Mining company Shanta Gold has provided an update from the second phase of its Bauhinia Creek drilling campaign at the New Luika Gold Mine (NLGM) in Tanzania.

Bauhinia Creek is among one of the three active sources of ore being mined at NLGM.

Phase 2 drilling at the mine intersected high-grade mineralisation over significant widths.

The drilling results indicated that Hole CSD122 intersected 16.02m grading 9.36g/t gold (Au), Hole CSD123 intersected 7.07m grading 16.10g/t Au and Hole CSD119 intersected 2.43m grading 5.26g/t Au.

This new area of mineralisation found in Phase 2 drilling is below the existing mineral reserves found at Bauhinia Creek.

The strike length of high-grade mineralisation below the existing reserves is estimated at 280m and also remains open at depth..

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By GlobalData

Shanta Gold CEO Eric Zurrin said: “These are some of the best exploration results yet at New Luika and it is of great encouragement to see such exceptional grades and widths as we go deeper into the orebody.

“The vertical level of the current mine plan is only 250m below the portal and we look forward to further exploring these high-grade extensions in the second half of 2019. Mine life extension is the single biggest contributor to value for Shanta Gold shareholders given the quality of the orebody and we will be combining the Phase 1 and 2 results into an updated resource estimate in July.”

The low-cost New Luika Gold Mine is located in the Songwe district of southwestern Tanzania. It is located approximately 700km south-west of Dar es Salaam.

The mine commenced production in 2012 while the underground project was commissioned in August 2012 with elution and electrowinning plant installed in the second quarter of 2014. A new crusher plant was also commissioned in September 2014.

Luika Gold consists of various small to medium-sized high-grade deposits in a close area. The two key gold deposits anchoring the mine are Bauhinia Creek and Luika.