Gold Developer Discovers Excellent Infrastructure Opportunity at Tanzania's Imwelo Project

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1. Ownership and Share Structure Information

The information listed above was updated on the date this article was published and was compiled from information from the company and various other data providers.

Lake Victoria Gold Ltd. (LVG:TSX; LVGLF:OTCQB; E1K:FSE) announced it is advancing its fully permitted Imwelo Gold Project toward development with drill rigs mobilizing to site ahead of a targeted sterilization drilling program scheduled to start next week, according to a May 6 release.

The drilling is a crucial component of the pre-construction phase, aimed at facilitating the final decisions regarding infrastructure placement and site layout as LVG pushes the Tanzania project towards near-term production.

"Mobilizing drill rigs to site marks another important step as we advance Imwelo toward development and construction," President and Chief Executive Officer Marc Cernovitch said. "This program is focused on de-risking the project at the infrastructure level, ensuring that key facilities are optimally located ahead of construction. With engineering work progressing in parallel, we continue to move Imwelo forward in a disciplined manner toward near-term production."

The upcoming drilling program is scheduled to start in mid-May and is expected to last about 21 days. It is specifically designed to carry out sterilization drilling to ensure that the infrastructure for the plant and other site facilities is optimally placed. This involves approximately 1,050 meters of reverse circulation (RC) drilling that will target areas planned for the plant, accommodation, and support facilities.

The results from this drilling will play a vital role in the final site layout, engineering design, and the sequencing of development, the company said. This efficient drilling program is structured to conclude within roughly three weeks, ensuring that the project remains on schedule.

The sterilization drilling is intended to confirm that the final infrastructure is sited in locations that will not interfere with potentially mineralized zones, thereby supporting efficient mine development, according to the release. The planned drilling includes about 500 meters across the plant area with 10 holes going to depths of approximately 50 meters, and about 550 meters in the accommodation and stores area with 11 holes also reaching depths of around 50 meters. Additionally, the program will include testing of northwest and east-west trending magnetic anomalies.

The Imwelo Gold Project is gaining significant development momentum as Lake Victoria Gold continues to push the project towards the construction phase. The sterilization drilling program is a crucial component of a series of engineering and development activities currently being executed, including finalizing the mine design, optimizing the site layout, and securing project financing, all of which are orchestrated to ensure a smooth transition from the development stage to construction.

Looking ahead, the company has outlined several key steps to maintain this momentum. The sterilization drilling, scheduled for completion between May and June 2026, is critical for confirming the placement of infrastructure and finalizing the site layout. The results from this drilling will be integral to finalizing the detailed site layout and engineering design.

Furthermore, the project will see the advancement of the final pit design and mine planning. This includes the scheduling and sequencing of the initial mining areas, ensuring that the mining process is both efficient and effective. Concurrently, ongoing geotechnical and engineering work will continue to assess slope stability, design pit walls, and characterize near-surface materials. These studies are essential for finalizing the pit configuration and ensuring the project is construction ready.

Additionally, the development of site access and infrastructure is progressing, the company said. This includes roadwork and site preparation, which are vital for supporting the upcoming construction activities and future operations at the Imwelo Gold Project.

Drilling Crucial for Optimizing Site Layout

According to an updated research note on May 6 by Atrium Analyst Ben Pirie, the drilling program is crucial for confirming the final placement of infrastructure and optimizing the site layout as LVG progresses towards near-term production.

"For context, sterilization drilling is a standard pre-construction step designed to confirm that planned facilities are not located over potentially mineralized material, ensuring infrastructure is optimally positioned and avoiding sterilization of any near-surface ounces," Pirie wrote. "The program is expected to wrap up within roughly three weeks, with results feeding directly into final site layout, engineering design, and development sequencing."

Concurrently, LVG is advancing other pre-construction activities, including final pit design and mine planning, scheduling and sequencing of initial mining areas, geotechnical and engineering work, slope stability analysis, and ongoing roadwork and site preparation. These initiatives are integral to the imminent commencement of construction.

On the financial front, LVG recently announced an increase in its non-brokered convertible debenture financing from CA$3 million to CA$3.8 million due to strong investor demand, with the conversion price adjusted to CA$0.30 per share. This adjustment was made alongside the announcement of a US$25 million gold loan facility from Monetary Metals. Additionally, LVG is exercising its mandatory conversion rights on its 2024 debentures, converting the remaining CA$217,000 outstanding into shares at CA$0.18 per share. These financial maneuvers strengthen LVG’s balance sheet and enhance its flexibility as it approaches the construction phase at Imwelo, the analyst said.

Looking ahead, key catalysts for LVG include ongoing progress and drilling results from the Tembo Project in partnership with Barrick, and the anticipated commencement of construction at Imwelo slated for the second to third quarter of 2026.

Pirie said Atrium likes LVG for its clear path to production at Imwelo, strategic partnership with Barrick at Tembo, and significant exploration potential across its portfolio. The company’s experienced management team and strategic partnerships, which own approximately 39% of shares, further bolster its prospects.

He maintained Atrium's Buy rating with a CA$0.50 target price, a return of 79% at the time of writing.

Advancing Project Should Drive Stock Price, Analyst Says

Analyst Alina Islam from Red Cloud Securities provided an updated research report on April 2, noting that the funding structure established for the project is strategically designed to minimize shareholder dilution while providing robust and largely non-dilutive capital to advance the project's development.

Imwelo, while relatively small with a projected steady state production of 24,000 ounces of gold per year, plays a strategic role within Tanzania's Lake Victoria Goldfield, the analyst said.

"We suspect that down the road, cash flow from Imwelo would help fund and capture upside from the company's Tembo project, which shares geological similarities with Barrick's 150,000 oz Au/yr Bulyanhulu mine," Islam wrote. "While Tembo is early-stage, management is in the midst of completing advanced negotiations with Nyati Resources (Private) for potential toll milling opportunities at Nyati's … CIP plant, located on Lake Victoria's claims."

Imwelo is fully permitted for construction and production, located just 12 kilometers west of AngloGold Ashanti's Geita mine, and holds a 10-year mining license. Recent tests have confirmed gold recoveries of up to 97% using a conventional gravity + CIL processing method.

While Islam noted Red Could does not have a rating or target price on the stock, "advancing Imwelo towards a start-up to generate cash flow, and successful exploration at the Tembo project, should drive the stock price."

The Catalyst: Possible Peace Gives Gold a Nudge

Gold prices experienced a significant surge this week, driven by emerging signs that the U.S. and Iran might soon finalize a peace agreement, according to a report by Anuron Mitra for Investing.com that was updated May 7.

This development pressured both oil prices and the dollar, subsequently enhancing the attractiveness of gold as an investment. By 3:11 p.m. ET Wednesday, spot gold had risen by 3% to US$4,694.40 per ounce, and gold futures also saw a 3% increase to US$4,705.50 per ounce.

Reports from Axios indicated that the White House was on the verge of securing a deal with Iran, involving a one-page memorandum of understanding aimed at concluding the ongoing conflict. This preliminary agreement, according to two U.S. officials cited in the report, would set the stage for more comprehensive nuclear negotiations. The U.S. is anticipating Tehran's response to several critical points within the next 48 hours. If realized, the deal would involve Iran agreeing to halt nuclear enrichment activities, while the U.S. would lift sanctions and unfreeze billions of dollars in Iranian assets. Additionally, the agreement would remove restrictions on the Strait of Hormuz, reopening this vital transit route.

The Wall Street Journal also covered the development, noting that the proposal includes a 14-point plan and would allow a one-month period for discussions aimed at ending the war. President Donald Trump later commented on social media regarding the potential agreement, stating, "Assuming Iran agrees to give what has been agreed to, which is, perhaps, a big assumption, the already legendary Epic Fury will be at an end, and the highly effective Blockade will allow the Hormuz Strait to be OPEN TO ALL, including Iran." This statement underscores the significant geopolitical implications of the agreement and its potential impact on global markets, including those for precious metals like gold.

According to an April 28 post on Goldfix, Goldman Sachs analysts Lina Thomas and Daan Struyven have maintained their optimistic forecast for gold prices, predicting that they will reach US$5,400 per troy ounce by the end of 2026.

This projection is based on several factors including ongoing diversification by central banks, a normalization of currently low speculative positions, and anticipated Federal Reserve rate cuts totaling 50 basis points, as expected by their economists.

Despite a temporary slowdown in central bank gold purchases in February 2026, which saw only 2 tonnes being bought amid extreme price volatility, Goldman Sachs expects an average monthly purchase of 60 tonnes throughout the year. This expectation aligns with sentiments from a recent Goldman Sachs central bank conference where approximately 70% of participants anticipated an increase in global gold reserves, and about 25% expected them to remain stable.

However, the analysts also acknowledge potential short-term risks that could pressure gold prices downward. These include possible continued liquidations if disruptions in the Strait of Hormuz persist, or corrections in the bond or equity markets. Notably, they mention that much of the gold positioning and call option overhang has already been cleared, which might mitigate some of the downward pressure.

Ownership and Share Structure¹

Approximately 28% is owned by management and insiders, institutions hold 15%, and strategic corporate investors (including Barrick Mining Corp. and the TAIFA Group) own 23%. The remainder is retail.

Top shareholders include AIMS Asset Management with 9.5%, Rostam Aziz with 8.02%, Simon Charles Benstead with 7.21%, Concept Capital Management Ltd. with 5.71%, and Walter David Scott with 3.01%.

The company's market cap is CA$56.86 million. It has 199.5 million shares outstanding, according to the company, and trades in a 52-week range of CA$0.16 to CA$0.36.