TRX Gold Plans $50 Million Expansion of Tanzanian Gold Mine

en.Wedoany.com Reported - On October 25, mining company TRX Gold disclosed its capital expenditure plan for the Buckreef Gold Mine in Tanzania, planning to invest approximately $45 million to $50 million over the next year for processing plant expansion and mining area exploration. The project plans to add a semi-autogenous grinding (SAG) and ball mill system with a daily processing capacity of 3,500 tonnes of ore, operating alongside the existing 2,000-tonne-per-day production line to achieve a planned combined processing capacity of 5,500 tonnes per day. The company plans to fund construction using cash flow generated from its existing gold production operations, with the goal of completing the expansion by the end of 2027.

The equipment procurement contract for the new processing system was signed in the early part of the fourth fiscal quarter of 2026, with the first payment made, and the construction period is expected to be 12 to 18 months. The existing production line is undergoing upgrades to the pre-leach thickener, agitation equipment, inter-stage screens, oxygen system, desorption and electrowinning recovery facilities, and gold doré production workshop. The company plans to update the project's preliminary economic assessment between the end of 2026 and early 2027, incorporating the expanded processing scale into the mine development plan.

According to preliminary operating data published by the company, the Buckreef Gold Mine achieved gold production of 29,650 ounces in fiscal year 2026, a year-on-year increase of 57%. During the same period, approximately 175 drill holes were completed at the mining area, with cumulative drilling of approximately 14,500 meters, and 3 additional drilling rigs were added. Exploration work will proceed in parallel with the processing facility expansion to continue orebody resource evaluation and prepare for subsequent ore supply.

Regarding financing arrangements, TRX Gold's previously published September 2026 corporate materials show cumulative investment of $90.5 million since 2021, of which operating cash flow contributed approximately $65.9 million. The company maintains a $25 million at-the-market equity financing facility and a combined $15 million in credit and gold prepayment financing arrangements. Management stated that the current priority is to secure funding for the processing plant expansion and drilling investment, and that share buybacks are only a capital allocation that may be considered after the expansion is completed.