Tanzanian graphite project developer  Walkabout Resources (ASX:WKT) is adding more gold to its portfolio.

But despite its previous woes in Tanzania — still considered one of the least attractive mining jurisdictions in the world — Walkabout is sticking with the African nation as a key jurisdiction.

This morning Walkabout told shareholders it had secured exploration ground covering the Amani gold project,  located in a “highly prospective, underexplored gold region in south western Tanzania”.

“Walkabout’s strategy has always been to maintain a diversified portfolio and continually look for high value exploration opportunities,” chairman Trevor Benson said.

“We believe the Amani gold project with its significant alluvial gold endowment will potentially provide significant value to the company while not distracting us from the funding and building of the Lindi Jumbo graphite project.”

For a long time  Lindi Jumbo graphite project has been the jewel in Walkabout’s crown – at least until Tanzania went and changed the rules on explorers and threw a temporary spanner in the works.

In July 2017, the government introduced amendments to the Tanzanian Mining Act 2010 that weren’t going to be so favourable for miners.

But those issues, along with a dispute between the government and gold major Barrick Gold and its subsidiary Acacia Mining, have now been resolved.

This prompted the money to start flowing again to fund mining developments in Tanzania.

Walkabout had been in the process of raising US$40m ($57.3m) for its Lindi Jumbo project development. The process involved the marketing, through Pareto Securities, of a structured high yield bond into international investment markets.

But this morning Walkabout said the global economic slowdown caused by COVID-19 had seen potential investor demand decline.

More recently though Walkabout had been in negotiations with a number of African development banks to secure debt funding for the project.

In March, the company received a non-binding, conditional term sheet for a loan of $US30m from one bank. Walkabout said finalising the loan would be an immediate focus for the company.

Mini 90s gold rush

Walkabout says the area that the Amani gold project is located in has the potential to host high-grade orogenic gold mineralisation similar to the Lupa Goldfields, 300km to the northwest, where Shanta Gold has numerous deposits.

Despite the fact that there was a mini alluvial gold-rush to the area in the 1990s, it largely remained unexplored.

Historically, alluvial gold nuggets were recovered from the Amani area, so processing of hard rock material was never a priority despite gold in quartz veins and rubble within the alluvial mining area.

Walkabout says geologists familiar with the area estimate that in excess of 2.5 tonnes of gold nuggets have been removed by artisanal miners from a 2km stretch of riverbed in only one of the alluvial mining areas within the Walkabout application area.

Known channel sampling of gold bearing quartz veins returned grades of 20.9 grams per tonne (g/t) gold from the artisanal mining area within Walkabout’s licence. Anything over 5g/t is considered high grade.

Shares edged down nearly 4 per cent this morning.


In other ASX gold news today:

Breaker Resources (ASX:BRB) shares jumped over 17 per cent after the explorer said it had intersected strong mineralisation 3km north of its 1-million-ounce Bombora deposit.

Early, wide-spaced reverse circulation drilling intersected up to 4.5g/t gold at the Kopai prospect, part of the company’s Lake Roe project, 100km east of Kalgoorlie in WA.

Meanwhile, Amani Gold (ASX:ANL) shares doubled to 0.2c despite the company saying Hong Kong-based investment company Neo Gold had not honoured a $3m placement.

“The company is considering its position including the possibility of legal action against Neo Gold,” Amani said.