Haneti Nickel PGM Project - Drilling Update

Katoro Gold plc (Incorporated in England and Wales)

(Registration Number: 9306219)

Share code on AIM: KAT

ISIN: GB00BSNBL022

("Katoro" or "the Company")

12 January 2021

Katoro Gold plc ('Katoro' or the 'Company')

HANETI NICKEL PGM PROJECT - DRILLING UPDATE

Katoro Gold plc (AIM: KAT) ("Katoro"), the AIM listed gold and nickel exploration and development company, is pleased to announce an update regarding the maiden drill programme targeting the discovery of nickel and platinum group metals ("PGM") at the Haneti Nickel Project ("Haneti") in Tanzania.

Katoro holds a 65% ownership interest in Haneti with 35% held by Power Metal Resources plc (LON: POW) ("Power Metal").

HIGHLIGHTS:

·    Maiden drill programme involves 2,000 metres of Rotary Air Blast ("RAB") drilling at Haneti with a planned 50 holes of circa 40 metres depth.

·    The RAB drill holes are being drilled on profiles across the three target areas in order to provide enhanced information of the subsurface shape and orientation of the ultramafic rock bodies being targeted and to allow for the optimisation of a planned follow-on diamond drill programme.

·    By end of drilling on 6 January 2021 a total of 22 holes and 863 metres had been drilled at the Mwaka Hill target, with the plan to move to the Mihanza Hill target during the week commencing 11 January 2021.

·    First two batches of samples from the RAB drilling at Mwaka Hill have been prepared and the first sample batch will be dispatched to SGS Tanzania, an accredited laboratory, for assay testing as soon as the accompanying QA/QC standards are received on site (expected week commencing 11 January 2021).

·    Drilling commenced on 29 December 2020 and has continued daily, with the exception of New Year's Day, for an average daily drilling rate of 96 metres / day.  The delay in commencing the drilling and logistical challenges presented by the current rainy season have not impacted the overall programme with drilled metres now in line with the planned schedule.

·    The potential impact on the planned programme of the COVID-19 pandemic and of the January - March rainy season is being monitored carefully on site with no issues at this time.  There may be some rain related access challenges to be overcome as the drill rig is moved over to the Mihanza Hill target area.

·    Concurrently to the drilling programme, geological fieldwork is continuing with:

-      Geological mapping of surrounding ultramafic target areas; and detailed mapping at Mwaka Hill and Mihanza Hill.

-      Geophysics:  three ground magnetic survey lines and one radiometric survey line completed over the Mwaka Hill drill fence profile with the same work due to be started at Mihanza Hill.

-      Fieldwork results will supplement the existing geophysics data, helping to optimise the planned RAB drill hole placement, and in conjunction with the results from the RAB drilling programme, will assist in targeting for the currently planned follow-up diamond drilling programme.

HANETI PROJECT - NICKEL SULPHIDE AND PGM TARGETS - FURTHER INFORMATION

Project overview

The Haneti Nickel Project covers an area of approximately 5,000 km² in central Tanzania approximately 88 km north of the capital city Dodoma. It comprises tenements (prospecting licences, offers and applications) prospective for nickel, PGMs and gold. 

One of the key exploration objectives for the JV partners at Haneti is to delineate the potential for economic nickel mineralisation on the linear dyke-like, Haneti-Itiso Ultramafic Complex ("HIUC"), which sporadically crops out over a strike length of 80 km through the centre of the tenement holding. The HIUC mainly comprises serpentinites (metamorphosed ultrabasic rocks such as dunite and peridotite), with metabasic rocks such as metagabbro and metadolerite and is being targeted for a Chonolith-Type Nickel exploration model.

RAB Drill Programme

An initial three target areas have been selected for RAB drilling: Milhanza Hill; Mwaka Hill; and Igari Hill. These targets are based on the recommendations of the 2012 AEM survey, the detailed field programme undertaken in 2013, and further supplementary exploration findings.

The planned 2,000 metres RAB drilling programme will consist approximately 50 holes drilled on linear fences across the targets. The programme will seek to verify the existence of near surface nickel sulphide mineralisation at each target whilst increasing the geological understanding such that the orientation and the meterage of a planned follow-up diamond drill programme can be optimised to confirm the scale of any nickel sulphide mineralisation.

The drilling is being conducted by an experienced Tanzanian company in line with international best practice and in accordance with health and safety and COVID-19 precautions. 

Historic Nickel Exploration

The Haneti area was first explored in 1931 by a private prospector who collected a nickel‐rich magnetite sample at Mihanza Hill. Later trenching uncovered a few discontinuous, green‐stained veins rich in nickel‐silicates and containing several percent nickel.

In the early 1960s, the Geological Survey of Tanzania carried out mapping, pitting, soil sampling, trenching and rock chip sampling of ultramafic outcrops on the Zoani, Mindii and Mihanza hills, within the HIUC belt.  Further geological mapping and sampling was undertaken in 2006, 2007 and in 2013. Additionally, an airborne electromagnetic ("AEM") geophysics survey was completed over the Mihanza and Mwaka Hill anomalies in 2012 with further geophysics flown in 2015.

A study commissioned with a consultant expert in ultramafic geochemistry in 2015 identified the nickel, copper, platinum, palladium anomaly at Mihanza Hill as a drill ready target. This report suggested that the Itiso‐Haneti Ultramafic body may fit the Chonolith-Type Nickel exploration model, which would imply that the main ultramafic belt may have small discrete sulphide bodies associated with it.

In 2019, several soil samples collected during the 2013 exploration programme were sent for analysis and the results confirmed the existing knowledge base and also identified a new ultramafic subcrop (see RNS dated 30 January 2019).

**ENDS**

For further information please visit www.katorogold.com or contact: