Why Lake Victoria Gold Stands to Gain as Barrick Drills Deeper Into Tanzania
JV drilling effort enters final phase as LVG eyes near-term production at flagship assets.
Barrick’s Drill Campaign Revs Up
Barrick Gold (TSX: ABX) (NYSE: B) and the Government of Tanzania are pushing forward with an intensive exploration effort under their joint venture vehicle, Bulyanhulu Gold Mine Limited, and Lake Victoria Gold (TSXV: LVG) (OTCQB: LVGLF) (FSE: E1K) stands to benefit. The campaign, part of a US$9 million exploration expenditure commitment tied to a 2021 Asset Purchase Agreement (APA), has already surpassed US$5.56 million in spending and is now poised to ramp up further through early 2026.
Lake Victoria Gold sold six non-core prospecting licenses to Buly under the APA, securing US$6 million in upfront cash. Crucially, LVG also retained rights to contingent payments of up to US$45 million, based on future gold discoveries on the properties. So far, Barrick’s exploration work includes over 33,200 metres of total drilling, much of it dedicated to defining structural corridors and geochemical anomalies in the Lake Victoria Goldfields.
While Barrick completed only 360 metres of diamond drilling in Q1 2025, the company focused on refining the geological model and laying the groundwork for a more aggressive drilling program in the months ahead.
CEO Highlights Near-Term Strategy
Despite the significant long-term potential tied to Barrick’s exploration, Lake Victoria Gold’s executive team remains focused on its wholly-owned Tembo and Imwelo projects, both of which are progressing toward production.
LVG President and CEO Marc Cernovitch emphasized that strategy in a recent update, stating:
While Buly’s exploration work provides valuable long-term upside, our immediate focus is on advancing Tembo and Imwelo toward production in 2025 & 2026 respectively. These are high-conviction assets under our direct control, and we’re committed to delivering near-term cash flow and operational milestones. At Tembo, we believe the project holds district-scale discovery potential-supported by its geological continuity with Bulyanhulu and over 50,000 metres of historical drilling.
Cernovitch also noted the synergistic relationship between Tembo and Barrick’s nearby Bulyanhulu Mine, pointing to over 50,000 metres of historical drilling and strong geological continuity.
“The APA adds further optionality, giving shareholders meaningful exposure to new discoveries without diverting capital or management attention. It’s a structure that aligns well with our disciplined strategy: prioritize near-term production, retain exploration upside, and build long-term value,” he added.
Drilling Unlocks Structural Gold Clues
Buly’s Q1 diamond drill campaign targeted anomalies from earlier phases and intersected zones of quartz-pyrite-pyrrhotite mineralization exceeding 3%. Key geological features included sheared mafic volcanics, felsic tuffs, and argillites, along with multiple deformation structures, suggesting a dynamic and gold-favorable environment.
David Scott, a Qualified Person under NI 43-101 and Director at LVG, expressed growing confidence in the geological model, stating:
The geological model continues to improve with each program. What excites us is the emerging alignment between Buly’s recent drill results and the structural framework we are seeing throughout our Tembo Project. The intersection of multiple zones of shear deformation, mafic-felsic lithological contacts, and associated sulphide-bearing quartz veins, provide ideal settings for mineralization, such as hosting the Bulyanhulu deposits. These are the kinds of environments where significant gold systems are formed, and they remain largely untested across much of the property.
Scott noted that such environments remain largely untested across much of the property, offering continued upside as both Barrick and LVG drill deeper.
Strategic Structure Benefits Both Sides
Under the APA’s sliding-scale royalty structure, LVG is eligible to receive:
– USD $20/oz on the first 1 million ounces discovered
– USD $10/oz on the second million
– USD $5/oz on the next three million ounces
The arrangement gives Lake Victoria Gold a powerful tailwind tied to Barrick’s success, without requiring additional capital expenditures. As Barrick prepares for a more aggressive campaign in the second half of 2025 and into 2026, LVG’s exposure to exploration upside appears well-positioned.
Meanwhile, Lake Victoria Gold continues to strengthen its strategic partnerships. Taifa Group, Tanzania’s largest mining contractor, has agreed to take an equity stake in LVG. Taifa Mining, a subsidiary, will handle all contract mining and civil works for the Imwelo Project.
With deep industry relationships and the largest fleet of mining equipment in the country, Taifa’s involvement further de-risks LVG’s near-term production goals, allowing the company to focus on execution while retaining a free upside bet on Barrick’s ongoing drill campaign.
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