Yesterday, Canaco released additional drill results from the Magambazi and
Magambazi North zones, which together represent the southernmost 1.4 km
of an 11 km long trend of anomalous gold-in-soil geochemistry and artisanal
mining on its Handeni Gold Project (100%) in eastern Tanzania. The results
included an interval of 37m grading 12.5 g/t in Hole 66 from Magambazi,
which we regard as the best intersection reported from it to date.
In the same release, the company announced a reinterpretation of the
geometry of the deposit that in our view dramatically increases its potential
tonnage. The Magambazi and Magambazi North zones are now seen by the
company as separate parallel zones of near-surface gold mineralization – the
Magambazi North lodes being the western limb, and the Magambazi lodes
being the eastern limb, of a single synclinal fold.
The intersection reported in Hole 66 (37m grading 12.5 g/t) is interpreted by
us to occur at the axis of this fold, approximately 200m below surface.
Because, in our view, this setting has not been tested by prior drilling to the
north or south, it is possible that this tenor of mineralization could be present
over the entire 1.4 km strike extent of Magambazi. We would expect future
drilling to target potential strike extensions to this compelling new target.