April 22, 2021

Barrick JV and Resolute investment

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In 2016, Loncor entered not a JV with Barrick Gold whereby Barrick could assess the potential of vast areas of Ngayu via an earn in agreement. While Loncor receives regular updates on the progress of exploration, Barrick are in total control of the program and any findings within the JV will be considered a significant bonus to Loncor.

In June 2018, agreements were concluded with Resolute Mining Limited (ASX: RSG) - subsequently, with Resolute becoming Loncor’s largest shareholder (currently holding 25% of Loncor’s outstanding shares).

Barrick Expands Loncor JV In Search of Tier 1 (+ 5 million oz) Gold Targets

In January 2016, Loncor entered into a joint venture agreement with Barrick Gold Congo SARL (formerly Randgold Resources Congo SARL) (“Barrick”) (NASDAQ:GOLD), Barrick beginning a program of diamond drilling in June 2020 over numerous potential Tier 1 targets. This agreement provides for a joint venture (the "Joint Venture") between Loncor and Barrick covering 12 exploration permit areas held by Loncor in the Ngayu greenstone belt. Under the agreement certain parcels of land surrounding and including the Makapela and Yindi projects have been retained by Loncor and do not form part of the Joint Venture, with Barrick having certain pre-emptive rights over these two areas. Barrick manages and funds all exploration of the Joint Venture permit areas until the completion of a pre-feasibility study on any gold discovery meeting the investment criteria of Barrick. Once the Joint Venture has determined to move ahead with a full feasibility study, a special purpose vehicle ("SPV") would be created to hold the specific discovery area. Subject to the DRC’s free carried interest requirements, Barrick would retain 65% of the SPV with Loncor holding the balance of 35%. Loncor would then be required, from that point forward, to fund its pro-rata share of the SPV in order to maintain its 35% interest or be diluted.

In June 2020, it was announced that Loncor’s 84.68% subsidiary, Adumbi Mining SARL (now Adumbi Mining S.A.) had entered into a similar JV arrangement (the "New Barrick JV") as above with Barrick for two exploitation permits held by Adumbi Mining. The ground being contiguous to the Imva area within the Ngayu gold belt.

In November 2020, it was announced that Loncor and Barrick further strengthened their JV relationship at Ngayu after entering into two new agreements. The first agreement (the "Amended Barrick JV") added three exploration areas held previously by Barrick outside of the JV. These three Barrick properties are located northwest of Loncor’s 100%-owned Makapela project where indicated mineral resources of 614,200 ounces (2.2 million tonnes grading 8.66 g/t Au) and 549,600 ounces (3.22 million tonnes grading 5.30 g/t Au) of inferred mineral resources have already been outlined by Loncor. Two significant targets have been delineated by Barrick at Mongaliema (7 kilometres northwest of Makapela) and Ntokayulu (3 kilometres northwest of Makapela). At Mongaliema, trenching and augering is continuing along a west-northwest trending shear zone with trench results including 37.3 metres grading 1.48 grammes per tonne of gold.

In the second new agreement (the “New Isiro JV”) agreed in November 2020, Loncor and Barrick replaced the existing joint venture agreement between Barrick and Loncor relating to the Isiro properties in the Ngayu gold belt, to focus on the three most prospective Isiro properties. These three Isiro properties include two of the drill targets identified by Barrick, Yambenda and Yasua, and which Barrick plans to drill as part of its ongoing drill campaign on priority targets in the Ngayu gold belt. At Yambenda, a 9.5 kilometre long banded ironstone ridge has a number of gold in soil anomalies.

Total acreage under the various Barrick/Loncor joint ventures in Ngayu now totals approximately 2,000 square kilometres.

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 Loncor’s Makapela and Adumbi deposits (which are not part of the Joint Venture), and the objective is to further unlock the potential of the Ngayu greenstone 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.

By the end of 2019, Barrick had identified a number of priority drill targets which were to be drilled during the upcoming dry season in 2020.

In June 2020, Barrick Gold (Congo) SARL commenced its core drilling program on several priority gold targets with the initial work classed as “scout drilling” with the aim of offering more structural certainty prior to making a decision to assess any one project further.

Figure 1 Ngayu Belt. Developing Prospectivity, Work Programs and Drill Targets for 2020

Ngayu Belt [map]

(From Barrick Q1 2020 joint venture report)

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 above technical information.

Read 39367 times Last modified on May 07, 2021

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