Senegal

Sabodala-Massawa

Ongoing multi-drill resource expansion and metallurgical drill programs underway on
the recently-acquired Massawa mine license.

Historic Exploration Results

Overview

The Sabodala Mine License covers 291 km2 and provides great potential for both near-term reserve and production growth opportunities by increasing millable reserves on existing deposits that are within close proximity to the central processing facility.

An updated mineral resource and reserve summary was released July 2017, where proven and probable reserves increased to 2.7 million ounces of gold representing an increase of more than 400,000 ounces over the previous mineral reserves estimate.

On the mine license, exploration continues to focus on a multi-year drilling program intended to further define near surface resources and reserves at both the highly prospective Niakafiri deposit and Goumbati West deposit over the next several years.

Teranga’s 2020 exploration budget for the Sabodala-Massawa gold complex in Senegal is approximately $10 million.

Niakafiri Deposit

The Niakafiri deposit is considered the most prospective target on the Sabdoala mine license, located within 5 km of the Sabodala mill.

A two-phase advanced drilling program commenced on the deposit in Q4 2016, where phase 2 continued throughout the first half of 2017. A total of 173 drill holes (19,538 m) were completed for inclusion in the most current resource estimation for all components of the deposit.

Drill program objectives were to confirm model interpretations, upgrade the resource classifications, fill-in gaps between current pit outlines, and test mineralization extents both along trend and to depth.

Results from the first half of 2017 were reported for the initial 60 of the planned 115 drill holes. These results represented some of the widest mineralized intervals encountered within Niakafiri to date and confirm that there is considerable opportunity to extend the mineralization both along strike and to depth.

An updated mineral resource estimate incorporating these results was released in July 2017 where majority of added reserves came from Niakafiri. As at June 30, 2017, Niakafiri has measured and indicated resources of approximately 850,000 ounces, and 205,000 ounces of inferred, inclusive of 590,000 ounces in proven and probable reserves.

Following completion of the Sabodala Village resettlement, which is currently ongoing, Teranga plans to continue with resource definition drilling with a focus on extending the mineralization along trend and to-depth.

Niakafiri Deposit

Geology & Mineralization

The Sabodala mine license and the surrounding exploration permits are located within the highly prospective Kedougou-Kenieba Inlier, which forms part of the Paleoproterozoic age Birimian Terrane of the West African Craton. The permits straddle the volcanic-dominated Mako Supergroup in the west and the sediment-dominated Diale-Dalema Supergroup to the east.

The Mako and Diale-Dalema supracrustal sequences are intruded by a series of variably deformed granitoid intrusions. Lithologies in the region are affected mainly by lower green schist grade metamorphism. Northeast trending intermediate to felsic and later, post-tectonic mafic dykes are present throughout the region, the latter forming prominent linear magnetic features. Felsic and intermediate composition dykes are often spatially associated with shear zones hosting gold mineralization, and locally are host to significant gold mineralization themselves.

Principal structures on the Sabodala property form a steeply west-northwest dipping, north-northeast trending shear zone network previously referred to as the “Sabodala Shear Zone”. This includes the Niakafiri and Masato shear zones, which are high strain zones developed in altered mafic and ultramafic units. There are also shear zones that are linked to them by north to northwest trending splays. These include the “Ayoub’s Thrust”, which is focused along the ultramafic sill that lies on the west side (hanging wall) of the Sabodala deposit.

Mineralization is generally associated with highly strained steeply dipping north-northeast or east-west trending shear zones, quartz–carbonate-sericite-tourmaline-pyrite shear veins, highly altered quartz-carbonate-albite-pyrite zones, and often spatially associated with felsic and mafic dykes.