional new underground
production charging unit has been placed with expected delivery in Q2 2022.

Shanta was an early adopter of several best practices designed to prevent the
COVID-19 pandemic from entering NLGM and Singida. COVID-19 is prevalent in
Tanzania, as it is elsewhere in the world. Tanzania has commenced a
vaccination and awareness campaign, however there has been a relatively low
uptake of the vaccination so far. Despite precautionary measures which remain
in place to protect the health and safety of our team, NLGM experienced
COVID-19 related cases during the Period which impacted workforce
availability. A wave of COVID-19 in East Africa was experienced particularly
in December 2021 which has since subsided. Shanta benefits from over 75% of
its workforce being under the age of 45 years old.

The commencement of new mining and oil & gas projects in Tanzania,
particularly in the last few months of 2021 following issuance of new Special
Mining Licences in country, led to instability in the labour force as new
operations commenced and demand for skilled labour increased. In addition,
Barrick's Tanzanian operations continue to ramp up which has increased
compensation levels to build up various workforces. Shanta adopted a policy of
training and development in situations where re-hiring was not possible or
deemed economically unfavourable.

NLGM is a remote operation in SW Tanzania, approximately 800 km from Dar es
Salaam. Timely availability of spares and equipment remains a heightened risk
for the NLGM operation. Shanta's Procurement Department was expanded including
Expeditors in the port of Dar es Salaam to assist in de-risking the purchasing
and delivery of key goods.

Financial

EBITDA(1) in Q4 excluding expenditure at West Kenya Project and Singida was
US$5.7m. Group EBITDA(1) increased to US$2.9 m (Q3: US$2.0 m). This was
primarily due to more revenue earned as the result of more ounces sold in the
period. A total of 13,538 oz was sold at an average price of US$1,796/oz (Q3:
12,001 oz sold at US$1,790 /oz).

Adjusted Operating Costs of US$1,254 /oz (Q3: US$1,063 /oz) and AISC of
US$1,624 /oz (Q3: US$1,480 /oz) were achieved in the Quarter, respectively.
The increase in the AISC is largely due to fewer ounces being recovered in the
Period because of temporary operational difficulties experienced which
resulted in the 2021 production guidance being reduced.

A total of US$4.2 m of the VAT receivable was received as a refund/offset from
the TRA in Q4. The Company's Tanzanian VAT receivable reduced from US$27.7 m
to US$26.8 m, the entirety of which is subject to verification audit by the
TRA before being available for further offsets. Approximately US$23 million of
the US$26.8 million relates to the period July 2017-June 2020.

Capital expenditure at New Luika was US$3.8 m (Q3: US$5.5 m) for the Quarter,
which predominately related to underground development at the Bauhinia Creek
and Luika mines.

Note 1: EBITDA is earnings before interest, tax, depreciation, and
amortisation which has been derived as operating profit exclusive of
depreciation/depletion of tangible assets, amortisation of intangible assets
and once off exceptional items.

Singida Gold Mine

Construction of the Singida Gold Mine is progressing as planned with the
project on course to become the first new large-scale Tanzanian gold mine to
enter production since the New Luika Gold Mine in 2012. The project is
approximately 42% completed on a measure of 'key deliverables', and US$10.9 m
in capital expenditure and prepayments was incurred in 2021. First gold pour
is expected in early 2023.  Once gold production commences, the project can
be expected to transform the Ikungi region in Central Tanzania to benefit
local communities.

Significant construction milestones were achieved in the Quarter with delivery
of the newly designed Crushing Circuit. Civil works for the Mill site
commenced together with the ongoing manufacture of the Grinding and Gravity
circuit mill in South Africa which is due to be installed in the first half of
2022. The design for the Tailings Storage Facility Dam was also completed
after receiving all the necessary approvals from regulators in the quarter.
Further key infrastructure including bulk power, water, buildings, and fencing
are progressing steadily on track.

Open pit mining operations continued at Gold Tree pit with the first
successful pit blast taking place in the Period. Ore stockpiling is underway
in readiness for the construction of the Processing Plant being completed. An
estimated 1,800 oz of gold has been mined and stockpiled thus far.

West Kenya

During the Quarter, West Kenya Phase 2a and Regional Drilling results were
finalised showing consistently encouraging assay intersections, reinforcing
Shanta's confidence in the asset. At the Isulu and Bushiangala deposits,
visible gold was identified in 7 intersections across 25 holes drilled with
visible gold being identified in 30 intersections across 93 holes drilled year
to date. Both deposits have proven to be high-grade ore bodies including 6.4 m
grading 47.3 g/t from 224.4 metres at Bushiangala.

Regional exploration drilling was also carried out at a third target area,
Ramula, with visible gold identified in 5 mineralised zones in the first hole,
and further encouraging results reported including the potential for a bulk
zone following an intersection of 60.8 m grading 3.75 g/t, including 7.2
metres grading 8.31 g/t from 155.8 metres and 15.6 metres grading 9.37 g/t
from 187.9 metres.

The exploration strategy for West Kenya is to increase the resource conversion
rate and the total resource estimates to further strengthen Shanta's
development portfolio. A resource update for the West Kenya Project is
expected to be released in late February.

Exploration

A total of 4,505 metres was drilled covering 17 holes at Bauhinia Creek
Bauhinia Creek East Area 1 ("BC East Area 1"), and Luika on the mining
licences at New Luika Gold Mine. The following encouraging drilling
intersections were identified:

·    BC Main:

o    Hole CSD294 intersected 3.05 m @ 15.17 g/t Au from 110.20 m

o  incl. 1.23 m at 36.29 g/t Au

·    BC East Area 1:

o    Hole CSD251 intersected 10.56 m @ 22.67 g/t Au from 98.00m

o  incl. 4.30 m at 51.65 g/t Au

·    Luika:

o    Hole CSD227 intersected 4.88 m @ 4.72 g/t Au from 529.20 m

o  incl. 2.12 m at 8.07 g/t Au

o    Hole CSD269 intersected 5.44 m @ 5.84 g/t Au from 539.92 m

o  incl. 1.16 m at 17.88 g/t Au

A further 3,733 metres of RC drilling covering 47 holes at Porcupine South
took place with the following significant intersections identified:

o    Hole PSRC049 intersected 8 m @ 2.60 g/t Au from 53 m

▪ incl. 1 m @ 5.02 g/t Au and 3 m at 4.23 g/t Au;

o    Hole PSRC066 intersected 7 m @ 2.38 g/t Au from 53 m

▪ incl. 2 m at 4.75 g/t Au

o    Hole PSRC051 intersected 10 m @ 2.26 g/t Au from 53 m

▪ incl. 4 m at 4.07 g/t Au

o    Hole PSRC088 intersected 13 m @ 3.01 g/t Au from 167 m

▪ incl. 5 m at 5.06 g/t Au

o    Hole PSRC089 intersected 9 m @ 2.46 g/t Au from 58m

▪ incl. 3 m at 5.63 g/t Au

o    Hole PSRC090 intersected 7 m @ 2.25 g/t Au from 93m

▪ incl. 3 m at 4.49 g/t Au

All of the these newly reported drilling intersections are outside existing
mineral reserves and will be incorporated into the next reserves and resources
update to be announced in Q1 2022.

Corporate Social Responsibility ("CSR")

Developing the education prospects of local communities around NLGM is a core
priority of Shanta's community development strategy. During the Quarter Shanta
completed the handover of three classrooms and a toilet block constructed at
the Primary School in nearby Maleza. The project was managed and funded by
Shanta and is expected to enable more students to be enrolled in the Primary
School during the 2022/23 academic year. This will reduce the current need for
students in Maleza to travel long distances outside of their ward to access
schools which can be a barrier to their education.

A key project during 2021 was the Mbangala Luika Dam water project. The final
stage of installing a submersible pump was successfully completed during Q4
with official commissioning to take place during Q1 2022. Water is now being
pumped from the 10,000-litre water storage tank at Luika Waste Rock Dump to
Mbangala village where it is being stored locally in two other tanks. This
project is now providing 7,600 residents with year-round access to clean
water.

Uptake in Shanta's Mining Agriculture Improvement Program ("SMAP") continued
to increase during the Quarter, and there are now approximately 2,000 farmers
enrolled for the 2021/22 farming period. Under the scheme farmers are provided
with advice, training, seeds, fertilizer, and insecticides to support farming
productivity and yields. Sunflower has become an increasingly popular crop
because of the rise in price of sunflower oil and the fact it provides crop
diversification to the sesame traditionally grown. During Q4 Shanta purchased
1,000 kg of sunflower seeds which were distributed to the farmers enrolled in
SMAP. In addition, training was delivered in the Period on the use of seed
planter equipment to promote modern farming methods in the surrounding
communities. Approximately 1,000 farmers attended the training which is
expected to encourage the use of seed planter equipment which can boost the
efficiency of seed planting and the crop performance due to better spacing.

2022 Guidance

Annual guidance of approximately 68,000 - 76,000 oz at AISC(3) of US$1,050 -
1,250 /oz on a like-for-like basis including development costs, in line with
the World Gold Council ("WGC") definition.

2022 gold production is weighted approximately 65% towards H2 2022 reflecting
mining of the high-grade Bauhinia Creek crown pillar beginning in May 2022.
The crown pillar consists of approximately 83,000 tonnes grading 8.4 g/t
containing around 22,500 ounces. Q1 2022 gold production is forecast at a
similar level to Q4 2021, with quarterly production increasing in Q2 2022 upon
commencement of the crown pillar mining.

As of January 2022, 82% of planned FY 2022 ounces have grade control
information.

Post Period

On 3 January 2022, the Company received a VAT Refund Verification Findings
from the TRA for approximately US$4.3 million. All VAT receivables for the
period from July 2020 to October 2021 totalling US$11.5 million have now
either been refunded, offset, or verified by the TRA for approval.

The Company completed the recruitment process of an international Feasibility
Study Manager at the West Kenya project commencing in Q2 2022.

The Company's three Mining Licences at Singida's Gold Mine were extended for
10-years through to January 2032.

ENDS

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