Pangea projects catch eye of African majors

It was only a matter of time before South Africa’s major mining companies became interested in the opportunities being aggressively developed in their own backyard by North American juniors.

In the space of several weeks, Toronto-based Pangea Goldfields (TSE) announced agreements with two major South African companies, involving several of its exploration concessions in Tanzania.

One of these agreements allows Anglo American the right to earn a 70% interest in Pangea’s Kahama gold project in the Lake Victoria gold district. Several other exploration joint ventures are under discussion.

Pangea also released details of a separate joint-venture agreement with South African-based Iscor, the largest producer of iron and steel in the continent and the fifth-largest industrial company (in terms of assets) listed on the Johannesburg Stock Exchange.

The agreement with Iscor covers several of Pangea’s exploration concessions in the Suguti and Ushirombo areas of Tanzania, as well as a joint venture to obtain a property Pangea describes as “highly prospective,” covering about 30 sq. km. An application for this property has been submitted by Pangea.

The Suguti concessions, comprising 280 sq. km, are east of Lake Victoria in the Suguti greenstone belt. Two gold-bearing shear zones have been traced from outcrop and electromagnetic surveys, over strike lengths of 6 km and 14 km, much of this under laterite cover. Grab samples returned values of up to 17 grams gold per tonne.

The Ushirombo greenstone belt, which hosts four of Pangea’s properties, is southwest of Lake Victoria. It is believed to be the extension of the volcanic belt which hosts the Bulyanhulu gold deposit adjacent to Pangea’s Bully South project. Four gold-copper anomalies were outlined on Pangea’s ground (390 sq. km) during its program of geochemical sampling.

Iscor can acquire a 35% share in any area by spending US$3 million, which can be increased to 51% once US$5 million has been spent on such an area.

Iscor can earn a 70% interest in the Suguti area and 75% of the Ushirombo (and the prospective license, if the application is successful) upon completion of a bankable feasibility study within five years. The company can obtain a further 5% in the Suguti joint venture by paying Pangea US$30 per oz. for 5% of the proven minable gold reserves, as defined in a feasibility study.