East Africa-focused gold producer, developer and explorer Shanta Gold has upgraded its Joint Ore Reserves Committee-compliant resource estimate at the Ilunga satellite deposit at the New Luika Gold Mine (NLGM), in south-west Tanzania, with indicated resources increasing by 409% – from 40 352 oz of gold to 205 347 oz of gold.

Ilunga is located in the Lupa goldfields, about 2.5 km north-east of the NLGM central processing facility. Access has been developed as part of the current openpit mining operation.

The significant increase in resource includes an indicated resource tonnage that has surged by 336%, from 311 355 t to 1.356-million tonnes, while the indicated resource gold grade rose 17%, from 4.03 g/t of gold to 4.71 g/t of gold, Shanta reported earlier this month.

The total Ilunga resources from the indicated and inferred categories have been upgraded from 73 940 oz at 3.51 g/t of gold to 257 965 oz at 4.55 g/t of gold.

“The deposit is a good grade, close to the plant and likely to contribute to a meaningful increase in the mining reserve, which, in turn, enhances shareholder value,” Shanta Gold CEO Toby Bradbury noted in a statement last week.

Shanta Gold expected that the majority of the Ilunga ounces would form part of a new high-grade underground operation, which would start as the Luika deposit, would be depleted in about 2020, he added.

“At this stage, [Shanta] envisages developing Ilunga using cash generated from operations and existing equipment and personnel to take the new development in its stride,” Bradbury said.

He further believes that the potential of this high-grade extension creates the option to blend the ore with, among others, the upgraded Elizabeth Hill Reserve declared earlier this year and, thereby, extend the mine life by several years with “more prospective exploration still in play”.

Ilunga’s updated resource will be fast-tracked for engineering studies to define an underground reserve during the first quarter of 2017.