LSE-listed Caracal Gold has agreed to a revised share purchase agreement (SPA) for its proposed acquisition of Tyacks Gold – the holder of the licences collectively referred to as the Nyakafuru project in Tanzania.

The project is located in the Lake Victoria Gold Fields in northern Tanzania, 140 km southwest of Mwanza, Tanzania's second largest city.

The changes from the previous SPA, announced in December 2021, include the extension of the completion date, revised commercial terms and the exclusion of the Nyakafura Reefs project and the Simba projects for the moment.

The acquisition of the Nyakafuru project is expected to create a major new gold mine development opportunity for Caracal in one of Africa's largest gold-producing regions.

The project was previously subject to extensive exploration and feasibility study work by ASX- and LSE-listed Resolute Mining.

The acquisition, when complete, will double Caracal's total gold resources to 1.3-million ounces prior to an impending resource update at Kilimapesa – delivering on its goal of building an emerging East Africa-focused gold producer.

The revised SPA, which follows due diligence by Caracal, allows for extended completion timing and agrees interim process steps to allow work on the ground to begin immediately.

The cash element of the purchase consideration has been revised such that on or before May 31, Caracal shall pay an amount equal to $500 000 (Tranche 1 payment); and that on or before July 31, Caracal shall pay an amount equal to $1-million (Tranche 2 payment).

The share element of the transaction will be finalised in due course, but is not expected to be materially different to what was previously announced.

The 0.5% gross net smelter return royalty remains unchanged.

Next steps include finalising the exploration plan and infrastructure preparation during the third quarter, ahead of starting drilling early in the fourth quarter.

Finalisation of the acquisition remains conditional upon receiving required in-country approvals, with all documentation to be submitted to the Tanzanian regulators.

“Signing the revised SPA allows us to immediately begin work on Nyakafuru, with drilling to commence in the fourth quarter of 2022.

“Since we reached the initial agreement with the vendors, we have been working collaboratively together to reach the stage where we can begin to advance the project. We have worked hard to identify and acquire a project that meets our stringent investment criteria, namely offering near term development opportunity and significant value upside whilst complementing our current portfolio,” comments Caracal CEO Robbie McCrae.