Loncor's Transformation has begun

Moving up the value curve

in the DRC's goldfields

NGAYU HISTORY AND REGIONAL OVERVIEW

Ngayu has a history of mining, with Belgians extracting a modest amount of gold from the area. Their focus was within our Imbo project area with the majority of output from the Adumbi deposit - Loncor's main area of potential expansion. The Ngayu belt has numerous positive indicators based on the geology, artisanal activity, encouraging drill results and an existing gold resource base. 

The area is 220 kilometres southwest of the Kibali gold mine, which is operated by Barrick Gold (Congo) SARL (“Barrick”).  In 2019, Kibali produced record gold production of 814,000 ounces at “all-in sustaining costs” of US$693/oz.  Barrick has highlighted the Ngayu Greenstone Belt as an area of particular exploration interest and via a Joint Venture with Loncor signed in 2016, is moving towards earning 65% of any discovery in close to 2,000 km2 of Loncor ground that Barrick is exploring. Any project that does not fit Barrick's criteria returns to the JV partner at no cost.

In June 2020, Barrick Gold (Congo) SARL commenced its core drilling program on several priority gold targets within the Ngayu greenstone belt in the northeast of the Democratic Republic of the Congo (“DRC”).  The beginning of the drilling campaign signals a significant step in the sequence of events necessary to assess numerous areas of potential in their search for Tier 1 (+5 million oz) deposits.  Since entering the JV agreement with Loncor in January 2016, Barrick has conducted various exploratory programs to define drill targets, targets that offer the early potential of attaining “Tier 1” status. Furthermore they have expanded the size of the JV through various supplementary JV agreements - see Projects section dedicated to Barrick JV for detail. The JV covers approximately 56% of Loncor's permitted ground.

The drilling on the Anguluku prospect is targeting a folded and thrust sequence of mineralised banded ironstone formation (“BIF”).  Further drilling is planned to be undertaken by Barrick at the other priority targets of Medere, Makasi, Lybie, Salisa and Bakpau NE in the Imva area in the west of the Ngayu belt.

 

Altitude within the Ngayu project area ranges from 550 metres above mean sea level to 950 metres above mean sea level.  The topography is made up of gently rolling hills and slightly incised valleys.  The vegetation is typical dense forest.

Figure 1: Ngayu is situated in the NE of the DRC - 200 kilometres from the world-class Barrick operated Kibali Mine 

Figure 1: Ngayu is located in NE of DRC, 200kms from Kibali Gold Mine   

A copy of the Ngayu Technical Report can be obtained from SEDAR at www.sedar.com and EDGAR at www.sec.gov.

The early history of gold activity at Ngayu is not complete, however, gold was first prospected for in the Ngayu region by Belgian prospectors in 1909.  The Ngayu project was owned by Société Minière de l’Aruwimi – Ituri and was exploited between 1929 and 1955. The database of the Central African Museum of Tervueren notes 13 occurrences of gold in the Ngayu greenstone belt, six of which are hosted within the Ngayu project area. The Tervuren database recorded historical gold production for some of the deposits occurring within the Ngayu greenstone belt.  The largest hard rock gold mining operation in the Ngayu greenstone belt was at Adumbi.  It is evident that mostly alluvial deposits were exploited, due to the ease of mining and extraction and due to the fact that it was mostly mined on a small scale.

The Ngayu project is located in an Archean  Greenstone Belt enclosing folded and fractured volcano-sedimentary series.  In the project area, both the Upper and Lower Kibalian Groups are present. The Upper Kibalian represents the greenstone belt made up of metasediments and metavolcanics of greenschist facies including prominent banded ironstone units (BIF) which form prominent ridges throughout the Ngayu greenstone belt. Within the Ngayu Belt there is a strong association between gold mineralization and the presence of BIF, the BIF either constituting the host rock (e.g. Adumbi, Yindi, Makapela, Nagasa) or forming a significant part of the local stratigraphy (e.g. Mondarabe, Itali, Anguluku).  BIF forms both physical and chemical traps for mineralizing hydrothermal fluids that follows. World-class examples of gold mines in similar geological settings to the Ngayu project include Kibali in the Moto greenstone belt and Geita in the Geita greenstone belt of northern Tanzania.

Figure 1: Overview of the Ngayu Belt illustrating the scale of Ngayu vs similar Geita and Kibali Greenstone Belts

 

The majority of gold occurrences within the Ngayu project are located close to the contact of BIF (Banded Ironstone Formation).  Historically, only two deposits were exploited on a large-scale by previous owners, namely Yindi and Adumbi which Loncor now have 100% and 84.68% interests respectively. Remnant mining infrastructure from previous operations at Yindi includes the old laboratory, plant and camp, but are derelict.  Makapela (100%) is a relatively new artisanal site which was developed by artisanal miners within the last 14 years and was one of the foci of the Company’s exploration activities previously.

A summary of the historical production for the Ngayu Belt is given in Table 1, although production records are incomplete and the figures quoted represent only an approximation.

Table 1: Historical Gold Production for the Ngayu Belt (1925 – 1955)

Deposit

Primary Au (oz)

Secondary Au (oz)

Total Au (oz)

Adumbi Area

208,000

83,000

291,000

Imva Fold Area

N/A

200,700

200,700

Yindi

45,200

21,000

66,200

Northern Ngayu Belt

N/A

60,800

60,800

Anguluku

5,700

N/A

5,700

Totals

258,900

365,500

624,400

 

The most prolific area for alluvial mining was the Imva Fold area, where extensive artisanal mining continues today, and where several areas of primary gold mineralization (Matete, Nagasa, Anguluku and Itali) have been under investigation by Loncor and now by Barrick.

Loncor's Exploration History

Exploration by Loncor at Ngayu commenced in late 2009 and initially included desktop research, primarily utilising data from the Royal Museum for Central Africa in Terveuren, Belgium and preliminary interpretation of airborne geophysical data, acquired by Rio Tinto in 2009. A base camp was set up at Yindi in 2010. 

At the beginning of Loncor’s Ngayu project, it was decided to divide the exploration into two concurrent programs:

  • Assessment of areas of known gold mineralization (Yindi and Makapela) with the potential to rapidly reach the drilling stage and provide a mineral resource base for the Company.  Soil sampling, augering, rock chip and channel sampling were carried out prior to diamond drilling.
  • Regional programs aimed at assessing the remainder of the then 4,500 km2 land package as quickly and cost-effectively as possible, in order to identify and prioritise mineralized target areas for follow-up, and enable less-prospective ground to be relinquished with confidence.  This program mainly entailed a regional BLEG (Bulk Leach Extractable Gold) survey and detailed interpretation of regional aeromagnetic data.  Both these programs were carried out under a technology consultation services agreement between Loncor and Newmont who had taken a 20% equity stake in Loncor which was entered into in February 2011 (but is no longer in place).

The two-pronged approach allowed for further delineation, drilling and resource announcements. For more detail, refer to the sections on the individual projects, plus the Resource web page.

The Imbo Project within Ngayu

Outside of the Barrick Joint Venture, exploration activities have focussed on the Imbo mining licence in the east of the Ngayu belt.  These activities have included updating the Adumbi database as well as reconnaissance fieldwork on the Imbo East (previously Maiepunji) prospect, 12 kilometres west-southwest of Adumbi where several artisanal workings occur over a strike length of 4 kilometres to the east of the Imbo river.

Loncor acquired control of the Imbo project in September 2019, initially acquiring a 71.25% interest in the project.  This 71.25% interest at Imbo was subsequently increased to 84.68% in September 2020.  A re-assessment of the resource bearing deposits at Imbo in April 2020 - namely Adumbi, Kitenge and Manzako - and the incorporation of 4 previously excluded drill holes, resulted in a 49% increase in the inferred resource. The three deposits, which sit within 5 kilometres of each other, now have an inferred mineral resource of 2.503 million ounces of gold (30.65 million tonnes grading 2.54 g/t Au), with 84.68% of this inferred mineral resource being attributable to Loncor. On June 10, 2020, a 43-101 technical report on the Imbo Project resource was filed on SEDAR, having been prepared by Minecon Resources and Services Limited with an effective date of April 17, 2020. The Minecon report is entitled "Independent National Instrument 43-101 Technical Report on the Imbo Project, Ituri Province, Democratic Republic of the Congo". The aforementioned report is available on www.sedar.com.

At Ngayu, a major structural fracture trends east-northeast through the Imva area where a number of targets are located and then trends southeast through the Imbo mining licence where the Adumbi, Kitenge and Manzako deposits are located and then across the Imbo river to the Imbo East prospect.  In total, this major structural break extends for 16 kilometres within the Imbo licence and will require further exploration to fully evaluate this prospective trend.  Recent reconnaissance to the east of the Imbo river at the Imbo East prospect has substantiated the potential of this structural trend, with several artisanal workings being located over four kilometres of strike.  Mineralization is found within steeply dipping metasediments with or without quartz veins with silica, sericite and graphitic alteration and mainly limonitic boxworks after pyrite.  These metasediments are found immediately southwest of a prominent range of BIF which is also mineralised.

Going forward, the Imbo project area is the focus of attention for the Company, with a 12 hole (+7,000 metres) drill program proposed late in 2020 to further delineate resources at Adumbi, and early-stage exploration at Imbo East moving forward in order to try and assess the potential of the area to host new drill targets. Refer to the web pages on the individual projects for more detail.

Barrick Gold Joint Venture Within Ngayu

As per the joint venture agreement signed in January 2016 between Loncor and Randgold (now Barrick Gold), Barrick manages and funds exploration of certain of the Ngayu exploration permit areas  (almost 2 000 square kilometres) held by Loncor until the completion of a pre-feasibility study on any gold discovery meeting the investment criteria of Barrick.  Subject to the DRC’s free carried interest requirements, Barrick would earn 65% of any discovery with Loncor holding the balance of 35%.  Loncor would then be required, from that point forward, to fund its pro-rata share in respect of the discovery in order to maintain its 35% interest or be diluted.  Certain parcels of land within the Ngayu project surrounding and including the Makapela and Yindi projects, have been retained by Loncor and do not form part of the joint venture with Barrick.  Barrick has certain pre-emptive rights over these two areas.    

The belt scale exploration strategy of Barrick is to focus on the discovery of large high-quality gold deposits by rapidly identifying and progressing targets that show the potential to meet these filters.  Gold mineral resources have already been identified within the Ngayu greenstone belt at the Makapela and Adumbi deposits, and the objective is to further unlock the potential of the Ngayu belt for a world-class discovery using cutting edge geophysics, geochemistry, structural interpretation and driven by an experienced and proven exploration team on the ground.

In June 2020, Barrick Gold (Congo) SARL commenced its core drilling program on several priority gold targets within the Ngayu greenstone belt in the northeast of the Democratic Republic of the Congo (“DRC”).  The beginning of the drilling campaign signals a significant step in the sequence of events necessary to assess numerous areas of potential.  Since entering the JV agreement with Loncor in January 2016, Barrick has conducted various exploratory programs to define drill targets, targets that offer the early potential of attaining “Tier 1” status.

The drilling on the Anguluku prospect is targeting a folded and thrust sequence of mineralised banded ironstone formation (“BIF”).  Further drilling is planned to be undertaken by Barrick at the other priority targets of Medere, Makasi, Lybie, Salisa and Bakpau NE in the Imva area in the west of the Ngayu belt.

Additional Areas of Interest

In addition to the Barrick joint venture, certain parcels of land within the Ngayu project surrounding and including the Makapela and Adumbi deposits have been retained by Loncor and do not form part of the joint venture with Barrick.    Loncor’s Makapela deposit (which is 100%-owned by Loncor) has an indicated mineral resource of 614,200 ounces of gold (2.20 million tonnes grading 8.66 g/t Au) and an inferred mineral resource of 549,600 ounces of gold (3.22 million tonnes grading 5.30 g/t Au).  

Loncor has a parcel of ground around the Yindi area (100%) where previous drilling during the period 2010-11 gave some significant gold drill interceptions.. Further investigation of the Yindi area is warranted.

Qualified Person

Peter N. Cowley, who is President of Loncor and a "qualified person" as such term is defined in National Instrument 43-101, has reviewed and approved the technical information on this web site.

Technical Reports

Certain additional information with respect to the Company’s Makapela project is contained in the technical report of Venmyn Rand (Pty) Ltd dated May 29, 2012 and entitled "Updated National Instrument 43-101 Independent Technical Report on the Ngayu Gold Project, Orientale Province, Democratic Republic of the Congo".  A copy of the said report can be obtained from SEDAR at www.sedar.com and EDGAR at www.sec.gov. Certain additional information with respect to the Imbo Project is contained in the technical report of Roscoe Postle Associates Inc. dated February 28, 2014 and entitled "Technical Report on the Somituri Project Imbo Licence, Democratic Republic of the Congo" plus the more recent Minecon Resources and Services Limited NI 43- 101 Technical Report on the Imbo Project filed on June 10, 2020. The Minecon report is entitled "Independent National Instrument 43-101 Technical Report on the Imbo Project, Ituri Province, Democratic Republic of the Congo". A copy of both said reports on the Imbo project can be obtained from SEDAR at www.sedar.com. 

 

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