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LVG: Mining License Transfer + 10-Year Renewal

What you need to know:
• LVG announced the completion of the 10-year renewal and authorization to transfer the Imwelo Mining Licence to LVG.
• This major milestone significantly de-risks the Company as it progresses with development plans of the Imwelo Project and looks to take advantage of the elevated gold price in the near-term.
• Upon certain conditions, this announcement triggers the second tranche of the financing involving Taifa Group (at a significant premium to market, $3.8M at $0.24/share)

This morning, Lake Victoria Gold (LVG:TSXV) announced the Tanzanian Mining Commission has officially completed the 10-year renewal and authorization to transfer the Imwelo Mining License to LVG. This announcement solidifies LVG’s long-term rights to the Imwelo Project and marks a major step towards the Company’s growth and development goals within the Lake Victoria Goldfield region. Despite the lengthy delay, we are excited by this release as the Company can now begin to execute on its development plans. This includes exploration, site preparation, and development/construction activities. We are maintaining our BUY rating and $0.45/share target price on Lake Victoria Gold Ltd.

We remind readers of the significance of the partnership with the Taifa Group as the Group is owned by Tanzanian billionaire, Rostam Aziz and is the largest locally owned mining contracting business in the country. Taifa works with prominent partners including Petra, De Beers, and Barrick. Rostam, showing his heightened involvement with LVG, was quoted in today’s release stating his strong support for the Company and his eagerness to move forward with the project development.

Funding Negotiations
Within today’s press release, the Company announced that it is in advanced negotiations with non-dilutive funding sources to fully fund the capex portion of the development costs for the Imwelo Project. As the project is now de-risked from a permitting perspective, we expect this process to move quickly, and announcements be made in the near term.

Additionally following certain conditions for the acquisition of the license, today’s announcement triggers the second tranche of equity investment from the Taifa Group. As a reminder (announced August 10, 2023), upon final engineering and closing of the acquisition, Taifa will have 20 days to complete a second private placement of 16M units at a price of $0.24/unit for gross proceeds of $3.84M. Each unit consists of one common share and one warrant exercisable for two years at $0.26/share. The agreement also states that six months after the Company breaks ground on the Project, Taifa will have 20 days to exercise the warrants listed above which will provide an additional $4.16M.