Tanzanian Workers process 200 ounces per month by hand.

This Mkuvia Project consists of 430 square kilometers which are made up of four prospecting licenses. With early sampling indicating economic grades between 1 and 5 grams and in some areas as high as 50g/t, this property has the potential to be a world-class alluvial operation. The property is currently in production generating between 150 to 200 ounces of high grade gold per month with no mechanized mining equipment. The company expects to be in mechanized production with an estimated expenditure of $2 million.

Excellent Mineralization Potential
The rocks in Mkuvia Project are mineralized with sulphides like arsenopyrite, visible gold and gemstones such as sapphire and galena. Gold mineralization in the sandy alluvial were observed to host free gold developed from weathering of existing bedrock which consists of
Mkuvia Property Evaluation
Report [PDF file - 2.30MB] garnet, chlorite, clays, silica and biotite rock. This material was transported and deposited on the trough at the time of the alluvial deposit. The gold grade in the alluvial deposit is as high as 50g/t in some areas.

Economic grades between 1 and 5 grams seem to be consistent throughout the area of approximately 22 km by 9 km. Grades seem to increase at depth and existing operations have not found bedrock with some pits as deep as 10 meters, suggesting a significant alluvial deposit.

Douglas Lake's geological team has completed initial systematic sampling of both alluvium and hard rock with test results expected by late June. Systematic sampling and mapping work continues.

Accessible Location
The Mkuvia Project is well-located in SE Tanzania and easily accessible by dirt road 138 km from the district town of Nachingwea. This town is only 500 km from Tanzania's capital Dar es Salaam."

The Mkuvia Property consists of four prospecting licences totalling 430 square miles.

Regional Geology
The Mkuvia Project is situated in low to high-grade metamorphosed rocks of Proterozoic age. The dominant rocks are biotite schist, granitic gnesis, garnetiferous amphibolite and quartzite. The Mkuvia Project lies at the east margin of the Selous Basin where Karoo and young sedimentary rocks are in fault contact with Proterozoic rocks. The regional structural trends that control the deposition appear to be trending at northwest and northeast.

Local Geology and Site Visit Observations
The Mkuvia Project is situated on a strongly faulted rock elevated up to 700m above sea level with the highest elevation observed being on the western part of the project. The project mainly consists of gneiss rocks that are covered with transported overburden. Three types of overburden materials were identified during the April to May 2008 visits. The overburden in the area consists of red brown silt soil, light gray sand soil, red brown sandy soil and black cotton soil (Mbuga).

This overburden extends to about 10m in depth on some localities and possibly deeper - drilling will determine the depth. The interface between the overburden and saprolite is hosted with angular to sub angular quartz fragments that indicate this horizon consists of transported materials. The saprolite material mainly consists of clays, chlorite garnet, and silica and biotite minerals. The saprolite in the project indicates that the bedrock has undergone low to high-grade metamorphism.

The area that hosts the source of Mbwemkuru River and its tributaries is elevated to about 700m above sea level and contains gravels that are euhedral to sub angular shapes. This indicates that the area contains no transported materials and could be one of the sources that created the alluvial deposit at the Mkuvia Project.

Douglas Lake’s Management’s Conclusions
The Mkuvia Placer Deposit comprises a significant, but un-quantified accumulation of gold in alluvium hosted by: 1) reworked palaeo-placer by the Mbwemkuru River and its tributaries, and 2) an over 10m thick zone of palaeo-placer pebble beds non-conformably overlying biotite schist, gneiss, quartzite, garnet-amphibolite and granitoids. The latter comprises a poorly sorted palaeo-placer plateau extending over 24 km along a NE-SW direction and ~9 km wide along a NW-SE direction. In addition there are extensive troughs with similar continental alluvium further west in the Karroo Basin. Gold-bearing alluvium along the Mbwemkuru River occurs within a 0.35 to 1.80 m thick zone between the bedrock and sandy-gravelly material. This zone contains ~0.10 and 0.50 grams per cubic metre that the small-scale miners are currently recovering. The palaeo-alluvium on top of the hill overlooking Jinonje Valley returned better grades but an exact number was not determined. Samples were taken here as well and results will be released when they are returned from the lab.