UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549



_________________________



FORM 20-F

_________________________



| | ☐ | REGISTRATION STATEMENT PURSUANT
                                         TO SECTION 12(b) OR 12 (g) OF THE SECURITIES EXCHANGE ACT OF 1934
| | - | ------------------------------------------------------------------------------------------------------------------------------------------



|☒ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
                                     EXCHANGE ACT OF 1934
|- | -------------------------------------------------------------------------------------------------------------------------
|  | For the fiscal year ended  August 31, 2018                                                                               





| | ☐ | TRANSITION REPORT PURSUANT TO SECTION
                                         13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
| | - | ----------------------------------------------------------------------------------------------------------------------------------

For the transition period from ____________ to ____________



| | ☐ | SHELL COMPANY REPORT PURSUANT TO
                                         SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
| | - | ------------------------------------------------------------------------------------------------------------------------------------

Date of event requiring this shell company report ____________





Commission File Number 001-32500



TANZANIAN ROYALTY EXPLORATION
CORPORATION

(Exact Name of Registrant as Specified in Its Charter)



ALBERTA, CANADA

(Jurisdiction of Incorporation or Organization)



82 Richmond Street East, Suite 200,

Toronto, Ontario

M5C 1P1

(Address of Principal Executive Offices)



James Sinclair

President and Director

Tanzanian Royalty Exploration Corporation

82 Richmond Street East

Toronto, Ontario

M5C 1P1



Telephone: 1.844.364.1830

Fax: 860.799.0350



(Name, Telephone, E-mail and/or Facsimile number and Address
of Company Contact Person)



Securities registered or to be registered pursuant to Section 12(b)
of the Act:



|Common Shares, without Par Value |  | NYSE American                            
|-------------------------------- |  | -----------------------------------------
|(Title of Class)                 |  | Name of Each Exchange on Which Registered



Securities registered or to be registered pursuant to Section 12(g)
of the Act: NONE















Securities for which there is a reporting obligation pursuant to
Section 15(d) of the Act: NONE





Indicate the number of outstanding shares of each of the issuer’s
classes of capital or common stock as of the close of the period covered by the annual report: 125,162,803 (as of August 31, 2018).







Indicate by check mark if the registrant is a well-known seasoned
issuer, as defined in Rule 405 of the Securities Act.



☐ Yes      ☒
No



If this report is an annual or transition report, indicate by check
mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.     ☐
Yes      ☒ No



Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements
for the past 90 days.

☒ Yes     ☐ No



Indicate by check mark whether the registrant has submitted electronically
every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 2.405 of this chapter) during
the preceding 12 months (or for such shorter period that the registrant was required to submit such files).



☐ Yes     ☐ No





Indicate by check mark whether the registrant is a large accelerated
filer, an accelerated filer, a non-accelerated filer or emerging growth company. See definition of “accelerated filer”
and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer ☐      Accelerated
filer ☐      Non-accelerated filer ☒

Emerging Growth Company ☐





Indicate by check mark which basis of accounting the registrant
has used to prepare the financial statements included in this filing:

U.S. GAAP ☐



International Financial Reporting Standards as issued by the International Accounting
Standards Board ☒



Other ☐





If “Other” has been checked in response to the previous
question, indicate by check mark which financial statement item the Company has elected to follow.

| | Item 17 ☐ | Item 18 ☐
| | --------- | ---------



If this is an annual report, indicate by check mark whether the
registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes      ☒
No













TABLE OF CONTENTS









|Cautionary
    Note to U.S. Investors Concerning Estimates of Mineral Resources | 1 
|------------------------------------------------------------------------------- | --
|Currency                                                                        | 1 
|Foreign Private Issuer
    Filings                                              | 1 
|Glossary of Technical
    Terms                                                 | 2 
|PART I                                                                          | 7 
|Item 1.   Identity
    of Directors, Senior Management and Advisers             | 7 
|A.   Directors
    and Senior Management:                                       | 7 
|B.   Advisers                                                                   | 7 
|Item 2.   Offer
    Statistics and Expected Timetable                           | 7 
|Item 3.   Key
    Information                                                   | 7 
|A.   Selected
    Financial Data                                                | 7 
|B.   Capitalization
    and Indebtedness                                        | 9 
|C.   Reasons
    for the Offer and Use of Proceeds                              | 9 
|D.   Risk
    Factors                                                           | 9 
|Item 4.    
    Information on the Company                                      | 18
|A.   History
    and Development of the Company                                 | 18
|B.   Business
    Overview                                                      | 19
|Plan of Operations                                                              | 20
|Governmental Regulations                                                        | 39
|C.   Organizational
    Structure                                               | 40
|D.   Property,
    Plant and Equipment                                          | 41
|Buckreef Project                                                                | 41
|Kigosi Project                                                                  | 53
|Lunguya Project
    Area                                                        | 58
|Itetemia Property                                                               | 61
|Luhala Property                                                                 | 65
|Item 4A.   
    Unresolved Staff Comments                                       | 67
|Item 5.   Operating
    and Financial Review and Prospects                      | 67
|A.   Operating
    Results                                                      | 69
|B.   Liquidity
    and Capital Resources                                        | 76
|C.   Research
    and Development, Patents and License, etc.                    | 76
|D.   Trend
    Information                                                      | 77
|E.   Off
    Balance Sheet Arrangements                                         | 77
|F.   Tabular
    Disclosure of Contractual Obligations                          | 77
|Item 6.   
    Directors, Senior Management and Employees                       | 77
|A.   Directors
    and Senior Management                                        | 77
|B.   Executive
    Compensation                                                 | 82
|C.   Board
    Practices                                                        | 90
|D.   Employees                                                                  | 96
|E.   
    Share Ownership                                                       | 96
|Item 7.   
    Major Shareholders and Related Party Transactions                | 97
|A.   Major
    Shareholders                                                     | 97
|B.   Related
    Party Transactions                                             | 97
|C.   Interests
    of Experts and Counsel                                       | 99





i






|Item
    8.    Financial Statements                                                         | 99 
|------------------------------------------------------------------------------------------- | ---
|A.   Consolidated
    Statements and Other Financial Information                            | 99 
|B.   Significant
    Changes                                                                | 99 
|Item 9.   
    The Offering and Listing                                                     | 100
|A.   Offering
    and Listing Details                                                       | 101
|B.   Plan
    of Distribution                                                               | 101
|C.   Markets                                                                                | 101
|D.   Selling
    Shareholders                                                               | 101
|E.   Dilution                                                                               | 101
|F.   Expenses
    of the Issue                                                              | 101
|Item 10.   Additional
    Information                                                       | 101
|A.   Share
    Capital                                                                      | 101
|B.   Articles
    of Association and Bylaws                                                 | 102
|C.   Material
    Contracts                                                                 | 105
|D.   Exchange
    Controls                                                                  | 106
|E.   Taxation                                                                               | 107
|F.   Dividends
    and Paying Agents                                                        | 118
|G.   Statement
    by Experts                                                               | 118
|H.   Documents
    on Display                                                               | 119
|I.   Subsidiary
    Information                                                             | 119
|Item 11.   Quantitative
    and Qualitative Disclosures About Market Risk                   | 119
|Item 12.   Description
    of Securities Other than Equity Securities                       | 120
|Part II                                                                                     | 120
|Item 13.   Defaults,
    Dividend Arrears and Delinquencies                                 | 120
|Item 14.   Material
    Modifications to the Rights of Security Holders and Use of Proceeds | 120
|Item 15.   Controls
    and Procedures                                                      | 120
|Item 16 A.   Audit
    Committee Financial Expert                                           | 121
|Item 16 B.   Code
    of Ethics                                                             | 121
|Item 16 C.   Principal
    Accountant Fees and Services                                     | 122
|Item 16 D.   Exemptions
    from the Listing Standards for Audit Committees                 | 122
|Item 16 E.   
    Purchases of Equity Securities by the Issuer and Affiliated Purchasers    | 122
|Item 16 F.   Change
    in Registrant’s Certifying Accountant                               | 122
|Item 16 G.   Corporate
    Governance                                                       | 122
|Item 16 H.   Mine
    Safety Disclosure                                                     | 123
|Part III                                                                                    | 123
|Item 17.   Financial
    Statements                                                         | 123
|Item 18.   Financial
    Statements                                                         | 123
|Item 19.   Exhibits                                                                         | 124





ii






Cautionary Note to U.S. Investors
Concerning Estimates of Mineral Resources



As an Alberta corporation, Tanzanian Royalty
Exploration Corporation (the “Company”) is subject to certain rules and regulations issued by Canadian Securities
Administrators. The Company files this Annual Report on Form 20-F as its Annual Information Form (“AIF”) with
the British Columbia, Alberta and Ontario Securities Commissions via the System for Electronic Document Analysis and Retrieval
(“SEDAR”). Under the filing requirements for an AIF, the Company is required to provide detailed information
regarding its properties including mineralization, drilling, sampling and analysis, security of samples, and mineral resource
and mineral reserve estimates, if any. Further, the Company may describe its properties utilizing terminology such as “Proven
Mineral Reserve” or “Probable Mineral Reserve” or “Measured Mineral Resources”, “Indicated
Mineral Resources” and “Inferred Mineral Resources” that are permitted by Canadian securities regulations.



U.S. investors are cautioned not to assume
that any part of the mineral deposits, if any, in the “Proven Mineral Reserve” or “Probable Mineral Reserve”
or “Measured Mineral Resources”, “Indicated Mineral Resources” and “Inferred Mineral Resources”
categories will ever be converted into reserves. Further, these terms are not defined terms under SEC Industry Guide 7 and are
not permitted to be used in reports and registration statements filed with the United States Securities and Exchange Commission
(“SEC”). The definitions of proven and probable reserves used in NI 43-101 differ from the definitions in SEC Industry
Guide 7. Under SEC Industry Guide 7, as interpreted by the staff of the SEC, mineralization may not be classified as a “reserve”
for United States reporting purposes unless the determination has been made that the mineralization could be economically and
legally produced or extracted at the time the reserve determination is made. Among other things, all necessary permits would be
required to be in hand or issuance imminent in order to classify mineralized material as reserves under the SEC guidelines. In
addition, NI 43-101 permits disclosure of “contained ounces” of mineralization. In contrast, the SEC only permits
issuers to report mineralization as in place tonnage and grade without reference to unit measures.







United States investors are cautioned not to
assume that any part or all of the mineral deposits identified as an “indicated mineral resource,” “measured
mineral resource” or “inferred mineral resource” will ever be converted to reserves as defined in SEC Industry
Guide 7. Further, “inferred mineral resources” have a great amount of uncertainty as to their existence and economic
and legal feasibility. It cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher
category. Under Canadian securities legislation, estimates of inferred mineral resources may not form the basis of feasibility
or pre-feasibility studies, or economic studies. U.S. investors are cautioned not to assume that part or all of an inferred mineral
resource exists, or is economically or legally mineable.



For clarification, the Company has no properties
that contain “Proven (Measured) Reserves” or “Probable (Indicated) Reserves” as defined by SEC securities
regulations.



Currency



All references to dollar amounts are expressed
in the currency of Canada, unless otherwise specifically stated.



Foreign Private Issuer Filings



As a foreign private issuer registered under
section 12(b) of the Securities Exchange Act of 1934 (the “Exchange Act”), the Company is subject
to section 13 of the Exchange Act, and is required to file an Annual Report on Form 20-F and Reports of Foreign Private Issuer
on Form 6-K with the SEC. However, the Company is exempt from the proxy rules under section 14 of the Exchange Act, and the short-swing
profit and other rules regarding disclosures of directors, officers and principal stockholders under section 16 of the Exchange
Act.





1







Glossary of Technical Terms



|alteration        | Mineralogical change at low pressures due to invading
    fluids or the influence of chemical reactions in a rock mass resulting from the passage of hydrothermal fluids.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|----------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|anomaly           | Any concentration of metal noticeably above or below the average
    background concentration.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|assay             | An analysis to determine the presence, absence or quantity
    of one or more components.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Au                | The elemental symbol for gold.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|background        | Traces of elements found in sediments, soils, and plant material
    that are unrelated to any mineralization and which come from the weathering of the natural constituents of the rocks.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Barrick           | Barrick Gold Corp.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|dyke              | A tabular body of igneous rock that has been injected while
    molten into a fissure.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|fault             | A planar fracture or discontinuity in a volume of rock, across
    which there has been significant displacement.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|feasibility study | A feasibility study is a comprehensive technical and economic
    study of the selected development option for a mineral project that includes appropriately detailed assessments of applicable
    modifying factors together with any other relevant operational factors and detailed financial analysis that are necessary
    to demonstrate, at the time of reporting, that extraction is reasonably justified (economically mineable). The results of
    the study may reasonably serve as the basis for a final decision by a proponent or financial institution to proceed with,
    or finance, the development of the project. The confidence level of the study will be higher than that of a pre-feasibility
    study.
|                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|fracture          | Any local separation or discontinuity plane in a geologic
    formation, such as a joint or a fault that are commonly caused by stress exceeding the rock strength.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|grade             | The concentration of each ore metal in a rock
    sample, usually given as weight percent.  Where extremely low concentrations are involved, the concentration may
    be given in grams per tonne (g/t or gpt) or ounces per ton (oz/t).  The grade of an ore deposit is calculated, often
    using sophisticated statistical procedures, as an average of the grades of a very large number of samples collected from throughout
    the deposit.                                                                                                                                                                                                                                                                                
|                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|hectare or ha     | An area totalling 10,000 square metres.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                 

2





|hydrothermal                                          | Hot fluids, usually mainly water, in the earth's
    crust which may carry metals and other compounds in solution to the site of ore deposition or wall rock alteration.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|----------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|IP                                                    | Induced polarization survey, a form of geophysical survey
    used in the exploration for minerals.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|intrusive                                             | A rock mass formed below earth's surface from magma which
    has intruded into a pre-existing rock mass.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|JORC                                                  | The Joint Ore Reserves Committee of the Australasian Institute
    of Mining and Metallurgy, Australian Institute of Geoscientists and Minerals Council of Australia.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|JV                                                    | A joint venture, which is a term for a contractual relationship
    between parties, usually for a single purpose, which is not a partnership.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|kilometres or km                                      | Metric measurement of distance equal to 1,000 metres (or 0.6214
    miles).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|mill                                                  | A facility for processing ore to concentrate and recover valuable
    minerals.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|mineral reserve                                       | That part of a mineral deposit which could be economically
    and legally extracted or produced at the time of the reserve determination.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|mineralization                                        | The hydrothermal deposition of economically important metals
    in the formation of ore bodies or "lodes”.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|net smelter or NSR royalty                            | Payment of a percentage of net mining profits based on returns
    from the smelter, after deducting applicable smeltering charges.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|NI 43-101                                             | National Instrument 43-101, “Standards of Disclosure
    for Mineral Projects”, as adopted by the Canadian Securities Administrators, as the same may be amended or replaced
    from time to time, and shall include any successor regulation or legislation.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|ore                                                   | A mineral or an aggregate of minerals from which a valuable
    constituent, especially a metal, can be profitably mined or extracted.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|outcrop                                               | An exposure of rock at the earth's surface.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|porphyry                                              | A variety of igneous rock consisting of large-grained
    crystals, such as feldspar or quartz, dispersed in a fine-grained feldspathic matrix or groundmass.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|Pre-feasibility study (preliminary feasibility study) | A pre-feasibility study is a comprehensive study of a range
    of options for the technical and economic viability of a mineral project that has advanced to a stage where a preferred mining
    method, in the case of underground mining, or the pit configuration, in the case of an open pit, is established and an effective
    method of mineral processing is determined. It includes a financial analysis based on reasonable assumptions on the modifying
    factors and the evaluation of any other relevant factors which are sufficient for a qualified person, acting reasonably, to
    determine if all or part of the Mineral Resource may be converted to a Mineral Reserve at the time of reporting. A pre-feasibility
    study is at a lower confidence level than a feasibility study.
|                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|                                                     

3





|Pyrrhotite       | A bronze coloured mineral of metallic lustre that
    consists of ferrous sulphide and is attracted by a magnet.                                                                                                                                                                                                                                                                                
|---------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                 |                                                                                                                                                                                                                                                                                                                                                                                                 
|pyrite           | Iron sulphide mineral.                                                                                                                                                                                                                                                                                                                                                                          
|                 |                                                                                                                                                                                                                                                                                                                                                                                                 
|Qualified Person | An individual who is an engineer or geoscientist with at least
    five years of experience in mineral exploration, mine development or operation or mineral project assessment, or any combination
    of these; has experience relevant to the subject matter of the mineral project and the technical report; and is a member or
    licensee in good standing of a professional association.
|                 |                                                                                                                                                                                                                                                                                                                                                                                                 
|quartz           | Silica or SiO2, a common constituent of veins,
    especially those containing gold and silver mineralization.                                                                                                                                                                                                                                                                                  
|                 |                                                                                                                                                                                                                                                                                                                                                                                                 
|RAB              | Rotary air blast drilling.                                                                                                                                                                                                                                                                                                                                                                      
|                 |                                                                                                                                                                                                                                                                                                                                                                                                 
|RC               | Reverse circulation drilling.                                                                                                                                                                                                                                                                                                                                                                   
|                 |                                                                                                                                                                                                                                                                                                                                                                                                 
|reef             | A geological discontinuity which served as a trap or conduit
    for hydrothermal mineralizing fluids to form an ore deposit.                                                                                                                                                                                                                                                                   
|                 |                                                                                                                                                                                                                                                                                                                                                                                                 
|silicification   | Replacement and or impregnation of the constituent of a rock
    by quartz rich hydrothermal fluids or (silica).                                                                                                                                                                                                                                                                                
|                 |                                                                                                                                                                                                                                                                                                                                                                                                 
|Sloane           | Sloane Developments Ltd., a corporation based in the United
    Kingdom.                                                                                                                                                                                                                                                                                                                        
|                 |                                                                                                                                                                                                                                                                                                                                                                                                 
|Songshan         | Songshan Mining Company.                                                                                                                                                                                                                                                                                                                                                                        
|                 |                                                                                                                                                                                                                                                                                                                                                                                                 
|Stamico          | State Mining Corporation of Tanzania.                                                                                                                                                                                                                                                                                                                                                           
|                 |                                                                                                                                                                                                                                                                                                                                                                                                 
|Tancan           | Tancan Mining Company Limited, a wholly-owned Tanzanian subsidiary
    of the Company.                                                                                                                                                                                                                                                                                                          
|                 |                                                                                                                                                                                                                                                                                                                                                                                                 
|Tanzam           | Tanzania American International Development Corporation 2000
    Limited, a wholly-owned Tanzanian subsidiary of the Company.                                                                                                                                                                                                                                                                   
|                 |                                                                                                                                                                                                                                                                                                                                                                                                 
|ton              | Imperial measurement of weight equivalent to 2,000
    pounds (sometimes called a “short ton”).                                                                                                                                                                                                                                                                                                 
|                 |                                                                                                                                                                                                                                                                                                                                                                                                 
|tonne            | Metric measurement of weight equivalent to 1,000 kilograms
    (or 2,204.6 pounds).                                                                                                                                                                                                                                                                                                             
|                 |                                                                                                                                                                                                                                                                                                                                                                                                 
|tuff             | A rock comprised of fine fragments and ash particles ejected
    from a volcanic vent.                                                                                                                                                                                                                                                                                                          
|                 |                                                                                                                                                                                                                                                                                                                                                                                                 
|veins            | Distinct sheetlike body of crystallized mineral constituents
    carried by hydrothermal aqueous solutions that are deposited through precipitation within the host country rock. These bodies
    are often the source of mineralisation either in or proximal to the veins.                                                                                                                   
|                

4





|Canadian Terminology
        
        The following terms may be
        used in the Company’s technical reports to describe its mineral properties and have been used in this Annual Report
        (see “Cautionary Note to U.S. Investors Concerning Estimates of Measured and Indicated Mineral Resources”).
        These definitions have been published by the Canadian Institute of Mining, Metallurgy and Petroleum (the “CIM”)
        as the CIM Standards on Mineral Resources and Reserves Definitions and Guidelines adopted by the CIM Council on May 10,
        2014, and have been approved for use by Canadian reporting issuers by the Canadian Securities Administrators under NI
        43-101, and as those definitions may be amended:
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               





|Mineral Resource                                                                                                   | A concentration or occurrence of diamonds, natural
        solid inorganic material, or natural solid fossilized organic material including base and precious metals, coal, and industrial
        minerals in or on the Earth’s crust in such form and quantity and of such a grade or quality that it has reasonable
        prospects for economic extraction. The location, quantity, grade, geological characteristics and continuity of a Mineral
        Resource are known, estimated or interpreted from specific geological evidence and knowledge.
        
        A Mineral Resource is an inventory of mineralization that
        under realistically assumed and justifiable technical and economic conditions might become economically extractable.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|------------------------------------------------------------------------------------------------------------------ | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|Inferred Mineral Resource
        
        
        
        
        
        
        Indicated Mineral Resource | That part of a Mineral Resource for which quantity and grade or quality can
        be estimated on the basis of geological evidence and limited sampling and reasonably assumed, but not verified, geological
        and grade continuity. The estimate is based on limited information and sampling gathered through appropriate techniques
        from locations such as outcrops, trenches, pits, workings and drill holes.
        
        Confidence in the estimate is insufficient to allow the meaningful application
        of technical and economic parameters or to enable an evaluation of economic viability worthy of public disclosure.
        
        An Indicated Mineral Resource is that part of a Mineral Resource for which quantity,
        grade or quality, densities, shape and physical characteristics are estimated with sufficient confidence to allow the
        application of Modifying Factors in sufficient detail to support mine planning and evaluation of the economic viability
        of the deposit.
        
        Geological evidence is derived from adequately detailed and reliable exploration,
        sampling and testing and is sufficient to assume geological and grade or quality continuity between points of observation.
        
        An Indicated Mineral Resource has a lower level of confidence than that applying
        to a Measured Mineral Resource and may only be converted to a Probable Mineral Reserve.
|                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|Measured Mineral Resource                                                                                          | A Measured Mineral Resource is that part of a Mineral Resource for which quantity, grade
    or quality, densities, shape, and physical characteristics are estimated with confidence sufficient to allow the application
    of Modifying Factors to support detailed mine planning and final evaluation of the economic viability of the deposit.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                   | Geological evidence is derived from detailed and reliable exploration, sampling and testing
    and is sufficient to confirm geological and grade or quality continuity between points of observation.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                   | A Measured Mineral Resource has a higher level of confidence than that applying to either
    an Indicated Mineral Resource or an Inferred Mineral Resource. It may be converted to a Proven Mineral Reserve or to a Probable
    Mineral Reserve.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|                                                                                                                  

5





|Mineral Reserve          | A Mineral Reserve is the
        economically mineable part of a Measured or Indicated Mineral Resource demonstrated by at least a Preliminary Feasibility
        Study. This Study must include adequate information on mining, processing, metallurgical, economic, and other relevant
        factors that demonstrate, at the time of reporting, that economic extraction can be justified. A Mineral Reserve includes
        diluting materials and allowances for losses that may occur when the material is mined.
        
        Mineral resources are sub-divided
        in order of increasing confidence into Probable Mineral Reserves and Proven Mineral Reserves. A Probable Mineral Reserve
        has a lower level of confidence than a Proven Mineral Reserve. The term “mineral reserve” need not necessarily
        signify that extraction facilities are in place or operative or that all governmental approvals have been received. It
        does signify that there are reasonable expectations of such approvals.
|------------------------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Probable Mineral Reserve | Is the economically mineable part of an Indicated and, in
    some circumstances, a Measured Mineral Resource demonstrated by at least a Preliminary Feasibility Study.  This
    Study must include adequate information on mining, processing, metallurgical, economic, and other relevant factors that demonstrate,
    at the time of reporting, that economic extraction can be justified.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Proven Mineral Reserve   | Is the economically mineable
        part of a Measured Mineral Resource demonstrated by at least a Preliminary Feasibility Study. This Study must include
        adequate information on mining, processing, metallurgical, economic, and other relevant factors that demonstrate, at the
        time of reporting, that economic extraction is justified.
        
        The term should be restricted
        to that part of the deposit where production planning is taking plce and for which any variation in the estimate would
        not significantly affect potential economic viability.                                                                                                                                                                                                                                                                                                                                                                                                                                          





6







PART I



| | Item 1. | Identity of
                                         Directors, Senior Management and Advisers
| | ------- | ----------------------------------------------------------------------------------------------



A.       Directors
and Senior Management:



Not applicable.



B.       Advisers



Not applicable.



| | Item 2. | Offer Statistics
                                         and Expected Timetable
| | ------- | --------------------------------------------------------------------------------



Not applicable.



| | Item 3. | Key Information
| | ------- | ---------------



A.       Selected
Financial Data





The audited financial statements for the Company’s
fiscal years ended August 31, 2018, 2017, 2016, 2015 and 2014 are prepared in accordance with International Financial Reporting
Standards (“IFRS”) as issued by the International Accounting Standards Board. The following selected
financial data is based on financial statements prepared in accordance with IFRS and is presented for the five most recent financial
years. Unless stated otherwise, reference to dollar amounts shall mean Canadian dollars.





For each of the years in the five year periods
ended August 31, the information in the tables was extracted from the more detailed audited financial statements of the Company.



The selected financial data should be read
in conjunction with Item 5, “Operating and Financial Review and Prospects” and in conjunction with the consolidated
financial statements of the Company and the notes thereto contained elsewhere in this Annual Report. The Company’s fiscal
period ends on August 31 of each year.



The following is a summary of certain selected
financial information for the Company’s five most recently completed fiscal years (in Canadian dollars, except number of
shares):



|                                 |  |   | 2018($)    |   |  |   | 2017($)    |   |  |   | 2016($)     |   |  |   | 2015($)    |   |  |   | 2014($)    |  
|-------------------------------- |  | - | ---------- | - |  | - | ---------- | - |  | - | ----------- | - |  | - | ---------- | - |  | - | ---------- | -
|Operations:                      |  |   |            |   |  |   |            |   |  |   |             |   |  |   |            |   |  |   |            |  
|                                 |  |   |            |   |  |   |            |   |  |   |             |   |  |   |            |   |  |   |            |  
|Revenues                         |  | $ | —          |   |  | $ | —          |   |  | $ | —           |   |  | $ | —          |   |  | $ | —          |  
|                                 |  |   |            |   |  |   |            |   |  |   |             |   |  |   |            |   |  |   |            |  
|Net loss                         |  |   | (6,897,397 | ) |  |   | (6,434,112 | ) |  |   | (12,781,902 | ) |  |   | (8,995,697 | ) |  |   | (2,416,265 | )
|                                 |  |   |            |   |  |   |            |   |  |   |             |   |  |   |            |   |  |   |            |  
|Basic and diluted loss per share |  |   | (0.06      | ) |  |   | (0.05      | ) |  |   | (0.12       | ) |  |   | (0.09      | ) |  |   | (0.02      | )



7







|                             |  | 2018 |             | 2017 |  | 2016 |             | 2015 |  | 2014
|---------------------------- |  | ---- | ----------- | ---- |  | ---- | ----------- | ---- |  | ----
|Balance sheet:               |  |      |             |      |  |      |             |      |  |     
|                             |  |      |             |      |  |      |             |      |  |     
|Working Capital (deficiency) |  |      | (12,010,685 | )    |  |      | (6,552,376  | )    |  |     
|                             |  |      |             |      |  |      |             |      |  |     
|Total Assets                 |  |      | 53,235,140  |      |  |      | 51,353,088  |      |  |     
|                             |  |      |             |      |  |      |             |      |  |     
|Net Assets                   |  |      | 34,326,005  |      |  |      | 36,254,043  |      |  |     
|                             |  |      |             |      |  |      |             |      |  |     
|Share Capital                |  |      | 127,003,132 |      |  |      | 125,174,377 |      |  |     
|                             |  |      |             |      |  |      |             |      |  |     
|Number of Shares             |  |      | 125,162,803 |      |  |      | 121,784,619 |      |  |     
|                             |  |      |             |      |  |      |             |      |  |     
|Deficit                      |  |      | 103,263,959 |      |  |      | 96,566,577  |      |  |     



Exchange Rates



The following table sets forth information
as to the period end, average, the high and the low exchange rate for Canadian Dollars (“CDN”) and U.S.
Dollars for the periods indicated based on the noon buying rate in New York City for cable transfers in Canadian Dollars as certified
for customs purposes by the Federal Reserve Bank of New York (Canadian dollar = US$1):



|Year Ended:August 31 | Average | Period
    End | High   | Low   
|-------------------- | ------- | -------------- | ------ | ------
|2018                 | 1.2771  | 1.3055         | 1.3310 | 1.2129
|2017                 | 1.3205  | 1.2535         | 1.3726 | 1.2471
|2016                 | 1.3261  | 1.3122         | 1.4592 | 1.2544
|2015                 | 1.2109  | 1.3223         | 1.3301 | 1.0862
|2014                 | 1.0777  | 1.0858         | 1.1251 | 1.0237



The following table sets forth the high and
low exchange rate for the past six months. As of August 31, 2018, the exchange rate was CDN $1.3055 for each US$1.00.



|Month          | High   | Low   
|-------------- | ------ | ------
|October 2018   | 1.2893 | 1.2472
|September 2018 | 1.3187 | 1.2905
|August 2018    | 1.3153 | 1.2917
|July 2018      | 1.3256 | 1.3017
|June 2018      | 1.3310 | 1.2913
|May 2018       | 1.3012 | 1.2775









8





B.       Capitalization
and Indebtedness



Not applicable.



C.       Reasons
for the Offer and Use of Proceeds



Not applicable.





D.       Risk
Factors



An investment in the Company’s
common shares involves a high degree of risk and should be considered speculative. You should carefully consider the following
risks set out below and other information before investing in the Company’s common shares. If any event arising from these
risks occurs, the Company’s business, prospects, financial condition, results of operations or cash flows could be adversely
affected, the trading price of common shares could decline and all or part of any investment may be lost.



The operations of the Company
are highly speculative due to the high-risk nature of its business, which include the acquisition, financing, exploration and,
if warranted, development of mineral properties. The risks and uncertainties set out below are not the only ones facing the Company.
Additional risks and uncertainties not currently known to the Company, or that the Company
currently deems immaterial, may also impair the Company’s operations. If any of the risks actually occur, the Company’s
business, financial condition and operating results could be adversely affected. As a result, the trading price of the Company’s
common shares could decline and investors could lose part or all of their investment. The Company’s business is subject
to significant risks and past performance is no guarantee of future performance.







Risks Relating to the Company



We intend to begin production at the Buckreef Project without
preparing a bankable feasibility study which may subject us to more risks.





We intend to begin production at the Buckreef
Project without preparing a bankable feasibility study which is a more common practice within the mining industry and therefore
may subject us to more business risks. Our decision to intend to begin production at the Buckreef Project was based on limited
prior historical information, drilling programs, modeling, positive metallurgical testing, and a pre-feasibility study. Therefore,
our decision to intend to begin production at the Buckreef Project was based on limited information which may or may not be representative
of information regarding the mine had we otherwise prepared a more comprehensive study. In addition, basing our decision to intend
to begin production on limited information may make us susceptible to risks, including, but not limited to:





| | • | certain difficulties in obtaining
                                         expected metallurgical recoveries when scaling up to production scale;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------

| | • | the preliminary nature of mine
                                         plans and processing concepts and applying them to full scale production;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------

| | • | determining operating/capital
                                         costs estimates and possible variance associated with constructing, commissioning and
                                         operating the Buckreef facilities based on limited information;
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | that metallurgical testing is
                                         in development and may not be representative of results of the Buckreef Project; and
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | that we may underestimate capital
                                         and operating costs without a comprehensive bankable feasibility study.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------





9







The Company has incurred net losses since its inception and
expects losses to continue.





The Company has not been profitable since
its inception. For the fiscal year ended August 31, 2018, the Company had a comprehensive loss of $6,897,397, and an
accumulated deficit of $103,263,959. The Company has never generated revenues and does not expect to generate revenues until
one of its properties are placed in production. There is a risk that none of the Company’s properties will be placed
into production.







The Company needs additional capital.





As at August 31, 2018, the Company had cash
of approximately $426,062 and working capital deficiency of approximately $12,010,685. The Company will continue to incur exploration
and development costs to fund its plan of operations and will need to raise capital to build a mining plant at the Buckreef Mine.
Ultimately, the Company’s ability to continue its exploration activities depends in part on the Company’s ability
to commence operations and generate revenues or to obtain financing through joint ventures, debt financing, equity financing,
production sharing agreements or some combination of these or other means. Further the raising of additional capital by the Company
may dilute existing shareholders. Traditionally, the Company has relied on issuing equity securities and debt securities that
may be converted into equity securities to raise capital. No assurance can be given that the Company can continue to raise capital
in this manner. Further, the issuance of equity securities or debt securities that may be convertible into equity securities will
have a dilutive effect.





Substantial doubt about the Company’s ability to continue
as a going concern.





Based on the Company’s current funding
sources and taking into account the working capital position and capital requirements at August 31, 2018, these factors indicate
the existence of a material uncertainty that raises substantial doubt about the Company’s ability to continue as a going
concern and is dependent on the Company raising additional debt or equity financing. The Company must obtain additional funding
in fiscal 2019 in order to continue development and construction of the Buckreef Project. Furthermore, the Company is currently
negotiating project financing terms with a number of lending institutions, which the Company believes will result in the Company
obtaining the project financing required to fund the construction of a mill at the Buckreef Project. However there is no assurance
that such additional funding and/or project financing will be obtained or obtained on commercially favourable terms.





The Company has no cash flow from operations and has historically
depended on the proceeds from equity financings for its operations.



The Company’s current operations do not
generate any revenues or cash flow. Any work on the Company’s properties will require additional equity financing. If the
Company seeks funding from existing or new joint venture partners, its project interests will be diluted. If the Company seeks
additional equity financing, the issuance of additional shares will dilute the current interests of the Company’s current
shareholders. The Company may not be able to obtain additional funding to allow the Company to fulfill its obligations on existing
exploration properties. The Company’s failure to obtain such additional financing could result in delay or indefinite postponement
of further exploration and development and the possible partial or total loss of the Company’s potential interest in certain
properties or dilution of the Company’s interest in certain properties.





10







We are subject to ligation which could cause a dilutive effect
to our shareholders and require us to incur legal expenses.



On January 19, 2018, Crede CG III, LTD (“Crede”)
filed suit against us in the Supreme Court of the State of New York, County of New York, claiming, among other things, breach
of contract for failure to allow Crede to exercise 1,300,000 Series A Warrants to acquire 3,100,751 common shares. The Series
A Warrants were issued, along with Series B Warrants (the Series A Warrants and Series B Warrants, collectively “Warrants),
in connection with a Securities Purchase Agreement entered into on September 1, 2016. In response to the complaint, our attorneys
initiated correspondence with Crede’s attorneys regarding Crede’s January 19, 2018 complaint. On February 27, 2018,
Crede dismissed its complaint against us without prejudice. On March 12, 2018, Crede filed suit against us in the Supreme Court
of the State of New York, County of New York (Index No. 651156/2018), claiming breach of contract (including specific performance
and injunctive relief); declaratory judgment that the Securities and Purchase Agreement and Warrants are binding obligations;
and, in the event injunctive and declaratory relief is not ordered, awarding compensatory and punitive damages, and attorney fees
and costs for failure to allow Crede to exercise 500,000 Series B Warrants to acquire 1,332,222 common shares. On May 10, 2018,
we filed a complaint in the United States District Court Southern District of New York (Case No. 18–Civ-4201) against Crede
and certain of its principals, and Wellington Shields & Co who acted as the broker in the sale of securities pursuant to the
Securities Purchase Agreement alleging, among other things, violation of Section 10 and Rule 10b-5 promulgated thereunder of the
Exchange Act, violation of Section 13(d) and Rule 13d-1 promulgated thereunder of the Exchange Act, and breach of contract. On
July 17, 2018, we filed a first amended complaint in the United States District Court Southern District of New York, seeking,
in additional to the relief sought in the initial complaint, declaratory relief that Securities Purchase Agreement and related
agreements, including the Warrants, are void based on a violation of Section 29(b) of the Exchange Act. The litigation is in its
initial stage and no discovery has yet been conducted. In the event that we are force to allow Crede to exercise the Warrants
and/or are subject to damages, we may be required to issue additional common shares under the Securities Purchase Agreement. The
issuance of additional common shares will have a dilutive effect to our shareholders and the payment of damages and legal expenses
may adversely affect our financial condition.



The Company has issued a number of gold and cash loans which
at the option of holder are convertible into our common shares, may be repaid through the issuance of gold, are secured by our
assets and may be subject to annual renewal.







To finance our operations and prior exploration,
as of August 31, 2018, we have issued $7,497,771 loans in the aggregate. Of this amount, $4,622,351 were in the form of gold bullion
loans. The principal and interest on the gold bullion loans may be, at the election of the holder, repaid in cash, gold bullion
or convertible into our common shares. In the event the gold loan holder elects repayment in gold bullion and we do not have the
gold bullion, we may be required to purchase gold bullion on the open market in order to repay the loans. As a result, the Company
may be at risk in the event the price of gold increases and we are required to purchase gold bullion to repay the loan. Further,
the holders of the gold bullion loans may elect to convert the principal and interest of such loans into our common shares at exercise
prices ranging from US$0.26 and US$0.3446 per share which has the effect of diluting the ownership of existing shareholders.



In addition, as of August 31, 2018, the Company
has issued $2,875,420 in convertible loans. The principal and interest on the convertible loans may be, at the election of the
holder, repaid in cash or convertible into our common shares at exercise prices ranging from US$0.26 to US$0.3469 per share. In
the event that the holder of the convertible loans elects to convert the principal and interest of such loans into our common shares,
such conversion will have the effect of diluting the ownership of existing shareholders.



Further, the gold and cash loans are secured
by certain assets of the Company, including its CIL plant, pad loadings, gold on pads, gold in form of dore, gold in plan process
and gold at refinery. In the event of default, the Company may lose its rights to these assets which could adversely affect its
operations.



Finally, these loans are subject to annual
renew.. Although many of these holders of loan have renewed the loans on an annual basis, no assurance can be given they will
continue to annually renew the loans.





11







The Company’s exploration activities are highly speculative
and involve substantial risks.





With the exception of one project, the Buckreef
Project, all of the other Company’s properties are in the exploration stage and no proven mineral reserves have been established.
The Company’s exploration work may not result in the discovery of mineable deposits of ore in a commercially economical
manner. There may be limited availability of water, which is essential to milling operations, and interruptions may be caused
by adverse weather conditions. The Company’s future operations, if any, are subject to a variety of existing laws and regulations
relating to exploration and development, permitting procedures, safety precautions, property reclamation, employee health and
safety, air quality standards, pollution and other environmental protection controls.





The Company has uninsurable risks.



The Company may be subject to unforeseen hazards
such as unusual or unexpected formations and other conditions. The Company may become subject to liability for pollution, cave-ins
or hazards against which it cannot insure or against which it may elect not to insure. The payment of such liabilities may have
a material adverse effect on the Company’s financial position.



The Company depends on key management personnel.



The success of the operations and activities
of the Company is dependent to a significant extent on the efforts and abilities of its management, including James E. Sinclair,
Executive Chairman. Investors must be willing to rely to a significant extent on their discretion and judgment. The Company does
not have an employment contract with the Executive Chairman. The Company does not maintain key-man life insurance on the Executive
Chairman.



The Company may be characterized as a passive foreign investment
company.



We may be characterized as a passive foreign
investment company (“PFIC”). If we are determined to be a PFIC, our U.S. shareholders may suffer adverse tax consequences.
Under the PFIC rules, for any taxable year that our passive income or our assets that produce passive income exceed specified
levels, we will be characterized as a PFIC for U.S. federal income tax purposes. This characterization could result in adverse
U.S. tax consequences for our U.S. shareholders, which may include having certain distributions on our common shares and gains
realized on the sale of our common shares treated as ordinary income, rather than as capital gains income, and having potentially
punitive interest charges apply to the proceeds of sales of our common shares and certain distributions.

Certain elections may be made to reduce or eliminate the adverse
impact of the PFIC rules for holders of our common shares, but these elections may be detrimental to the shareholder under certain
circumstances. The PFIC rules are extremely complex and U.S. investors are urged to consult independent tax advisers regarding
the potential consequences to them of our classification as a PFIC. See “Certain United States Federal Income Tax Considerations.”



Foreign corrupt practices legislation.



The Company is subject to the Foreign Corrupt
Practices Act (the “FCPA”), the Corruption of Foreign Public Officials Act (Canada) (“CFPOA”), and other
laws that prohibit improper payments or offers of payments to foreign governments and their officials and political parties by
persons and issuers as defined by the statutes, for the purpose of obtaining or retaining business. It is our policy to implement
safeguards to discourage these practices by our employees; however, our existing safeguards and any future improvements may prove
to be less than effective and our employees, consultants, sales agents or distributors may engage in conduct for which the Company
might be held responsible.





12







Risks Relating to the Mining Industry





The Company cannot accurately predict whether commercial quantities
of ores as estimated or projected in the pre-feasibility study will be established once commercial production commences.



Whether an ore body will be commercially viable
depends on a number of factors beyond the control of the Company, including the particular attributes of the deposit such as size,
grade and proximity to infrastructure, as well as mineral prices and government regulations, including regulations relating to
permitting, prices, taxes, royalties, land tenure, land use, importing and exporting of minerals and environmental protection.
The Company cannot accurately predict the exact effect of these factors, but the combination of these factors may result in a
mineral deposit being unprofitable. The Company has no mineral producing properties at this time. Although the mineral resource
estimates included herein have been prepared by the Company, or, in some instances have been prepared, reviewed or verified by
independent mining experts, these amounts are estimates only and there is a risk that a particular level of recovery of gold or
other minerals from mineral resource will not in fact be realized or that an identified mineralized deposit, if any, will never
qualify as a commercially mineable or viable reserve.



The exploration for and development of mineral deposits involves
significant risks.







Mineral resource exploration is a speculative
business and involves a high degree of risk. The Company has completed several diamond and reverse circulation drilling programs
on the Buckreef Project and independent qualified persons have reviewed the results of the drilling program in the context of
analyzing the economic significance of the open-pittable mineral resources at the Buckreef Project using current gold prices.
However, the exploration for and development of mineral deposits involves significant risks, which even a combination of careful
evaluation, experience and knowledge may not eliminate. Significant expenditures will be required to locate further and/or upgrade
mineral resources from inferred category to measured and Indicated category, to revise and/or upgrade the recently established
mineral reserves, to develop metallurgical processes, to purchase, construct and run a test 60tph pilot process plant and to finalize
on a bankable feasibility study to construct mining and processing facilities at the Buckreef Project site.





The Company may not be able to establish the presence of minerals
on a commercially viable basis.



The Company’s ability to generate revenues
and profits, if any, is expected to occur through exploration and development of its existing properties as well as through acquisitions
of interests in new properties. The Company will need to incur substantial expenditures in an attempt to establish the economic
feasibility of mining operations by identifying mineral deposits and establishing ore reserves through drilling and other techniques,
developing metallurgical processes to extract metals from ore, designing facilities and planning mining operations. The economic
feasibility of a project depends on numerous factors beyond the Company’s control, including the cost of mining and production
facilities required to extract the desired minerals, the total mineral deposits that can be mined using a given facility, the
proximity of the mineral deposits to a user of the minerals, and the market price of the minerals at the time of sale. The Company’s
existing or future exploration programs or acquisitions may not result in the identification of deposits that can be mined profitably.



The Company depends on consultants and engineers for its exploration
programs.



The Company has relied on and may continue
to rely upon consultants for exploration development, construction and operating expertise. Substantial expenditures are required
to construct mines, to establish ore reserves through drilling, to carry out environmental and social impact assessments, to develop
metallurgical processes to extract the metal from the ore and, in the case of new properties, to develop the exploration infrastructure
at any site chosen for exploration. The Company may not be able to discover minerals in sufficient quantities to justify commercial
operation, and the Company may not be able to obtain funds required for exploration on a timely basis.





13







The Company may not have clear title to its properties.





Acquisition of title to mineral properties
is a very detailed and time-consuming process, and the Company’s title to its properties may be affected by prior unregistered
agreements or transfers, or undetected defects. Several of the Company’s prospecting licenses are currently subject to renewal
by the Ministry of Energy and Minerals of Tanzania. There is a risk that the Company may not have clear title to all its mineral
property interests, their licenses may not be renewed or they may be subject to challenge or impugned in the future. See “Mineral
Properties”. In other instances, the Company might not have immediate access to some of its mineral properties due to the
ever revolving statutory requirements and regulations as enacted by the Government of Tanzania and enforced by the various ministries.





The Company’s properties have been and may continue to
be subject to illegal mining.



During 2015, illegal miners, consisting primarily
of artisanal miners, invaded and forced occupation at the Buckreef property. As a result, these illegal miners disrupted our activities.
As a result of these illegal miners’ activities, we provided a notice of force majeure under our agreement with Stamico
and did not allow Tanzam, our joint venture operator, to continue mining activities at our property until this issue was resolved.
Although we worked out an agreement with Deputy Minister of Energy and Minerals to provide an area for artisanal mining, no assurance
can be given that no more illegal mining activities will occur at our properties or disrupt our operations.

Mining exploration, development and operating activities are inherently
hazardous.





We have not paid all annual license fees on our properties and
we may be subject to penalties.



In order to maintain the existing site of mining
and exploration licenses, we are required to pay annual license fees. We have not paid certain of its annual license fees since
October 2014 with exception of Buckreef mining licenses. As at August 31, 2018 an accrual of $260,000 has been recorded relating
to unpaid license fees. Note that these licenses remain in good standing until a letter of demand is received from Ministry of
Energy and Minerals requesting payment of any unpaid license fees plus 50% penalty, and the Company fails to respond within 30
days. The Company has not received a letter of demand. If we fail to pay our annual license fees, we may lose our properties.



We may be subject to additional payments to the Tanzanian government
because we have not brought the Buckreef Property into production by a certain date.



Our joint venture agreement with Stamico contains
an obligation clause regarding the commissioning date for the plant. The clause becomes effective only in the event the property
is not brought into production before a specified future date which was originally estimated to be in December 2015. Under the
agreement, the Company is entitled to extend the date for one additional year: (i) for the extension year; on payment to Stamico
of US$500,000; (ii) for the second extension year, on payment to Stamico of US$625,000; and (iii) for each subsequent extension
year, on payment to Stamico of US$750,000.



The Company has received a request letter from
Stamico regarding the status of the penalty payment and has responded that no penalty is due at this time. The Company has received
a subsequent letter from Stamico regarding request for payment. It remains the Company’s position that no penalty is due
at this time, but the Company and Stamico have been engaged in settlement discussions to resolve this issue, and a payment of $172,330
has been made in connection with the settlement discussions to be applied towards the amount owing with the remainder to be paid
out of proceeds of production.



No assurance can be given that Stamico will
not demand additional money from the Company because the Company has not brought the Buckreek Project into production by a certain
date.





If the Company experiences mining accidents or other adverse
conditions, the Company’s mining operations could be materially adversely affected.



The Company’s exploration activities
may be interrupted by any or all of the following mining accidents such as cave-ins, rock falls, rock bursts, pit wall failures,
fires or flooding. In addition, exploration activities may be reduced if unfavorable weather conditions, ground conditions or
seismic activity are encountered, ore grades are lower than expected, the physical or metallurgical characteristics of the ore
are less amenable than expected to mining or treatment, dilution increases or electrical power is interrupted. Occurrences of
this nature and other accidents, adverse conditions or operational problems in future years may result in the Company’s
failure to achieve current or future exploration and production estimates.



Development of the Company’s projects is based on estimates
and the Company cannot guarantee that its projects, if any, will be placed into production.



Any potential production and revenues based
on production from any of the Company’s properties are estimates only. Estimates are based on, among other things, mining
experience, resource estimates, assumptions regarding ground conditions and physical characteristics of ores (such as hardness
and presence or absence of certain metallurgical characteristics) and estimated rates and costs of mining and processing. The
Company’s actual production from the Buckreef Project, if it ever achieves production, may be lower than its production
estimates. Each of these factors also applies to future development properties not yet in production at the Company’s other
projects. In the case of mines the Company may develop in the future, it does not have the benefit of actual experience in its
estimates, and there is a greater likelihood that the actual results will vary from the estimates. In addition, development and
expansion projects are subject to unexpected construction and start-up problems and delays.





14







The Company’s exploration activities are subject to various
federal, state and local laws and regulations.





Laws and regulation govern the exploration,
mining development, mine production, importing and exporting of minerals; taxes; labor standards; occupational health; waste disposal;
protection of the environment; mine safety; toxic substances; and other matters. The Company requires licenses and permits to
conduct exploration and mining operations. Amendments to current laws and regulations governing operations and activities of mining
companies or more stringent implementation thereof could have a substantial adverse impact on the Company. Applicable laws and
regulations will require the Company to make certain capital and operating expenditures to initiate new operations. Under certain
circumstances, the Company may be required to close an operation once it is started until a particular problem is remedied or
to undertake other remedial actions.



The Buckreef Project is held through a special
mining license expiring October 2026 granted pursuant to the Mining Act, 2010 (Tanzania). The Company’s has other mineral
interests in Tanzania that are held under prospecting licenses granted under that Act. There are initial application fees, registration
fees, preparation fees and annual rental fees for prospecting licenses based on the total area of the license. Renewals of prospecting
licenses can take many months and possibly even years to process by the regulatory authority in Tanzania and there is no guarantee
that they will be granted. With each renewal at least 50% of the licensed area, if greater than 20 square kilometers, must be
relinquished and if the Company wishes to keep the relinquished one-half portion, it must file a new application for the relinquished
portion. There is no guarantee on the timing for processing the new application and whether it will be successful.



In addition, any new license (PL, ML &
SML) applications and renewals are also now subject to the recently enacted of the Ministry of Mines Local Content Regulations
GN 3 of 2018 that is enforced by the newly enacted and established 6-member Tanzanian Mining Commission that now oversees the
Mining Commissioner and all license applications. The new regulations reflect a strong will to foster diversification and linkages
to the local economy, create jobs through the use of Tanzanian expertise, goods and services, businesses and financing in the
mining value chain. Not only does it force licensees and contractors to use indigenous Tanzanian companies for the procurement
of goods and services, but also requires a physical presence in Tanzania.





Risks Relating to the Market



The Company’s competition is intense in all phases of
the Company’s business.



The mining industry in which the Company is
engaged is in general, highly competitive. Competitors include well-capitalized mining companies, independent mining companies
and other companies having financial and other resources far greater than those of the Company. The Company competes with other
mining companies in connection with the acquisition of gold and other precious metal properties. In general, properties with a
higher grade of recoverable mineral and/or which are more readily mineable afford the owners a competitive advantage in that the
cost of production of the final mineral product is lower. Thus, a degree of competition exists between those engaged in the mining
industries to acquire the most valuable properties. As a result, the Company may eventually be unable to acquire attractive gold
mining properties.



The Company is subject to the volatility of metal and mineral
prices.



The economics of developing metal and mineral
properties are affected by many factors beyond the Company’s control, including, without limitation, the cost of operations,
variations in the grade ore or resource mined, and the price of such resources. The market prices of the metals for which the
Company is exploring are highly speculative and volatile. Depending on the price of gold or other resources, the Company may determine
that it is impractical to commence or continue commercial production. Gold prices fluctuate widely and are affected by numerous
factors beyond the Company’s control, including central bank purchases and sales, producer hedging and de-hedging activities,
expectations of inflation, the relative exchange rate of the U.S. dollar with other major currencies, interest rates, global and
regional demand, political and economic conditions, production costs in major gold-producing regions, speculative positions taken
by investors or traders in gold and changes in supply, including worldwide production levels. The price of gold and other metals
and minerals may not remain stable, and such prices may not be at levels that will make it feasible to continue the Company’s
exploration activities, or commence or continue commercial production. The aggregate effect of these factors is impossible to
predict with accuracy.





15







The Company’s business activities are conducted in Tanzania.



The Company’s principal exploration and
mine development properties are currently located in the United Republic of Tanzania, Africa under which the Company has obtained
a license to explore, develop and operate the property. Although the Company believes that the Tanzania government is a stable,
multi-party democracy, there is no guarantee that this will continue. Tanzania is surrounded by unstable countries enduring political
and civil unrest, and in some cases, civil war. There is no guarantee that the surrounding unrest will not affect the Tanzanian
government and people, and therefore, the Company’s mineral exploration activities. Any such effect is beyond the control
of the Company and may materially adversely affect its business.



Further, the operator of the Buckreef project
is Tanzam, a joint venture that is 55% owned by one of our subsidiaries and 45% is owned by the Stamico, a governmental agency
of the Tanzania. Therefore, the government of Tanzania will have a substantial input at our operations at the Buckreef project.



Additionally, the Company may be affected in
varying degrees by political stability and government regulations relating to the mining industry and foreign investment in Tanzania.
The government of Tanzania may institute regulatory policies that adversely affect the exploration and mine development (if any)
of the Company’s properties. Any changes in regulations or shifts in political conditions in this country are beyond the
control of the Company and may materially adversely affect its business. Investors should assess the political and regulatory
risks related to the Company’s foreign country investments. The Company’s operations in Tanzania are also subject
to various levels of economic, social and other risks and uncertainties that are different from those encountered in North America.
The Company’s operations may be affected in varying degrees by government regulations with respect to restrictions on production,
price controls, export controls, restrictions on foreign exchange and repatriation, income taxes, expropriation of property, environmental
legislation and mine safety. Other risks and uncertainties include extreme fluctuations in currency exchange rates, high rates
of inflation, labor unrest, risks of war or civil unrest, government and civil unrest, regional expropriation and nationalization,
renegotiation or nullification of existing concessions, licenses, permits and contracts, illegal mining, corruption, hostage taking,
civil war and changing political conditions and currency controls. Infectious diseases (including Ebola virus, malaria, HIV/AIDS
and tuberculosis) are also major health care issues where the Company operates.



Mineral exploration in Tanzania is affected by local climatic
and economic conditions.



The Company’s properties in Tanzania
have year round access, although seasonal winter rains from December to March may result in flooding in low lying areas, which
are dominated by mbuga, a black organic rich laustrine flood soil. Further, most lowland areas are under active cultivation for
corn, rice, beans and mixed crops by subsistence farmers. As a result, the area has been deforested by local agricultural practices
for many years. The seasonal rains and deforested areas can create a muddy bog in some areas, which can make access more difficult,
and could impede or even prevent the transport of heavy equipment to the Company’s mineral properties at certain times of
the year between December and March.



The Company’s operations are subject to issues relating
to security and human rights.



Civil disturbances and criminal activities
such as trespass, illegal mining, theft and vandalism may cause disruptions at the Company’s operations in Tanzania which
may result in the suspension of operations. There is no guarantee that such incidents will not occur in the future. Such incidents
may halt or delay exploration, increase operating costs, result in harm to employees or trespassers, decrease operational efficiency,
increase community tensions or result in criminal and/or civil liability for the Company or its employees and/or financial damages
or penalties. The manner in which the Company’s personnel respond to civil disturbances and criminal activities can give
rise to additional risks where those responses are not conducted in a manner that is consistent with international standards relating
to the use of force and respect for human rights. The failure to conduct security operations in accordance with these standards
can result in harm to employees or community members, increase community tensions, reputational harm to the Company and its partners
or result in criminal and/or civil liability for the Company or its employees and/or financial damages or penalties. It is not
possible to determine with certainty the future costs that the Company may incur in dealing with the issues described above at
its operations.





16







Risks relating to the Securities of the Company



As a foreign private issuer, the Company is subject to different
U.S. securities laws and rules than a domestic U.S. issuer, which may limit the information publicly available to U.S. shareholders.



The Company is a foreign private issuer under
applicable U.S. federal securities laws. As a result, the Company does not file the same reports that a U.S. domestic issuer would
file with the SEC, although the Company is required to file with or furnish to the SEC the continuous disclosure documents that
the Company is required to file in Canada under Canadian securities laws. In addition, the Company’s officers, directors,
and principal shareholders are exempt from the reporting and “short swing” profit rules of Section 16 of the Exchange
Act. Therefore, shareholders may not know on as timely a basis when the Company’s officers, directors and principal shareholders
purchase or sell common shares, as the reporting dates under the corresponding Canadian insider reporting requirements are longer.
In addition, as a foreign private issuer, the Company is exempt from the proxy rules under the Exchange Act.



The Company may lose its foreign private issuer status in the
future, which could result in significant additional costs and expenses.



In order to maintain the Company’s current
status as a foreign private issuer, a majority of its common shares must be either directly or indirectly owned by non-residents
of the United States, unless the Company also satisfies one of the additional requirements necessary to preserve this status.
The Company may in the future lose its foreign private issuer status if a majority of its common shares is held in the United
States and it fails to meet the additional requirements necessary to avoid loss of foreign private issuer status. The regulatory
and compliance costs under U.S. federal securities laws as a U.S. domestic issuer may be significantly more than the costs incurred
as a Canadian foreign private issuer eligible to use the multijurisdictional disclosure system (“MJDS”). If the Company
is not a foreign private issuer, it would not be eligible to use the MJDS or other foreign issuer forms and would be required
to file periodic and current reports and registration statements on U.S. domestic issuer forms with the SEC, which are more detailed
and extensive than the forms available to a foreign private issuer. In addition, the Company may lose the ability to rely upon
certain exemptions from NYSE American corporate governance requirements that are available to foreign private issuers.



U.S. investors may not be able to obtain enforcement of civil
liabilities against the Company.



The enforcement by investors of civil liabilities
under the United States federal or state securities laws may be affected adversely by the fact that the Company is governed by
the Business Corporations Act (Alberta), that the some of the Company’s officers and directors are residents of Canada or
otherwise reside outside the United States, and that all, or a substantial portion of their assets and a substantial portion of
the Company’s assets, are located outside the United States. It may not be possible for investors to effect service of process
within the United States on certain of the Company’s directors and officers or enforce judgments obtained in the United
States courts against the Company, certain of its directors and officers based upon the civil liability provisions of United States
federal securities laws or the securities laws of any state of the United States.





17







Common share prices will likely be highly volatile, and your
investment could decline in value or be lost entirely.



The market price of the common shares is likely
to be highly volatile and may fluctuate significantly in response to various factors and events, many of which the Company cannot
control. The stock market in general, and the market for mining company stocks in particular, has historically experienced significant
price and volume fluctuations. Volatility in the market price for a particular issuer’s securities has often been unrelated
or disproportionate to the operating performance of that issuer. Market and industry factors may depress the market price of the
Company’s securities, regardless of operating performance. Volatility in the Company’s securities price also increases
the risk of securities class action litigation.



Our common shares must meet the requirements of the NYSE American.



The NYSE American rules provides that the NYSE
American may, in its discretion, at any time, and without notice, suspend dealings in or remove any security from listing or unlisted
trading privileges, if, among other things, where the financial condition and/or operating results of the issuer appear to be
unsatisfactory or it appears that the extent of public distribution or the aggregate market value of the security has become so
reduced as to make further dealings on the NYSE American inadvisable. Although the Company has received no indication or notification
that its common shares may be delisted, in light of the current per common share price and the Company’s financial losses,
there is no assurance that the Company’s common shares will continue to be listed on the NYSE American.



Offers or availability for sale of a substantial number of common
shares may cause the price of our common shares to decline.



In the future, in connection with current and
future financings, we could have sales of a significant number of our common shares in the public market which could harm the
market price of our common shares and make it more difficult for us to raise funds through future offerings of common shares.
The Company’s shareholders may sell substantial amounts of its common shares in the public market. The availability of these
common shares for resale in the public market has the potential to cause the supply of its common shares to exceed investor demand,
thereby decreasing the price of the common shares.



In addition, the fact that the Company’s
shareholders can sell substantial amounts of its common shares in the public market, whether or not sales have occurred or are
occurring, could make it more difficult for the Company to raise additional financing through the sale of equity or equity-related
securities in the future at a time and price that it deems reasonable or appropriate.





| | Item 4. | Information
                                         on the Company
| | ------- | -------------------------------------------------------------------



A.       History
and Development of the Company



The Company was originally
incorporated under the name “424547 Alberta Ltd.” in the Province of Alberta on July 5, 1990, under the Business
Corporations Act (Alberta). The name was changed to “Tan Range Exploration Corporation” on August 13, 1991.
The name of the Company was again changed to “Tanzanian Royalty Exploration Corporation”on February 28, 2006.
The Company is also registered in the Province of British Columbia as an extra-provincial company under the Business Corporations
Act (British Columbia) and in the Province of Ontario as an extra-provincial company under the Business Corporations Act(Ontario).





18







The principal executive
office of the Company is located at 82 Richmond Street East, Toronto, Ontario, M5C 1P1, Canada, and its telephone number is (860)
355-3253.



For the year ended August
31, 2018, the Company reported a net loss of $6,897,397. Included in the net loss is nil of mineral properties and deferred exploration
expenses that was written off relating to abandoned mineral properties. The Company incurred deferred exploration expenditures
of $2,992,551 during the year ended August 31, 2018.



In connection with the Company’s disclosure
of mineral resources/mineral reserves and the cut-off grade associated with each mineral resource/reserve, it has made certain
assumptions for mineral pricing and cost associated with each cut-off grade to determine the reasonable prospects for economic
extraction as discussed below.



During fiscal 2018, the Company focused on
the Buckreef Project. In October 2017, the Company awarded another contract to Virimai Project Resources Pvt Ltd of Zimbabwe to
undertake an an amendment of the NI 43-101 Compliant updated Buckreef Pit Optimized Resource Technical Mining Feasibility Report
previously published on 5th April 2017. On July 30, 2018, the Company filed the Amended National Instrument 43-101
Independent Technical Report Mineral Reserves Estimate and Pre-Feasibility Study on the Buckreef Gold Mine Project, Tanzania,
East Africa with an effective date of June 26, 2018 on Form 6-K for July 2018 with the SEC.





B.       Business
Overview



The Company is a mineral resource company with
exploration stage properties, which engages in the acquisition of interests in and the exploration of natural resource properties
in the future and the possible development of those properties where warranted. The Company commits its own resources to the initial
evaluation of mineral properties and in select situations, if and when warranted, the Company enters into joint venture agreements
with other corporations to further the exploration of such properties for the purpose of earning income from the sale of gold
and other mined materials. At present, the Company’s natural resource activities do not generate any income from production.



The Company’s main area of interest has
been in the exploration and development of gold properties, with a primary focus on exploring for and developing gold properties
in Tanzania. Tanzania remains the focus of the Company’s exploration and development activities.



In the Company’s view, its use of a joint
venture and royalty strategy in addition to its planned direct exploration and development offers investors leverage to precious
and base metal prices with lower risk and shareholder dilution. Future production royalties from any producing properties discovered
by joint venture partners would provide the Company with a direct interest in the mine’s cash flow, with exposure to any
benefits from new discoveries and production growth, but without the capital obligations, and environmental and social liabilities,
associated with direct ownership.





19







Plan
of Operations



Exploration Activities



All of the properties
in which the Company holds an interest are in the exploration and preliminary economic assessment stages of mining. Mineral exploration
involves a high degree of risk and few properties, which are explored, are ultimately developed into producing mines. There is
no assurance that the Company’s mineral exploration activities will result in any discoveries of commercial bodies of ore.
The long-term profitability of the Company’s operations will be in part directly related to the cost and success of its
exploration programs, which may be affected by a number of factors beyond the control of the Company.



By way of general description
of the Company’s operating activities, the Company’s business operations involve using known or published geological
and geophysical data to locate mineral resource properties meriting further exploration or development. Once identified, the Company
must stake and apply for registration to title of the mineral properties, or negotiate the acquisition of such properties from
any third party owners. Upon registration or acquisition of title, the Company then designs a program of preliminary exploration
which can involve grid mapping, geophysical and magnetic surveying, geochemical surveying, geological mapping and sampling, grab
sampling, assaying and other forms of prospecting as circumstances may require. Based on the preliminary results, mineral properties
are ranked according to merit for further exploration work, which may involve further mapping, more detailed geophysical and geochemical
surveying, and trenching to identify potential drill targets. If mineralization is indicated which merits further investigation,
drill targets are selected and a preliminary RC drilling program commences for underground sampling and assaying. If the results
are positive, then a diamond drilling program will commence mainly to check, verify and confirm the mineralization potential of
the prospect.



Based on the drilling
program results, the Company will develop models of the underlying geology and mineralized zones for more detailed testing. After
further drilling, some mineralized zones will then be modeled using relevant geological software and ultimately be classified
as inferred or indicated mineral resources. With sufficient infill drilling, these inferred or indicated mineral resources can
be confirmed as a measured mineral resource, upon which a pre-feasibility study can be prepared by a qualified, independent mining
engineer or geologist to determine whether mining activities are economic in the circumstances of the particular property. A pre-feasibility
study must be completed under the requirements of NI 43-101 in Canada in order for mineral reserves to be designated and to confirm
the appropriate mining and mineral processing method based on the geological and metallurgical studies of the ore. A final or
bankable feasibility study must be completed for the designation of reserves under the SEC’s Industry Guide 7. If the bankable
feasibility study is favorable, the Company can then use the feasibility study to seek out the necessary financing from a merchant
banker or other financial institution for mine construction and development.



20









The map below shows the
regional location of our primary properties with historical and/or a current published mineral resource estimate in Tanzania.







The map below shows the location
of mainstay prospects that make up the Company’s Buckreef project with a published Mineral resource and Mineral reserve
estimate in Geita District,Tanzania









21











Highlights for the year ended August 31, 2018



Financial:



| | • | During the year ended August 31 2018, the Company received loans in the amount of $1,754,291 (US$1,389,710) with
a one year term with a right to extend by one additional year by mutual consent, carrying an 8% interest rate payable quarterly.
The convertible loans may be repaid in cash or common shares of the Company at the option of the lender. The convertible loans
may be converted into common shares of the Company at the sole discretion of the lender at exercise prices ranging between US$0.274
and US$0.3469 per common share. Interest is payable quarterly, either in cash or in shares at the option of the lender at exercise
prices ranging between US$0.274 and US$0.3469 per common share.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



In connection with the gold loans described in note 21
to the Company’s financial statements and the convertible loans, the Company paid a finder’s fee via the issuance
of an aggregate of 466,504 common shares with a value of $234,752.



| | • | During the year ended August 31, 2018, the Company received $1,310,660
    (US $1,027,727) in gold loans.
| | - | ---------------------------------------------------------------------------------------------------------





Under the terms of the loan agreements, the bullion loans
are for a period of one year, are subject to renewal, and carry an 8% interest rate payable quarterly. At the sole discretion
of the Lender, the bullion loans may be repaid in cash or common shares of the Company or gold in specified form at the option
of the lender. If the bullion loans are paid back by bullion, the valuation date for such bullion will be the date of the loan
agreements. The bullion loans may be converted into common shares of the Company at the sole discretion of the lenders at exercise
prices ranging between US$0.267 and US$0.3446 per common share. Interest is payable quarterly, either in cash or in shares at
the option of the lender at exercise prices ranging between US$0.267 and US$0.3446 per common share. There is no prepayment penalty.



On June 8, 2018, the Company repriced the exercise price
to convert the loans and interest into common shares at a price of US$0.26.



On August 27, 2018, the Company settled $324,475 (US$250,000)
of principal amount of outstanding loans through the issuance of 961,538 shares with a value of $605,769 resulting on a loss on
settlement of $281,294.



| | • | The Company entered into extension agreements
    in regards to US$1,530,000 in gold loans closed on June 22, 2015, extending the term by one year to June 22, 2018, but modifying
    no other terms of the 2015 loans.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | • | During the year ended August 31, 2017, the Company received loans
    in the amount of US$884,078 with a one year term with a right to extend by 1 additional year by mutual consent, carrying an
    8% interest rate payable quarterly. The convertible loans may be repaid in cash or common shares of the Company at the option
    of the lender. The convertible loans may be converted into common shares of the Company at the sole discretion of the lender
    at an exercise price of US$0.36 – US$0.38 per share. Interest is payable quarterly, either in cash or in shares at the
    option of the lender at a price of US$0.34 – US$0.36 per share.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



In connection with the loans, the Company paid a finder’s
fee via the issuance of an aggregate of 132,577 common shares with a value of $92,805.



22





| | • | On July 19, 2017, the Company settled $63,075 (US$50,000) of principal
    amount of outstanding loans through the issuance of 83,333 shares with a value of $49,166 resulting on a gain on settlement
    of $13,909.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | • | On September 1, 2016, the Company closed a US$1.25 million first tranche of a $5 Million private placement
of securities with Crede CG III, Ltd.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------





In the initial round of financing, the Company
privately placed 1,840,400 shares of its common shares and warrants for US$1.25 million. The common shares issued in the first
tranche of the financing, which closed on September 1, 2016, was priced at US$0.6792 per share. The investor also received five-year
warrants to purchase 1,840,400 common shares of with an exercise price of US$0.8291 per share. The common shares issued in the
first tranche of the financing or issued upon exercise of the warrants issued in the first tranche of the financing will be restricted
until a valid registration for such common share becomes effective.



On September 26, 2016, the Company closed on
the US$3.75 million second tranche of the $5 million private placement of securities with Crede CG III, Ltd.





In the second round of the financing, the Company
privately placed convertible notes and warrants for US$3.75 million. The convertible notes were issued in the principal amount
of US$3.75 million, carried a coupon of 2.0% and matured on September 26, 2046. The Company immediately exercised its right to
cause the conversion of the convertible notes, resulting in the cancellation of the notes and the issuance of 5,357,143 common
shares to the investor. The investor also received five-year warrants to purchase 4,017,857 common shares at an exercise price
of US$1.10 per share. The closing of the second tranche of the financing was conditioned upon a valid registration statement for
the common shares issued or issuable to the investor upon exercise of warrants being declared effective by the SEC. The SEC declared
the Company’s Form F-3 Registration Statement registering the common shares effective on September 23, 2016. The Company
is currently in litigation with Crede CG III, Ltd.



Buckreef Project: Mine Development and Operations



| | · | No mining or ore processing activities conducted
    at South Pit and Plant during the year ended 31st August 2018. Status is still care and maintenance while we wait
    for the resolution of the land compensation issue and issuance of the renewed SML certificate.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | The cumulative Total Ore mined from the Buckreef South Pit (ROMPad + Pad#1-Pad#3+Crusher pad) as of 30th
August 2018 remains at 119,725.59 tonnes averaging 1.86g/t Au with total contained metal ounces of 7,161.24.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | The disposition of the Ore stockpiled as of
    30th August 2018, remains as follows: ROMPAD: 72,315.66t @1.39g/t Au (3,237.96 Ozs); Pad#1: 20,931.75t
    @2.29g/t Au (1,541.77 Ozs); Pad#2: 12,943.78t @2.78g/t Au (1,155.55 Ozs); Pad#3: 9,237.90t @ 3.85g/t Au (1,143.49
    Ozs) & Crusher Pad: 4,245t @ 3.86 g/t Au (526.62 Ozs).
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Q1_2018 (September 2017 – November 2017)



| | • | The
                                         Company hosted the newly appointed Minister for Minerals, Honourable Angellah Kairuki
                                         (MP) and her Deputy Minister who paid a visit to our Buckreef Gold Company in company
                                         of the Stamico Board Chairman and the acting DG for Stamico. The team was given a detailed
                                         brief on the project. In attendance was Mr. Duval (acting CEO), Mr. Volo (Financial Advisor)
                                         with Mr. Zizhou (GM) doing the PowerPoint presentation.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



23





| | • | The
                                         Company was engaged with the Ontario Securities Commission in order to comply with NI
                                         43-101 requirements for Technical report disclosures on SEDAR (MaSS Resources report
                                         review).
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | The
                                         Company also continued with its efforts to engage the Minister of Tourism and Natural
                                         Resources with regards to the limited access to our Kigosi gold project area located
                                         in a restricted game reserve commenced during the quarter.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | PMCG
                                         consulting auditors commenced and completed the year-end audit inventory during the quarter.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------

| | • | End
                                         of year Occupational Health and Safety (OSHA) audits were conducted by the responsible
                                         government officials at Buckreef site towards the end of the quarter. The officials were
                                         informed the operations were on care & maintenance status till mining licence renewal
                                         issues were resolved.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Q2_2018 (December 2017 – February 2018)



| | • | The
                                         Company engaged a Zimbabwean consultant group, Virimai Projects (pvt) Ltd who commenced
                                         the review and amendment of the Buckreef Project Mining and Feasibility Technical Report
                                         in compliance with directives from the Ontario Securities Commission in order to comply
                                         with NI 43-101 requirements for Technical report disclosures on SEDAR.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | Our
                                         JV partner, Stamico, dispatched a special technical and legal audit team of three officials
                                         Ms.Zena (Leader-Stamico); Ms. Khadija (Advocate-Ministry of Mines) & Mr Alex (Geologist-Stamico).
                                         The team was joined up at Buckreef by Peter (GM) & Pius (CA) for an audit meeting
                                         on the Buckreef Gold Company which started on 11th February and ended on 13th February
                                         2018.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | The
                                         Company also paid up all annual fees for the legal statutory requirements (Water permit,
                                         Fire permit, OSHA chemical storage permit) for the Buckreef Gold Company during this
                                         quarter.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | The
                                         Company also submitted applications to renew work and residence permit for Peter Zizhou
                                         (GM) during this period.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





Q3_2018 (March 2018 – May 2018)



| | • | Virimai
                                         Projects of Zimbabwe (QP), has successfully queried, evaluated and validated the Buckreef
                                         project Mineral resource as published by Venymn in 2014. The QP successfully submitted
                                         a letter to the OSC accepting responsibility for the Mineral resource.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | Virimai
                                         Projects also successfully completed and submitted the amended and updated Buckreef Pre-Feasibility
                                         Independent Technical Report (ITR) that now complies with the Canadian NI43-101 reporting
                                         standards of mineral projects technical reports as requested by the OSC.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | The
                                         list of TRX license holdings portfolio and liabilities was updated during the quarter.
                                         All field work still suspended on all projects with operations still focused on care
                                         & maintenance of the Buckreef Special Mining License and camp till the company receives
                                         the renewed SML certificate.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | TRX management is also still awaiting feedback
    from the Hon. Minister’s offices on their final determination on the outstanding issue of compensation to villagers
    within the extended SML area who will be affected when open-pit mining operations commence.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | • | The Company made concerted efforts to resolve the access issue into our Kigosi Project camp and licenses but
received no further response from the Director General of the Kigosi-Moyowosi game reserve.                                                              

| | • | The Company continued its follow up efforts
    on the issuance of the Itetemia Mining License (Applic. #01722), applied for on 4th November 2015 and reportedly still under
    review. Efforts to get feedback on progress was again met with a stone-wall from the responsible officers at the Ministry
    of Mines despite the fact that the long awaited 6-man Mining Commission, who now award MLs, officially commenced duties during
    this reporting quarter.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



24





| | • | Application to renew work
                                         and residence permit for Peter Zizhou (GM) successfully completed during the reporting
                                         quarter period. Both permits were renewed for a further 2 years effective from 4th April
                                         2018.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Q4_2018 (June 2018 – August 2018)



| | • | The
                                         Company successfully published on SEDAR, the amended and updated Buckreef Pre-Feasibility
                                         Independnt Technical Report (ITR) by Virimai Projects (QP) with effective date of 28thJune 2018.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | The
                                         Company commenced detailed planning and proposals for Mineral resource upgrade drilling
                                         as well as deep drilling to further assess the underground mineral potential on the main
                                         Buckreef prospect with Virimai Projects as main consultant.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | A
                                         review of the Buckreef SML renewal certification process by the newly established Mining
                                         Commission commenced. The Commission circulated the Local Content Regulation documentation
                                         and The Pledge that are both mandatory for submission as the last critical part of their
                                         review process.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | Tenure
                                         on 12 Buckreef Project PLs (PL6427/10 – PL6432/10 & PL6544/10 - PL6549/10)
                                         expired on 20th June & 11th July 2018 respectively. The Company plans to submit new
                                         PL applications (after a 4 month grace period) on 21st October & 12th November 2018
                                         respectively, as per the Mining Act of 2010. The PLs are however still reflected as part
                                         of the TRX license portfolio on the Ministry of Energy and Minerals Portal as of 31st
                                         August 2018.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | SML04/92
                                         annual fees (US$80,200) for 2018/2019 were successfully paid on 2nd September 2018 within
                                         the 3 month grace period that ended on 11th September 2018.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | The
                                         Company was served with a 7-day Ministerial eviction order to vacate the Kigosi project
                                         base camp while negotiations for renewed access are finalized. This was part of enforcing
                                         the law barring mining and exploration for gold and base metals in game reserve areas
                                         after the Minister of Natural Resources & Tourism visited the area on 26th July 2018.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | The
                                         Company successfully relocated all pertinent equipment and drill-cores from the Kigosi
                                         camp to Buckreef mine site as part of compliance with the Ministerial order to vacate
                                         Luhwaika camp.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





Exploration



There was no exploration work done in any of
the company’s project licenses in Tanzania during the year-ended 31st August 2018. This was essentially due to
the company strategy where all efforts are directed on the Buckreef project following the Company’s decision to pursue and
promote mine development as its main strategy of generating maximum revenue from its extensive portfolio of properties.



The Company also continued to review, revamp
and clean up the TRX license portfolio with a view to discard certain licenses and/or alternatively farm them out in JV packages
and also to closely monitor and reduce its liabilities arising from statutory payments such as annual fees and JV option payments
to underlying vendors.



In line with the established prospecting license
project categories of PLs to Retain, PLs to Joint Venture & PLs to Discard/Abandon, the company license holdings as of 31stAugust 2018 comprises a total of 64 active licenses split into the three main categories as follows:



25







- Licenses to Retain – 29 PLs, 1 SML, 1 ML & 1 ML application
- Licenses to JV –9 PLs
- Licenses to Discard – 23 PLs



Brief descprtion of the licenses grouped by project names under
each of the three above categories is summarized in the section below.



Projects/Licenses to Retain (Mining projects)

- Buckreef – 12 PLs & 1 SML
- Buziba – 1 PL
- Itetemia – 6 PLs & 1 ML (Application)
- Kigosi – 8 PLs & 1 ML
- Luhala – 2 PLs



Five (5) critical target projects were identified
as Buckreef project, Buziba project, Kigosi project, Itetemia project and Luhala project. The Buziba project was traditionally
lumped up under Buckreef project in previous annual reports but will now be treated as a standalone project. Brief descriptions
of PL holdings and financial obligation status for each respective project area as of 31st August 2018 are summarized
in the sections below.



Buckreef Project



The Buckreef Project is in the Geita District
of the Geita Region south of Lake Victoria, some 110km southwest of the city of Mwanza (see Figure, overleaf). The project area
can be accessed by ferry across Smiths Sound, via tarred national road and thereafter via unpaved but well-maintained gravel roads.
The Project comprises four prospects namely Buckreef, Bingwa, Tembo, and Eastern Porphyry . The Buckreef prospect encompasses
three ore zones namely Buckreef South, Buckreef Main and Buckreef North. The Project is fully-licensed for mining and extraction
of gold.



The following cumulative work was completed
up to 31st August 2018:



- No mining or ore processing activities conducted at the Buckreef project during the year. Status of
the project for the year-ended 31st August 2018 is still care and maintenance while we wait for the issuance of the
renewed SML certificate.
- Historical cumulative total ore mined from the Buckreef South pilot pit as of 31st August
2018 remains at 119,725.59t averaging 1.86g/t Au with total contained metal ounces of 7,161.24.
- The disposition of the Ore stockpiled as of 31st August 2018, remains as follows: ROMPAD:72,315.66t @1.39g/t Au (3,237.96 Ozs); Pad#1: 20,931.75t @2.29g/t Au (1,541.77 Ozs); Pad#2: 12,943.78t @2.78g/t
Au (1,155.55 Ozs); Pad#3: 9,237.90t @ 3.85g/t Au (1,143.49 Ozs) & Crusher Pad: 4,245t @ 3.86 g/t Au (526.62 Ozs).
- An amended and updated NI43-101 Compliant Independent Technical Report on the Buckreef Pit Optimized
Resource Technical Mining Pre-Feasibility Report was completed by Virimai Projects as QP and subsequently published on SEDAR effective
June 2018.



The Study results again confirmed and reflect
the continued refinement of pit optimized mining reserves, mine production schedule, process plant ore feed schedule and financial
projections & analysis based on comprehensive cost estimations for process plant (design, fabrication, construction and operation)
and mining (equipment purchase and mine production) on the Buckreef Project. Major highlights are:



26







| | · | Conventional
                                         open pit mining methods selected in pit designs.
| | - | ------------------------------------------------------------------------------------------------------

| | · | Over
                                         LoM, a total of 19.20Mt of ore with a strip ratio of 9.5:1 will be mined.
| | - | -----------------------------------------------------------------------------------------------------------------------

| | · | Pre-existing
                                         stockpile (ROMPAD) ore totaling 119,726t grading 1.89g/t to be used for process plant
                                         commissioning.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | 950,746.87oz
                                         of gold mined over the life of the project.
| | - | -------------------------------------------------------------------------------------------------

| | · | Recoveries
                                         of 89% for primary ore and 93%for saprolite ore, utilizing a simple EDS comminution,
                                         flotation and leaching process with gravity recovery circuit for free Au component collection.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | 822,000oz
                                         of gold will be produced over the life of the project.
| | - | ---------------------------------------------------------------------------------------------------------

| | · | Initial
                                         capital cost outlay estimated at US$76.5 million with a life of mine sustaining capital
                                         of $22.95 million and closure costs of US$4.5 million.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | Cash
                                         operating costs of $735/oz .
| | - | --------------------------------------------------------------------------

| | · | Generation
                                         of a positive after tax NPV of $130.96 million at a 5% discount rate and an IRR of 74%
| | - | ------------------------------------------------------------------------------------------------------------------------------------------



The Buckreef Gold project mineral resources
as at 31st August 2018 using a cut-off grade of 0.5g/t is as summarized in the table below:



Buckreef Gold Project Mineral Resource
Estimate as of 31st August 2018 (Source Virimai Projects, 2018)











27







The Buckreef Gold project pit-optimized mineral reserves as at
31st August 2018 using a cut-off grade of 0.38g/t (oxides) to 0.41g/t (fresh rock) is as summarized in the table below:



Buckreef Gold Project Mineral Reserve
Estimate as of 31st August 2018 (Source Virimai Projects, 2018)





Buziba Project



The Buziba Project comprises a single prospecting
license (PL6545/2010) located some 25km east of the Buckreef project in the Geita district (see Figure, overleaf). The project
area can be accessed from Buckreef via unpaved and poorly maintained gravel roads. The Buziba Project is a pre-development stage
medium grade gold deposit and principal host lithologies include basalt, co-magmatic dolerite and a suite of intrusive quartz-albite
felsic porphyries. Gold mineralization associated with shear-hosted vein quartz arrays in meta-basalts and as extensive stock
works in the felsic porphyries. Geometry of the mineralization is highly irregular, forming a zone 200m thick and extending E-W
for at least 2,500m.



During the reporting period, no fieldwork was
conducted in the project area.



License Holding and Status (Buckreef & Buziba)



At the end of Q4_2017, the Buckreef and Buziba
projects had 13 PLs and 1 SML covering a surface area of 95.40km2. The license status and statutory liabilities for the two projects
are as shown in the table below:





28





Buckreef-Buziba Gold Projects PL
Portfolio Status – License Status and Liabilities as of 31st August 2018









| | · | Tenure
                                         on 12 PLs expired and new applications only allowed after a 4 month grace period on 20thOctober 2018 and 11th November respectively as per the Mining Act of
                                         2010. PLs still our TRX MEM Portal portfolio as of 10th September 2018.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | SML04/92
                                         annual fees for 2018/2019 were paid up within the 3-month grace period to 11th
                                         September 2018.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | The
                                         six-man Mining Commission now responsible for SML certificate issuance commenced work
                                         and is still reviewing the Buckreef JV Agreement terms and conditions prior to issuance
                                         of the renewal certificate as per announcement by Hon. Minister of Mines during budget
                                         deliberations in Parliament in May 2018.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | A
                                         review of the Buckreef SML renewal certification process by the newly established Mining
                                         Commission is underway. The Commission circulated the Local Content Regulation documentation
                                         and The Pledge that are both mandatory for submission as the last critical part of their
                                         review process.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | No
                                         response and/or directive was received as yet on the proposed land compensation for villagers
                                         affected by the proposed mining activity from the Hon. Minister of Mines as yet.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





29





Buckreef-Buziba Gold Projects Regional
Geology Map (source: Buckreef Gold Company)









Itetemia Project



During the reporting period, no fieldwork was
conducted in the project area.



The Itetemia gold deposit includes the mineral
resources of the Golden Horseshoe Reef (“GHR”), and is an advanced stage exploration project focusing on the development
of the GHR. A total of 9,833m of diamond core drilling (51 holes) and 8,339m of RC drilling (138 holes) was completed on the project.
Modeling and processing of assay results from both the core drilling and RC drilling so far completed over the GHR and surrounding
areas culminated in the estimation of the following Mineral Resources. The gold resource numbers for the GHR are as at 30th May
2016 using a cut-off grade of 1.0g/t:











30





The process to convert the PL covering the
Horseshoe Gold Prospect at Itetemia into a Mining License (ML) commenced on 4th November 2015. The Company re-submitted
all documentation required for the conversion of the Itetemia PL into a Mining License at the request of the relevant authorities
in the Ministry of Mines. A follow up on the Mining License renewal shows that the application is still under review.



As of the 31st August 2018, the retained portion
of the Itetemia project area has 6 active PLs and 1 ML application all covering a surface area of 31.92km2. The Itetemia Project
license status and statutory liabilities are as shown in the table below:



Itetemia Gold Project PL Portfolio
Status – License Status and Liabilities as of 31st August 2018







- Two (2) PLs (PL6059/09 & PL9564/14) have both technically expired.
One is in the retain folder while the other is designated for discard. Liabilities for both are as shown in table above.
- Four (4) PLs pending renewal after successful lodgment of renewal
applications. However during the period only 2 PLs (PL8638/12 & PL8661/12) were recommended for offer upon fulfillment of
local content doc presentation, payment of 2018/19 annual fees and Integrity pledge doc signing.
- The ML application is still under review for over 2 years now and
no response on the delayed application has been received from MoM offices. The ML application covers three (3) licenses registered
under Tanzam2000 and one (1) license registered under Tancan Mining.



Kigosi Project



During the reporting period, no fieldwork was
conducted in the project area.



The Company was however directed to evacuate
the Kigosi camp site by the Minister of Environment and Natural Resources while negotiations to access the site in the future
are underway in view of the recent mining regulations barring exploration and/or mining of gold and any other base metals within
areas designated as game reserves are pursued. All the company equipment and drill cores and RC samples were evacuated and are
now stored at the Buckreef main site.



Kigosi Project area remains subject to a Game
Reserve Declaration Order. Upon repeal or amendment of that order by the Tanzanian Government, the Kigosi Mining Company will
be legally entitled to exercise its rights under the Mineral Rights and Mining Licence. The procedures for de-gazetting the Kigosi
mining licence project area from a game reserve area to a mining area on the government gazette has not been completed by government
of Tanzania.



Gold Mine development plans at Kigosi continue
to be shelved mainly since under the 2010 Mining Act, only exploration and mining of energy minerals, including uranium, gas and
petroleum is permitted in any game reserve. Historical exploration on the project established a resource as shown in table below.





31





Kigosi Gold Project: Historical published Resource/Reserve results











The table below shows the status (as of 31stAugust 2018) of the Kigosi Project license portfolio (identified as critical to the project) has 9 active PLs and 1 ML all
covering a surface area of 121km2. The Kigosi license status and statutory liabilities is as shown in the table below:



Kigosi Gold Project PL Portfolio
Status – License Status and Liabilities as of 31st August 2018







- 7 of the Kigosi PLs nominated for retention by the company have outstanding annual
fee payments.
- Kigosi ML 2017/2018 annual fees were due in October 2017 but have been withheld due
to finalization of access negotiations or pending de-gazetting of the area into a forestry reserve.
- Access to the project area is still difficult due to the prevailing uncertainty with
the new laws enacted recently with especial reference to game reserves.





Luhala Project



During the reporting period, no fieldwork was
conducted in the project area.



The Luhala Project is an exploration project
focusing on the development of the Luhala gold deposit which consists of five anomalous hilltops. The mineralization is stratabound
shear-zone hosted gold mineralization (stratigraphic and structural control) within a distinct unit of felsic rocks with associated
ferruginized mafic and felsic rocks.





32





Drilling at the Luhala Project has been concentrated
on the Luhala Hills (Luhala Hill, Kisunge Hill, Shilalo Hill South and Shilalo Hill West). A total of 3,279m of diamond core drilling
(26 holes) and 8,665m of RC drilling (144 holes) was completed on the project. Modeling and processing of assay results from both
the core drilling and RC drilling conducted over the various deposits at Luhala, has resulted in the estimation of the following
Mineral Resources for Luhala as at 8th March 2011 using a cut-off grade of 1.0g/t:





Luhala Gold Project: Historical
published exploration results









The process of selecting a consultant to carry
out feasibility study at the Luhala gold project has been completed and once funds are available the contract to engage the consultant
to carry out the study will be signed to initiate the FS study works.



At the end of this reporting period critical
Luhala project area had 2 PLs covering a surface area of 17.31km2. The Luhala Project license status and statutory
liabilities are as shown in the table below:



Luhala Gold Project PL Portfolio
Status – License Status and Liabilities as of 31st August 2018









| | · | Payment
                                         of outstanding annual fees for the critical Luhala PLs was completed as one of the conditions
                                         to submit renewal or extension applications.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | Offer
                                         letters from the Mining Commission await.
| | - | ----------------------------------------------------------------------------------------





As of 31stAugust 2018, the Projects
to Retain license portfolio’s outstanding and current financial liabilities and obligations arising from unpaid rents
including the penalties for a total of 32 licenses stands at US$94,819.25 as summarized in the table below.





33





PLs to Retain (Mining Projects):
License Liabilities as of 31st August 2018











Projects Licenses to Joint Venture

- Biharamulo – 4 PLs
- Lunguya – 4 PLs
- Manonga – 1 PLs

Prospecting Licenses within three project areas,
identified as Biharamulo project, Lunguya project and Manonga project were selected as possible licenses to farm out in JV agreements.
Brief descriptions of PL holdings and financial obligation status for each respective project area as of 31st August 2018 are
summarized in the section below.



Biharamulo project area



There was no filed-work done during the reporting
period. Biharamulo Gold Prospect is a green-fields to brown-fields stage project focusing on the defining the mineralization along
a regional WNW-ESE trending shear. Historical preliminary exploration results show a very high potential for gold mineralization
associated and/or controlled by the prominent NW-SE parallel structures over a strike length of >600m covered by the cluster
of 4 contiguous PLs. Joint Venture Partners for the Project are being sought.



The Biharamulo Project license status and statutory
liabilities as of 31st August 2018 are as shown in the table below:



Biharamulo Gold Project JV PL Portfolio
Status – License Status and Liabilities as of 31st August 2018







| | · | All
                                         the Biharamulo PLs nominated for potential JV partnerships by the company have outstanding
                                         annual fee payments as shown in the table above.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | All
                                         the PLs have technically expired (30th Dec. 2017, 23rd Apr. 2018
                                         & 4th Jun 2018) but they are still reflected on the MEM portal as part
                                         of our portfolio.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





34





Lunguya project area



There was no work done during the reporting
period. Based on historical in-house exploration data, three zones were identified and are associated
with extensive artisanal workings (±30 m depth), with more extensive workings at Nyamakwenge. These known gold prospects
include the Nyamakwenge Reefs (NE corner of PL 6941/11); the Nyikoboko Reefs (NE corner of PL 5289/08) & NW-SE trending Shilela
reef system (PLs 8940/13, 10145/14 & 9626/14). Gold occurs principally as free gold within multiple quartz veins or stock-works,
often associated with felsic intrusives.



The Lunguya Project license status and statutory liabilities as
of 31st August 2018 are as shown in the table below:



Lunguya Gold Project JV PL Portfolio
Status – License Status and Liabilities as of 31st August 2018







| | · | All
                                         the Lunguya PLs nominated for potential JV partnerships by the company have outstanding
                                         annual fee payments as shown in the table above.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | All
                                         the PLs have technically expired (7th Feb. 2017, 13th Mar. 2018 & 28thAug 2018) but they are still reflected on the MEM portal as part of our portfolio.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Manonga project area



There was no field-work done during the reporting
period. The Manonga Project licence is located within the Nzega Greenstone Belt of the southern margin
of Lake Victoria Gold Fields. Manonga Gold Project is a greenfield gold exploration project focusing on identification
of potential Golden Pride mine type mineralization in the Nzega East Goldfield and the Chomachankola
artisanal workings to the south.



The Manonga Project license status and statutory liabilities as
of 31st August 2018 are as shown in the table below:



Manonga Gold Project JV PL Portfolio
Status – License Status and Liabilities as of 31st August 2018







| | · | The
                                         Manonga PL nominated for potential JV partnerships by the company has outstanding annual
                                         fee payments as shown in the table above.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | The
                                         PL technically expired (15th Nov. 2017) but still reflected on the MEM portal
                                         as part of our portfolio.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



As of 31st August 2018, the Projects
to JV license portfolio’s outstanding and current financial liabilities and obligations arising from unpaid rents including
the penalties are US$72,513 as summarized in the table below.





35





PLs to JV (Exploration Projects):
Total Liabilities up to 31stAugust 2018







Projects Licenses to Discard/Abandon

| | · | Biharamulo
                                         – 1 PL
| | - | ----------------------------------------------------------

| | · | Itetemia
                                         – 1 PL
| | - | --------------------------------------------------------

| | · | Kabanga
                                         – 2 PLs
| | - | --------------------------------------------------------

| | · | Kanegele
                                         – 6PLs & 1 Application
| | - | ------------------------------------------------------------------------

| | · | Kigosi
                                         – 6 PLs
| | - | -------------------------------------------------------

| | · | Kibara
                                         – 1 PL
| | - | ------------------------------------------------------

| | · | Mwadui
                                         – 1 PL
| | - | ------------------------------------------------------

| | · | Nzega
                                         – 1 PL
| | - | -----------------------------------------------------

| | · | Tulawaka
                                         – 3 PLs
| | - | ---------------------------------------------------------



As of 31stAugust 2018, the Projects to Discard/Abandon license portfolio comprised of a total of 23 licenses.



There was no work done in any of the licenses
and historical preliminary exploration results showed a negligent potential for gold mineralization within these PLs hence they
were consequently recommended to be abandoned or returned to original owners to cut liabilities. The license
status and statutory liabilities for these PLs are as shown in the table below:



Various Projects PLs to Discard
Portfolio Status – License Status and Liabilities as of 31st August 2018





36









| | · | All
                                         the PLs nominated for potential discarding or return back to original vendors by the
                                         company have outstanding annual fee payments as shown in the table above.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | 21
                                         of the 23 PLs have all technically expired but still reflected on the MEM portal as part
                                         of our portfolio.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | 1
                                         PL (PL10605/2015) in the Kigosi area will expire in May 2019 while for 1 PL (PL8480/2012),
                                         we received an offer letter but declined to take up the offer.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



As of 31st August 2018, the Projects
to Discard license portfolio’s outstanding and current financial liabilities and obligations arising from unpaid rents
including the penalties are US$128,614.50 as summarized in the table below.



PLs to Discard/Abandon (Exploration
Projects): Total Liabilities up to 31st August 2018











License Relinquishment



The practice within the Tanzanian Mining industry
during the previous years was generally accepted that companies would half the size of their active license on 1st
renewal period (at the end of the first 4 years of tenure) and 2nd renewal period (at the end of the following 3 years
of tenure) periods where the company would retain half of the PL and relinquish the other half to the government but subsequently
submit a new application covering the relinquished half to secure ground.



Following the gazetting of the new Mining Regulations
(2017) and strict adherence to the statutory directives in the Mining Act of 2010, the relinquished half of the license area now
reverts back to the government and has a 4-month lpase period during which no applications are entertained by the Ministry of
Mines. At the end of the 4-month period, companies can apply for the ground but now it’s up to the government to decide
which new players to award the ground in order to maximize exploration activity by more juniors and the previous holder is not
automatically guaranteed to be awarded the relinquished ground.





37





The total number of licenses that expired and/or
forfeited to the state during the reporting period amounted to 47 PLs as summarized in the table below.



Various Projects PLs that forfeited
and written-off Liabilities as of 31st August 2018







38







Exploration



The Company’s principal exploration properties
are currently all located in the United Republic of Tanzania, Africa. The government of Tanzania is a stable, multi-party democracy.
Mineral exploration in Tanzania is affected by local climatic, political, and economic conditions. The Company’s properties
have year round access, although seasonal summer rains from December to March may result in flooding in low lying areas, which
are dominated by mbuga (black organic rich laustrine flood soils). Further, most lowland areas are under active cultivation for
corn, rice, beans and mixed crops by subsistence farmers. As a result, the area has been deforested by local agricultural practices
for many years. The seasonal rains and deforested areas can create a muddy bog in some areas, which can make access more difficult,
and could impede or even prevent the transport of heavy equipment to the Company’s mineral properties at certain times of
the year between December and March.



Competition



The mining industry in which the Company is
engaged is in general, highly competitive. Competitors include well-capitalized mining companies, independent mining companies
and other companies having financial and other resources far greater than those of the Company. The Company competes with other
mining companies in connection with the acquisition of gold and other precious metal properties. In general, properties with a
higher grade of recoverable mineral and/or which are more readily mineable afford the owners a competitive advantage in that the
cost of production of the final mineral product is lower. Thus, a degree of competition exists between those engaged in the mining
industry to acquire the most valuable properties. As a result, the Company may eventually be unable to acquire attractive gold
mining properties.



Dependence on Customers and Suppliers



The Company is not dependent upon a single
or few customers or supplier for revenues or its operations.



Governmental Regulations



As of November 1, 2010, the Tanzania Mining
Act, 2010 (“Mining Act, 2010”) came into effect. The Tanzania Ministry of Energy and Minerals announced
changes to fees effective July 27, 2012.



The Company’s mineral interests in Tanzania
are initially held under prospecting licenses granted pursuant to the Mining Act, 2010 for a period of up to four years, and are
renewable two times for a period of up to two years each. The Company must pay annual rental fees for its prospecting licenses
based on the total area of the license measured in square kilometres, multiplied by US$100/sq.km for the initial period, $150/sq.km
for the first renewal and $200/sq.km for the second renewal. There is also an initial one-time “preparation fee” of
US$500 per license. Upon renewal, the Company must pay a renewal fee of US$300 per license. Renewals of its prospecting licenses
can take many months and even years to process by the regulatory authority in Tanzania.



All prospecting licenses in Tanzania also require
the holder to expend funds which are set out in the Mining Act, 2010. At each renewal, at least 50% of the Company’s licensed
area must be relinquished on prospecting licences in excess of 20 square kilometres. On relinquishing the ground, the area is
automatically returned to the Mining Commissioner’s jurisdiction for a period of 4 months after which it will be declared
vacant or otherwise by the Commissioner. If the Company still has an interest in the relinquished one-half portion, it must then
file a new application in competition with other interested companies for the relinquished portion 4 months after the relinquishment
date. If more than one application is lodged on the same day at the Mining Commissioner’s office, then the Commissioner
may award the ground by tender. There is no guarantee on the timing for processing the new application and whether it will be
successful.





39





The Company must hold a mining license or special
mining licence to carry on mining activities. Pursuant to the Mining Act, 2010 a mining license is granted for a maximum initial
period of 10 years. It is renewable 6 months prior to expiry for a period the applicant will state but not exceeding 10 years.
A special mining licence is granted for the estimated life of the ore body indicated in the feasibility study report, or such
period as the applicant may request whichever period is shorter. It is renewable for a period not exceeding the estimated life
of the remaining ore body.



Prospecting and special mining and mining license
holders must submit regular reports in accordance with mining regulations. Upon commercial production, the government of Tanzania
imposes a royalty on the gross value of all production at the rate of 7.3% of all gold produced. The applicable regulatory body
in Tanzania is the Ministry of Energy and Minerals.



An environmental impact statement and an environmental
management plan must accompany special mining license, mining license and gemstone mining license applications for mineral rights.
In addition to the establishment of environmental regulations, the Tanzanian Government has improved management procedures for
effective monitoring and enforcement of these regulations by strengthening the institutional capacity, especially in the field
offices. The Government has provided rules for the creation of reclamation funds to reinstate land to alternative uses after mining
and it has developed guidelines for mining in restricted areas, such as forest reserves, national parks, sources of water and
other designated areas.



C.       Organizational
Structure



The Company has the following seven subsidiaries:



|Name of Subsidiary                                                       | Jurisdiction
    of Incorporation | Percentage
    &Type of Securities Owned or Controlled by Company
|------------------------------------------------------------------------ | --------------------------------- | -----------------------------------------------------------------
|Voting
    Securities Held                                               | Non-Voting
    Securities        
|Itetemia
    Mining Company Limited                                      | Republic
    of Tanzania, Africa  | 90%  (1)common shares                                            
|Lunguya
    Mining Company Ltd.                                          | Republic
    of Tanzania, Africa  | 60%
    (2)common shares                                         
|Tancan
    Mining Company Limited                                        | Republic
    of Tanzania, Africa  | 100%common shares                                                
|Tanzania
    American International Development Corporation 2000 Limited | Republic
    of Tanzania, Africa  | 100%common shares                                                
|Buckreef
    Gold Company Limited (BGCL)                                 | Republic
    of Tanzania, Africa  | 55%
    (3)common shares                                         
|Northwest
    Basemetals Company Limited                                 | Republic
    of Tanzania, Africa  | 75%
    (4)common shares                                         
|BGCL/AGC
    Joint Venture (6)                                           | Republic
    of Tanzania, Africa  | 40%
    (5)common shares                                         



| | (1) | The
                                         remaining 10% interest is held by State Mining Corporation.
| | --- | --------------------------------------------------------------------------------------------------------

| | (2) | The
                                         remaining 40% interest is held by Northern Mining and Consultancy Company Ltd.
| | --- | ---------------------------------------------------------------------------------------------------------------------------

| | (3) | The
                                         remaining 45% interest is held by State Mining Corporation.
| | --- | --------------------------------------------------------------------------------------------------------

| | (4) | The
                                         remaining interest is held 15% by State Mining Corporation and 10% by Songshan.
| | --- | ----------------------------------------------------------------------------------------------------------------------------

| | (5) | The
                                         remaining interest is held 60% by Allied Gold Corp. of United Arab Emirates.
| | --- | -------------------------------------------------------------------------------------------------------------------------

| | (6) | Joint
                                         venture letter of intent signed and subject to final approval.
| | --- | -------------------------------------------------------------------------------------------------------------





40







D.       Property,
Plant and Equipment



The Company’s business is the acquisition,
exploration and development of mineral properties, with a primary focus on exploring for gold properties in Tanzania. From 2011
onwards, the Company has focused on the development of the Buckreef project. Historically, the Company has funded its activities
by way of the sale and issuance of its securities. The Company also obtains operating funds through sales of and options to sell
its various mineral property interests to other parties, retaining a royalty interest. The activities of the Company within its
properties with or without a known body of commercial ore, with or without established mineral reserves, to date have been exploratory
and developmental in nature. Pre-feasibility studies have been compeleted and published on the Buckreef Project.



Mineral
Properties



Buckreef Project



History



The Lake Victoria Goldfields (“LVG”)
was discovered in 1894 by German explorers and significant exploitation began in the 1930s at the Geita Gold Mine. Several small
gold mines exploiting near surface reefs, operated throughout the Rwamagaza Greenstone Belt (“RGB”), particularly
near the village of Rwamagaza. By 1940, Tanzania was producing 4.5tpa of gold (Au).



Gold bearing quartz veins were reported from
the current Buckreef Mine area in 1945 and reports from the 1950s attest to ongoing production at a number of localities near
Rwamagaza, including the Buckreef area. The extent of the small scale local and colonial mining activities is evident from the
numerous pits and adits covering the entire Buckreef tenement; however, no production figures are available.





41





Buckreef Exploration History Synopsis



|Year      | Operator                                              | Work
    Performed                                                                                                                                                                                                                                                                                               
|--------- | ----------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|1959      | Tanzania Mineral Resources
    Division (TMRD) & UNDP | UN-sponsored regional airborne
    geophysical survey over Rwamgaza Greenstone Belt.                                                                                                                                                                                                                             
|1960-1965 | Tanzania Mineral Resources
    Division (TMRD) & UNDP | Ground based geophysical surveys
    (magnetics, IP) follow up on regional targets. Discovery of Buckreef Quartz Vein and follow up drilling commenced. 13 diamond
    drill holes by UNDP (12 in current database, UNBR01-12) identified a “possible ore zone 107m long, 8m wide and extending
    to 122m depth
|1968      | Tanzania Mineral Resources
    Division (TMRD)        | 13 diamond drill holes by Tanzanian
    Mineral Resources Division (MRD01-13)                                                                                                                                                                                                                                    
|1972      | Tanzania Mineral Resources
    Division (TMRD)        | Tanzanian government approved
    investment decision and Buckreef Gold Mining Company.                                                                                                                                                                                                                          
|Mid-1970s | Williamson Diamonds Ltd                               | Underground development on
    30m and 61m levels by Williamson Diamonds Ltd. Indicated ore reserve of 106,000t @ 8.7g/t Au between 23m and 76m levels using
    minimum mining width of 1.5m                                                                                                                    
|1973-79   | Tanzania Mineral Resources
    Division?              | Further underground development
    and 3 diamond drill holes (BGMDD01-03) by BGMC.                                                                                                                                                                                                                              
|1973-1981 | State Mining Corporation                              | CIP treatment plant and other
    facilities established with financial assistance from Swedish International Development Agency                                                                                                                                                                                 
|1982-1988 | State Mining Corpoaration                             | Gold production commenced but
    reached only 25-40% of forecast targets. Production figure unavailable. Review of operations by British Mining Consultants
    Ltd. who found Buckreef assay laboratory assays 65% higher than overseas check assays                                                           
|1990      | State Mining Corporation                              | Mining ceased and workings
    flooded. Total ore extracted estimated at approximately 100,000t @3-4g/t Au                                                                                                                                                                                                       
|1992      | East African Mining Corporation                       | Commencement of modern exploration
    techniques including Aircore, RC and diamond drilling.                                                                                                                                                                                                                    
|1994      | East African Gold Mines Ltd                           | Signing of first Buckreef Gold
    Mine Re-Development agreement with State Mining Corporation. Additional surface and subsurface gold resources were identified.                                                                                                                                                



42







|Year           | Operator                                                 | Work
    Performed                                                                                                                                                                                                                                                                                                                                                                                                
|-------------- | -------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|1995-2010      | East African Gold
    Mines Ltd / Gallery Gold / Iamgold | Explored 40km of
    contiguous strike length of the RGB encompassing geophysical surveys (IP, EM & magnetic); 52,737m of RAB & AC drilling;
    80,796m RC drilling and 22,197m of Diamond drilling. Several metallurgical test-works for a CIL and/or CIC process plant conducted;
    Preliminary economic assessment leading to a Feasibility scoping study completed. Project returned to Stamico by IAMGOLD.
|2008-
    2009 | Tanzanian Royalty                                        | Continues with exploration
    and starts RAB, RC and DC drilling at Kigosi on the Luhwaika and Igunda Prospects. Completed drilling at Luhwaika and Igunda
    Prospects. 3D modelling completed and resources declared for both.                                                                                                                                                                                
|2010-2011      | Tanzanian Royalty                                        | Commenced RAB and
    RC drilling at Msonga   and Commenced and subsequently ceased bulk sampling of Luhwaika quartz rubble deposit
    (four months later). Completed drilling at Msonga. 3D modelling completed. No resource declared on Msonga.                                                                                                                                                                
|2011           | Tanzanian Royalty                                        | Second Buckreef Gold mine Re-Development
    JV Agreement signed between Tanzanian Royalty Exploration Corp and Stamico. Commenced with detailed review of all historical
    exploration data and results for an updated NI 43-101 report supervised by Venmyn Rand (Pty) Ltd.                                                                                                                                   
|2012-2013      | Tanzanian Royalty                                        | Additional exploration and
    resource drilling (33,711m diamond core & 4,459m RC) conducted. Preliminary NI 43-101 report completed by Venmyn Rand
    (Pty) Ltd that showed a 121% increase in mineral resources. Successfully applied for extension of the Special Mining License
    area (from 3.4km2 to 16.04km2). Commenced NEMC EIA certification process.                                               
|2014           | Tanzanian Royalty                                        | Awarded NEMC Environmental
    EIA certification. Metallurgical testwork for heap leach and/or CIL process plant conducted. Geotechnical test-work conducted.
    Construction of pilot Heap leach process plant commenced. Pilot Mining on South Pit commenced late October 2014.                                                                                                                                
|2015           | Tanzanian Royalty                                        | Pilot mining continued on South
    pit. Pilot heap leaching operations commenced.                                                                                                                                                                                                                                                                                                                                
|2016           | Tanzanian Royalty                                        | Force majeure declared February
    2016. First gold pour from heap leach operations. Further Metallurgical testwork for CIL process plant commenced. Buckreef
    process plant re-dsign into CIL system commenced. Commenced application for an initial 15yr Life of Mine extension for the
    Special Mining License.                                                                                         
|2017-2018      | Tanzanian
    Royalty                                    | Applied for and received offer
    letter for a 10-year renewal of the Buckreef Special Mining License. Published NI 43-101 compliant Updated Mining Reserve
    Estimate and Economic Feasibility report completed by MaSS Resources (Pvt) Ltd of Tanzania. Subsequent amendement on said
    report by Virimai Projects (QP) as Zimbabwe published on SEDAR on July 2018 as per OSC directives.                 





43





The technical content of the following discussion
regarding the Buckreef Project in Tanzania is summarized from an Amended National Instrument 43-101 Independent Technical Report
Mineral Reserves Estimate and Pre-Feasibility Study on the Buckreef Gold Mine Project, Tanzania, East Africa with an effective
date of June 26, 2018, as filed with the SEC.



Ownership



Prior Ownership



Originally, the Buckreef Project was an advanced
exploration project held by Iamgold Tanzania (“IAGT”) prior to July 2009. The Agreement to Redevelop the Buckreef
Gold Mine (“ARBGM”) between IAGT and the Ministry for Energy and Minerals included at that point, a single
Mining Licence and 12 Prospecting Licences covering 98.19km2.



In July 2009, IAGT applied to surrender all
licenses relating to the ARBGM, effective October 25, 2009 and the Commissioner for Minerals withdraw all license applications
relating to the ARBGM.



Current Ownership, Property
and Location



In December 2010, the Company signed a binding
heads of agreement with Stamico for the Buckreef Project and on October 25, 2011 entered into a Definitive Joint Venture Agreement
with Stamico for the development of the project. Through its wholly-owned subsidiary, Tanzam, the Company will hold a 55% interest
in the joint venture company, Buckreef Gold Company Limited, with Stamico holding the remaining 45%. The agreement provided for
the formation and establishment of a joint venture company, Buckreef Gold Company Limited (“BGC Ltd.”). On
24th of October 2011, BGC Ltd. was formed and incorporated under certificate of incorporation number 86681.



The Buckreef Project is located in north central
Tanzania immediately to the south of Lake Victoria, in the Mwanza Provincial District. The Buckreef Project is situated 110km
southwest of Mwanza, in the Geita District and is accessed by ferry across Smiths Sound and then via unpaved roads and an airstrip.
The Buckreef Project comprises five gold deposits located within two geographically separated areas approximately 25km apart,
termed the Buckreef Mining Area (“BRMA”) and the Buziba-Busolwa Mining Area (“BZMA”) and
the individual gold deposits within these mining areas have been termed Prospects, as summarized below:-



44







- BRMA: includes the Buckreef Prospect, the Bingwa Prospect, Eastern Porphyry Prospect and the Tembo Prospect;
and



- BZMA: includes the Buziba Prospect



An extended mining right was granted to Tanzam
(Special Mining Licence 04/1992) encompassing the Buckreef, Bingwa, Eastern Porphyry and Tembo Prospect areas. The Buziba Prospect
is held under a prospecting licence which is in the process of being converted into either a retention licence or a special mining.
Within the BZMA small-scale miners operate under numerous primary mining licences adjacent to our main prospect.



Geology and Mineralisation



The BRMA and BZMA gold deposits are classified
as low to medium grade orogenic gold deposits hosted by mafic volcanic sequences of the eastwest trending Archaean RGB within
the L of the Tanzanian Craton. The BRMA gold deposits are hosted by a major steeply dipping, northeast-southwest trending brittle-ductile
shear zone and subsidiary shears, with an early phase of iron rich carbonate alteration, re-brecciation, felsite intrusion and
a later phase of auriferous quartz veining.



The BZMA deposit is located 25km east of the
Buckreef Prospect in the RGB. The principal host lithologies include magnesium rich basalt, co-magmatic dolerite and a suite of
quartz-albite felsic porphyries that have intruded the mafic sequence. Gold mineralisation is associated with quartz vein arrays
that occur in altered shear zones in mafic lithologies and as extensive stock works in the felsic porphyries.



Regional Geological Setting



The Buckreef Project is situated within the
LVG of northern Tanzania, which consists of a number of eastwest trending, linear, Archaean greenstone belts, which are separate
granite-gneiss terrains within the Tanzanian Craton of east Africa. The LVG is the third largest gold producing region of Africa,
surpassed only by the Witwatersrand Basin in South Africa and the Tarkwa region of Ghana. Numerous gold occurrences have been
identified in the LVG, and new discoveries continue to be made. Since 1998, when the first mine, Golden Pride was commissioned,
four additional large scale mines namely, Geita, Bulyanhulu, North Mara, and Tuluwaka have come into production.



The greenstone belts comprise mafic volcanics,
pyritic sediments, tuffs, iron formation, chert, and felsic volcanics, collectively known as the Nyanzian Group. The metamorphic
grade of the Nyanzian Group is lower to middle greenschist facies, and two major deformational episodes have been identified.
Amphibolite facies metamorphic rocks are exposed in the western portions of the belt near Tulawaka Mine, but in general higher
grade metamorphic complexes are rare.



The greenstone belt sequences have geological
and structural similarities to major gold districts in the Canadian Shield (Val d ́Or, Kirkland Lake) and the Yilgarn Craton
in Western Australia (Kalgoorlie, Laverton, Leonora, Kambalda and Southern Cross).



Gold mineralisation within the LVG occurs in
a number of styles including:-



45







| | · | quartz
                                         veins within minor brittle lineaments, most commonly worked on a small scale by artisanal
                                         workers, due to their limited extent and erratic gold distribution;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | mineralisation
                                         within major ductile shear zones;
| | - | -----------------------------------------------------------------------------------------



| | · | mineralisation
                                         associated with replacement of iron formation and ferruginous sediments; and
| | - | ------------------------------------------------------------------------------------------------------------------------------------



| | · | Felsic
                                         (porphyry) hosted mineralisation, such as within the RGB.
| | - | ---------------------------------------------------------------------------------------------------------



Regardless of the geological environment, it
is accepted that structural control on the emplacement of the mineralisation is critical. The following structural features have
proven to be important foci of gold mineralisation:



| | · | structural
                                         lineaments trending at 120o;
| | - | --------------------------------------------------------------------------------



| | · | flexures
                                         and splays to the 120o trend (such as at Golden Pride);
| | - | ---------------------------------------------------------------------------------------------------------



| | · | structural
                                         lineaments at 70o (such as at Golden Ridge); and
| | - | ----------------------------------------------------------------------------------------------------



| | · | Granite-greenstone
                                         contacts (such as at the Ushirombo and RGB).
| | - | --------------------------------------------------------------------------------------------------------



Local Geological Setting



The Buckreef Project area covers the eastern
portion of the eastwest trending RGB, which forms part of the Sukumaland Greenstone Belt. The Sukumaland Greenstone Belt is oval
shaped and is defined by two intermittently exposed belts of meta-volcanic and meta-sedimentary rocks that surround a core of
granitoids and gneisses. The inner belt comprises an older, Lower Nyanzian sequence characterised by basaltic and andesitic lavas
and tuffs, whilst the outer, younger, Upper Nyanzian succession consists of iron formation and tuffs. The understanding of the
geology in the region has been hampered by the lack of outcrop (less than 2%). Isotopic dating suggests that the sequences are
approximately 2.6Ga in age and although no contact between the outer and inner belts is exposed, a general trend of younging outwards
is considered valid.



Within the Sukumaland Greenstone Belt, the
RGB consists of a sequence of eastwest trending, poorly outcropping basaltic flows and overall the RGB varies in width from 5km
to 10km. The mafic sequences consist of komatiitic basalts to the south and tholeitic basalts in the north, separated by the Rwamagaza
Shear Zone. The basalts display well preserved volcanic features such as varioles, pillows, and flow top breccias Aeromagnetic
data and minor outcrop, indicate the presence of a number of elongate discontinuous, serpentinised, sheared ultramafic bodies
which parallel the flow stratigraphy and which could represent either intrusive bodies or the cumulate portions of thick, magnesium
rich basaltic lava flows.



Two main clusters of felsic intrusions occur
throughout the region and comprise large batholithic granites and porphyry intrusions. The RBG could possibly form part of a much
larger mafic belt that has been dissected by the intrusion of large batholithic granites. Aeromagnetic surveys over the Project
area indicate the presence of granites at depth. The RBG mafic-ultramafic sequence is strained to varying degrees, with the highest
strain occurring in the central area of the Buckreef Prospect tenements, where the belt is thinnest. In this area, the dominant
rock type is mafic schist. Toward the thicker (less attenuated) eastern and western parts, the schists form thinner more discrete
zones of high strain separating areas of relatively unstrained ultramafic lithologies. The granitoids are generally unstrained
and hence assumed to be post peak deformation. A large portion of the basalts to the southeast of Nyarugusu are hornfelsed, suggesting
the presence of granite at shallow depths beneath them.





46





The tectonic evolution of the RGB is very poorly
understood. Aeromagnetic data reveals several generations of crosscutting, late stage, brittle-ductile faults and shears, which
offset flow stratigraphy and have locally been intruded by the felsic porphyries and by a late stage dolerite dykes. Early formed
ductile structures are not easily defined in aeromagnetic data and there is evidence of shear zones that parallel the stratigraphy.
The Project host rocks comprise meta-basalt, which is generally un-deformed but metamorphosed to lower greenschist facies grades.
At Buckreef Prospect interflow units of predominantly pelitic and cherty sediments occur, as well as a variety of porphyritic
textured, dyke and vein like felsic intrusions along crosscutting structures or sub-parallel to flow stratigraphy.



The RGB has been subjected to a phase of laterite
development, with formation of predominantly iron rich ferricrete caps, which were subsequently extensively eroded and only isolated
remnants of laterite remain in situ. The high rainfall and sub-tropical climate has resulted in deep laterisation and although
there is evidence of localised gold enrichment in the shallow oxidation profiles in both BRMA or BZMA areas, major zones of supergene
gold enrichment are not developed in either area. The RGB in general is covered by a thin layer of elluvial regolith, which is
amenable to standard soil sampling techniques.



A non-penetrative deformation fabric is developed
at Buziba, which dips steeply to the south, sub-parallel to the stratigraphy. Individual zones in which this fabric is well developed
cannot be traced for distances of more than a few hundred metres on drill sections, but a number of such zones occur throughout
the 200m of thickness of stratigraphy, which hosts the mineralisation.



Exploration Status and
Project History



The Buckreef Gold Mine was an underground mine
operated by the Tanzanian State during the late 1980s to early 1990s. A brief description of the historical work conducted during
periods 1992-2011 (pre-Tanzananian Royalty) and 2011-2018 (Tanzanian Royalty era) is summarized in two sections below.



Pre-TRX era Project History



Apart from the state, several previous owners
of the project undertook numerous exploration programmes including aeromagnetic, helicopter borne IP, ground magnetic and soil
geochemistry surveys, as well as extensive RC, Air Circulation (“AC”) and diamond drilling programmes
as highlighted below.



1994:Signing of Buckreef Redevelopment Agreement ( of the
project undertook numerous exploration programmes including aeromagnetic, helicopter borne IP, and ground magnetic.



1996:Spinifex Gold of Australia acquires East Africa Mines
Ltd.



2003: Gallery Gold of Australia acquires Spinifex Gold



2006-2010: IAMGOLD Corporation (Canada) acquire Gallery Gold
(project incorporated Buckreef, Buziba, Mawe Meru & Busolwa).



Work done includes:



| | · | 65,000m
                                         of exploration and reconnaissance drilling
| | - | -------------------------------------------------------------------------------------------

| | · | 70,000m
                                         of resource definition, metallurgical and hydrogeological drilling,
| | - | --------------------------------------------------------------------------------------------------------------------

| | · | Estimated
                                         expenditure of US$12 million on all four projects.
| | - | -----------------------------------------------------------------------------------------------------

| | · | Total
                                         Buckreef Project mineral resources increased from 1.1 to 1.9 MoZ.
| | - | ----------------------------------------------------------------------------------------------------------------





47





2010: IAMGOLD Corporation surrendered project back to Stamico
after decision to relocate and concentrate on projects in Mali.



2010: October, TRX Corporation (Canada) signs MOU with Stamico
to acquire Buckreef Gold Project.



Iamgold, the most recent historic owner of
the project, verified the historic drilling data, undertook additional exploration and defined JORC compliant Mineral Resources
in 2006. Historic metallurgical testwork programs were undertaken on both the BRMA and BZMA mineralisation types. The testwork
on BMRA material indicated that oxide and transitional material are amenable to treatment using typical carbon-in-leach (“CIL”)
processing techniques and fresh material may benefit from flotation and a finer grind with recoveries anticipated to be in the
low 90%s. The testwork results for BZMA mineralisation indicated that it is amenable to treatment using gravity and CIL processing
techniques. Metallurgical recoveries for BZMA mineralisation were anticipated to be in the low to mid 90%s. Heap leaching testwork
indicated that, at a 25mm to 50mm crushing size fraction in oxide mineralisation, a 75% recovery could be anticipated, whilst
transitional and fresh mineralisation recoveries were lower, at 35% to 50%.



TRX era Project History
and Development



The Company acquired the rights to the Buckreef
Project early in 2011 and undertook further exploration wrk that mainly involved mineral resource confirmation drilling, mineral
resource drilling, rrent metallurgical and geotechnical diamond drilling programs as tabulated briefly below.



2011:

| | · | October,
                                         TRX Corporation (Canada) acquire Buckreef Gold (project incorporated Buckreef, Buziba)
                                         through definitive JV Agreement (55/45% equity) with Stamico.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | TRX
                                         engaged Hellman & Schofield (Pty) Limited of Australia to prepare an independent
                                         Canadian National Instrument 43-101 (NI 43-101) Preliminary Economic Assessment (PEA)-:
                                         pathfinder study
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



2012:

| | • | TRX engaged Venmyn Independent
                                         Projects (Pty) Limited of South Africa to prepare an independent Canadian National Instrument
                                         43-101 (NI 43-101) Preliminary Economic Assessment (PEA)-: pathfinder study evaluating
                                         all historical technical and economic parameters of the Buckreef Project (Buckreef, Buziba,
                                         Busolwa).
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | TRX successfully enalrges SML
                                         area from 4km2 to 16km2 to encompass Bingwa and Tembo prospects
| | - | --------------------------------------------------------------------------------------------------------------------------------------



2013:

| | • | TRX commences infill exploration
                                         & additional resource definition drilling on four main prospects as follows:
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | Buckreef
                                         Prospect: 684 drill-holes for 97,287m;
| | - | ----------------------------------------------------------------------------------------

| | · | Tembo
                                         Prospect: 74 drill-holes for 5,713m;
| | - | -----------------------------------------------------------------------------------

| | · | Bingwa
                                         Prospect: 136 drill-holes for 12,537m &
| | - | ---------------------------------------------------------------------------------------

| | · | Eastern
                                         porphyry: 80 drill-holes for 10,814m.
| | - | --------------------------------------------------------------------------------------

| | • | TRX engaged ENATA Resources to
                                         commence a National Environmental Management Council (NEMC) compliant Environmental Impact
                                         Assessment report. Final certification received in 0ctober 2014.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | TRX institutes bulk sample heap
                                         leach metallurgical testwork on ores from Bingwa and Tembo using SGS of South Africa.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------



48





2014:

| | • | TRX engages Venymn to produce
                                         an updated NI43-101 compliant Independent Technical and Valuation Report.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------

| | • | ITVR incorporated new technical
                                         parameters, exploration results, Mineral Resources to update preliminary mine design,
                                         preliminary process design, environmental fatal flaw review and economic analysis on
                                         the 2012 PEA report.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | TRX engages contractors to construct
                                         Carbon-in-Column process plant and 4 heap leach pads.
| | - | -----------------------------------------------------------------------------------------------------------------------------------

| | • | TRX completes 10,000m of Grade
                                         control drilling targeting oxide & transition ore on the pilot Buckreef South Prospect
                                         (delineated 5 major mineralized zones with a proved reserve of 206,551t @1.54g/t containing
                                         10,225ozs Au within the original mineralization envelope).
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | TRX commences pilot mining on Buckreef
                                         South (Oct. 2014).
| | - | --------------------------------------------------------------------------------------------------



2015/2016:

| | • | TRX continues pilot mining, commences
                                         CIC process plant and heap leach pad operation.
| | - | ------------------------------------------------------------------------------------------------------------------------------

| | • | TRX commences the CIC pilot heap
                                         leaching on 3 loaded pads in April 2016.Leaching operations run for 9 months and subsequently
                                         stopped due to unfavourable un-agglomerated ore conditions.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | Process plant failure leads to
                                         Process Plant re-design planning (Emisha Mining Solution engaged).
| | - | ------------------------------------------------------------------------------------------------------------------------------------------

| | • | Renewal application for SML04/92
                                         submitted (MEM).
| | - | ------------------------------------------------------------------------------------------



2017:

| | • | TRX receives offer letter for
                                         the renewal of the Buckreef SML and pays all statutory dues as requested. License extended
                                         for a further 10-years to 2027.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | TRX smelts 6.6kg of gold dore`
                                         from the Carbon-in-Column process plant.
| | - | ----------------------------------------------------------------------------------------------------------------

| | • | TRX submits 4-tonne bulk sample
                                         for further detailed metallurgical testwork with a laboratory in South Africa.TRX engages
                                         MaSS Resources Pvt Ltd of Tanzania to commence and complete an NI43-101 compliant Mining
                                         and Economic Feasibility study. The Report titled “Updated Independent Technical
                                         Mining Reserve Estimate and Economic Feasibility Study on the Buckreef Gold Mine Project,
                                         Tanzania, East Africa” is published on SEDAR with effective date 27th
                                         April 2017.)
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | Emisha Mining Solutions continues
                                         with detailed Carbon-in-Leach (CIL) process plant designs.
| | - | -------------------------------------------------------------------------------------------------------------------------------------

| | • | TRX hosts the new Minister of
                                         Mines, Hon. Angellah Kairuki at Buckreef Mine site.
| | - | --------------------------------------------------------------------------------------------------------------------------

| | • | Buckreef mega-pit site area marked,
                                         cleared and surveyed as part of mine development.
| | - | ------------------------------------------------------------------------------------------------------------------------------

| | • | Mining and pit pre-development
                                         work on the ground halted while awaiting issuance of renewed SML certificate
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------



2018:

| | • | Detalied planning for 10,000m
                                         of close-spaced grade control drilling on the Buckreef main pit finalized.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------

| | • | TRX engages Virimai Projects Pvt
                                         Ltd of Zimbabwe to commence and complete Ontario Securities Commission recommended amendments
                                         to the NI43-101 compliant Mining and Economic Feasibility study. Report entilteled “ITR
                                         Mineral Reserve Estimation and Pre-Feasibility Study for the Buckreef Gold Mine Project”
                                         published on SEDAR with effective date 26th June 2018. Reports supercedes
                                         all previous ITRs on the Buckreef project.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | TRX commences detailed planning
                                         for additional deep drilling (diamond core) and resource upgrade drilling (RC) on the
                                         main Buckreef prospect.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | TRX in constant engagement with
                                         the Ministry of Mines pertaining to the issuance of the renewed SML certificate.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | Mining and pit pre-development
                                         work on the ground still on halt while awaiting issuance of renewed SML certificate
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------



In total, the exploration programme included
approximately 30,000 soil samples, 202,000m of RC drilling, 124,000m of AC drilling and 28,000m of diamond core drilling. To
date, additional mineralisation has been intersected on Buckreef Prospect Main Zone in a wide zone between 150m and 250m vertical
depth with assay results of 4.5g/t Au over 26m and 10.58g/t Au over 19m. Additional near surface mineralisation at less than 200m
depth, from Buckreef North includes a mineralised zone 46m wide at 2.31g/t Au. Gold mineralisation has also been identified in
the Eastern Porphyry deposit 800m east of Buckreef Main Zone, over 500m of strike length with near surface mineralisation ranging
between 1.25g/tAu to 6.3g/tAu over widths of 2.25m to 10.5m.





49







In 2013-2014, heap leach metallurgical testwork
indicated positive results from column leach test for the oxide ore resources, at a 6mm crushing size fraction in oxide mineralization,
up to 71% recovery was achieved on agglomerated ores during the testing. Testwork on the sulphide and transition resource indicate
a recovery of 58% using a 12.5mm crush size and agglomeration using 4kg/t of lime and 3kg/t of cement. During the period 2015
to 2016, the Company conducted a test pilot Carbon-in-Column heap leach operation on un-agglomerated oxide and transition ores.



Current (2016-2017) metallurgical testwork
indicate positive results from Carbon-in-Leach (CIL) test for all three (3) resources types, oxide; transition and sulphide resources.
Test-results indicated that 36-40% of the gold in all three types of ore recoverable by simple gravity via a Knelson concentrator.
Results also indicated that remaining 64-60% of the gold was recoverable by up to 94% through the conventional CIL process plant.



Mineral Resource and Mineral Reserve Estimates: Virimai
Projects June 2018





On publication of MaSS’ report entitled
“Updated Independent Technical Mining Reserve Estimate and Economic Feasibility Study on the Buckreef Gold Mine Project,
Tanzania, East Africa”, the Ontario Securities Commission (OSC) conducted a routine review of the report’s contents
and raised some queries that necessitated a review of the original report compiled by MaSS. Virimai Projects was then commissioned
by Tanzam2000, to carry out an in-depth review of the original report by MaSS with the objective of amending and recompiling the
ITR in compliance with Canadian National Instrument 43-101 “Standards of Disclosure for Mineral Projects” (NI43-101).





Virimai Projects subsequently produced an amended
Mining and Economic Analysis Pre-feasibility study of the Buckreef Gold Mine Project titled “ITR Mineral Reserve Estimation
and Pre-feasibility Study on the Buckreef Gold Mine Project” that takes into account a number of refinements, optimizations
and alternatives that will form the basis for TRX to move to Definitive Feasibility Study and development of the Buckreef Gold
Project as an open pit mine, which can be brought rapidly into production to benefit from the current favourable gold market conditions.



The scope of work for this study included the
following:



| | · | Confirmation
                                         of the Mineral Resources as first published by Venymn
| | - | -----------------------------------------------------------------------------------------------------------

| | · | Estimation
                                         of Mineral Reserves
| | - | -----------------------------------------------------------------------

| | · | Mining
                                         Method Analysis and Selection
| | - | -----------------------------------------------------------------------------

| | · | Development
                                         and Production Scheduling with Specialized Mining Software
| | - | ---------------------------------------------------------------------------------------------------------------

| | · | Optimization
                                         of Production rate and Sequencing
| | - | ---------------------------------------------------------------------------------------

| | · | Estimation
                                         of Equipment and manpower requirements
| | - | ------------------------------------------------------------------------------------------

| | · | Mining
                                         logistics and infrastructure design
| | - | -----------------------------------------------------------------------------------

| | · | Project
                                         Execution Plan
| | - | ---------------------------------------------------------------

| | · | Capital
                                         and Operating cost estimation
| | - | ------------------------------------------------------------------------------

| | · | Benchmarking
                                         against current operations
| | - | --------------------------------------------------------------------------------

| | · | Financial
                                         analysis modeling and valuation
| | - | ----------------------------------------------------------------------------------

| | · | Identification
                                         of opportunities, risks and risk mitigation
| | - | ---------------------------------------------------------------------------------------------------





50







Virimai carried out a review of the four resource
models (Buckreef Main, Eastern Porphyry, Tembo and Bingwa) used in the published estimates and found that the grade estimates
were robust. For this reason, Virimai accepted and adopted the resource models for use in the current pre-feasibility study. However,
Virimai re-stated the Mineral Resources for two of the resource areas as follows:



| | · | Virimai
                                         declared about 10,000 t less Inferred Mineral resources as a result of surface correction
                                         &
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | 85,0000t
                                         spread across the categories were removed for the declared Mineral Resources at Bingwa
                                         as a result of being located away from the main mineralised zone either located under
                                         overburden exceeding 40 m or existing as discrete non-contiguous bodies.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The 85,000 tonnes remains in the Mineral Inventory
outside the open-pitable mineral resource from current Mineral Resource projections as summarized in the table below.



NI 43-101 Compliant Re-stated Mineral Resource Estimate for
BRMA as at June 26, 2018









Source: Virimai Projects 2018

Mineral Resources that are not Mineral Reserves
do not have demonstrated economic viability

Mineral Resources reported inclusive of Mineral
Reserves

Cut-off Grade 0.5g/t Au

Estimates over variable widths to 1m to 40m

Specific Gravity ranges 2.0 to 2.8

Inconsistencies in totals are due to rounding

55% attributable to the Company



Having taken into account a number of economic costing and engineering
refinements, optimizations and alternatives, Virimai Projects declared an open-pit optimized Mineral Reserve estimate of
19.08Mt grading at 1.54g/t (excluding the existing mined stockpile) and containing 943,851 troy ounce goldfor the Buckreef
Project as summarized in the table below.





51





NI 43-101 Compliant Pit Optimized Mineral Reserve Estimate for
BRMA as at June 26, 2018









Source: Virimai Projects 2018

Mineral Resources that are not Mineral Reserves
do not have demonstrated economic viability

Mineral Resources reported inclusive of Mineral
Reserves

Cut-off Grade: Oxide/Trans 0.38 g/t Au &
Fresh rock 0.41g/t Au

Estimates over variable widths to 1m to 40m

Specific Gravity ranges 2.0 to 2.8

Inconsistencies in totals are due to rounding

55% attributable to the Company



The major highlights from the Technical Mining
Feasibility report include the following:



| | · | Conventional
                                         open pit mining methods selected in pit designs.
| | - | ------------------------------------------------------------------------------------------------------

| | · | Over
                                         LoM, a total of 19.08Mt of ore with a strip ratio of 8.1:1 will be mined.
| | - | -----------------------------------------------------------------------------------------------------------------------

| | · | Pre-existing
                                         stockpile (ROMPAD) ore totaling 119,726t grading 1.89g/t to be used for process plant
                                         commissioning.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | 0.944Moz
                                         of gold mined over the open-pit life of the project.
| | - | ------------------------------------------------------------------------------------------------------

| | · | Recoveries
                                         of 89% for primary ore and 93%for saprolite ore, utilizing a simple EDS comminution,
                                         flotation and leaching process with gravity recovery circuit for free Au component collection.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | 0.822Moz
                                         of gold will be produced over the open-pit life of the project.
| | - | -----------------------------------------------------------------------------------------------------------------

| | · | Initial
                                         capital cost outlay estimated at US$76.5 Million and sustaining capital of US$22.95 Million,
                                         including closure costs.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | · | Cash
                                         operating costs of $735/oz produced.
| | - | ----------------------------------------------------------------------------------

| | · | Generation
                                         of a positive after-tax NPV of $130.96 million at a 5% discount rate and an IRR of 74%
| | - | ------------------------------------------------------------------------------------------------------------------------------------------



The Company has incurred total net costs (after
recoveries, if any) of $2,075,893 on the Buckreef Project for the year ended August 31, 2018.





52







Kigosi
Project



Property Description and Location



The Kigosi Project area is principally located
within the Kigosi Game Reserve controlled area. Through prospecting and mining option agreements, the Company has options to acquire
interests in several Kigosi prospecting licenses. A comprehensive report summarizing exploration work done and results to date
was submitted to the Director of Wildlife and Nature Conservation as part of the requisite and mandatory requirements for an application
to renew the Kigosi game reserve access permit. It is a statutory requirement to have an access permit to conduct any exploration
activities in an area designated as a forest and/or game reserve. On May 31st, 2012, the Company was granted a
two year permit from the Ministry of Wildlife and Nature Conservation to enter the Kigosi Game Reserve and continue with
exploration activities. The Company is evaluating various alternatives for advancing the Kigosi Project by focusing on an area
of near surface mineralization.



In December 2012, the Kigosi Access Agreement
between the Company (through its subsidiary Tanzam) and the Director of Wildlife, Wildlife Division, Ministry of Natural Resources
and Tourism was signed, and in February 23, 2013, the Company (through Tanzam), was awarded the Environmental Impact Assessment
Certificate for the Kigosi gold project. Stamico has a 15% carried interest in the Kigosi Project.



On May 30, 2013 the Company announced it had
been granted a Mineral Rights and Mining Licence through its wholly owned subsidiary, Tanzam. The Mineral Rights and Mining Licence
covers the entire area applied for of 9.91 square kilometres of the Kigosi Project. The area remains subject to a Game Reserve
Declaration Order. Upon repeal or amendment of that order by the Tanzanian government, the Company will be legally entitled to
exercise its rights under the Mineral Rights and Mining Licence.



Accessibility, Climate, Local Resources, Infrastructure and
Physiography



The property is accessed
via air from the city of Dar Es Salaam on the Indian Ocean coast to the city of Mwanza on the southern shoreline of Lake Victoria.
From Mwanza, a moderately maintained tar road accesses the town of Ushirombo, via the towns of Shinyanga and Kahama, around the
southern part of the Lake, referred to as Smith Sound. This trip is approximately 400 km and takes some 5 hours. From the town
of Ushirombo one keeps heading east along the main Burundi tar road for approximately 6 km, where a dirt track allows access into
the Kigosi Game Reserve.



The southern bulk of the
Kigosi Project area is wholly located within the northern sector of the Kigosi game reserve with a third of the licenses being
located in the adjacent Nikonga-Ushirombo Forestry reserves further north. As per legal and mandatory requirements, the Company
acquired respective renewable permits from the Departments of Game Reserves and Forestry Reserves of the Ministry of Wildlife
and Tourism to conduct exploration activities in both the game and forestry reservation areas throughout the year. Access to the
main Kigosi exploration camp via the dirt track has been substantially improved by the Company to allow access by four wheel drive
vehicles during the rainy season.



The exploration camp at
Kigosi is predominantly a tented facility with larger semi-permanent structures employed for offices and storage facilities. Recent
construction included the installation of metal containers which will be utilized as living and office quarters. Communications
at the camp are via satellite, internet and telephone.



The access track passes
over the Shiperenge River, a tributary to the Nikonga River and both are perennial rivers, typically dry in the winter months
and overflowing during the October-May rainy season. Three (3) large ponds located on the Nikonga River were the only close source
of water until recently when the company drilled a highly productive water borehole located some 5km northwest of the camp. Drinking
water for the camp is pumped via pipeline from the borehole to the camp. The Nikonga and Shiperenge rivers have played a major
part in structuring the physiographic landscape in the area. These rivers drain southwards into the Moyowosi and Njingwe Swamps.
Small undulating granite hills form the topographic highs, and generally trend northwest. These hills make up approximately 5%
of the project area. The climate is typical of an African tropical climate, being hot during the day and cooling down in the evenings.
Winters are very mild, but a blanket is needed in the early hours of the mornings. Kigosi falls within a malaria area, and precautions
are necessary. Tsetse flies are also present in some parts of the project area. The region is heavily forested, but has only limited
wildlife, chiefly small gazelle and baboons.



53







Geology and Mineralization



The Kigosi-Miyabi granite-greenstone belt and
the Ushirombo greenstone belt, form part of two of the greenstone belts within the Nyanzian Archaean greenstone terrain in northwestern
Tanzania. These belts host small-scale artisanal workings at Luhwaika and Igunda within the core project area at Kigosi and further
to the southeast. The Ushirombo Greenstone Belt has been extensively explored by geologists and small scale miners over the past
decade. It consists predominantly of mafic volcanics with lesser meta-sedimentary rocks across an east-west trending belt some
50 kilometres in strike. Gold mineralization generally occurs in narrow quartz veins. The Kigosi-Miyabi Greenstone Belt has been
less explored, mainly because of the location within the Kigosi Game Reserve.



Several prominent regional scale NW trending
structural lineaments, interpreted as regional shear zones, appear to be the major conduits and controls for the localization
of gold mineralization in the Kigosi area. There is also a prominent NNW trending set of regional scale lineaments that are believed
to be deep seated sources of the gold bearing fluids.



The Company previously discovered three previously
undocumented shear-zone hosted gold mineralized targets and it has also established the presence of a surface to sub-surface horizon
of unconsolidated residual in-situ auriferous vein quartz rubble on the Kigosi Property, forming a part of the Company’s
Lake Victoria Goldfield Properties held through its subsidiary, Tanzam.



The Kigosi Mineral Resource estimate September
2009 includes Mineral Resources from several prospects each with primary mineralisation in shears and secondary mineralisation
in alluvial gravels. No cut-off grade was applied to the shear hosted mineralisation and a cut-off of 0.1g/t Au was applied in
the case of the gravels just as nominal indicator of the presence of mineralisation. The Kigosi prospect is an early exploration
project and no specific costing exercises have been yet been conducted that could be used in an economic cut-off grade calculation.
Nonetheless, the effect of introducing and changing cut-off grades was provided in the document as an indicative exercise. The
parameters pertaining to prospects for economic extraction in the Victoria Goldfields are well known, and the grades and style
of mineralisation reported for the Kigosi prospect were considered relative to this benchmark.



Luhwaika Quartz Rubble Deposit



A brief summary of the work done on the Luhwaika
Quartz Rubble Deposit and the Msonga Prospect during the year are briefly summarized. Historical summaries for Luhwaika and Igunda
Prospects are also briefly described.



During a previous detailed vertical RC-drilling
program on the Luhwaika Prospect, the company established the presence of a consistent and sizeable near-surface quartz-rubble
bed with a potentially significant economic potential. The Luhwaika Prospect is host to a potentially economic quartz rubble deposit
which is likely a direct result of surface collapse and erosion of the Luhwaika Main and West reefs. Artisanal mining activity
has concentrated on this loose quartz rubble deposit which is easily accessible for mining. High grade quartz rubble has so far
been identified in three areas: the Luhwaika West reef, the Luhwaika Main reef and the Luhwaika East area. The Company completed
a detailed bulk sampling program on this potentially economic quartz rubble bed.





54







Bulk Sampling Program



The Company initiated a pit bulk sampling campaign
between September 2010 and February 2011. The nature of this exploration was the collection of composite channel sampling from
the pit side walls as a way of providing an indication of the in-situ grade. The bulk sample itself was fed through a mobile modular
gravity separation plant located at the main camp. The extent of the exploration was on a small scale and included 43 excavated
and channel sampled pit bulk samples. Only 18 of these pit bulk samples underwent the full excavation, channel sampling and pilot
plant testing within the four month period. The objective of the pit bulk sampling campaign was to provide confidence in the gold
grades for the already finalised resource model for the quartz rubble deposit and to ascertain the free gold recoverability using
a rudimentary pilot plant as a low cost exercise.



The Company utilised an in-house geologist
and field assistants to carry out the pit bulk sampling. Excavation was conducted with a small excavator and a single dump truck.
Excavation was monitored by the geologist to ensure uniformity of the excavation and to stop the hole once the mottled zone had
been reached. The mottled zone was also dug out as part of the bulk sample to a further depth of ~0.5m below the quartz rubble.



The location of the bulk sampling pits was
defined by the then Senior VP, Mr. R. Van Der Westhuizen, based on the earlier RAB drilling and various other requirements. The
pit co-ordinates were emailed to the field geologist who then located the pit using a hand-held GPS and staked the limits on an
east-west orientation. A 5.0m x 2.5m x 2.5m pit was measured out with tape and staked. The sizing of each pit was targeted to
yield approximately 80t of bulk sample. No specific grid size or spacing was used for the pit location.



Luhwaika Prospect



Gold mineralization at the Luhwaika Prospect
occurs in a series of sub-parallel and variably auriferous shear zones. The geological setting of the Luhwaika Gold Prospect shows
many characteristics that are typical of classic mesothermal lode gold deposits.



At Luhwaika, two principal shear zones have
been identified: the Luhwaika Main and Luhwaika West reefs. These reefs carry significant gold mineralization as evidenced by
strike extensive small-scale mining and exploration shafts, and more recent drill results. The gold mineralization in the Luhwaika
Main reef is structurally controlled, consisting mostly of lodes of laminated quartz veins impregnated in strongly sheared and
altered quartz sericite schist with occasional massive tabular whitish-grey quartz vein blow-outs. These veins are shear hosted,
with lesser extensional veins noted in outcrop in the granite host rock.



The Luhwaika West reef, located 100-200m in
the hanging-wall and sub-parallel to the Luhwaika Main reef, consists mainly of shear-zone hosted tabular quartz veins that often
contain irregular hematite filled fracture surfaces.





55





Igunda Prospect



The structural setting of the Igunda Gold Prospect
is similar to that of the Luhwaika Prospect with the exception that the former is hosted in mafic greenstone rocks intruded by
lenses of felsic granitoids including quartz-feldspar porphyry. At Igunda, two principal shear zones have been identified: the
Igunda A and B reefs. Closely associated with the reefs are sub parallel quartz feldspar porphyry units.



Gold mineralization is structurally controlled
and the Igunda Reefs are localized in two sub-vertical dipping northwest striking shear zones, dipping steeply (75o –
85o) to the northeast. Gold mineralization also occurs in the host wall rock up to over a meter and is not confined to the
veins.



Msonga Prospect



Drilling



The Msonga Prospect is situated in the far
northeast of the Kigosi license area. The earlier geochemical and structural studies covering this area had identified the presence
of a substantial (7 km long) Au-in-soil anomaly hosted in mafic greenstone rocks. Dominant regional structures in the area (Ushirombo
greenstone belt) generally trend east-west and are associated with the development of swarms of auriferous quartz veins such as
those being currently mined by small-scale miners in the Katente area at Ushirombo. The Msonga Prospect is located ~3-5km along
strike from these artisanal workings, and as such it was considered conceivable that the Msonga Prospect represented a similar
setting to the Igunda Prospect (i.e., a greenstone and shear zone hosted gold deposit).



During the period mid-2009 to early-2011, the
Company conducted a single phase of widely spaced RAB drilling covering the 7km-long Au-in-soil anomaly outline. From early 2010
to June 2011, the Company conducted two phases of RC drilling. The first phase of RC drilling comprised short vertical RC drill-holes
mainly investigating the area’s potential for gold mineralization in a distinctive auriferous surficial lateritic quartz
rubble deposit. The second phase of RC drilling comprised inclined RC drill-holes to mainly investigate the east-west strike extension
of the auriferous quartz veins associated with the nearby Katente Prospect. A total of 148 inclined RC holes were drilled on the
Msonga Prospect.



Subsequent modelling and krigging was conducted
on the deposit. However, no mineral resources could be declared for Msonga Prospect due to the very low average grade, the paucity
of sampling and a lack of geological control for mineralisation. The current targets at Msonga prospect are therefore, classified
as minor gold occurrences only.



Kigosi Exploration History



The exploration history of the Kigosi Property
from 2006 to 2018 is summarized as follows:



Kigosi Exploration History Synopsis



|Year            | Operator                         | Work
    Performed                                                                                                                                   
|--------------- | -------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------
|1990            | Barth                            | Production
    of the regional geological map of granite-greenstone belt south of Lake Victoria                                                      
|Early
    1990s | Pangea
    Goldfields Inc/ Iscor | Rotary
    Air Blast (RAB) drilling in Msonga prospect area (Kigosi North). No records available                                                     
|Early
    1990s | Artisinal
    Miners             | First
    evidence of artisanal working in the Kigosi area. No records available for gold extracted by the artisanals.                               
|1994            | Tan
    Range                    | Acquires
    gold properties for exploration in Tanzania.                                                                                            
|1998            | AngloGold                        | Acquired
    rights to nine licenses associated with the Kigosi area.                                                                                
|1999            | Geodass                          | Conducted
    regional geophysical survey (airborne magnetics, radiometric and VLF-EM) over Ushirombo greenstone belt, including the Kigosi
    area.





56







|Year | Operator | Work
    Performed
|---- | -------- | ------------------

|1999           | Tan
    Range                                                           | Helicopter
    visit to Luhwaika and Igunda artisanal workings. Signed option agreement with Anglo for the Kigosi North Property.                                                                                                                 
|-------------- | ----------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|2003           | Geoscientific and Explora
        
        Services Ltd (Geoscientific) | Conducted
    a regional LandSat interpretation on the Kigosi Project area.                                                                                                                                                                       
|2003           | J
    Klein (Independent Consultant                                     | Reviewed
    and interpreted 1999 geophysical survey data                                                                                                                                                                                         
|2003           | AngloGold
    Ashanti                                                   | Detailed
    regional airborne geophysical survey and soil sampling survey                                                                                                                                                                        
|2004           | AngloGold
    Ashanti & Tan Range                                       | Follow
    up of anomalies with soil and termite mound sampling. Identification of Msonga, Bungoni, Luhwaika and Igunda Prospect area.
    Geological and regolith mapping conducted. Limited sampling from pits, streams and trenches.           
|2005-2006      | AngloGold
    Ashanti & Tan Range                                       | Temporary
    suspension of exploration activities due to permitting issues for access into Kigosi Game reserve area. JV arrangement maintained.                                                                                                  
|2007           | Tan
    Range/ Tanzania Royalty                                         | JV
    agreement with AngloGold Ashanti terminated & Tan Range changes name to Tanzanian Royalty Exploration Corp. Commenced
    with exploration at Kigosi in September. Exploration included biogeochemistry and induced polarisation surveys.  
|2008-
    2009 | Tanzanian
    Royalty                                                   | Continues
    with exploration and starts RAB, RC and DC drilling at Kigosi on the Luhwaika and Igunda Prospects. Completed drilling at
    Luhwaika and Igunda Prospects. 3D modelling completed and resources declared for both.                
|2010-2011      | Tanzanian
    Royalty                                                   | Commenced
    RAB and RC drilling at Msonga   and Commenced and subsequently ceased bulk sampling of Luhwaika quartz rubble
    deposit (four months later). Completed drilling at Msonga. 3D modelling completed. No resource declared on Msonga.
|2013           | Tanzanian
    Royalty                                                   | Applied
    for and granted Mining License (ML496/2013) covering Luhwaika and Igunda Prospects                                                                                                                                                    
|2014-2016      | Tanzanian
    Royalty                                                   | Kigosi
    game reserve access permitting issues forced a stop to all activities on the project.                                                                                                                                                  
|2017-2018      | Tanzanian
    Royalty                                                   | Evacuation
    of Luhwaika base camp while access negotiations are pursued.                                                                                                                                                                       



The Company has incurred total net costs (after
recoveries, if any) of $87,507 on the Kigosi Project for the year ended August 31, 2018. The Kigosi
Project is currently in the care and maintenance stage.





57





Lunguya Project Area



Property Description and Location



The Lunguya Property is
located in the Kahama District of Tanzania. The Lunguya Property is situated in the Lake Victoria Greenstone Belts, approximately
100 kms by air to the southwest of Mwanza and about 15 kms south of Bulyanhulu. With respect to Lunguya PL 1766/01 in January,
2003, a Shareholder’s Agreement was entered into wherein a new company, Lunguya Mining Company Limited (“LMC”),
was created to form a joint venture between Northern Mining and Consultancy Company Limited (“NMCCL”), Tanzam
and LMC. Tanzam has a 60% shareholding and NMCCL has the remaining 40% shareholding in LMC.



In February 2010, the
Company entered into an Option and Royalty Agreement with Joseph Magunila and Partners (“JMP”) over an area
in the Kahama District of the Shinyanga Region in Tanzania 100% owned by JMP. The agreement grants the Company an option to acquire
up to 90% of JMP’s interest and/or, at the sole discretion of the Company, to enter into a mining and exploration services
agreement. The Company paid US$90,000 for this option.



In late 2015, the Option
and Royalty Agreement between Joseph Magunila and the company became null and void as the Company relinquished its interest in
the Primary Mining Licenses.



Accessibility, Climate, Local Resources, Infrastructure and
Physiography



The Lunguya Property can be reached by plane
from Mwanza to an airstrip accommodating Bulyanhulu or by road via Geita up to the Bulyanhulu/Kahama road intersection. From Kahama,
the property is located approximately 8 kms to the south, toward Lunguya village. Secondary roads and trails traverse the property.
The Nyamakwenge Reef, located in the northeastern part of the property, can be accessed using a 12 kms dirt tract passing to the
north of the property. Climate and elevation are similar to the Luhala Property.



Very little outcrop (less than 1%) has been
identified at Lunguya. The entire property is flat and covered largely by granitic sands and grey orange laterities derived from
granitic sources. Like Luhala, Lunguya is actively cultivated, but also is being actively mined by a few score artisanal miners
along the trend of the Nyamakwenge Reefs. No significant infrastructure, power or water is available on site. However, the entire
infrastructure of the region including electricity, air transport, health clinics, schools, and improved road networks, have been
greatly improved due to the proximity to Barrick’s Bulyanhulu mine, some 20 kms to the north.



History



Lunguya Exploration History Synopsis



|Year      | Operator          | Work
    Performed                                                                                                                                                                   
|--------- | ----------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|1999-2001 | Tan Range         | Acquire prospecting licenses.
    Review of regional aeromagnetic data as part of regional prosctive target identification                                                           
|2002      | Tan Range         | Regional scale soil surveys.
    4 regional anomalies identified                                                                                                                     
|2003-2004 | Tan Range         | Follow up detailed soil surveys,
    ground IP surveys, Biogeochemistry (BGC) surveys identified Luhawika North (Bulynhulu replica?) Shilela, Nyikoboko & Nyaamakwenge
    prospects.
|2005-2006 | Tan Range         | Phase 1 auger drilling, RAB/RC/Core
    drilling on selected targets on 3 of the 4 prospects.                                                                                        
|2007-2008 | Tanzanian Royalty | Conducted detailed ground magnetics
    and IP surveys on Shilela, Nyamakwenge & Nyikoboko prospects                                                                                 





58







|Year | Operator | Work
    Performed
|---- | -------- | ------------------

|2009      | Tanzanian Royalty | Signed Option &
    Royalty Agreement on Primary Mining Licenses covering the Nyamakwenge prospect                                                                                                     
|--------- | ----------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|2010-2012 | Tanzanian Royalty | Detailed RC and diamond core
    drilling on Nyamakwenge prospect (Reef and gravel resource definition-internal report). Lost main license over Luhwaika North
    (Buly-type?) prospect inadvertently.
|2013-2015 | Tanzanian Royalty | No field work conducted. JV
    agreement on Nyamakwenge terminated in late 2015.                                                                                                                      
|2016-2018 | Tanzanian Royalty | No field work done. Review
    of project conducted internally.                                                                                                                                        



Geology



The very limited outcrop exposures on the Lunguya
concession necessitate development of a geological and interpretive environment largely based on geophysical interpretations.



Regionally, Lunguya is located near the eastern
terminus of the inner volcanic arc, lower Nyanzian, of the Sukumaland Greenstone belt. The succession is dominated by tholeiitic
volcanic rocks containing lesser felsic tuffaceous rocks and argillaceous horizons cut by thin quartz porphyry dykes and sills.
The thick, banded iron formation and felsic flows characteristic of the outer arc Upper Nyanzian sequence are absent. Most of
the map scale granite – greenstone contacts strike north-south. No information is available with respect to the orientation
of sub-surface contacts.



At Lunguya, all currently known, auriferous
structural zones track at an oblique angle, the eastern granodiorite-mafic volcanic contact. Auriferous veins strike at 020°to 030° with the dominant intrusive volcanic contact trending at approximately
360°. On the property scale, two 330°
trending fault structures are interpreted to offset the Lunguya vein into two fault repeated vein segments, having strike lengths
of approximately 180 and 300 m. A few score artisanal miners have exploited these veins to a depth not exceeding 30 verticalm
subsurface. A second set of auriferous reefs, the Nyikoboko Reefs, are located 12 kilometres to the south. This area is associated
with a smaller set of largely inactive artisanal dumps and workings.



Based on the aeromagnetic data a model has
been proposed whereby a large NS trending shear zone is believed to exist below a thick black cotton soil (mbuga) cover. The thin
veins associated with the Nyikoboko and Nyamakwengwe reefs probably represent secondary structures from the main shear. This idea
has been tested using biogeochemistry.





59





Mineralization



Lunguya is a mineralized brittle ductile strain
zone, developing internal to a major granite-greenstone contact. Gold is associated with one fault offset vein which is likely
broken into two segments, the Western and Eastern reefs. Lesser veins are also present. Initial sampling of artisanal vein waste
dumps indicated the presence of well mineralized dump samples. The site contained greater than 200 of these small pits-shafts
ranging from 1 to 20m deep.



Diamond drill and RC programs at Lunguya have
demonstrated geological continuity of the Nyamakwenge West and East Reefs but weaker continuity of grade. The difficulty in obtaining
representative gold grades from small core samples of vein material containing coarse particulate gold is a well documented phenomenon.
Widths in these boreholes are approximately true widths and the boreholes have been collared roughly perpendicular to the strike
and dip of the mineralized structural zones.



Exploration



In November 2010, the Company announced positive
results from laboratory test work on surface quartz rubble collected from its Lunguya Primary Mining Licenses (PMLs) in northern
Tanzania. The laboratory test work was intended to establish the mineralogical (physical) characteristics of gold contained within
an extensive auriferous (gold bearing) quartz rubble bed identified at Lunguya, along with suitable gravity-based recovery methods
to extract gold from the quartz rubble which is essentially broken and fractured surface rock.



Chemical analysis of sample material returned
values of 3.58g/t, 5.75g/t, 2.33g/t and 3.31g/t, giving an average "head grade" for gold of 3.74g/t. (The "head
grade" refers to the average grade of the material submitted for processing and analysis).



Bulk samples were collected from random
pits within the Lunguya PML in February 2010.  RC drilling began at Lunguya in June 2011. The program was intended to confirm
evidence of reef mineralization identified during the 2002 RC and diamond drilling program in the area.  A total of 14 drill
holes consisting of 1,247m were completed during the month. A number of narrow, parallel, moderate dipping shear structures hosted
in granite were intersected.  The shears are possibly related to those hosting gold mineralization in the area.



The RC drilling program continued at Lunguya
in August 2011, demonstrating the continuity of Nyamakwenge reefs to the southwest of the prospect. Two sets of quartz vein in
sheared granite were identified during the drilling program in 2002, with their thickness ranging from 1 – 8m thick. During
2011 RC program another two sets of quartz reefs were identified, with their thickness ranging from 2 to 20m. These two new sets
of quartz reef have similar characteristics with the first sets of quartz veins identified.



During the period ended August 31, 2018,
no direct property work was conducted on the Lunguya property. The Lunguya Property is currently in the care and maintenance stage.



The Lunguya Property is without known mineral
reserves and any exploration program is an exploratory search for ore.





60





Itetemia Property



Property Description and Location



The Itetemia Property is
located in the Mwanza Region of the Lake Victoria Greenstone Region, Tanzania, approximately 90 kilometres by air southwest of
the city of Mwanza, situated on the south shore of Lake Victoria.



Accessibility, Climate, Local Resources, Infrastructure and
Physiography



The property is accessed via local roads from
Geita or by plane from Mwanza to an airstrip accommodating the neighbouring Bulyanhulu Mine, owned by Barrick. The Barrick airstrip
is 3.75 km west of the western boundary of the Itetemia prospecting license, and approximately 4 km northeast of the Nyamykonze
village. Local resources are available at Mwanza, located on the southern shore of Lake Victoria.



The topography in the region and on the property
consists of large flat-lying areas surrounded by numerous small hills. The hills have elevations of up to 100 m above local terrain.
The hills are thickly vegetated and access is only possible along cut lines. Little outcrop exists on the property. The climate
is similar to the rest of the region. The rainy season starts in November and lasts to the middle of April, but precipitation
is irregular from one season to another. The dry seasons are usually hot. Mwanza, located along the southern shore of Lake Victoria,
can, and has, provided limited supplies for mining and exploration operations in the area. Dwellers in the area of the Itetemia
Project, such as the neighbouring Nyamykonze village, are traditionally subsistence farmers and ranchers, and have limited mining
experience from the Bulyanhulu operation and numerous small scale activities. Water for the purpose of mining and processing is
not readily available in the region; however, a pipeline from Lake Victoria built by Barrick for its Bulyanhulu Mine, provides
an adequate supply.



The large, relatively flat terrain surrounding
the known gold mineralization may be suitable for potential tailings and waste rock storage and for heap leach pads and a potential
processing plant. Electric power is available via the national grid within 5 km; due to the unreliability of such power, alternative
forms of residual or back-up power would be necessary for mining or processing operations, such as diesel power generation used
by Barrick at its Bulyanhulu mine.



Ownership



Prior Ownership



With respect to one Itetemia prospecting license,
the interest of the Company was acquired from Stamico pursuant to a joint venture agreement dated July 12, 1994 (the “Stamico
Venture Agreement”). The Stamico Venture Agreement obligated the Company to make two initial payments of TSh$1,000,000
and US$7,200 to Stamico, both of which were satisfied.



The Company’s Interest



Through prospecting and
mining option agreements, the Company has options to acquire interests in several Itetemia Property prospecting licenses. The
prospecting licenses comprising the Itetemia Property are indirectly held by the Company through the Company’s subsidiaries,
Tancan or Tanzam. In the case of one prospecting license, Tancan acquired its interest pursuant to the Stamico Venture Agreement,
as amended June 18, 2001 and July 2005, which provides, among other things, that:



61







| | 1. | Tancan had to pay Stamico, on execution
                                         of the Stamico Venture Agreement, the sum of US$7,200 (as an advance against the 2% gross
                                         revenue royalty) and TSh1,000,000.
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 2. | Tancan and Stamico were to form
                                         a joint venture company for the purpose of holding the prospecting license that shall
                                         be held 10% by Stamico (with no obligation to contribute) and 90% by Tancan, which was
                                         effected through the formation of Itetemia Mining Co.
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 3. | Stamico is entitled to acquire
                                         an additional 20% interest in the joint venture company by paying a sum equal to 20%
                                         of the cost of placing the property into commercial production based on the feasibility
                                         study, if and when submitted to the Government of Tanzania for such purpose.
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 4. | Tancan shall assist Stamico in
                                         raising the required capital to exercise the right referred to in (3) above.
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------





| | 5. | Tancan was to expend the sum
                                         of US$25,000 in the first year and US$50,000 annually thereafter in relation to the training
                                         of Tanzanian personnel.
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 6. | Upon commencement of commercial
                                         production, Stamico shall receive a 2% gross revenue royalty, which shall be increased
                                         to a 2.5% gross revenue royalty should a mine on the Itetemia prospecting license produce
                                         recoverable gold in excess of 12 grams per tonne.
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 7. | Tancan shall pay to Stamico,
                                         as an advance against the 2% gross revenue royalty, the sum of US$7,200 on or before
                                         every anniversary of the Stamico Venture Agreement up until the development phase, upon
                                         and after which the annual sum of US$10,000 shall be paid as an advance against such
                                         royalty.
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 8. | Tancan shall show preference
                                         to Stamico for the provision of local materials and services during the period of mining
                                         operations.
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 9. | As amended July 2005, Tancan had to
                                         pay to Stamico the sum of US$15,000 on or before July 12 of 2006 and 2007, and ending
                                         upon commercial production, provided that commercial production commences by December
                                         31, 2007, failing which the aforementioned payment shall be revisited. As expected, commercial
                                         production did not commence by December 31, 2007. In 2008, the annual option fee was
                                         renegotiated to US$25,000 per annum until commercial production.
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 10. | Tancan may assign its rights under
                                         the agreement, subject to the prior written consent of Stamico.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------



The Itetemia prospecting licences are adjacent
to Barrick’s Bulyanhulu gold mine.



History



The exploration history of the Itetemia Property from 2006 to 2018
is summarized as follows:



Itetemia Exploration History Synopsis



|Year | Operator | Work
    Performed                                                             
|---- | -------- | -------------------------------------------------------------------------------
|2006 | Tancan   | In-house evaluation. 4-hole
    diamond drill program                          
|2007 | Sloane   | Planned 2000 m RC drill program
    and 3000 m infill diamond drilling program.





62







|Year            | Operator | Work
    Performed                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|--------------- | -------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|2008            | Sloane   | First phase drill program consisted
    of 10 Reverse Circulation (RC) aggregating 1,489m.  Eight diamond drill holes were drilled totalling 2,286.5m.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|2009            | Sloane   | Data analysis                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|2010            | Sloane   | Data analysis                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|2013            | Company  | In-house evaluation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|2014            | Company  | Digital Terrain Model (DTM)
    survey pickups using GPS to create topographical survey over the resource area for resource modelling, completion of study,
    which was contracted to MaSS Resources Company Ltd., submission of the Final Itetemia Gold Project (IGP) Study by MaSS Resources
    company, Environmental Impact Assessment (EIA) study on the Itetemia Gold Project (IGP), which was contracted to Efficient
    Consultants environmental experts. The EIA study is ongoing and completed activities include - Visit to site, conducting consultative
    meetings with stake holders, consultation with OSHA officials & Lake zone mines officer, project registration with NEMC,
    submission of brief project report to NEMC for project screening, preparation of Scoping Project Report and Terms of Reference
    (ToR) for management approval before submission and the submission of the Scoping Report to NEMC for approval.
|2015            | Company  | EIA study report approved and
    ESIA certificate issued. Application to convert PL into Mining License procedures have commenced                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|2016
    - 2018 | Company  | Itetemia Mining License Application
    no/01722 submitted on 4th November 2015 still under review by the Ministry of Enenrgy and Minerals. No fieldwork
    conducted pending resolution on application.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   



Geology



The Lake Victoria area contains 12 Archean
Nyanzian greenstone belts which are surrounded by and have been interrupted by numerous granitic intrusions. The Nyanzian belts
comprise a volcano-sedimentary sequence composed of mafic to felsic volcanics (lavas and tuffs), BIF and shales. The greenstone
belts have been grouped into locally distinct geographic regions. One of these regions is the Southwest Mwanza Region which includes
a large area south of the town of Mwanza, located on the south shore of Lake Victoria. There are five greenstone belts in the
Southwest Mwanza Region, one of which is the Ushirombo belt. The Ushirombo belt is an east-west trending belt, the eastern end
of which is located approximately 25 km west of the southern end of Smith Sound on Lake Victoria. The eastern end of the belt
is arcuate in shape and trends northerly tangential to the northwestern flank of the Siga Hills.





63





The Itetemia Property is underlain by the northerly
trending eastern portion of the Ushirombo Nyanzian greenstone belt. Granite underlies the eastern and northern portions of the
property. The greenstone/granite contact trends northerly through the east-central portion of the Itetemia prospecting license
and through the central portion of the Itetemia East prospecting license onto the Itetemia Village license; at which point, the
contract tends westerly through the Mwingilo license cutting the northeast corner of the Ngula license. Sixty percent of the Itetemia,
Itetemia North and Ngula licenses are underlain by the Nyanzian greenstone belt. The remaining 40% is underlain by granite. Granite
variably underlies 90 to 100% of the Itetemia East, Itetemia Village and Mwingilo prospecting licenses. The Mbuga soil covers
10 to 40% of the property.



Mineralization



The sulphide mineralization encountered on
the Itetemia Property comprises massive to semi-massive, stringers, veins and veinlets, disseminated and nodular mineralization.
The types of mineralization are (i) sulphides associated with volcanism activity; (ii) remobilized sulphides associated with deformation
(shear hosted); and (iii) sulphides associated with sedimentation. The gold and metallic contents associated with this mineralization
are variable and the relation between the grades and the mineralized type is not well known at this stage.



The massive to semi-massive sulphide mineralization
seems to be related to volcanism. It occurs in two areas on the Property. One area is located in the northern part of the licenses
and has been intersected by the hole ITDD-06. More than 30 m. of sulphides were intersected at the contact between a QFP and an
argillite horizon separating two pillowed basalts. The sulphide content ranges from 10 to 90% pyrrhotite, 2 to 5% pyrite, trace
to 5% sphalerite, trace to 1% copper.



The Golden Horseshoe Reef mineralization occurs
as massive sulphide veins locally ranging from 15-30 cm wide. Sulphides dominantly appear in veins/veinlets less than 5 cm wide
in felsic volcanic rocks. Five to thirty percent pyrite-pyrrhotite is common over sections of 1 to 15 m along the holes. They
are sub-concordant and parallel to the schistosity. The strong shearing at the Golden Horseshoe Reef probably represents a remobilization
of the sulphides.



Exploration



The majority of the exploration work in 2007
consisted of RC and diamond drilling, along with limited ground geophysics. Exploration crews were mobilized to the Itetemia Project
in August 2007 and drilling commenced in mid-September. The first phase drill program completed 10 RC holes aggregating 1,489m
and eight diamond drill holes totaling 2,286.5m. The drill program targeted the shallowest part of the previously established
Golden Horseshoe Reef with a view to developing an open pit resource with a notional floor level of 200m below surface. In support
of preparation of a resource estimate, drill holes were sited to provide data at grid points at or below 50 x 50m spacing. A number
of deeper holes were also sited to test the extent of the mineralized body at depth and along strike.



The Company is reviewing various alternatives
for advancing its Itetemia project. Previous studies have indicated that the Golden Horseshoe Reef (GHR) represents a small, yet
robust, medium-grade, near surface gold deposit that warrants further feasibility investigations.



During the period ended August 31, 2018, no
direct property work was conducted on the Itetemia property.





64





The Company has incurred total net costs (after
any recoveries and write offs) of $17,738 and written off $nil of expenditure on the Itetemia Property
for the year ended August 31, 2018. The Itetemia property is currently in the care and maintenance stage.



Luhala Property



Property Description and Location



The Luhala property is
located in Misungwi District of Mwanza Region of Tanzania. It lies approximately 70 kilometres south of the city of Mwanza. The
Luhala prospecting licenses are in good standing with respect to required filings and payments with the Government of Tanzania.



The target on the Luhala property is gold stockwork mineralization
associated with felsic rock units in dilatational structures.



Accessibility, Climate, Local Resources, Infrastructure and
Physiography



Access to the Luhala Property is via the main
Mwanza – Shinyanga road, which is a single lane, good to excellent quality, asphalt highway. To access the property, one
drives approximately 45km to the south of Mwanza, where a dirt road from a junction at the settlement of Manawa, leads southwest
to the town of Misasi. The property has year round access, although seasonal winter rains, December to March, may result in flooding
in low lying areas which are dominated by mbuga (black organic rich laustrine flood soils). Most lowland areas are under active
cultivation, corn, rice, beans and mixed crops, by subsistence farmers. Low scrub and thorn bushes cover the small hills. The
area has been, for many years, deforested by local agricultural practices.



At Luhala, the mean elevation is approximately
1,200 m above sea level, with a series of small sub-rounded hills, rising up to one hundred meters above the surrounding plain.
These hills are typically formed by either resistive iron formations or felsic volcanic rocks. Mafic volcanic rocks weather recessively
and are typically only exposed in trenches through well formed laterite profiles. Laterite development is extensive with brick-red
laterites overlying weak mottled zones and saprolites at a depth of approximately 3-5m. Deep weathering penetrates 45 - 60m vertically
within the subsurface.



An enthusiastic and competent labor force is
available through the surrounding villages, and local people have been routinely hired during the trenching, drilling and soil
sampling programs conducted on this property. However, no other significant infrastructure is available.



History



Luhala has had a significantly more protracted
exploration history than Lunguya, beginning with the initial exploration by the then Tanganyikan Geological Survey in 1947. The
exploration history of Luhala since 2006 to 2018 is summarized as:



LUHALA EXPLORATION HISTORY SYNOPSIS



|Year      | Operator | Work
    Performed                                        
|--------- | -------- | ----------------------------------------------------------
|2006      | Tancan   | Diamond drilling, RC drilling                             
|2007      | Sloane   | Follow-up exploration planning                            
|2008      | Sloane   | Data analysis                                             
|2009      | Sloane   | Data analysis                                             
|2010      | Sloane   | Data analysis                                             
|2013      | Company  | In-house evaluation                                       
|2014      | Company  | Continued in-house evaluation                             
|2015      | Company  | Continued in-house evaluation/property
    maintenance    
|2016-2018 | Company  | No fieldwork conducted. Property
    maintenance observed.





65







Geology



Luhala is found within the eastern portion
of the Buhungukira Belt, a local place name assigned to one of the eight greenstone belts in the Lake Victoria District. These
rocks are believed to be the eastern continuation of the Geita Greenstone Belt and consist of dominantly Upper Nyanzian rock sequences.



In the Luhala area, the predominant structural
grain is dominated by an early deformational event which has deformed all supracrustal rocks into tight, south to southwest plunging,
west overturned, synforms and antiforms. The short limbs of these folds may have east-west strikes and modest, 40 degree south
dips. The long limbs of these folds have north to northeast strikes and generally much steeper, 60 – 80 degree, and east
dips.



At Luhala, three principal mineralized zones
have been identified. These include Kisunge Hill, Shilalo South, and Shilalo West. All of the three principal mineralized areas
are linked by a common southwest plunging antiform, the limbs of which are separated by 500 to 800m and converge just south of
Line 6200 E and 3800 N. Mineralization to Kisunge Hill is associated with a chert – felsic volcanic contact. As
Shilalo South, structurally controlled gold mineralization closely tracks the position of a massive to locally well-bedded chert
or cherty iron formation. The results of diamond drilling in Shilalo West strongly outline the importance of the felsic volcanic - chert
– structural sites and gold association. For example, borehole LSD – 08A is collared in the hangingwall to the Shilalo
West mineralized zone, traverses the host rhyolite-chert lithology, and terminates in the footwall. This borehole intersected
significant gold mineralization of 3.55 g/t Au over 5 m near the hangingwall contact of the felsic volcanic rocks, and is mineralized
repeatedly at over one gram ranges throughout much of the felsic host interval, which in this borehole is over 35m thick.



The felsic volcanic rock package at Shilalo
West once again presents an excellent structural site for the development of dilatant sites and gold mineralization. As of Shilalo
South, a well defined planar, brittle-ductile structural zone was not identified at Shilalo West. Gold distribution is likely
related to the presence of extensional and shears extensional veinlets, which are developed within the felsic volcanic rocks at
or near, the felsic volcanic “red tuff” contact.





66





Exploration



During the period ended
August 31, 2018, no site-based exploration work was conducted on the Luhala Property.



At Luhala, three principal mineralized zones
have been identified: Kisunge Hill, Shilalo South, and Shilalo West. Gold mineralization is associated with zones of diffuse silicification,
localized around small scale fractures within competent chert and felsic volcanic rock units.



Mineralization



At Luhala, gold mineralization
is associated with zones of diffuse silicification, localized around small cm and mm scale fractures within competent chert and
felsic volcanic rock units. Major discordant vein structures are not identified and planar high strain zones are absent.



No specific gravity data
have been calculated for any of the rocks cored in these intervals and without strong cross sectional control, no reliable resource
estimates for any of the principal mineralized zones at Kisunge, Shilalo South and Shilalo West may be calculated.



Historical Drilling



The Phase 7 drill program at Luhala was completed
in August 2006 and consisted of nine diamond drill holes aggregating 991m. All the holes tested the eastern limb of the Kisunge
Main Zone. Among the better intercepts reported from this program was 3.07m @ 6.87 g/t. Within this intercept was a 1.44m interval
averaging 10.95 g/t. Invaluable structural information was obtained from the Phase 7 diamond drilling program which will be utilized
in the planning process for follow-up exploration.



The Company has incurred total net costs of
$5,988 and written off $nil of expenditures on the Luhala Property for the year ended August 31,
2018. The Luhala Property is currently in the care and maintenance stage.



The Luhala Property is without known mineral
reserves and any exploration program is an exploratory search for ore.



| | Item 4A. | Unresolved
                                         Staff Comments
| | -------- | ------------------------------------------------------------------





None



| | Item 5. | Operating
                                         and Financial Review and Prospects
| | ------- | -------------------------------------------------------------------------------------



This discussion and analysis
of the operating results and the financial position of the Company for the years ended August 31, 2018 and 2017, and should be
read in conjunction with the consolidated financial statements and the related notes attached hereto.



Critical Accounting Policies



Mineral Properties



All direct costs related to the acquisition
and exploration and development of specific properties are capitalized as incurred. If a property is brought into production,
these costs will be amortized against the income generated from the property. If a property is abandoned, sold or impaired, an
appropriate charge will be made to the statement of comprehensive loss at the date of such impairment. Discretionary option payments
arising on the acquisition of mining properties are only recognized when paid. Amounts received from other parties to earn an
interest in the Company's mining properties are applied as a reduction of the mining property and deferred exploration and development
costs until all capitalized costs are recovered at which time additional reimbursements are recorded in the statement of comprehensive
loss, except for administrative reimbursements which are credited to operations.





67





Consequential revenue from the sale of metals,
extracted during the Company's test mining activities, is recognized on the date the mineral concentrate level is agreed upon
by the Company and customer, as this coincides with the transfer of title, the risk of ownership, the determination of the amount
due under the terms of settlement contracts the Company has with its customer, and collection is reasonably assured. Revenues
from properties earned prior to the commercial production stage are deducted from capitalized costs.



The amounts shown for mining claims and related
deferred costs represent costs incurred to date, less amounts expensed or written off, reimbursements and revenue, and do not
necessarily reflect present or future values of the particular properties. The recoverability of these costs is dependent upon
discovery of economically recoverable reserves and future production or proceeds from the disposition thereof.



The Company reviews the carrying value of a
mineral exploration property when events or changes in circumstances indicate that the carrying value may not be recoverable.
If the carrying value of the property exceeds its fair value, the property will be written down to fair value with the provision
charged against operations in the year of impairment. An impairment is also recorded when management determines that it will discontinue
exploration or development on a property or when exploration rights or permits expire.



Ownership in mineral properties involves certain
risks due to the difficulties in determining the validity of certain claims as well as the potential for problems arising from
the frequently ambiguous conveyance history characteristic of many mineral interests. The Company has investigated the ownership
of its mineral properties and, to the best of its knowledge, ownership of its interests are in good standing.



Capitalized mineral property exploration costs
are those directly attributable costs related to the search for, and evaluation of mineral resources that are incurred after the
Company has obtained legal rights to explore a mineral property and before the technical feasibility and commercial viability
of a mineral reserve are demonstrable. Any costs incurred prior to obtaining the legal right to explore a mineral property are
expensed as incurred. Field overhead costs directly related to exploration are capitalized and allocated to mineral properties
explored. All other overhead and administration costs are expensed as incurred.



Once an economically viable reserve has been
determined for a property and a decision has been made to proceed with development has been approved, acquisition, exploration
and development costs previously capitalized to the mineral property are first tested for impairment and then classified as property,
plant and equipment under construction.



Impairment of Long-lived Assets



At each date of the statement of financial
position, the Company reviews the carrying amounts of its tangible and intangible assets to determine whether there is an indication
that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated
in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount
of an individual asset, the Company estimates the recoverable amount of the cash-generating unit to which the assets belong.





68





Recoverable amount is the higher of fair value
less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present
value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific
to the asset.



If the recoverable amount of an asset (or cash-generating
unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced
to its recoverable amount. An impairment loss is recognized immediately in the statement of comprehensive loss.



Where an impairment loss subsequently reverses,
the carrying amount of the asset (cash-generating unit) is increased to the revised estimate of its recoverable amount, but so
that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss
been recognized for the asset (or cash-generating unit) in prior years.



The Company’s most critical accounting
estimate relates to the impairment of mineral properties and deferred exploration costs. During the year ended August 31, 2018,
the Company wrote off nil of costs related to its mineral properties (2017 – $124,717). Management assesses impairment of
its exploration prospects quarterly. If an impairment results, the capitalized costs associated with the related project or area
of interest are charged to expense.



Asset Retirement Obligations



The Company recognizes liabilities for statutory,
contractual, constructive or legal obligations, including those associated with the reclamation of mineral properties and property,
plant and equipment, when those obligations result from the acquisition, construction, development or normal operation of the
assets. Initially, a liability for an asset retirement obligation is recognized at its fair value in the period in which it is
incurred. Upon initial recognition of the liability, the corresponding asset retirement obligation is added to the carrying amount
of the related asset and the cost is amortized as an expense over the economic life of the asset using either the unit-of-production
method or the straight-line method, as appropriate. Following the initial recognition of the asset retirement obligation, the
carrying amount of the liability is increased for the passage of time and adjusted for changes to the current market-based discount
rate, amount or timing of the underlying cash flows needed to settle the obligation.





A.       Operating
Results



The following discussion and analysis of the
financial condition and operating results of the Company for the years ended August 31, 2018 and 2017 should be read in conjunction
with the consolidated financial statements and related notes to the financial statements which have been prepared in accordance
with IFRS.



Overall Performance



As at August 31, 2018, the Company had current
assets of $1,322,307, compared to $1,922,088 on August 31, 2017. The decrease is mainly due to inflows from proceeds of convertible
loans issued of $1,754,291 (2017 - $1,181,993) and inflows from proceeds of gold loans issued of $1,312,660 (2017 - $nil), offset
by outflows in regards to expenditures on exploration of $1,305,094 (2017 - $1,568,614) and cash used in operations of $2,351,200
(2017 - $4,283,489). Mineral properties and deferred exploration assets were $49,912,854 as at August 31, 2018, compared to $46,920,303
at August 31, 2017.





69





Net loss for the year ended August 31, 2018
was $6,897,397, compared to a net loss of $6,434,112 in the comparable year ended August 31, 2017. Net loss remained fairly consistent
between the two periods. Variances in expenses are discussed below.



The main difference in net loss between the
two periods is due to the loss on settlement of debt for shares which increased to $522,226 (2017 - $141,108) as the price of
the stock increased and interest and principal on the various loans were converted to shares.



Share Capital:



During the year ended August 31, 2018, the
Company issued 385,147 shares (2017 – 695,991 shares) pursuant to the RSU plan with a value of $188,722 (2017 - $1,040,990).
The Company issued 1,172,128 (2017 – 814,089) shares with a value of $612,900 (2017 - $542,447) in connection with interest
payments related to the convertible loans and gold bullion loans outstanding. The Company issued 1,354,405 shares (2017 –
83,333) with a value of $792,381 (2017 - $49,166) for settlement of convertible loans as well. During the comparative period,
in September 2016, the Company also completed its private placement financing issuing 7,197,543 shares for proceeds, net of issue
costs, of $5,589,501. In connection with the private placement closed in September 2016, the Company also issued 3,146,944 shares
pursuant to cashless exercise of warrants issued on the private placement. The Company also issued, in the comparative period,
458,329 and 187,321 shares with a value of $288,747 and $131,998 respectively for settlement of various leases and amounts due
to related parties. In the current period, capital was utilized for the Buckreef Gold Project development, property acquisition,
exploration, capital equipment purchases and general operating expenses as tabulated below. The remaining funds/cash liquid assets,
when available, are invested in interest bearing investments, which are highly liquid.



|                                                                                                       |  | (000)
|------------------------------------------------------------------------------------------------------ |  | -----
|Funds available August 31, 2017                                                                        |  |      
|Net proceeds from convertible loans and gold bullion loans                                             |  |      
|Mineral property expenditures including licences, environmental and exploration,
    net of recoveries |  |      
|General corporate expenses                                                                             |  |      
|Funds available August 31, 2018                                                                        |  | $    



At August 31, 2018, the Company had a working
capital deficiency of $12,010,685 (August 31, 2017 – $6,552,376 working capital deficiency), had not yet achieved profitable
operations, has accumulated losses of $103,263,959 (August 31, 2017 – $96,566,577) and expects to incur further losses in
the development of its business. The Company will require additional financing in order to conduct its planned work programs on
mineral properties, meet its ongoing levels of corporate overhead and discharge its future liabilities as they come due.



Based on the Company’s current funding
sources and taking into account the working capital position and capital requirements at August 31, 2018, these factors indicate
the existence of a material uncertainty that raises substantial doubt about the Company’s ability to continue as a going
concern and is dependent on the Company raising additional debt or equity financing. The Company must obtain additional funding
in order to continue development and construction of the Buckreef Project. The Company presently does not have adequate resources
to maintain its core activities for the next fiscal year or sufficient working capital to fund all of its planned activities.
The Company is continuing to pursue additional financing to fund the construction of the Buckreef Project and additional projects.
However there is no assurance that such additional funding and/or project financing will be obtained or obtained on commercially
favourable terms.





70





Additional funding may be derived from revenues
generated in the future from anticipated completion and operation of its Buckreef mine currently under development. Management
continues to explore alternative financing sources in the form of equity, debt or a combination thereof; however, the current
economic uncertainty and financial market volatility make it difficult to predict success. Risk factors potentially influencing
the Company’s ability to raise equity or debt financing include: the outcome of the feasibility study at the Buckreef Project,
mineral prices, the risk of operating in a foreign country, including, without limitation, risks relating to permitting, and the
buoyancy of the credit and equity markets.



Due to the current low interest rate environment
and lack of funds, interest income is not expected to be a significant source of income or cash flow. Management intends to monitor
spending and assess results on an ongoing basis and will make appropriate changes as required.



TRENDS



| | · | There
                                         are significant uncertainties regarding the prices of precious and base metals and other
                                         minerals and the availability of equity and debt financing for the purposes of mineral
                                         exploration and development. The prices of precious and base
                                         metals have been subject to extreme volatility over recent periods, as such the Company
                                         remains cautious;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | The
                                         Company’s future performance is largely tied to development of the Buckreef project
                                         and other main projects and outcome of future drilling results; and
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Current
                                         financial markets are likely to be volatile in Canada and the United States for the remainder
                                         of the fiscal year, reflecting ongoing concerns about the stability of the global economy.
                                         As well, concern about global growth may lead to future drops in the commodity markets.
                                         Uncertainty in the credit markets has also led to increased difficulties in borrowing
                                         or raising funds. Companies worldwide have been negatively affected by these trends.
                                         As a result, the Company may have difficulties raising equity and debt financing for
                                         the purposes of base and precious metals exploration and development.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



These trends may limit the Company’s
ability to discover and develop an economically viable mineral deposit.





71





Results of operations



Fiscal year ended August 31, 2018 compared to fiscal year
ended August 31, 2017



Net additions to mineral properties and deferred
exploration costs for the year ended August 31, 2018 were $2,992,551 compared to $1,242,162 for the year ended August 31, 2017.
Out of the net additions, $1,703,323 (2017 - $1,933,614 decrease) represents an increase/decrease due to foreign exchange in the
current period on functional currency. The increase excluding these amounts saw expenditures of $1,289,228 for the year ended
August 31, 2018 compared to $3,175,776 during 2017. The lower expenditure in 2018 is due to reduced financial resources currently
available to the Company and a related reduction in exploration expenditures.



Net loss for the year ended August 31, 2018
was $6,897,397, compared to a net loss of $6,434,112 for the comparable year ended August 31, 2017. For the three month period
ended August 31, 2018 and 2017, there was a net loss of $1,876,711 compared to a net loss of $1,307,313, respectively. Net loss
and related expenditures were consistent between the two periods.



Variances in expenditures are set out below:



For the year ended August 31, 2018, depreciation
expense was $386,845, compared to $421,983 for the year ended August 31, 2017. The decrease of $35,138 is due to a lower overall
capital assets base as there were minimal additions during the period and prior fiscal year.



Consulting fees for the year ended August 31,
2018 were $938,569, compared to $805,943 in the comparable year ended August 31, 2017. Consulting expenses increased during the
current period as the Company hired consultants in an effort to advance its Buckreef project. The consultants were hired to advise
in regards to the status of the processing plant and any modifications and changes to the operational process, and many were hired
in replacement of salaried management and personnel that resigned or were let go during the course of the last year resulting
in a decrease in salaries and benefits expenses discussed below. Consulting fees for the three months ended August 31, 2018 were
$241,471 compared to $272,597 in the comparable period ended August 31, 2017. The amount remained consistent for the three month
period.



Directors’ fees for the year ended August
31, 2018 were $111,625, compared to $186,826 in the comparable year ended August 31, 2017. The amount decreased as compared to
the same period in the prior year due to director resignations during the prior year as well as no RSU issuances during the current
year. For the three month period ended August 31, 2018, director fees amounted to $27,906 (2017 - $27,907). The amount was the
same for the three month period.



Office and general expenses for the year ended
August 31, 2018 were $121,757, compared to $197,457 in the comparable year ended August 31, 2017. Office and general costs decreased
between the comparable periods due to continued cost reduction measures across all areas of the Company. For the three month period
ended August 31, 2018, office and general expenses were $26,819 compared to $44,777 in the comparable period ended August 31,
2017. The reason for the decrease for the three month period is the same as above.



Shareholder information costs for the year
ended August 31, 2018 decreased to $343,658 from $476,285 for the comparable year ended August 31, 2017. The amounts decreased
due to reduced spending on investor relation services for the period. For the three month period ended August 31, 2018, shareholder
information costs were $58,340 compared to $113,838 for the three month period ended August 31, 2017. The decrease is due to the
same reason as the decrease for the year.



Professional fees increased by $91,186 for
the year ended August 31, 2018 to $845,924 from $754,738 for the year ended August 31, 2017. Professional fees increased mainly
due to increased work surrounding the adoption of the stock option plan incurred in the comparative period. For the three month
period ended August 31, 2018 professional fees went from $17,001 for the three month period ended May 31, 2017 to $280,841. The
increase is due to an increase in general corporate matters during the period.





72





Salaries and benefits expense increased to
$605,659 for the year ended August 31, 2018 from $458,700 for the year ended August 31, 2017. Salaries and benefits increased
due to an increase in payroll tax assessment in Tanzania. The expenses for the corresponding three month period ending August
31, 2018 and 2017 were $124,943 and $116,309 respectively and remained consistent between the two periods.





Share based payments for the year ended August
31, 2018 were $1,598,883, compared to $1,772,663 in the comparable year ended August 31, 2017. The decrease is due to the Company
issuing 3,682,000 options (2017 – 3,750,000) with a value vested of $966,000 (2017 - $1,725,000) offset by the forfeiture
of RSU’s of $65,098 (2017 - $(123,569)) as well as the repricing of the 3,750,000 options issued in 2016 which resulted
in additional compensation of $240,000 (2017 - $nil), see note 6 to the audited consolidated financial statements for the years
ended August 31, 2018 and 2017 for details of stock options issued.



For the year ended August 31, 2018, travel
and accommodation expense were lower at $24,335 compared to $31,267 in 2017. Travel and accommodation expense decreased due to
cost cutting measures across all areas of the Company. For the three months ended August 31, 2018 and 2017, travel and accommodation
went from $(4,103) in 2017 to $1,098. Travel and accommodation expense were minimal during the period.



For the year ended August 31, 2018, the foreign
exchange gain was $126,583 compared to an exchange gain of $161,593 for the same year ended August 31, 2017. The primary reason
is the US Dollar exchange rate decreasing from 1.258 at August 31, 2017 to 1.3055 at August 31, 2018.



The interest accretion expense for the year ended August 31, 2018 was $819,060,
compared to $725,696 for the year ended August 31, 2017. Interest accretion generally decreases as loans approach their maturity
date. The amount increased due to additional loans issued during the course of fiscal 2017 and in the first quarter of fiscal
2018.



Fiscal year ended August 31, 2017 compared to fiscal year
ended August 31, 2016



Net additions to mineral properties and deferred
exploration costs for the year ended August 31, 2017 were $1,242,162 compared to $1,168,935 for the year ended August 31, 2016.
The amount has increased as compared with the prior year due primarily to additions of $1,900,000 in connection with accrued amounts
owing in connection with the Buckreef joint venture, offset by $1,933,614 (2016 - $nil) representing a decrease due to foreign
exchange in the current period stemming from the change in functional currency from Canadian dollars to US dollars as of September
1, 2016. The increase excluding these amounts saw expenditures of $1,425,776 year ended August 31, 2017 compared to $1,168,935
during 2016 is due to the Company’s recently closed private placement financing out of which resources were allocated to
license fees and other costs to keep properties in good standing and advance them towards production.



Net loss for the year ended August 31, 2017
was $6,434,112, compared to a net loss of $12,781,902 for the comparable year ended August 31, 2016. For the three month period
ended August 31, 2017 and 2016, there was a net loss of $1,307,313 compared to a net loss of $5,509,566, respectively. The main
difference in net loss between the comparable periods ended August 31, 2017 and 2016 is mainly due to the variances discussed
above.





73





Variances in the remaining expenditures is set out below:



For the year ended August 31, 2017, depreciation
expense was $421,984, compared to $478,699 for the year ended August 31, 2016. The decrease of $56,715 is due to a lower overall
capital assets base as there were no additions during the period and prior fiscal year.



Consulting fees for the year ended August 31,
2017 were $805,943, compared to $432,316 in the comparable year ended August 31, 2016. Consulting expenses increased during the
current period as the Company hired consultants in an effort to advance its Buckreef project. The consultants were hired to advise
in regards to the status of the processing plant and any modifications and changes to the operational process, and many were hired
in replacement of salaried management and personnel that resigned or were let go during the course of the last year resulting
in a decrease in salaries and benefits expenses discussed below. Consulting fees for the three months ended August 31, 2017 were
$272,597 compared to $204,446 in the comparable period ended August 31, 2016. The reason for the increase for the three month
period is the same as above.



Directors’ fees for the year ended August
31, 2017 were $186,826, compared to $285,188 in the comparable year ended August 31, 2016. The amount decreased as compared to
the same period in the prior year due to director resignations during the year as well as lower RSU expense in the current period,
driven by lower stock prices for most of the year and a reduction of RSU issuances in favour of the newly adopted stock option
plan. For the three month period ended August 31, 2017, director fees amounted to $27,907 (2016 - $54,890). The reason for the
decrease for the three month period is the same as above.



Office and general expenses for the year ended
August 31, 2017 were $197,456, compared to $246,938 in the comparable year ended August 31, 2016. Office and general costs decreased
between the comparable periods due to continued cost reduction measures across all areas of the Company. For the three month period
ended August 31, 2017, office and general expenses were $44,777 compared to $87,752 in the comparable period ended August 31,
2016. The reason for the decrease for the three month period is the same as above.



Shareholder information costs for the year
ended August 31, 2017 increased to $476,285 from $249,645 for the comparable year ended August 31, 2016. The amounts increased
due to higher spending in the current fiscal year on investor relations as the Company hired new investor relations consultants.
For the three month period ended August 31, 2017, shareholder information costs were $113,838 compared to $99,299 for the three
month period ended August 31, 2016. Shareholder information costs were comparable between the two periods.



Professional fees increased by $367,561 for
the year ended August 31, 2017 to $754,738 from $387,177 for the year ended August 31, 2016. Professional fees increased mainly
due to various work surrounding the adoption of the stock option plan as well as continuing legal fees from the resolution of
the Force Majeure matters. For the three month period ended August 31, 2017 professional fees went from $127,180 for the year
ended August 31, 2016 to $17,001. The decrease is due to various costs incurred in the last quarter of fiscal 2016 as the Company
prepared for the financing closed in September 2016.



Salaries and benefits expense decreased to
$458,700 for the year ended August 31, 2017 from $623,716 for the year ended August 31, 2016. Salaries and benefits decreased
as the Company moved towards using consultants in the place of salaried employees which carries a lower cost than having salaried
employees as well as the Company reducing its workforce wherever possible in an effort to minimize costs. The expenses for the
corresponding three month period ending August 31, 2017 and 2016 were $116,309 and $57,788 respectively and increased in the current
period as the third and fourth quarters of the prior year saw the largest staffing cuts as the Company was under Force Majeure
during the period leading up.





74







Share based payments for the year ended August
31, 2017 were $1,772,663, compared to a recovery of $38,996 in the comparable year ended August 31, 2016. The increase is due
to the Company adopting a stock option plan during the period and issuing 3,750,000 options (2016 – nil) with a value of
$1,725,000 (2016 - $nil) offset by the number of RSU’s forfeited during the current period resulting in a recovery of RSU
expense (see note 6 to the audited consolidated financial statements for the three and years ended August 31, 2017 and 2016 for
details of RSU’s and stock options issued).



For the year ended August 31, 2017, travel
and accommodation expense decreased by $30,414 from $61,881 in 2016 to $31,267. For the three months ended August 31, 2017 and
2016, travel and accommodation expense decreased by $43,876 from $39,773 in 2016 to $(4,103). Travel and accommodation expense
decreased in comparison to the comparable period as various personnel took trips to Tanzania to assess the development of the
Buckreef project during the last quarter in 2016 as well as refunds on travel overpayments in the current quarter.



For the year ended August 31, 2017, the foreign
exchange gain was $161,593 compared to an exchange gain of $111,352 for the same year ended August 31, 2016. The primary reason
is the US Dollar exchange rate decreasing from 1.312 at August 31, 2016 to 1.258 at August 31, 2017.



The interest accretion expense for the year
ended August 31, 2017 was $725,696, compared to $1,028,568 for the year ended August 31, 2016. Interest accretion decreases as
loans approach their maturity date.



A loss of $nil (2016 – $3,905,000 loss)
was recognized during the year ended August 31, 2017, in connection with the revaluation of the derivative liability and $nil
(2016 – $946,600 loss) was recognized during the year ended August 31, 2017, in connection with the revaluation of the warrant
liability. The derivative and warrant liabilities are revalued at every reporting period using the Black-Scholes model. On September
1, 2016, upon the change in functional currency to the U.S. dollar, these derivative liabilities were no longer classified as
derivatives and reclassified to reserve for share based payments.



A decrease in write offs of mineral properties
to $124,717 during the year ended August 31, 2017, compared to $3,516,268 during the year ended August 31, 2016. See details in
note 4 of the audited consolidated financial statements for the years ended August 31, 2017 and 2016 for details.



Inflation



Historically, inflation has not affected the
Company’s business in the current locations where it is doing business and the Company does not expect it to affect the
Company’s operations in the future.



Foreign Exchange



The Company is exposed to the financial risk
related to the fluctuation of foreign exchange rates. The Company has offices in Canada, USA, and Tanzania, but holds cash mainly
in Canadian and United States currencies. A significant change in the currency exchange rates between the Canadian dollar relative
to US dollar and Tanzanian shillings could have an effect on the Company’s results of operations, financial position, or
cash flows. At August 31, 2018, the Company had no hedging agreements in place with respect to foreign exchange rates. As
a majority of the funds of the Company are held in Canadian currencies, the foreign currency risk associated with US dollar and
Tanzanian Shilling financial instruments is not considered significant at August 31, 2018.





75





B.       Liquidity
and Capital Resources



The Company manages liquidity risk by maintaining
adequate cash balances in order to meet short term business requirements. Because the Company does not currently derive any production
revenue from operations, its ability to conduct exploration and development work on its properties is largely based upon its ability
to raise capital by equity funding. Previously, the Company obtained funding via private placements, public offering and various
sources, including the Company’s President and former CEO.



Based on the Company’s current funding
sources and taking into account the working capital position and capital requirements at August 31, 2018, these factors indicate
the existence of a material uncertainty that raises substantial doubt about the Company’s ability to continue as a going
concern and is dependent on the Company raising additional debt or equity financing. The Company must obtain additional funding
in order to continue development and construction of the Buckreef Project. The Company is continuing to pursue additional financing
to fund the construction of the Buckreef Project and additional projects. However there is no assurance that such additional funding
and/or project financing will be obtained or obtained on commercially favourable terms. These consolidated financial statements
do not give effect to any adjustment which would be necessary should the Company be unable to continue as a going concern and,
therefore, be required to realize its assets and discharge its liabilities in other than the normal course of business and at
amounts different from those reflected in the consolidated financial statements.



At August 31, 2018 the Company had a working
capital deficiency of $12,010,685 (August 31, 2017 – $6,552,376 working capital deficiency), had not yet achieved profitable
operations, has accumulated losses of $103,263,959 (August 31, 2017 – $96,566,577) and expects to incur further losses in
the development of its business. The Company will require additional financing in order to conduct its planned work programs on
mineral properties, meet its ongoing levels of corporate overhead and discharge its future liabilities as they come due.



Some of the Company’s mineral properties
are being acquired over time by way of option payments. It is at the Company’s option as to whether to continue with the
acquisition of the mineral properties and to incur these option payments.



Mineral Property Projects



As of August 31, 2018, amounts capitalized
in respect of mineral properties were $49,912,854, being an increase from August 31, 2017 when the balance was $46,920,303.



During the fiscal year ended August 31, 2018,
the Company capitalized mineral property exploration costs of $2,992,551 on its mineral resource properties, compared to fiscal
2017 when the Company capitalized mineral property exploration costs of $1,242,162.



For information on the Company’s commitments
for property and rental payments, refer to Item 4.



C.       Research
and Development, Patents and License, etc.



Not applicable.





76





D.       Trend
Information



No known trend.



E.       Off
Balance Sheet Arrangements



The Company has no material off balance sheet
arrangements that have or are reasonably likely to have a current or future effect on the Company’s financial condition.





F.       Tabular
Disclosure of Contractual Obligations





The Company has no contractual obligations
as of the latest fiscal year end which have a term of more than one year.



Item 6. Directors, Senior
Management and Employees



A.       Directors
and Senior Management



Directors and Senior Management





The following is a list of the Company’s
current directors and officers. The directors named below were elected or re-elected by the Company’s shareholders on February
28, 2018. There are no family relationships between the directors and officers.



77







|Name, Municipality of Residence and Position With the
    Company                 | Principal
    occupation or employment and, if not a previously elected director, occupation during the past 5 years                                    | Served
    as a Director Continuously Since
|--------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------
|Jeffrey
    Duval
    Sharon, ConnecticutActing Chief Executive Officer           | Acting CEO of the Company                                                                                                                               | Officer only                               
|James
    E. Sinclair
    Sharon, ConnecticutExecutive Chairman and Director      | Executive Chairman and Director,
    former CEO of the Company                                                                                          | April 30, 2002                             
|Dr.
    Norman Betts
    Fredericton, New BrunswickDirector                       | Associate Professor, Faculty
    of Business Administration, University of New Brunswick and a Chartered Professional Accountant                        | January 4, 2005                            
|William
    Harvey
    Sharon, ConnecticutDirector                                | Psychologist                                                                                                                                            | April 30, 2002                             
|Rosalind
    Morrow
    Toronto, OntarioDirector                                  | Lawyer; Partner, Borden Ladner
    Gervais LLP                                                                                                          | October 20, 2003                           
|Ulrich
    E. Rath
    Toronto, OntarioDirector                                   | Formerly President and CEO
    and Director of Chariot Resources Ltd.                                                                                   | October 7, 2003                            
|Marco
    Guidi
    Toronto, OntarioChief Financial Officer & Corporate Secretary | Chartered Professional Accountant,
    currently serving as Chief Financial Officer, Controller and Accountant for a number of junior mining companies. | Officer only                               



Directors and Senior Management



James E. Sinclair, Executive Chairman and Director



Mr. Sinclair is the Executive Chairman and
a Director of the Company. He was also previously served as CEO. Mr. Sinclair, age 74, devotes his full time to the business and
affairs of the Company.



Mr. Sinclair is a precious metals specialist,
commodities and foreign currency trader, and a respected minerals industry executive. He founded the Sinclair Group of Companies
in 1977 which offered full brokerage services in stocks, bonds, and other investment vehicles. The companies, which operated branches
in New York, Kansas City, Toronto, Chicago, London and Geneva, were sold in 1983. From 1981 to 1984, Mr. Sinclair served as a
Precious Metals Advisor to Hunt Oil and the Hunt family for the liquidation of their silver position as a prerequisite for a $1
billion loan arranged by the Chairman of the Federal Reserve, Paul Volcker. He was also a General Partner and Member of the Executive
Committee of two New York Stock Exchange firms and President of Sinclair Global Clearing Corporation and Global Arbitrage, a derivative
dealer in metals and currencies.





78





Mr. Sinclair has authored numerous magazine
articles and three books dealing with a variety of investment subjects including precious metals, trading strategies and geopolitical
events, and their relationship to world economics and the markets. He maintains a high public profile and his commentary on gold
and other financial issues garners extensive media attention at home and abroad. Mr. Sinclair is Executive Chairman of the Advisory
Board to the Singapore Precious Metals Exchange, a physical metal exchange.



Jeffrey Duval, Acting Chief Executive Officer



Jeffrey Duval, Mr. Duval is a licensed General
Engineering Contractor with over a quarter-century of experience working with several construction firms in the US south-west.
His experience in corporate executive management, project development, project estimation and management, time-management, excavation,
movement of material, earthworks, and related skills is a valuable asset to the Company as it aggressively moves to monetize the
in-ground assets on its various licenses. Mr. Duval’s management skills, efforts and involvement were instrumental in the
Company furthering its planned objectives over the past 12 months. Mr. Duval age 55 devotes 100% of his time in the roll of Acting
Chief Executive Officer for the Company.



Dr. Norman Betts, Ph.D., Director



Dr. Betts is an associate professor, Faculty
of Business Administration, University of New Brunswick (UNB) and a Chartered Accountant Fellow (FCA). Dr. Betts serves as a Chair
of the board of directors of Starfield Resources Inc. and as a director and member of the audit committees of Tembec Inc., New
Brunswick Power Corporation, Export Development Canada and Adex Mining Inc. In June, Dr. Betts was appointed to the Board of Directors
of the Bank of Canada. He is also a co-chair of the board of trustees of the UNB Pension Plan for Academic Employees. He is a
former Finance Minister and Minister of Business New Brunswick with the Province of New Brunswick. He was awarded a PhD in Management
from the School of Business at Queen’s University in 1992. Dr. Betts, age 61, devotes approximately 10% of his time to the
business and affairs of the Company.



Dr. William Harvey, B.A., Ph.D., Director



Dr. Harvey is a Clinical Psychologist, who for over thirty years
has served as a consultant and technical expert on matters relating to substance abuse prevention and mental health promotion
to a wide variety of private and governmental programs and agencies in the United States. These include the National Institute
of Drug Abuse, the National Institute of Alcoholism and Alcohol Abuse, the Office of Juvenile Justice & Delinquency Prevention,
and the National Mental Health Association. He was an Adjunct Professor in the Department of Sociology at Washington University,
and a Senior Research Scientist at the Missouri Institute of Mental Health, University of Missouri. He continues to be involved
in the formulation of new programs and policies aimed at the betterment of society. Dr. Harvey will continue to expand the role
which the Company has at the local level to ensure that stakeholder interests are addressed. Dr. Harvey, age 85, devotes approximately
10% of his time to the business and affairs of the Company.



Rosalind Morrow, B.A., B.Ed., A.R.C.T, LL.B., Director



A graduate of Trinity College, Toronto, the
Royal Conservatory of Music of Toronto, the University of Toronto Faculty of Education (French immersion specialist) and the University
of Toronto Law School, Ms. Morrow specializes in corporate and securities law with a particular emphasis on financings, including
government and structured finance, corporate governance and mergers and acquisitions. She has advised Canadian and international
corporations on a number of major projects in the financial, communications and resource sectors. Ms. Morrow is a former member
of the Securities Advisory Committee to the Ontario Securities Commission. Since the inception of the program in 2001, Ms. Morrow
has been lead external counsel to Canada Mortgage and Housing Corporation on over $250 billion in fully underwritten global bond
issuances under its Canada Mortgage Bond Program, and during the financial crisis has represented the Canadian federal government
on its $125 billion Insured Mortgage Purchase Program, the Canadian equivalent of the U.S. TARP Program. A past president of the
Women’s Law Association of Ontario and recipient of its President’s Award, Ms. Morrow served on the Board of Governors
of Trent University where she was a member of its Executive Committee and Chair of its Nominating and Governance Committee. In
2018, Ms. Morrow chaired Trent University’s Special Review Committee on colleges. She is a director and past Chair of The
Toronto and Region Conservation Foundation, the charitable arm of the Toronto and Region Conservation Authority, one of the largest
environmental organizations in North America, dedicated to the preservation of a green environment in the Toronto region. Ms.
Morrow, age 64, devotes approximately 10% of her time to the business and affairs of the Company.



79





Ulrich E. Rath, Director



Mr. Rath has a wide range of experience in
the mining industry, and has specific experience in North America, South America including Argentina, Chile and Peru and in South
Africa. Mr. Rath was the President and CEO and Director of Chariot Resources Ltd., a junior resource company focused
on the exploration, acquisition and development of copper and precious metal mineral deposits in the Andes region of Latin America. In
June 2010, Mr. Rath facilitated the sale of Chariot Resources following a global auction. The sale was approved by over 98%
of the shareholders of Chariot Resources. As the former President, CEO and Director of Chimera Gold Corp. (previously
known as EAGC Ventures), Ulrich Rath was responsible for facilitating the $US67 million acquisition of gold operations in
the East Rand region of South Africa that now produce more than 200,000 ounces gold per annum. Subsequently, the Board of Chimera
agreed to a 1:1 merger with Bema Gold Corp.  He was formerly CEO and director of Compania Minera Milpo, a medium
sized Peruvian zinc mining company.   Mr. Rath was also formerly Vice-President, Corporate Development, for
Rio Algom Ltd. from December 1992 to October 1998.  Rio Algom Ltd. was a U.S. reporting issuer, whose common shares were
listed on the American Stock Exchange.  Mr. Rath, age 69, devotes approximately 10% of his time to the business and affairs
of the Company.



Marco Guidi, B.Com (Hons), CPA, CA, Chief
Financial Officer and Corporate Secretary



Mr. Guidi is a Chartered Professional Accountant
and holds an Honours Bachelor degree in Business Administration from Wilfrid Laurier University. Mr. Guidi began his career with
an accounting firm where he was as an audit supervisor specializing in serving the audit and tax needs of clients in a variety
of industries. He has worked with publicly listed junior mining companies, technology companies, and privately-owned and entrepreneurial
companies. In 2010, Mr. Guidi transitioned out of public accounting and is currently serving as Chief Financial Officer, Controller
and Accountant for a number of junior mining companies. Mr. Guidi, age 31, devotes 30% of his time to the business and affairs
of the Company.



Cease Trade Orders



No director or executive officer of the Company
(or any personal holding corporation of such persons) is, or was within the ten years prior to the date hereof, a director, chief
executive officer or chief financial officer of any company, including the Company, that:



| | (i) | was subject to an order (as
                                         defined below) that was issued while the director or executive officer was acting in
                                         the capacity as director, chief executive officer, or chief financial officer; or
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



80







| | (ii) | was subject to an order (as
                                         defined below) that was issued after the director or executive officer ceased to be a
                                         director, chief executive officer or chief financial officer and which resulted from
                                         an event that occurred while that person was acting in the capacity as director, chief
                                         executive officer, or chief financial officer.
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



For the purposes of the above disclosure, “order” means:



| | (i) | a cease trade order;
| | --- | --------------------



| | (ii) | an order similar to a cease
                                         trade order; or
| | ---- | ------------------------------------------------------------------------------------



| | (iii) | an order that denied the
                                         relevant company access to any exemption under securities legislation;
| | ----- | ----------------------------------------------------------------------------------------------------------------------------------------



that was in effect for a period of more than thirty consecutive
days.



Penalties or Sanctions



Within the past 10 years
no directors or executive officers of the Company, or a shareholder holding a sufficient number of securities of the Company to
affect materially the control of the Company (or any personal holding corporation of such persons), has been subject to:



| | (a) | any penalties or sanctions imposed
                                         by a court relating to Canadian securities legislation or by a Canadian securities regulatory
                                         authority or has entered into a settlement agreement with a Canadian securities regulatory
                                         authority; or
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (b) | any other penalties or sanctions imposed
                                         by a court or regulatory body that would likely be considered important to a reasonable
                                         investor in making an investment decision.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Personal Bankruptcies



No director or executive officer of the Company,
or a shareholder holding a sufficient number of securities of the Company to materially affect control of the Company (or any
personal holding corporation of such persons):



| | (i) | is at the date hereof, or has
                                         been within the last ten years, a director or executive officer of any company that while
                                         the person was acting in that capacity, or within a year of that person ceasing to act
                                         in that capacity, became bankrupt, made a proposal under any legislation relating to
                                         bankruptcy or insolvency or was subject to or instituted any proceedings, arrangement,
                                         or compromise with creditors, or had a receiver, receiver manager or trustee appointed
                                         to hold its assets; or
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (ii) | has, within the last ten years,
                                         become bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency,
                                         or become subject to or instituted any proceedings, arrangement, or compromise with creditors,
                                         or had a receiver, receiver manager or trustee appointed to hold the assets of the director,
                                         executive officer or shareholder
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





81







Conflicts of Interest



There is no existing material
conflict of interest between the Company or its subsidiaries and a director or executive officer of the Company or its subsidiaries.
However, certain directors and officers of the Company are and may continue to be involved in the mining and mineral exploration
industry through their direct and indirect participation in corporations, partnerships or joint ventures which are potential competitors.
Situations may arise in connection with potential acquisitions and investments where the other interests of these directors and
officers may conflict with the interests of the Company. As required by law, each of the directors of the Company is required
to act honestly, in good faith and in the best interests of the Company. Any conflicts which arise shall be disclosed by the directors
and officers in accordance with the Business Corporations Act (Alberta) and they will govern themselves in respect thereof
to the best of their ability in accordance with the obligations imposed on them by law.



B.       Executive
Compensation



Compensation Discussion and Analysis



The adequacy and form of director and officer
compensation is reviewed on an annual basis by the Audit and Compensation Committee of the Board of Directors (the “Board”)
of the Company. The Audit and Compensation Committee recommends to the Board any adjustments to the compensation payable to directors,
officers, and senior staff. The Audit and Compensation Committee is comprised of three directors: Norman Betts (Chair), William
Harvey and Ulrich Rath, all of whom are independent for the purposes of National Instrument 58-101 – Corporate Governance.



The Audit and Compensation Committee meet to
discuss salary matters as required. Its recommendations are reached primarily by comparison of the remuneration paid by the Company
with publicly available information on remuneration paid by other reporting issuers that the Audit and Compensation Committee
feels are similarly placed within the same stage of business development as the Company. No consultant or advisor has been retained
by the Company to assist in determining compensation.



In assessing the compensation of its executive
officers, the Company does not have in place any formal objectives, criteria or analysis; instead, it relies mainly on the recommendations
of the Audit and Compensation Committee and Board discussion. The Company’s executive compensation program has three principal
components: base salary, incentive bonus plan, and equity compensation plans.



Base salaries for all employees of the Company
are established for each position based on market information obtained through the recruitment process from recruitment consultants
and candidates on an ad hoc basis. The Audit and Compensation Committee familiarizes itself with this market information, but
does not employ a statistical or formal benchmarking approach in making its compensation recommendations. Individual qualifications
and experience, together with the Company’s pay scale and any market information obtained, are considered in determining
base compensation levels.



Equity compensation plans are designed to provide
an incentive to the directors, officers, employees and consultants of the Company to achieve the longer-term objectives of the
Company; to give suitable recognition to the ability and industry of such persons who contribute materially to the success of
the Company; and to attract and retain persons of experience and ability, by providing them with the opportunity to acquire an
increased proprietary interest in the Company. The Company awards equity based compensation to its executive officers and employees,
based upon the Board’s review of the recommendations of the Audit and Compensation Committee. Previous awards of such equity
compensation are taken into account when considering new grants. The Company does not currently have an incentive stock option
plan and none is contemplated.





82







Implementation of a new incentive equity based
compensation plans and amendments to the existing plans are the responsibility of the Company’s Board. The Company’s
equity compensation plans are discussed in more detail below, under the sub-headings, “Restricted Stock Unit Plan”
and “Employee Share Ownership Plan”.



The Company's Code of Ethics and Business Conduct
prohibits directors and NEOs (defined below) from entering into transactions to hedge or offset a decrease or protect the value
of equity securities of the Company granted as compensation or otherwise directly or indirectly held.



The Company has no other forms of compensation,
although payments may be made from time to time to individuals or companies they control for the provision of consulting services.
Such consulting services are paid for by the Company at competitive industry rates for work of a similar nature by reputable arm’s
length services providers.



The Company is required, under applicable securities
legislation in Canada to disclose to its shareholders details of compensation paid to its named executive officers (a “named
executive officer” or “NEO”). A named executive officer as defined in Form 51-102F6 – Statement
of Executive Compensation, prescribed by National Instrument 51-102 - Continuous Disclosure Obligations, means an individual
who, at any time during the year, was:



| | (a) | the Company’s chief executive
                                         officer (“CEO”);
| | --- | ---------------------------------------------------------------------------------------



| | (b) | the Company’s chief financial
                                         officer (“CFO”);
| | --- | ---------------------------------------------------------------------------------------



| | (c) | each of the Company’s three
                                         most highly compensated executive officers, or the three most highly compensated individuals
                                         acting in a similar capacity, other than the CEO and CFO, at the end of the most recently
                                         completed financial year and whose total compensation will be, individually, more than
                                         $150,000 for that financial year; and
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (d) | each individual who would be a NEO
                                         under paragraph (c) but for the fact that the individual was neither an executive officer
                                         of the Company, nor acting in a similar capacity, at the end of the most recently completed
                                         financial year.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The following tables set forth particulars
concerning the compensation of the named executive officers for the Company’s last three fiscal years ended August 31, 2018,
2017 and 2016:



Summary Compensation Table



|Name and Principal Position                              | Year                                               | Salary
        ($)                    | Share-based awards
        ($) | Option-based awards
        ($) | Non-equity incentive plan compen-
        sation
        ($) | Pension Value
        ($) | All other compen-sation
        ($) | Total compen-sation
        ($)
|-------------------------------------------------------- | -------------------------------------------------- | ------------------------------------- | ------------------------------ | ------------------------------- | ------------------------------------------------------------ | ------------------------- | ----------------------------------- | -------------------------------
|Annual incentive plans
        (RSU)                     | Long term incen-
        tive plans
        (ESOP)
|Jeffrey
    Duval,Acting CEO                             | 201820172016                                       | 331,599
    (1)222,378 (1)Nil         | NilNilNil                      | NilNilNil                       | 321,000(12)460,000(12)Nil                                    | NilNilNil                 | NilNilNil                           | NilNilNil                      
|James
    Sinclair,President and Director, former CEO    | 201820172016                                       | 192,145
    (1)167,624 (1)104,987 (2) | NilNilNil                      | NilNilNil                       | 150,000(12)138,000(12)Nil                                    | NilNilNil                 | NilNilNil                           | NilNilNil                      
|Joseph
    Kahama, (6)Former Chairman and COO (Tanzania) | 201820172016                                       | NilNil65,975 (2)                      | NilNilNil                      | NilNilNil                       | NilNilNil                                                    | NilNilNil                 | NilNilNil                           | NilNilNil                      
|Marco
    Guidi, (9)CFO                                  | 201820172016                                       | 75,00075,00075,000                    | NilNilN/A                      | NilNilN/A                       | 32,00027,600(12)N/A                                          | NilNilN/A                 | NilNilN/A                           | NilNilN/A                      
|Donna
    M. Moroney,Corporate Secretary                 | 201820172016                                       | Nil60,00060,000                       | NilNil24,100 (10)              | NilNilNil                       | Nil13,800(12)N/A                                             | NilN/AN/A                 | NilN/AN/A                           | NilN/AN/A                      
|Peter
    Zizhou, (11)General Manager                    | 201820172016                                       | 213,746213,746214,958 (2)             | NilN/AN/A                      | NilN/AN/A                       | NilN/AN/A                                                    | NilN/AN/A                 | NilN/AN/A                           | NilN/AN/A                      



83













|(1)  | US$ exchange average for the year = $1.3205.                                                                                                          
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                       
|(2)  | US$ exchange average for the year = $1.3269.                                                                                                          
|     |                                                                                                                                                       
|(3)  | US$ exchange average for the year = $1.2092.                                                                                                          
|     |                                                                                                                                                       
|(4)  | US$ exchange = 1.00.                                                                                                                                  
|     |                                                                                                                                                       
|(5)  | Valued at $4.89 per RSU granted on April 11, 2012.                                                                                                    
|     |                                                                                                                                                       
|(6)  | Mr. Kahama resigned as a director, Chairman and COO (Tanzania) on February 6, 2016.                                                                   
|     |                                                                                                                                                       
|(7)  | Valued at $6.28 per RSU granted on May 6, 2011.                                                                                                       
|     |                                                                                                                                                       
|(8)  | Valued at $2.72 per RSU granted on July 3, 2013.                                                                                                      
|     |                                                                                                                                                       
|(9)  | Marco Guidi was appointed as CFO on December 31, 2014.                                                                                                
|     |                                                                                                                                                       
|(10) | Valued at $2.41 per RSU granted on September 5, 2014.                                                                                                 
|     |                                                                                                                                                       
|(11) | Peter Zizhou was appointed as General Manager on March 21, 2015.                                                                                      
|     |                                                                                                                                                       
|(12) | Valued using the Black-Scholes model with the following variables: volatility – 84%,, life – 9 years, risk
    free rate – 0.95%, dividend yield – 0%.
|     |                                                                                                                                                       
|(13) | Valued using the Black-Scholes model with the following variables: volatility – 76%,, life – 9 years, risk
    free rate – 1.98%, dividend yield – 0%.



Compensation is determined by the Audit and
Compensation Committee as set out under “Compensation Discussion and Analysis”. Salary compensation is not
tied to a named executive officer’s individual performance, however the grant of restricted share units (“RSUs”)
may be. The grant date fair value of RSUs is based on the closing price of the Company’s shares on the Toronto Stock Exchange
(the “TSX”) on the date of grant. All Employee Share Ownership Plan (“ESOP”) share purchases
are at market prices at the time of each monthly purchase, through the facilities of the TSX using registered representatives.
See “Restricted Stock Unit Plan” and “Employee Share Ownership Plan” below for more information.



















84





Incentive Plan Awards



Outstanding share-based awards and option-based
awards



|Option-based Awards                                   | Share-based
    Awards                                                                       
|----------------------------------------------------- | ---------------------------------------------------------------------------------------------
|Name                                                  | Year                                                                                         
|Jeffrey
    Duval,Acting CEO                          | 20182017
                                                                                2016
|James
    Sinclair,President and Director, former CEO | 20182017
                                                                                2016
|Joseph
    Kahama,Former Chairman and COO (Tanzania)  | 20182017
                                                                                2016
|Marco
    Guidi,CFO                                   | 20182017
                                                                                2016
|Donna
    M. Moroney,Corporate Secretary              | 20182017
                                                                                2016
|Peter
    Zizhou,General Manager                      | 20182017
                                                                                2016





85





Incentive plan awards – Value vested
or earned during the year



|Name                                                   | Option-based awards – Value vested during the year
        ($) | Share-based awards – Value vested during the year
        ($) | Non-equity incentive plan compensation – Value
        earned during the year
        ($)
|------------------------------------------------------ | -------------------------------------------------------------- | ------------------------------------------------------------- | -----------------------------------------------------------------------------------------
|Jeffrey
    Duval, CEO                                 | Nil                                                            | Nil                                                           | Nil                                                                                      
|James
    Sinclair, President and Director, former CEO | Nil                                                            | Nil                                                           | Nil                                                                                      
|Joseph
    Kahama, Former Chairman and COO (Tanzania)  | Nil                                                            | Nil                                                           | Nil                                                                                      
|Marco
    GuidiCFO                                     | Nil                                                            | Nil                                                           | Nil                                                                                      
|Donna
    M. Moroney, Corporate Secretary              | Nil                                                            | Nil                                                           | Nil                                                                                      
|Peter
    Zizhou,General Manager                       | Nil                                                            | Nil                                                           | Nil                                                                                      





Long Term Incentive Plan Awards to NEOs



The Company has made long-term
incentive plan awards during the fiscal year ended August 31, 2018 to NEOs of the Company. See “Restricted Stock Unit
Plan” and “Employee Share Ownership Plan” below.



Restricted Stock Unit Plan



The Restricted Stock Unit Plan (“RSU
Plan”) is intended to enhance the Company’s and its affiliates’ abilities to attract and retain highly
qualified officers, directors, key employees and other persons, and to motivate such officers, directors, key employees and other
persons to serve the Company and its affiliates and to expend maximum effort to improve the business results and earnings of the
Company, by providing to such persons an opportunity to acquire or increase a direct proprietary interest in the operations and
future success of the Company. To this end, the RSU Plan provides for the grant of RSUs. Each RSU represents an entitlement to
one common share of the Company, upon vesting.



Any of these awards of RSUs may, but need not,
be made as performance incentives to reward attainment of annual or long-term performance goals in accordance with the terms of
the RSU Plan. Any such performance goals are specified in the agreement between the Company and the recipient governing the award.
The Board implemented the RSU Plan under which employees and directors are compensated for their services to the Company. See
“Director Compensation.”



On April 26, 2011, the Company’s RSU
Plan was amended as the RSU Plan expressly excluded the Chairman and Chief Executive Officer of the Company from participating
in the RSU Plan. As the joint office of Chairman and Chief Executive Officer of the Company no longer exists, and was replaced
by two new positions, being President and Chief Executive Officer and Chairman and Chief Operating Officer (Tanzania), the Board
determined that it would be in keeping with the objects of the RSU Plan and in the best interests of the Company that each of
the offices of President and Chief Executive Officer and Chairman and Chief Operating Officer (Tanzania) be unambiguously included
in the category of Service Providers eligible to receive awards of RSUs under the RSU Plan, and that the wording of the RSU Plan
be amended as required to effect such result (as so amended, the “Amended RSU Plan”). The Amended RSU
Plan was presented to shareholders and approved at the Company’s annual general and special meeting held on March 1, 2012.





86







As of November 9, 2012, the Board resolved
to suspend 1,500,000 common shares of the 2,500,000 common shares previously authorized for issuance under the RSU Plan, such
that a maximum of 1,000,000 shares shall be authorized for issuance under the RSU Plan, until such suspension may be lifted or
further amended. Subsequently, on January 9, 2014, the Board resolved to decrease the number of common shares suspended to 1,200,000
common shares and on September 29, 2015 the number of RSUs suspended was decreased to 800,000 so that a maximum of 1,700,000 common
shares be authorized for issuance under the RSU Plan.



RSUs Granted to Directors and Named Executive Officers During
the Fiscal Year Ended August 31, 2018:



There were no RSUs granted to directors and
Named Executive Officers during the fiscal year ended August 31, 2018.



The following RSUs granted to directors and
officers during the fiscal years ended August 31, 2015, vested during fiscal year ended August 31, 2018:



|Name                | Date
    of Grant | No.
    of Shares | Cash
    Compensation Election | Vesting
    Period | Expiration
    Date
|------------------- | ----------------- | ----------------- | ------------------------------ | ------------------ | -------------------
|Rosalind
    Morrow | April 8, 2015     | 168,367(1)        | $82,500                        | 3 years            | April 8, 2018      
|Ulrich
    Rath     | April 8, 2015     | 77,168(1)         | $37,812                        | 3 years            | April 8, 2018      
|Norman
    Betts    | April 8, 2015     | 87,883(1)         | $43,063                        | 3 years            | April 8, 2018      
|William
    Harvey  | April 8, 2015     | 77,168(1)         | $37,812                        | 3 years            | April 8, 2018      

| | (1) | Valued at $0.49 per RSU
| | --- | -----------------------



RSUs Granted to Directors and Named Executive Officers During
the Fiscal Year Ended August 31, 2017:



There were no RSUs granted to directors and
Named Executive Officers during the fiscal year ended August 31, 2017.



The following RSUs granted to directors and
officers during the fiscal year ended August 31, 2015 vested during fiscal year ended August 31, 2017:



|Name                | Date
    of Grant | No.
    of Shares(1) | Cash
    Compensation Election | Vesting
    Period | Expiration
    Date
|------------------- | ----------------- | -------------------- | ------------------------------ | ------------------ | -------------------
|Norman
    Betts    | April 9, 2014     | 15,949(2)            | $43,062                        | 3 years            | April 9, 2017      
|William
    Harvey  | April 9, 2014     | 14,004(2)            | $37,811                        | 3 years            | April 9, 2017      
|James
    Sinclair  | April 9, 2014     | 76,296(2)            | $205,999                       | 3 years            | April 9, 2017      
|Rosalind
    Morrow | April 9, 2014     | 12,731(2)            | $34,374                        | 3 years            | April 9, 2017      

(1)     Valued at $2.70 per RSU





87







The following RSUs granted to directors and
officers during the fiscal year ended August 31, 2013 vested during fiscal year ended August 31, 2016:



|Name                | Date
    of Grant | No.
    of Shares(1) | Cash
    Compensation Election | Vesting
    Period | Expiration
    Date
|------------------- | ----------------- | -------------------- | ------------------------------ | ------------------ | -------------------
|James
    Sinclair  | April 10, 2013    | 57,577(3)            | $206,126                       | 3 years            | April 10, 2016     
|Rosalind
    Morrow | April 10, 2013    | 9,602(3)             | $34,375                        | 3 years            | April 10, 2016     
|Norman
    Betts    | April 10, 2013    | 11,470(3)            | $41,063                        | 3 years            | April 10, 2016     

(1)Valued
at $3.58 per RSU



Outstanding RSUs



There are no RSUs outstanding as of August
31, 2018.



Employee Share Ownership Plan



By an agreement dated May
1, 2003, the Company appointed Computershare Trust Company (formerly Olympia Trust Company), as trustee (the “Trustee”)
to manage and administer the Company’s ESOP. Under the ESOP, eligible employees, directors, and consultants can elect to
contribute up to 30% of their salary or compensation on a monthly basis for investment by the Trustee in shares of the Company.
The Company will contribute funds equal to 100% of the employee’s contribution up to an amount equal to 5% or less of the
employee’s salary. The Company will contribute funds equal to 50% of the employee’s contribution for the next 6% to
30% inclusive of the employee’s salary. All share purchases are at market prices at the time of purchase, through the facilities
of the TSX using registered representatives. Due to market conditions and the resultant decline in the Company’s share price,
all contributions to the ESOP were suspended as of October 1, 2014.



Pension
Plan Benefits



The Company has
not set aside or accrued any funds for pension, retirement or similar benefits.



Equity Compensation Plan Information



The following table provides information regarding
compensation plans under which securities of the Company are authorized for issuance in effect as of the end of the Company’s
most recently completed financial year end:



88







|                                                                                        | Number
    of securities to be issued upon exercise of outstanding RSUs | Weighted
    average exercise price of outstanding RSUs | Number
    of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column
    (a))
|--------------------------------------------------------------------------------------- | ----------------------------------------------------------------------- | ------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------
|Plan
    Category                                                                       | (a)                                                                     | (b)                                                     | (c)                                                                                                                                                
|Equity
    compensation plans approved by security holders (Restricted Stock Unit Plan) | 520,000                                                                 | $0.49                                                   | 0                                                                                                                                                  
|Total                                                                                   | 520,000                                                                 | $0.49                                                   | 0                                                                                                                                                  



Director Compensation



Director Compensation Table



The following table sets forth the value
of all compensation provided to directors not including those directors who are also NEOs, for the Company’s most recently
completed financial year:



|Name                 | Fees
    Earned($) | RSUs
    granted (1)(#) | Cash
    Compensation Election($) | All
    Other Compensation($) | Total($)
|-------------------- | ------------------ | ----------------------- | --------------------------------- | ----------------------------- | --------
|Norman
    Betts     | 36,000             | Nil                     | 36,000                            | 80,000                        | 116,000 
|William
    Harvey   | 37,813             | Nil                     | 37,813                            | 80,000                        | 117,813 
|Rosalind
    Morrow  | Nil                | Nil                     | Nil                               | 80,000                        | 80,000  
|Abdulkarim
    Mruma | Nil                | Nil                     | Nil                               | Nil                           | Nil     
|Ulrich
    Rath      | 37,813             | Nil                     | 37,813                            | 161,000                       | 198,813 



Directors who are also
members of management do not receive any additional cash compensation for serving on the Board. All directors are granted RSUs
as compensation for serving on the Company’s Board. Please see the table entitled “RSUs Granted to Directors and
Named Executive Officers During the Fiscal Year Ended August 31, 2015” under “Restricted Stock Unit Plan”
above.



Annual compensation for outside directors is
$68,750 per year, plus $6,875 per year for serving on Committees, plus $3,437.50 per year for serving as Chair of a Committee.
On April 11, 2012, the Board approved that at the election of each individual director, up to one half of the annual compensation
may be received in cash, paid quarterly. The remainder of the director’s annual compensation (at least one half and up to
100%) will be awarded as RSUs in accordance with the terms of the RSU Plan and shall vest within a minimum of one year and a maximum
of three years, at the election of the director, subject to the conditions of the Amended RSU Plan with respect to earlier vesting.
In 2016, outside directors had the option to elect to receive 100% of their compensation in RSUs. If 100% compensation in RSUs
is elected, the compensation on which the number of RSUs granted in excess of the required one half shall be increased by 20%.





89







There were no RSUs granted to the directors
under the Amended RSU Plan during the fiscal year ended August 31, 2018 or 2017.



Termination and Change of Control Benefits



There are currently no contracts for outside
management services. There are currently no employment contracts in place whereby any person is entitled to termination or change
of control benefits.



C.       Board
Practices



The directors of the Company serve a one year
term and are elected at the annual general meeting of shareholders. At the last annual general meeting, held on February 16, 2018,
the shareholders elected James Sinclair, William Harvey, Rosalind Morrow, Norman Betts and Ulrich Rath as directors. The officers
of the Company are elected by the Board and serve at the pleasure of the Board.



The Company has an audit committee consisting
of Ulrich Rath, William Harvey and Norman Betts. The roles and responsibilities of the audit committee have been specifically
defined as described below under Audit Committee Information, and include responsibilities for overseeing management reporting
on internal control. The audit committee has direct communication channels with the external auditors.



The Company also has a compensation committee.
The audit committee and compensation committee is collectively referred to as the “Audit and Compensation Committee”.



The adequacy and form of director and officer
compensation is reviewed on an annual basis by the Audit and Compensation Committee of the Board of Directors of the Company.
The Audit and Compensation Committee recommends to the Board any adjustments to the compensation payable to directors, officers,
and senior staff. The Audit and Compensation Committee is comprised of three directors: Norman Betts (Chair), William Harvey and
Ulrich Rath, all of whom are independent for the purposes of National Instrument 58-101 – Corporate Governance. The
Audit and Compensation Committee meet to discuss salary matters as required. Its recommendations are reached primarily by comparison
of the remuneration paid by the Company with publicly available information on remuneration paid by other reporting issuers that
the Audit and Compensation Committee feels are similarly placed within the same stage of business development as the Company.



The
Company also has a nominating committee (the “Nominating Committee”) comprised of Ulrich Rath, William Harvey
and Norman Betts. The Nominating Committee considers the size of the Board each year when it considers the number of directors
to recommend to shareholders for election at the annual meeting of shareholders, taking into account the number required to carry
out the Board’s duties effectively and to maintain a diversity of view and experience. When a vacancy on the Board arises,
the independent directors of the Nominating Committee will be encouraged to bring forward any potential nominees that have the
necessary skills and knowledge to serve on the Company’s Board.





90







The Company has a technical committee (“Technical
Committee”) currently comprised of Ulrich Rath, Peter Zizhou and Jeff Duval. The Technical Committee has approved a
Technical Committee Manual defining Composition and Terms of Reference. Among other things, the Technical Committee reviews with
management any exploration, geological, mining, metallurgical and other technical issues and reviews technical and financial issues
associated with new and existing projects that require Board approval with respect to their technical and financial impact on
the Company. The Technical Committee reports directly to the Board of Directors.



AUDIT COMMITTEE INFORMATION



Under National Instrument 52-110 – Audit
Committees (“NI 52-110”) reporting issuers are required to provide disclosure with respect to its Audit
Committee including the text of the Audit Committee’s Charter, composition of the Committee, and the fees paid to the external
auditor. Accordingly, the Company provides the following disclosure with respect to its Audit Committee:



| | 1. | The Audit and Compensation
                                         Committee’s Charter
| | -- | ---------------------------------------------------------------------------------------



| | 1.0 | Purpose of the
                                         Committee
| | --- | -----------------------------------------------------------------



| | 1.1 | The purpose of the Audit
                                         and Compensation Committee is to assist the Board in its oversight of the integrity of
                                         the Company's financial statements and other relevant public disclosures, the Company's
                                         compliance with legal and regulatory requirements relating to financial reporting, the
                                         external auditors' qualifications and independence and the performance of the internal
                                         audit function and the external auditors.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 2.0 | Compensation
| | --- | ------------



| | 2.1 | The adequacy and form of
                                         director and officer compensation is reviewed on an annual basis by the Board. The Audit
                                         and Compensation Committee recommends to the Board any adjustments to the compensation
                                         payable to directors, officers, and senior staff. The Audit and Compensation Committee
                                         meet to discuss salary and bonus incentive matters as required.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 3.0 | Members of
                                         the Audit and Compensation Committee
| | --- | ----------------------------------------------------------------------------------------



| | 3.1 | All of the members
                                         of the Audit and Compensation Committee must be "financially literate" as defined
                                         under NI 52-110, Audit Committees, having sufficient accounting or related financial
                                         management expertise to read and understand a set of financial statements, including
                                         the related notes, that present a breadth and level of complexity of the accounting issues
                                         that are generally comparable to the breadth and complexity of the issues that can reasonably
                                         be expected to be raised by the Company's financial statements.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 3.2 | The Audit and Compensation
                                         Committee shall consist of no less than three Directors.
| | --- | ----------------------------------------------------------------------------------------------------------------------------



| | 3.3 | All of the members of the
                                         Audit and Compensation Committee shall be "independent" as defined under NI
                                         52-110.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 4.0 | Relationship
                                         with External Auditors
| | --- | ----------------------------------------------------------------------------



| | 4.1 | The external auditors are
                                         the independent representatives of the shareholders, but the external auditors are also
                                         accountable to the Board of Directors and the Audit and Compensation Committee.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





91







| | 4.2 | The external auditors must
                                         be able to complete their audit procedures and reviews with professional independence,
                                         free from any undue interference from the management or directors.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 4.3 | The Audit and Compensation
                                         Committee must direct and ensure that the management fully co-operates with the external
                                         auditors in the course of carrying out their professional duties.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 4.4 | The Audit and Compensation
                                         Committee will have direct communications access at all times with the external auditors.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 4.5 | The Audit and Compensation
                                         Committee will ensure the rotation of the lead (or coordinating) audit partner having
                                         primary responsibility for the audit and the audit partner responsible for reviewing
                                         the audit as required by law.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 4.6 | The Audit and Compensation
                                         Committee will recommend to the Board of Directors policies for the Company’s hiring
                                         of employees or former employees of the external auditors who participated in any capacity
                                         in the audit of the Company.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 5.0 | Non-Audit Services
| | --- | ------------------



| | 5.1 | The external auditors are
                                         prohibited from providing any non-audit services to the Company, without the express
                                         written consent of the Audit and Compensation Committee. In determining whether the external
                                         auditors will be granted permission to provide non-audit services to the Company, the
                                         Audit and Compensation Committee must consider that the benefits to the Company from
                                         the provision of such services, outweighs the risk of any compromise to or loss of the
                                         independence of the external auditors in carrying out their auditing mandate.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 5.2 | Notwithstanding section
                                         5.1, the external auditors are prohibited at all times from carrying out any of the following
                                         services, while they are appointed the external auditors of the Company:
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (i) | acting as an agent
                                         of the Company for the sale of all or substantially all of the undertaking of the Company;
                                         and
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (ii) | performing any non-audit
                                         consulting work for any director or senior officer of the Company in their personal capacity,
                                         but not as a director, officer or insider of any other entity not associated or related
                                         to the Company.
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 6.0 | Appointment of
                                         Auditors
| | --- | ----------------------------------------------------------------



| | 6.1 | The external auditors will
                                         be appointed each year by the shareholders of the Company at the annual general meeting
                                         of the shareholders.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 6.2 | The Audit and Compensation
                                         Committee will nominate the external auditors for appointment, such nomination to be
                                         approved by the Board of Directors.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 7.0 | Evaluation of
                                         Auditors
| | --- | ---------------------------------------------------------------



| | 7.1 | The Audit and Compensation
                                         Committee will review the performance of the external auditors on at least an annual
                                         basis, and notify the Board and the external auditors in writing of any concerns in regards
                                         to the performance of the external auditors, or the accounting or auditing methods, procedures,
                                         standards, or principles applied by the external auditors, or any other accounting or
                                         auditing issues which come to the attention of the Audit and Compensation Committee.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





92







| | 8.0 | Remuneration
                                         of the Auditors
| | --- | ---------------------------------------------------------------------



| | 8.1 | The remuneration of the
                                         external auditors will be determined by the Board of Directors, upon the annual authorization
                                         of the shareholders at each general meeting of the shareholders.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 8.2 | The remuneration of the
                                         external auditors will be determined based on the time required to complete the audit
                                         and preparation of the audited financial statements, and the difficulty of the audit
                                         and performance of the standard auditing procedures under generally accepted auditing
                                         standards and generally accepted accounting principles of Canada.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 9.0 | Termination
                                         of the Auditors
| | --- | --------------------------------------------------------------------



| | 9.1 | The Audit and Compensation
                                         Committee has the power to terminate the services of the external auditors, with or without
                                         the approval of the Board of Directors, acting reasonably.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 10.0 | Funding of Auditing
                                         and Consulting Services
| | ---- | ------------------------------------------------------------------------------------



| | 10.1 | Auditing expenses will
                                         be funded by the Company. The auditors must not perform any other consulting services
                                         for the Company, which could impair or interfere with their role as the independent auditors
                                         of the Company.
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 11.0 | Role and Responsibilities
                                         of the Internal Auditor
| | ---- | ------------------------------------------------------------------------------------------



| | 11.1 | At this time, due to the
                                         Company's size and limited financial resources, the Chief Financial Officer of the Company
                                         shall be responsible for implementing internal controls and performing the role as the
                                         internal auditor to ensure that such controls are adequate.
| | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 12.0 | Oversight of
                                         Internal Controls
| | ---- | -----------------------------------------------------------------------



| | 12.1 | The Audit and Compensation
                                         Committee will have the oversight responsibility for ensuring that the internal controls
                                         are implemented and monitored, and that such internal controls are effective.
| | ---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 13.0 | Continuous Disclosure
                                         Requirements
| | ---- | ---------------------------------------------------------------------------



| | 13.1 | At this time, due to the
                                         Company's size and limited financial resources, the Chief Financial Officer of the Company
                                         is responsible for ensuring that the Company's continuous reporting requirements are
                                         met and in compliance with applicable regulatory requirements.
| | ---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 14.0 | Other Auditing
                                         Matters
| | ---- | ---------------------------------------------------------------



| | 14.1 | The Audit and Compensation
                                         Committee may meet with the Auditors independently of the management of the Company at
                                         any time, acting reasonably.
| | ---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 14.2 | The Auditors are authorized
                                         and directed to respond to all enquiries from the Audit and Compensation Committee in
                                         a thorough and timely fashion, without reporting these enquiries or actions to the Board
                                         of Directors or the management of the Company.
| | ---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 15.0 | Annual Review
| | ---- | -------------



| | 15.1 | The Audit and Compensation
                                         Committee Charter will be reviewed annually by the Board of Directors and the Audit and
                                         Compensation Committee to assess the adequacy of this Charter.
| | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



93







| | 16.0 | Independent
                                         Advisers
| | ---- | -------------------------------------------------------------



| | 16.1 | The Audit and Compensation
                                         Committee shall have the power to retain legal, accounting or other advisors to assist
                                         the Committee.
| | ---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 17.0 | Reports of Fraud
                                         and Misconduct
| | ---- | ------------------------------------------------------------------------



| | 17.1 | The Audit and Compensation
                                         Committee will review, investigate and evaluate all reports of fraud and misconduct.
                                         Refer to the Company’s Whistle Blower Policy and Procedures.
| | ---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 18.0 | Changes in Accounting
                                         Policies
| | ---- | -----------------------------------------------------------------------



| | 18.1 | The Audit and Compensation
                                         Committee will review and maintain Accounting Policies including the selection, documentation
                                         and changes in Accounting Policies.
| | ---- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 19.0 | Nominating Committee
| | ---- | --------------------



| | 19.1 | The Nominating Committee
                                         considers the size of the Board of Directors each year when it considers the number of
                                         directors to recommend to shareholders for election at the annual meeting of shareholders,
                                         taking into account the number required to carry out the Board’s duties effectively
                                         and to maintain a diversity of view and experience. When a vacancy on the Board arises,
                                         the independent directors of the Nominating Committee will be encouraged to bring forward
                                         any potential nominees that have the necessary skills and knowledge to serve on the Company’s
                                         Board.
| | ---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



2.       Composition of the
Audit and Compensation Committee



Following are the members of the Audit and Compensation Committee:



|Norman Betts (Chair) | Independent (1) | Financial expert (3)    
|-------------------- | --------------- | ------------------------
|Ulrich Rath          | Independent (1) | Financially literate (2)
|William Harvey       | Independent (1) | Financially literate (2)



| | (1) | A member of an audit
                                         committee is independent if the member has no direct or indirect material relationship
                                         with the Company, which could, in the view of the Board of Directors, reasonably interfere
                                         with the exercise of a member’s independent judgment.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (2) | An individual
                                         is financially literate if he has the ability to read and understand a set of financial
                                         statements that present a breadth of complexity of accounting issues that are generally
                                         comparable to the breadth and complexity of the issues that can reasonably be expected
                                         to be raised by the Company’s financial statements.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (3) | An Audit Committee
                                         Financial Expert must possess five attributes: (i) an understanding of GAAP and financial
                                         statements; (ii) the ability to assess the general application of such principles in
                                         connection with the accounting for estimates, accruals and reserves; (iii) experience
                                         preparing auditing, analyzing or evaluating financial statements that present a breadth
                                         and level of complexity of accounting issues that are generally comparable to the breadth
                                         and complexity of issues that can reasonably be expected to be raised by the registrant’s
                                         financial statements, or experience actively supervising one or more persons engaged
                                         in such activities; (iv) an understanding of internal controls and procedures for financial
                                         reporting; and (v) an understanding of audit committee functions.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





94









3.       Relevant Education
and Experience



Dr. Betts is the Chair of the Committee.
He is the former Minister of Finance of New Brunswick and current Associate Professor of Business Administration, University of
New Brunswick; Mr. Rath was the President and CEO of a Canadian resource company; and Dr. William Harvey is a psychologist and
businessman.



4.6.       Reliance on Certain
Exemptions



At no time since the commencement of the
Company’s most recently completed financial year has the Company relied on the exemption in Section 2.4 of NI 52-110 (De
Minimis Non-audit Services), Section 3.3(2) (Controlled Companies), Section 3.6 (Temporary Exemption for Limited and Exceptional
Circumstances), or an exemption from NI 52-110, in whole or in part, granted under Part 8 of National Instrument 52-110. Nor has
the Company relied on Section 3.8 (Acquisition of Financial Literacy) of NI 52-110.



7.       Audit and Compensation
Committee Oversight



At no time since the commencement of the Company’s most recently
completed financial year was a recommendation of the Audit and Compensation Committee to nominate or compensate an external auditor
not adopted by the Board of Directors.



8.       Pre-Approval Policies
and Procedures



The Audit and Compensation Committee is authorized by the Board
of Directors to review the performance of the Company’s external auditors and approve in advance the provision of services
other than auditing and to consider the independence of the external auditors, including a review of the range of services provided
in the context of all consulting services bought by the Company. The Audit and Compensation Committee is authorized to approve
in writing any non-audit services or additional work which the Chairman of the Audit and Compensation Committee deems is necessary,
and the Chairman will notify the other members of the Audit and Compensation Committee of such non-audit or additional work and
the reasons for such non-audit work for the Committee’s consideration, and if thought fit, approval in writing.



9.       External Auditor
Service Fees



The fees billed by the Company’s external auditors in each
of the last two fiscal years for audit and non-audit related services provided to the Company or its subsidiaries are as follows:



|Financial Year Ending
    August 31 | Audit
    Fees                         | Audit
    Related Fees | Tax
    Fees | All
    Other Fees
|----------------------------------- | -------------------------------------- | ---------------------- | ------------ | ------------------
|2018                                | Canada
    – $88,000Tanzania - $15,000 | NilNil                 | NilNil       | NilNil            
|2017                                | Canada
    – $80,000Tanzania - $15,000 | NilNil                 | NilNil       | NilNil            





95







D.       Employees



The Company has 3 full
time employee located in Sherman, Connecticut, 11 full time employees located in Buckreef, Tanzania, and 1 full time employees
located in Dar es Salaam, Tanzania.



The Company also hires
employees on a part time or temporary basis as dictated by the exploration activities on its properties. The full time and temporary
employees and consultants of the Company can be grouped according to main category of activity and geographic location as follows:



|Location                    | Category       | Full
    Time Employees | Temporary
    Employees | Full
    Time Consultants | Part
    Time Consultants
|--------------------------- | -------------- | ----------------------- | ----------------------- | ------------------------- | -------------------------
|Buckreef
    , Tanzania     | Administration | 5                       | Nil                     | Nil                       | Nil                      
|Exploration                 | 7              | Nil                     | Nil                     | Nil                      
|Dar
    es Salaam, Tanzania | Administration | 1                       | Nil                     | Nil                       | Nil                      
|Exploration                 | Nil            | Nil                     | Nil                     | Nil                      
|Connecticut                 | Administration | 3                       | Nil                     | Nil                       | Nil                      



E.        Share
Ownership



The following table sets forth the share ownership
of our directors and named executive officers, held by such persons as of August 31, 2018.



|Name of Owner                                             | Number
    of Shares Owned | Percentage
    (1)
|--------------------------------------------------------- | -------------------------- | ------------------
|Betts,
    Norman                                         | 125,799                    | 0.10%             
|Duval,
    Jeff                                           | 180,000                    | 0.14%             
|Guidi,
    Marco                                          | 50,000(2)                  | 0.04%             
|Harvey,
    William                                       | 230,424                    | 0.18%             
|Morrow,
    Rosalind                                      | 669,784                    | 0.54%             
|Rath,
    Ulrich E.                                       | 172,003                    | 0.14%             
|Sinclair,
    James E.                                    | 2,593,992(3)               | 2.07%             
|All
    directors and named executive officers as a group | 4,022,002                  | 3.21%             



| | (1) | Calculation based on 125,162,803 shares of common shares outstanding as of August 31, 2018.
| | --- | -------------------------------------------------------------------------------------------

| | (2) | 50,000 shares held
                                         by ITCA Consulting Inc.
| | --- | -----------------------------------------------------------------------------------

| | (3) | 579,022 shares held
                                         by the Estate of Barbara M. Sinclair, James E. Sinclair, Executor
| | --- | ------------------------------------------------------------------------------------------------------------------------------





96







The voting rights attached to the common shares
owned by our officers and directors do not differ from those voting rights attached to shares owned by people who are not officers
or directors of our Company.



Item 7. Major Shareholders
and Related Party Transactions



A.       Major
Shareholders



As far as it is known to the Company, it is
not directly or indirectly owned or controlled by any other Company or by the Canadian Government, or any foreign government.
The Company has no knowledge of any arrangements which at a subsequent date would result in a change of control. All of the Company’s
issued common shares rank equally as to voting rights, dividends, and any distribution of assets on winding-up or liquidation.



As of August 31, 2018, the Company knows of
one shareholder who beneficially own more than 5% of the outstanding shares of the Company’s voting securities as set forth
in the following table:



|Title of Class    | Identity
    of Holder(2)      | Amount
    Owned | Percent
    of Class(1)
|----------------- | ------------------------------ | ---------------- | -----------------------
|Common
    Shares | Van Eck Associates Corporation | 7,486,737        | 6.44%                  

| | (1) | As reported on its Schedule
                                         13G filed with the SEC for December 31, 2014. If their ownership was based on the issued
                                         and outstanding shares of the Company of 125,162,803 shares
                                         as at August 31, 2018, their ownership percentage would be 5.98%.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (2) | As per information provided
                                         on Schedule 13G as filed with the SEC.
| | --- | -----------------------------------------------------------------------------------------------------------



The following table sets out the portion of
common shares of the Company held by registered shareholders in Canada, the United States of America, and all other countries
by total number of holders, total shareholdings, percentage of total issued shares, and percentage of total holders as of August
31, 2018:



|Jurisdiction of Shareholders of Record | Number
    of Shareholders | Number
    of Common Shares | Percentage
    of Total Issued Shares | Percentage
    of Total Holders
|-------------------------------------- | -------------------------- | --------------------------- | ------------------------------------- | -------------------------------
|United
    States                      | 1,392                      | 62,196,276                  | 49.69%                                | 81.60%                         
|Canada                                 | 209                        | 60,697,064                  | 48.49%                                | 12.25%                         
|Other
    Countries                    | 105                        | 2,269,463                   | 1.82%                                 | 6.15%                          
|TOTAL                                  | 1,706                      | 125,162,803                 | 100.00%                               | 100.00%                        



B.       Related
Party Transactions



Related parties include the Board of Directors
and officers, close family members and enterprises that are controlled by these individuals as well as certain consultants performing
similar functions.



(a) Tanzanian Royalty Exploration Corporation entered into the
following transactions with related parties:



97







|Year ended August
    31 |  | Notes |       | 2018 |  | 2017
|------------------------ |  | ----- | ----- | ---- |  | ----
|Legal services           |  |       | (i)   |      |  |     
|Consulting               |  |       | (ii)  |      |  |     
|Consulting               |  |       | (iii) |      |  |     



(i) The Company engages a legal firm for professional services
in which one of the Company’s directors is a partner. During the year ended August 31, 2018, the legal expense charged by
the firm was $nil (2017 - $82,455). As at August 31, 2018, $335,940 remains payable (August 31, 2017 - $370,940).



(ii) During the year ended August 31, 2018, $215,108 (2017 - $203,274)
was paid for heap leach construction consulting and website/data back-up services to companies controlled by individuals associated
with the former CEO and current director.



(iii) During the year ended August 31, 2018, $nil (2017 - $172,330)
was paid for grade control drilling, license fees and other consulting services to Stamico, the Company’s joint venture
partner on the Buckreef Gold Project.



As at August 31, 2018, the Company has a receivable
of $40,086 (August 31, 2017 - $37,247) from an organization associated with the Company’s President and former CEO and current
director and from current officers and directors.



During the year ended August 31, 2015, the
Company sold automotive and mining equipment in the amount of $243,805 to directors of the Company and $333,700 to the Company’s
former CEO and current director for total proceeds of $577,505 as described in Note 5. Pursuant to the agreements, the Company
entered into 1-year lease agreements on the automotive and mining equipment with effective dates in May 2015. Per the terms of
the leases, the Company agrees to purchase back the automotive and mining equipment at the end of the lease periods for a lump
sum payment of USD$74,848. The initial base payments vary between the agreements and range between $3,500 and $8,000 payable monthly.
The effective interest rate on the capital lease obligation outstanding is between 20% and 30%.



On December 1, 2016, the Company entered into
settlement agreements whereby a total of $343,623 in principal and accrued interest was settled through the issuance of 458,329
shares issued at an average price of $0.63 per share for total issued value of $288,747, resulting
in a gain on settlement of debt of $54,876 for the year ended August 31, 2017.



As at August 31, 2018, the remaining balance
outstanding under finance lease obligations after the settlements described above is $67,819 (August 31, 2017 - $56,631) and is
repayable within 1 year, as such, the finance lease obligation is classified as a current liability.



(b) Remuneration of Directors and key management personnel (being
the Company’s Chief Executive Officer, Chief Financial Officer and Chief Operating Officer) of the Company was as follows:



|Year
    ended August 31 |  | 2018 |                                                                          | 2017
|------------------------ |  | ---- | ------------------------------------------------------------------------ | ----
|                         |  |      | Fees,
                                         salaries and benefits (1) |     
|Management               |  | $    | 636,744                                                                  |     
|Directors                |  |      | 111,625                                                                  |     
|Total                    |  | $    | 748,369                                                                  |     



98







|(1) |  | Salaries
                                         and benefits include director fees. The board of directors do not have employment or
                                         service contracts with the Company. Directors are entitled to director fees and RSU’s
                                         for their services and officers are entitled to cash remuneration and RSU’s for
                                         their services.
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) |  | Compensation
                                         shares may carry restrictive legends.
|--- |  | -------------------------------------------------------------------------------------------

|(3) |  | All RSU
                                         share based compensation is based on the accounting expense recorded in the year.
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------

|(4) |  | All stock
                                         option share based compensation is based on the accounting expense recorded in the year.
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------



As at August 31, 2018, included in trade and
other payables is $863,000 (August 31, 2017 - $638,000) due to these key management personnel with no specific terms of repayment.



The Company’s former CEO and current
director provided various loans to the Company totaling $133,632. On December 1, 2016, the Company entered into settlement agreements
whereby the remaining balance of $136,519 was settled through the issuance of 187,321 shares issued at
an average price of $0.705 per share for total issued value of $131,998, resulting in a gain on settlement of debt of $4,521 for
the year ended August 31, 2017. As at August 31, 2018 $nil (August 31, 2017 - $nil) is outstanding. The balance is payable
on demand, interest free, and unsecured.



C.       Interests
of Experts and Counsel



Not applicable.



Item 8. Financial Statements



A.       Consolidated
Statements and Other Financial Information



This Form 20-FAnnual Report contains the audited
consolidated financial statements of the Company for the fiscal years ended August 31, 2018 and 2017 with the Report of Independent
Registered Public Accounting Firm, comprised of:



| | (a) | Consolidated Statements of Financial
                                         Position as of August 31, 2018 and 2017;
| | --- | ----------------------------------------------------------------------------------------------------------------------



| | (b) | Consolidated Statements of Comprehensive
                                         Loss for the years ended August 31, 2018 and 2017;
| | --- | ------------------------------------------------------------------------------------------------------------------------------------



| | (c) | Consolidated Statements of Changes
                                         in Equity for the years ended August 31, 2018 and 2017;
| | --- | -----------------------------------------------------------------------------------------------------------------------------------



| | (d) | Consolidated Statements of Cash
                                         Flows for the years ended August 31, 2018 and 2017; and
| | --- | --------------------------------------------------------------------------------------------------------------------------------



| | (e) | Notes to the
                                         consolidated financial statements.
| | --- | ----------------------------------------------------------------------------------------



Dividend Policy



The Company has never paid dividends and does
not intend to in the near future.



Legal Proceedings



The Company is not a party to any material
legal proceedings.



B.       Significant
Changes



None.





99





Item 9. The Offering and
Listing



A.       Offering
and Listing Details



The common shares of the Company are listed
on the TSX under the symbol “TNX”. The common shares of the Company are also listed on the NYSE American LLC
(“NYSE American”) under the symbol “TRX”



As of August 31, 2018, there were 1,392 registered
shareholders in the United States holding 49.69% of the Company’s outstanding common shares, representing approximately
81.59% of the total number of registered shareholders. The Company’s common shares are issued in registered form and the
percentage of shares reported to be held by registered holders in the United States is taken from the records of the Computershare
Trust Company, the registrar and transfer agent for the Company’s common shares.



The number of registered shareholders resident
in the United States is attributed as to 0.21% to directors and officers of the Company who are United States residents; a further
0.20% held by United States residents who are immediate family members of a director and officer of the Company; and the
balance of 42.80% are United States residents who have purchased shares in the secondary market, through the facilities of the
TSX or NYSE American.





The following sets forth the high and low prices
expressed in U.S. Dollars on the NYSE American and in Canadian Dollars on the TSX for the past full six months and through October
31, 2018, for each quarter for the past two fiscal years and for the past five years.



|                             |  | NYSE American               |  | TSX                   
|---------------------------- |  | --------------------------- |  | ----------------------
|                             |  | (United States
    Dollars) |  | (Canadian
    Dollars)
|                             |  | High                        |  | Low                   
|Last Six Months              |  |                             |  |                       
|October 2018                 |  | 0.45                        |  | 0.36                  
|September 2018               |  | 0.46                        |  | 0.32                  
|August 2018                  |  | 0.47                        |  | 0.35                  
|July 2018                    |  | 0.50                        |  | 0.39                  
|June 2018                    |  | 0.56                        |  | 0.38                  
|May 2017                     |  | 0.68                        |  | 0.54                  
|                             |  |                             |  |                       
|For the Fiscal Quarter Ended |  |                             |  |                       
|August 31, 2018              |  | 0.56                        |  | 0.35                  
|May 31, 2018                 |  | 0.68                        |  | 0.30                  
|February 28, 2018            |  | 0.52                        |  | 0.24                  
|November 30, 2017            |  | 0.45                        |  | 0.25                  
|                             |  |                             |  |                       
|August 31, 2017              |  | 0.56                        |  | 0.38                  
|May 31, 2017                 |  | 0.59                        |  | 0.40                  
|February 29, 2017            |  | 0.63                        |  | 0.40                  
|November 30, 2016            |  | 1.13                        |  | 0.46                  
|August 31, 2016              |  | 1.49                        |  | 0.39                  
|                             |  |                             |  |                       
|For Fiscal Year Ended        |  |                             |  |                       
|August 31, 2018              |  | 0.68                        |  | 0.24                  
|August 31, 2017              |  | 1.13                        |  | 0.38                  
|August 31, 2016              |  | 1.49                        |  | 0.17                  
|August 31, 2015              |  | 2.45                        |  | 0.25                  
|August 31, 2014              |  | 4.06                        |  | 1.63                  



100









B.       Plan
of Distribution



Not applicable.



C.       Markets



The Company’s common shares are listed
on the TSX under the trading symbol “TNX” and on the NYSE American under the trading symbol “TRX”.



D.       Selling
Shareholders



Not applicable.



E.       Dilution



Not applicable.



F.       Expenses
of the Issue



Not applicable.



| | Item 10. | Additional
                                         Information
| | -------- | ---------------------------------------------------------------



A.       Share
Capital



The Company’s Restated Articles of Incorporation
authorize the Company to issue an unlimited number of common shares. On December 8, 2014, the Board resolved that the Company
authorize for issuance up to a maximum of 155,000,000 common shares, subject to further resolutions of the Company’s Board
of Directors. As of August 31, 2018, there were 125,162,803 shares common shares issued and outstanding.





Each common share has equal dividend, liquidation
and voting rights. Voters of common shares are entitled to one vote per share on all matters that may be brought before them.
Holders of common shares are entitled to receive dividends when declared by the Board from funds legally available therefor. The
common shares are not redeemable, have no conversion rights and carry no pre-emptive or other rights to subscribe for additional
shares. The outstanding common shares are fully paid and non-assessable.





101







The following table reconciles the total number
of common shares outstanding for the last three fiscal years:





|                                                                   | No.
    of Shares | $
    Amount     
|------------------------------------------------------------------ | ----------------- | -----------------
|Total
    Outstanding as of August 31, 2015                        | 107,853,554       | 120,532,634      
|Add:Issued pursuant to Restricted Share Unit Plan                  | 50,000            | 120,500          
|Interest
    shares on gold loans                                  | 536,137           | 477,609          
|Finder’s
    fee on loan agreement                                 | 320,543           | 372,130          
|Bonus
    shares                                                   | 75,000            | 26,250           
|Cashless
    exercise of warrants                                  | 233,258           | 851,600          
|Total
    Outstanding as of August 31, 2016                        | 109,068,492       | 122,380,723      
|Add:Issued for private placements, net of warrants                 | 7,197,543         | (1,094,499)      
|Issued
    pursuant to Restricted Share Unit Plan                  | 695,991           | 1,040,990        
|Shares
    issued for interest on gold loans                       | 814,089           | 542,447          
|Finders
    fees on convertible loans                              | 132,577           | 92,805           
|Shares
    issued for settlement of lease obligations              | 458,329           | 288,747          
|Shares
    issued for amounts due to related parties               | 187,321           | 131,998          
|Shares
    issued for settlement of convertible loans              | 83,333            | 49,166           
|Cashless
    exercise of warrants                                  | 3,146,944         | 1,742,000        
|Total
    Outstanding as of August 31, 2017                        | 121,784,619       | $
    125,174,377
|Add:Issued pursuant to Restricted Share Unit Plan                  | 385,147           | 188,722          
|Shares
    issued for interest on gold loans and convertible loans | 1,172,128         | 612,900          
|Finders
    fees on convertible loans and gold loans               | 466,504           | 234,752          
|Shares
    issued for settlement of convertible loans              | 1,354,405         | 792,381          
|Total
    Outstanding as of August 31, 2018                        | 125,162,803       | $
    127,003,132





Shares are issued by the Company with the regulatory
acceptance of the Toronto Stock Exchange and NYSEAmerican, upon resolution of the Board of Directors of the Company. As of August
31, 2018, there are a total of 125,162,803 common shares issued and a further 7,432,000 common shares reserved for issuance under
outstanding share purchase options and 4,562,901 reserved for issuance under share purchase warrants.



B.       Articles
of Association and Bylaws



The Company was originally incorporated under
the corporate name “424547 Alberta Ltd.” on July 5, 1990, under the Business Corporations Act (Alberta).



The Articles of 424547 Alberta Ltd. were amended on August
13, 1991, as follows:



| | · | the
                                         name of the Company was changed to “Tan Range Exploration Corporation”;
| | - | --------------------------------------------------------------------------------------------------------------------



| | · | the
                                         restriction on the transfer of shares was removed; and
| | - | ---------------------------------------------------------------------------------------------------





102







| | · | a
                                         new paragraph regarding the appointment of additional directors was added as follows:
| | - | --------------------------------------------------------------------------------------------------------------------------------



| | “(b) | The Directors,
                                         may, between annual general meetings, appoint one or more additional directors of the
                                         Company to serve until the next annual general meeting, but the number of additional
                                         Directors shall not at any time exceed one-third (1/3) of the number of Directors who
                                         held office at the expiration of the last annual meeting of the corporation.”
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The Company was registered in the Province
of British Columbia as an extra provincial company under the Company Act (British Columbia) on August 5, 1994.



The Articles of the Company were further amended
on February 15, 1996, as follows:



| | · | the
                                         provisions of the Articles authorizing the issue of Class “B” Voting shares,
                                         Class “C” Non-Voting shares and Class “D” Preferred shares were
                                         deleted;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Class
                                         “A” voting shares were redesignated as common shares; and
| | - | --------------------------------------------------------------------------------------------------------



| | · | a
                                         provision was added to allow meetings of shareholders to be held outside Alberta in either
                                         of the cities of Vancouver, British Columbia or Toronto, Ontario.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The Articles of the Company were further amended
on February 28, 2006, as follows:



| | · | the
                                         name of the Company was changed to its present name, “Tanzanian Royalty Exploration
                                         Corporation”.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The Articles of the Company were further amended on February 29,
2008 as follows:



| | · | Pursuant
                                         to Section 173(1)(l) of the Business Corporations Act (Alberta), Item 5 of the
                                         Articles of the Company was amended by changing the maximum number of directors from
                                         9 to 11.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Common Shares



All issued and outstanding common shares are
fully paid and non-assessable. Each holder of record of common shares is entitled to one vote for each common share so held on
all matters requiring a vote of shareholders, including the election of directors. The holders of common shares will be entitled
to dividends on a pro-rata basis, if and when as declared by the board of directors. There are no preferences, conversion rights,
preemptive rights, subscription rights, or restrictions or transfers attached to the common shares. In the event of liquidation,
dissolution, or winding up of the Company, the holders of common shares are entitled to participate in the assets of the Company
available for distribution after satisfaction of the claims of creditors.



The rights of shareholders cannot be changed
without a special resolution of at least 2/3 of the votes cast by the shareholders who voted in respect of the resolution, and
separate classes of shareholders are entitled to separate class votes. Any such alteration of shareholder’s rights would
also require the regulatory acceptance of the TSX. There are no provisions of the Company’s Articles or Bylaws that would
have the effect of delaying, deferring, or preventing a change of control of the Company, and that would operate only with respect
to a merger, acquisition, or corporate restructuring involving the Company (or any of its subsidiaries).





103







Powers and Duties of Directors



The directors shall manage or supervise the
management of the affairs and business of the Company and shall have authority to exercise all such powers of the Company as are
not, by the Business Corporations Act (Alberta) or by the Articles or Bylaws, required to be exercised by the Company in
a general meeting.



Directors will serve as
such until the next annual meeting. In general, a director who is, in any way, directly or indirectly interested in an existing
or proposed contract or transaction with the Company whereby a duty or interest might be created to conflict with his duty or
interest director, shall declare the nature and extent of his interest in such contract or transaction or the conflict or potential
conflict with his duty and interest as a director. Such director shall not vote in respect of any such contract or transaction
with the Company in which he is interested and if he shall do so, his vote shall not be counted, but he shall be counted in the
quorum present at the meeting at which such vote is taken. However, notwithstanding the foregoing, directors shall have the right
to vote on determining the remuneration of the directors.



The directors may from time to time on behalf
of the Company: (a) borrow money in such manner and amount from such sources and upon such terms and conditions as they think
fit; (b) issue bonds, debentures and other debt obligations; or (c) mortgage, charge or give other security on the whole or any
part of the property and assets of the Company.



At least one-quarter of the directors of the
Company should be persons ordinarily resident in Canada and all must be at least 18 years of age. There is no minimum share ownership
to be a director. No person shall be a director of the Company who is not capable of managing their own affairs; is an undischarged
bankrupt or who is a person who is not an individual.



Shareholders



An annual general meeting
shall be held once in every calendar year at such time and place as may be determined by the directors. A quorum at an annual
general meeting and special meeting shall be two shareholders or one or more proxy holder representing two shareholders, or one
shareholder and a proxy holder representing another shareholder. There is no limitation imposed by the laws of Canada or by the
charter or other constituent documents of the Company on the right of a non-resident to hold or vote the common shares, other
than as provided in the Investment Canada Act, (the “Investment Act”) discussed below under “Item
10. Additional Information, D. Exchange Controls.”



In accordance with Alberta
law, directors shall be elected by an “ordinary resolution” which means (a) a resolution passed by the shareholders
of the Company in general meeting by a simple majority of the votes cast in person or by proxy, or (b) a resolution that has been
signed by all shareholders entitled to vote on the resolution.



Under Alberta law certain
items such as an amendment to the Company’s articles or entering into a merger, requires approval by a special resolution,
which means (a) a resolution passed by a majority of not less than 2/3 of the votes cast by the shareholders of the Company who,
being entitled to do so, vote in person or by proxy at a general meeting of the company (b) a resolution consented to in writing
by every shareholder of the Company who would have been entitled to vote in person or by proxy at a general meeting of the Company,
and a resolution so consented to is deemed to be a special resolution passed at a general meeting of the Company.





104







C.       Material
Contracts





The following are the material contracts of the Company (other than
contracts in the ordinary course of business) entered into within the last three years.



| | A. | Secured Gold Loan Agreements
| | -- | ----------------------------



|Date             | Name of Lender             | Interest Rate | Terms                                                       | Conversion Rate | Loan Amount  
|---------------- | -------------------------- | ------------- | ----------------------------------------------------------- | --------------- | -------------
|June 11, 2018    | Kelly McKennon             | 8%            | One year, with extension for one year                       | US$0.3446       | US$180,000   
|March 1, 2018    | Dennis and Jane Smith      | 8%            | One year, with extension for successive terms of one year   | US$0.2670       | US$330,000   
|January 19, 2018 | Dennis and Jane Smith      | 8%            | One year, with extension for successive terms of one year   | US$0.2853       | US$417,206.50
|January 19, 2018 | Structural Logistics, LLC  | 8%            | One year, with extension for successive terms of one year   | US$0.2853       | US$100,726.86
|June 28, 2016    | David Ponelli              | 8%            | One year, with extension for one year                       | US$0.26         | US$100,000   
|June 27, 2016    | Edward F. Marin Family LLC | 8%            | One year, with extension for one year                       | US$0.26         | US$100,000   
|May 16, 2016     | Structural Logistics, LLC  | 8%            | One year, with extension for successive terms of one year   | US$0.26         | US$104,540   
|October 19, 2015 | Edward F. Marin Family LLC | 8%            | Three years with extension for successive terms of one year | US$0.26         | US$500,000   
|October 19, 2015 | David Pontelli             | 8%            | Three years with extension for successive terms of one year | US$0.26         | US$500,000   
|June 22, 2015    | William Holter             | 8%            | One year, with extension for successive terms of one year   | US$0.26         | US$515,000   
|June 22, 2015    | Hoffman Heritage Ranch     | 8%            | One year, with extension for successive terms of one year   | US$0.26         | US$1,015,000 





| | B. | Secured Loan Agreements
| | -- | -----------------------



|Date               | Names of Lender                  | Interest Rate | Term                                                      | Conversion Rate | Loan Amount  
|------------------ | -------------------------------- | ------------- | --------------------------------------------------------- | --------------- | -------------
|September 10, 2018 | Vimco Holdings Pty Ltd.          | 8%            | One year, with extension for one year with mutual consent | US$0.27         | US$270,019.75
|September 10, 2018 | Echelon Super Pty Ltd.           | 8%            | One year, with extension for one year with mutual consent | US$0.27         | US$135,000   
|September 10, 2018 | William J. and Sharon B. Keating | 8%            | One year, with extension for one year with mutual consent | US$0.27         | US$200,769.62
|September 10, 2018 | Nancy Kamali                     | 8%            | One year, with extension for one year with mutual consent | US$0.27         | US$75,000    
|September 10, 2018 | The Witt Family Trust            | 8%            | One year, with extension for one year with mutual consent | US$0.27         | US$100,000   
|September 10, 2018 | Steven Lane                      | 8%            | One year, with extension for one year with mutual consent | US$0.27         | US$450,000   
|August 21, 2018    | Dennis and Jane Smith            | 8%            | One year, with extension for one year with mutual consent | US$0.27         | US$100,000   
|August 21, 2018    | William Holter                   | 8%            | One year, with extension for one year with mutual consent | US$0.274        | US$100,000   
|August 21, 2018    | Jeff and Linda Lane              | 8%            | One year, with extension for one year with mutual consent | US$0.274        | US$100,000   
|July 30, 2018      | SATYA, LLC                       | 8%            | One year, with extension for one year with mutual consent | US$0.31         | US$100,000   
|April 16, 2018     | William Holter                   | 8%            | One year, with extension for one year with mutual consent | US$0.346935     | US$200,000   
|April 16, 2018     | Dennis and Jane Smith            | 8%            | One year, with extension for one year with mutual consent | US$0.346935     | US$250,000   
|January 19, 2018   | The Witt Family Trust            | 8%            | One year, with extension for one year with mutual consent | US$0.2853       | US$200,000   
|June 1, 2017       | New Direction IRA                | 8%            | One year, with extension for one year with mutual consent | US$0.26         | US$339,709.87
|June 1, 2017       | The Witt Family Trust            | 8%            | One year, with extension for one year with mutual consent | US$0.26         | US$433,301.99
|March 31, 2017     | Structural Logistics, LLC        | 8%            | One year, with extension for one year with mutual consent | US$0.26         | US$100,776   
|March 31, 2017     | William Holter                   | 8%            | One year, with extension for one year with mutual consent | US$0.26         | US$100,000   
|March 31, 2017     | New Direction IRA                | 8%            | One year, with extension for one year with mutual consent | US$0.26         | US$100,000   
|March 31, 2017     | The Witt Family Trust            | 8%            | One year, with extension for one year with mutual consent | US$0.26         | US$150,000   
|June 30, 2016      | David Schectman                  | 8%            | One year, with extension for one year with mutual consent | US$0.26         | US$100,000   
|May 16, 2016       | William Holter                   | 8%            | One year, with extension for one year with mutual consent | US$0.26         | US$104,900   





105







D.       Exchange
Controls



Canada



There is no law, governmental decree or regulation
in Canada that restricts the export or import of capital or affects the remittance of dividends, interest or other payments to
a non-resident holder of common shares other than withholding tax requirements. Any such remittances to United States residents
are subject to withholding tax. See “Taxation.”



There is no limitation imposed by the laws
of Canada or by the charter or other constituent documents of the Company on the right of a non-resident to hold or vote the common
shares, other than as provided in the Investment Act. The following discussion summarizes the principal features of the Investment
Act for a non-resident who proposes to acquire the common shares.



The Investment Act generally prohibits implementation
of a reviewable investment by an individual, government or agency thereof, corporation, partnership, trust or joint venture (each
an “entity”) that is not a “Canadian” as defined in the Investment Act (a “non-Canadian”),
unless after review, the Director of Investments appointed by the minister responsible for the Investment Act is satisfied that
the investment is likely to be of net benefit to Canada. An investment in the common shares by a non-Canadian other than a “WTO
Investor” (as that term is defined by the Investment Act, and which term includes entities which are nationals of or are
controlled by nationals of member states of the World Trade Organization) when the Company was not controlled by a WTO Investor,
would be reviewable under the Investment Act if it was an investment to acquire control of the Company and the value of the assets
of the Company, as determined in accordance with the regulations promulgated under the Investment Act, was $5,000,000 or more,
or if an order for review was made by the federal cabinet on the grounds that the investment related to Canada’s cultural
heritage or national identity, regardless of the value of the assets of the Company. An investment in the common shares by a WTO
Investor, or by a non-Canadian when the Company was controlled by a WTO Investor, would be reviewable under the Investment Act
if it was an investment to acquire control of the Company and the value of the assets of the Company, as determined in accordance
with the regulations promulgated under the Investment Act was not less than a specified amount, which as specified in 2014 was
any amount in excess of $354 million. A non-Canadian would acquire control of the Company for the purposes of the Investment Act
if the non-Canadian acquired a majority of the common shares. The acquisition of one third or more, but less than a majority of
the common shares would be presumed to be an acquisition of control of the Company unless it could be established that, on the
acquisition, the Company was not controlled in fact by the acquirer through the ownership of the common shares.





106







Certain transactions relating to the common
shares would be exempt from the Investment Act, including: (a) an acquisition of the common shares by a person in the ordinary
course of that person’s business as a trader or dealer in securities; (b) an acquisition of control of the Company in connection
with the realization of security granted for a loan or other financial assistance and not for a purpose related to the provisions
of the Investment Act; and (c) an acquisition of control of the Company by reason of an amalgamation, merger, consolidation or
corporate reorganization following which the ultimate direct or indirect control in fact of the Company, through the ownership
of the common shares, remained unchanged.



Foreign Investments and Exchange in Tanzania



The Tanzania Investment Centre (TIC) issues
certificates of Approval to Foreign and Local Companies wishing to invest in Tanzania. Possession of Certificate of Approval entitles
the investor to the following Tax Incentives under the Income Tax Act.



| | (i) | maximum Corporate Tax Rate of 30%
                                         (Residents and Non Residents)
| | --- | --------------------------------------------------------------------------------------------------------



| | (ii) | Withholding Tax on Dividends =
                                         10%
| | ---- | ---------------------------------------------------------------------------



| | (iii) | Withholding Tax on Interest =
                                         10%
| | ----- | --------------------------------------------------------------------------



| | (iv) | Carry forward of losses for unlimited
                                         period of time.
| | ---- | ----------------------------------------------------------------------------------------------



In 1992, the stringent foreign exchange legislation
was repealed and the restriction on foreign commercial banks abolished. Any person whether resident or not may establish foreign
currency accounts with any of the commercial banks and transfer foreign currency outside Tanzania without restriction. The Bank
of Tanzania regulates commercial banks and approves the establishment of offshore foreign currency accounts by residents.
There are no controls on foreign exchange rates or interest rate on loans and overdrafts.



E.       Taxation



Material Canadian Federal Income Tax Considerations



The following is a summary of the principal
Canadian federal income tax considerations of the purchase, ownership and disposition of the common shares offered hereunder generally
applicable to purchasers of common shares of the Company who, at all relevant times, are residents of the U.S. for the purposes
of the Canada-United States Tax Convention (1980), as amended (the “Convention”), are not resident in Canada or deemed
to be resident in Canada for purposes of the Income Tax Act (Canada), as amended to the date hereof (the “Canadian
Tax Act”), deal at arm’s length with and are not affiliated with the Company for the purposes of the Canadian Tax
Act, and do not use or hold and are not deemed to use or hold such common shares in the course of carrying on or being deemed
to be carrying on business in Canada (“U.S. Resident Holders”). Special rules, which are not discussed in this summary,
may apply to a U.S. Resident Holder that is an insurer carrying on business in Canada and elsewhere.





107







This summary is based upon the current provisions
of the Canadian Tax Act, the regulations thereunder, all specific proposals to amend the Canadian Tax Act and regulations thereunder
publicly announced by or on behalf of the Minister of Finance of Canada prior to the date hereof (the “Proposals”),
the provisions of the Convention as in effect on the date hereof, and an understanding, based on publicly available published
materials, of the current administrative policies and assessing practices of the Canada Revenue Agency in force as of the date
hereof. Other than the Proposals, this summary does not take into account or anticipate any changes in law or in the administrative
policies or assessing practices of the Canada Revenue Agency, whether by legislative, governmental or judicial action, nor does
it take into account tax laws of any province or territory of Canada or of any jurisdiction outside Canada which may differ significantly
from those discussed herein. The summary assumes that the Proposals will be enacted substantially as proposed, but there can be
no assurance that the Proposals will be enacted as proposed or at all.



This summary is of a general nature only and
is not intended to be, nor should it be construed to be, legal or tax advice to any particular U.S. Resident Holder, and no representation
with respect to the tax consequences to any particular U.S. Resident Holder is made. The tax liability of a U.S. Resident Holder
will depend on the holder’s particular circumstances. Accordingly, U.S. Resident Holders should consult with their own tax
advisors for advice with respect to their own particular circumstances.



For purposes of the Canadian Tax Act, all amounts
relating to the acquisition, holding or disposition of the common shares must be expressed in Canadian dollars using the rate
of exchange quoted by the Bank of Canada at noon on the day the amount first arose, or such other rate of exchange as is acceptable
to the Canada Revenue Agency.



Dividends



Dividends paid or credited or deemed under the
Canadian Tax Act to be paid or credited to a U.S. Resident Holder on the common shares are subject to Canadian withholding tax
equal to 25% of the gross amount of such dividends. Under the Convention and subject to the provisions thereof, the rate of Canadian
withholding tax which would apply to dividends paid on the common Shares to a U.S. Resident Holder that beneficially owns such
dividends and is fully entitled to the benefits under the Convention is generally 15%, unless the beneficial owner is a company
which owns at least 10% of the voting shares of the Company at that time, in which case the rate of Canadian withholding tax is
reduced to 5%.



Dispositions



A U.S. Resident Holder will not be subject to
tax under the Canadian Tax Act on any capital gain realized by the holder on a disposition or deemed disposition of common shares,
provided that the shares do not constitute “taxable Canadian property” of the U.S. Resident Holder for purposes of
the Canadian Tax Act. The common shares will generally not constitute taxable Canadian property of a U.S. Resident Holder at the
time of disposition provided that the common shares are listed on a designated stock exchange (which includes the TSX and the
NYSE American) at that time unless at any time during the 60-month period immediately preceding the disposition the following
two conditions are met concurrently: (i) the U.S. Resident Holder, persons with whom the U.S. Resident Holder did not deal at
arm’s length and partnerships whose members include, either directly or indirectly through one or more partnerships, the
U.S. Resident Holder or persons that do not deal at arm's length with the U.S. Resident Holder, or the U.S. Resident Holder together
with all such persons owned 25% or more of the issued shares of any class of the capital stock of the Company, and (ii) more than
50% of the fair market value of such shares was derived directly or indirectly from Canadian real estate, “Canadian resources
properties” (as defined in the Canadian Tax Act), “timber resource property” (as defined in the Canadian Tax
Act) or an option, an interest or right in such property, whether or not such property exists. Notwithstanding the foregoing,
the common shares may otherwise be deemed to be taxable Canadian property to a U.S. Resident Holder for purposes of the Canadian
Tax Act in particular circumstances. U.S. Resident Holders to whom common shares constitute taxable Canadian property should consult
with their own tax advisors as to the Canadian income tax consequences of a disposition of the common shares.





108







Certain United States Federal Income Tax Considerations





The following is a general summary of certain
material U.S. federal income tax considerations applicable to a U.S. Holder (as defined below) arising from the ownership and
disposition of the common shares. This summary applies only to U.S. Holders who hold common shares as capital assets (generally,
property held for investment).



This summary is for general information purposes
only and does not purport to be a complete analysis or listing of all potential U.S. federal income tax considerations that may
apply to a U.S. Holder as a result of the ownership and disposition of common shares. In addition, this summary does not take
into account the individual facts and circumstances of any particular U.S. Holder that may affect the U.S. federal income tax
consequences to such U.S. Holder, including specific tax consequences to a U.S. Holder under an applicable tax treaty. Accordingly,
this summary is not intended to be, and should not be construed as, legal or U.S. federal income tax advice with respect to any
particular U.S. Holder. In addition, this summary does not address the U.S. federal alternative minimum, U.S. federal estate and
gift, U.S. Medicare contribution, U.S. state and local, or non-U.S. tax consequences of the acquisition, ownership, exercise or
disposition of common shares. Except as specifically set forth below, this summary does not discuss applicable tax reporting requirements.
Each U.S. Holder should consult its own tax advisor regarding all U.S. federal, U.S. state and local and non-U.S. tax consequences
of the ownership of common shares.



No opinion from U.S. legal counsel or ruling
from the Internal Revenue Service (the “IRS”) has been requested, or will be obtained, regarding the U.S. federal
income tax consequences of the acquisition, ownership, exercise or disposition of common shares. This summary is not binding on
the IRS, and the IRS is not precluded from taking a position that is different from, and contrary to, any position taken in this
summary. In addition, because the authorities upon which this summary is based are subject to various interpretations, the IRS
and the U.S. courts could disagree with one or more of the positions taken in this summary.



Scope of This Disclosure



Authorities This summary is based on
the Internal Revenue Code of 1986, as amended (the “Code”), Treasury Regulations (whether final, temporary, or proposed),
published rulings of the IRS, published administrative positions of the IRS, the Convention Between Canada and the United States
of America with Respect to Taxes on Income and on Capital, signed September 26, 1980, as amended (the “Canada-U.S. Tax Convention”),
and U.S. court decisions that are applicable and, in each case, as in effect and available, as of the date hereof. Any of the
authorities on which this summary is based could be changed in a material and adverse manner at any time, and any such change
could be applied on a retroactive or prospective basis which could affect the U.S. federal income tax considerations described
in this summary. This summary does not discuss the potential effects, whether adverse or beneficial, of any proposed legislation
that, if enacted, could be applied on a retroactive or prospective basis.



U.S. Holders.For purposes
of this summary, the term “U.S. Holder” means a beneficial owner of common shares that is for U.S. federal income
tax purposes:



·     
An individual who is a citizen or resident of the U.S.;

109







·     
A corporation (or other entity taxable as a corporation for U.S. federal income tax purposes) created or organized in or under
the laws of the U.S., any state thereof or the District of Columbia;

·     
An estate the income of which is subject to U.S. federal income taxation regardless of its source; or

·     
A trust that (a) is subject to the primary supervision of a court within the U.S. and the control of one or more U.S. persons
for all substantial decisions or (b) has a valid election in effect under applicable Treasury Regulations to be treated as a U.S.
person.



Non-U.S. Holders.For
purposes of this summary, a “non-U.S. Holder” is a beneficial owner of common shares that is not a partnership (or
other “pass-through” entity) for U.S. federal income tax purposes and is not a U.S. Holder. This summary does not
address the U.S. federal income tax considerations applicable to non-U.S. Holders arising from the ownership of common shares.



Accordingly, a non-U.S. Holder should consult
its own tax advisor regarding all U.S. federal, U.S. state and local, and non-U.S. tax consequences (including the potential application
of and operation of any income tax treaties) relating to the purchase of the common shares pursuant to the ownership of common
shares.



Transactions Not Addressed.This summary does not address the tax consequences of transactions effected prior or subsequent to, or concurrently with,
any purchase of the securities (whether or not any such transactions are undertaken in connection with the purchase of the securities),
other than the U.S. federal income tax considerations to U.S. Holders of the the ownership of such common shares.



U.S. Holders Subject to Special U.S. Federal Income Tax Rules
Not Addressed



This summary does not address the U.S. federal
income tax considerations of the ownership of common shares by U.S. Holders that are subject to special provisions under the Code,
including, but not limited to, the following: (a) tax-exempt organizations, qualified retirement plans, individual retirement
accounts, or other tax-deferred accounts; (b) financial institutions, underwriters, insurance companies, real estate investment
trusts, or regulated investment companies; (c) broker-dealers, dealers, or traders in securities or currencies that elect to apply
a “mark-to-market” accounting method; (d) U.S. Holders that have a “functional currency” other than the
U.S. dollar; (e) U.S. Holders that own common shares as part of a straddle, hedging transaction, conversion transaction, constructive
sale, or other arrangement involving more than one position; (f) U.S. Holders that acquire common shares in connection with the
exercise of employee stock options or otherwise as compensation for services; (g) U.S. Holders that hold common shares other than
as a capital asset within the meaning of Section 1221 of the Code (generally, property held for investment purposes); (h) U.S.
Holders that own directly, indirectly, or by attribution, 10% or more, by voting power or value, of the outstanding stock of the
Company; and (i) U.S. Holders subject to Section 451(b) of the Code. This summary also does not address the U.S. federal income
tax considerations applicable to U.S. Holders who are: (a) U.S. expatriates or former long-term residents of the U.S.; (b) persons
that have been, are, or will be a resident or deemed to be a resident in Canada for purposes of the Tax Act; (c) persons that
use or hold, will use or hold, or that are or will be deemed to use or hold common shares in connection with carrying on a business
in Canada; (d) persons whose common shares constitute “taxable Canadian property” under the Tax Act; or (e) persons
that have a permanent establishment in Canada for purposes of the Canada-U.S. Tax Convention. U.S. Holders that are subject to
special provisions under the Code, including U.S. Holders described immediately above, should consult their own tax advisors regarding
all U.S. federal, U.S. state and local, and non-U.S. tax consequences (including the potential application and operation of any
income tax treaties) relating to the ownership of common shares.





110







If an entity or arrangement that is classified
as a partnership (or other “pass-through” entity) for U.S. federal income tax purposes holds common shares, the U.S.
federal income tax consequences to such partnership and the partners (or other owners) of such partnership of the ownership of
the common shares generally will depend on the activities of the partnership and the status of such partners (or other owners).
This summary does not address the U.S. federal income tax consequences for any such partner or partnership (or other “pass-through”
entity or its owners). Owners of entities and arrangements that are classified as partnerships (or other “pass-through”
entities) for U.S. federal income tax purposes should consult their own tax advisors regarding the U.S. federal income tax consequences
of the ownership of common shares.



Distributions on Common Shares



The Company has never paid a dividend and has
no intention of paying a dividend. Subject to the PFIC rules discussed below, a U.S. Holder that receives a distribution, including
a constructive distribution, with respect to common shares will be required to include the amount of such distribution in gross
income as a dividend (without reduction for any Canadian income tax withheld from such distribution) to the extent of the current
or accumulated “earnings and profits” of the Company, as computed for U.S. federal income tax purposes. To the extent
that a distribution exceeds the current and accumulated “earnings and profits” of the Company, such distribution will
be treated first as a tax-free return of capital to the extent of a U.S. Holder’s tax basis in the common shares and thereafter
as gain from the sale or exchange of such common shares (see “Sale or Other Taxable Disposition of Common Shares”
below). However, the Company may not maintain calculations of earnings and profits in accordance with U.S. federal income tax
principles, and each U.S. Holder should therefore assume that any distribution by the Company with respect to the common shares
will be reported to them as a dividend. Dividends received on the common shares generally will not be eligible for the “dividends
received deduction” available to U.S. corporate shareholders receiving dividends from U.S. corporations. If the Company
is eligible for the benefits of the Canada-U.S. Tax Convention, or another qualifying income tax treaty with the United States
that includes an exchange of information program which the U.S. Treasury Department has determined is satisfactory for these purposes,
or its shares are readily tradable on an established securities market in the U.S., dividends paid by the Company to non-corporate
U.S. Holders generally will be eligible for the preferential tax rates applicable to long-term capital gains, provided certain
holding period and other conditions are satisfied, including that the Company not be classified as a PFIC in the tax year of distribution
or in the preceding tax year. The dividend rules are complex, and each U.S. Holder should consult its own tax advisor regarding
the application of such rules.



Sale or Other Taxable Disposition of Common Shares



Subject to the PFIC rules discussed below,
upon the sale or other taxable disposition of common shares, a U.S. Holder generally will recognize a capital gain or loss in
an amount equal to the difference between the amount of cash plus the fair market value of any property received and such U.S.
Holder’s tax basis in the common shares sold or otherwise disposed of. Such capital gain or loss will generally be a long-term
capital gain or loss if, at the time of the sale or other taxable disposition, the U.S. Holder’s holding period for the
common shares is more than one year. Preferential tax rates apply to long-term capital gains of non-corporate U.S. Holders. Deductions
for capital losses are subject to significant limitations under the Code. A U.S. Holder’s tax basis in common shares generally
will be such U.S. Holder’s U.S. dollar cost for such common shares.





111







PFIC Status of the Company



The Company had no revenues for its taxable
year ended August 31, 2018, and has not performed an analysis of whether or not it was or will be deemed a PFIC for its prior
and current taxable years. If the Company is or becomes a PFIC, the foregoing description of the U.S. federal income tax consequences
to U.S. Holders of the ownership of Common Shares will be different. The U.S. federal income tax consequences of owning and disposing
of common shares if the Company is or becomes a PFIC are described below under the heading “Tax Consequences if the Company
is a PFIC.”



A non-U.S. corporation is a PFIC for each tax
year in which (i) 75% or more of its gross income is passive income (as defined for U.S. federal income tax purposes) (the “income
test”) or (ii) 50% or more (by value) of its assets (based on an average of the quarterly values of the assets during such
tax year) either produce or are held for the production of passive income (the “asset test”). For purposes of the
PFIC provisions, “gross income” generally includes sales revenues less cost of goods sold, plus income from investments
and from incidental or other operations or sources, and “passive income” generally includes dividends, interest, certain
rents and royalties, certain gains from commodities or securities transactions and the excess of gains over losses from the disposition
of certain assets which product passive income. If a non-U.S. corporation owns at least 25% (by value) of the stock of another
corporation, the non-U.S. corporation is treated, for purposes of the income test and asset test, as owning its proportionate
share of the assets of the other corporation and as receiving directly its proportionate share of the other corporation’s
income.



Under certain attribution and indirect ownership
rules, if the Company is a PFIC, U.S. Holders will generally be deemed to own their proportionate share of the Company’s
direct or indirect equity interest in any company that is also a PFIC (a “Subsidiary PFIC”), and will be subject to
U.S. federal income tax on their proportionate share of (a) any “excess distributions,” as described below, on the
stock of a Subsidiary PFIC and (b) a disposition or deemed disposition of the stock of a Subsidiary PFIC by the Company or another
Subsidiary PFIC, both as if such U.S. Holders directly held the shares of such Subsidiary PFIC. In addition, U.S. Holders may
be subject to U.S. federal income tax on any indirect gain realized on the stock of a Subsidiary PFIC on the sale or disposition
of common shares. Accordingly, U.S. Holders should be aware that they could be subject to tax even if no distributions are received
and no redemptions or other dispositions of the Company’s common shares are made.



The determination of PFIC status is inherently
factual, is subject to a number of uncertainties, and can be determined only annually at the close of the tax year in question.
Additionally, the analysis depends, in part, on the application of complex U.S. federal income tax rules, which are subject to
differing interpretations. There can be no assurance that the Company will or will not be determined to be a PFIC for the current
tax year or any prior or future tax year, and no opinion of legal counsel or ruling from the IRS concerning the status of the
Company as a PFIC has been obtained or will be requested. U.S. Holders should consult their own U.S. tax advisors regarding the
PFIC status of the Company.



Tax Consequences if the Company is a PFIC



If the Company is a PFIC for any tax year during
which a U.S. Holder holds common shares, special rules may increase such U.S. Holder’s U.S. federal income tax liability
with respect to the ownership and disposition of such common shares. If the Company is a PFIC for any tax year during which a
U.S. Holder owns common shares, the Company will be treated as a PFIC with respect to such U.S. Holder for that tax year and for
all subsequent tax years, regardless of whether the Company meets the income test or the asset test for such subsequent tax years,
unless the U.S. Holder makes a “deemed sale” election with respect to the common shares. If the election is made,
the U.S. Holder will be deemed to sell the common shares it holds at their fair market value on the last day of the last taxable
year in which we qualified as a PFIC, and any gain recognized from such deemed sale would be taxed under the PFIC excess distribution
regime. After the deemed sale election, the U.S. Holder’s common shares would not be treated as shares of a PFIC unless
the Company subsequently becomes a PFIC. U.S. Holders should consult their own U.S. tax advisors regarding the availability and
desirability of a deemed sale election.





112





Under the default PFIC rules:



·     Any
gain realized on the sale or other disposition (including dispositions and certain other events that would not otherwise be treated
as taxable events) of common shares (including an indirect disposition of the stock of any Subsidiary PFIC) and any “excess
distribution” (defined as a distribution to the extent it (together with all other distributions received in the relevant
tax year) exceeds 125% of the average annual distribution received during the shorter of the preceding three years or the U.S.
Holder’s holding period for the common shares) received on common shares or with respect to the stock of a Subsidiary PFIC
will be allocated ratably to each day of such U.S. Holder’s holding period for the common shares;

·    
The amount allocated to the current tax year and any year prior to the first year in which the Company was a PFIC will be taxed
as ordinary income in the current year;

·    
The amount allocated to each of the other tax years (the “Prior PFIC Years”) will be subject to tax at the highest
ordinary income tax rate in effect for the applicable class of taxpayer for that year; and

·    
An interest charge will be imposed with respect to the resulting tax attributable to each Prior PFIC Year.



A U.S. Holder that makes a timely and effective
“mark-to-market” election under Section 1296 of the Code (a “Mark-to-Market Election”) or a timely and
effective election to treat the Company and each Subsidiary PFIC as a “qualified electing fund” (a “QEF”)
under Section 1295 of the Code (a “QEF Election”) may generally mitigate or avoid the default PFIC rules described
above with respect to common shares U.S. Holders should be aware that there can be no assurance that the Company has satisfied
or will satisfy the recordkeeping requirements that apply to a QEF or that the Company has supplied or will supply U.S. Holders
with information such U.S. Holders require to report under the QEF rules in the event that the Company is a PFIC for any tax year.



A timely and effective QEF Election requires
a U.S. Holder to include currently in gross income each year its pro rata share of the Company’s ordinary earnings and net
capital gains, regardless of whether such earnings and gains are actually distributed. Thus, a U.S. Holder could have a tax liability
with respect to such ordinary earnings or gains without a corresponding receipt of cash from the Company. If the Company is a
QEF with respect to a U.S. Holder, the U.S. Holder’s basis in the common shares will be increased to reflect the amount
of the taxed but undistributed income. Distributions of income that had previously been taxed will result in a corresponding reduction
of basis in the common shares and will not be taxed again as a distribution to a U.S. Holder. Taxable gains on the disposition
of common shares by a U.S. Holder that has made a timely and effective QEF Election are generally capital gains. A U.S. Holder
must make a QEF Election for the Company and each Subsidiary PFIC if it wishes to have this treatment. To make a QEF Election,
a U.S. Holder will need to have an annual information statement from the Company setting forth the ordinary earnings and net capital
gains for the year and the Company may not provide this statement, in which case a QEF Election cannot be made. In general, a
U.S. Holder must make a QEF Election on or before the due date for filing its income tax return for the first year to which the
QEF Election will apply. Under applicable Treasury Regulations, a U.S. Holder will be permitted to make retroactive elections
in particular, but limited, circumstances, including if it had a reasonable belief that the Company was not a PFIC and did not
file a protective election. If a U.S. Holder owns PFIC stock indirectly through another PFIC, separate QEF Elections must be made
for the PFIC in which the U.S. Holder is a direct shareholder and the Subsidiary PFIC for the QEF rules to apply to both PFICs.





113







Each U.S. Holder should consult its own
tax advisor regarding the availability and desirability of, and procedure for, making a timely and effective QEF Election (including
a “pedigreed” QEF election where necessary) for the Company and any Subsidiary PFIC.



Alternatively, a Mark-to-Market Election may
be made with respect to “marketable stock” in a PFIC if which is stock that is “regularly traded” on a
“qualified exchange or other market” (within the meaning of the Code and the applicable U.S. Treasury Regulations).
A class of stock that is traded on one or more qualified exchanges or other markets is considered to be “regularly traded”
for any calendar year during which such class of stock is traded in other than de minimis quantities on at least 15 days during
each calendar quarter. If the common shares are considered to be “regularly traded” within this meaning, then a U.S.
Holder generally will be eligible to make a Mark-to-Market Election with respect to its common shares. However, there is no assurance
that the common shares will be or remain “regularly traded” for this purpose. A Mark-to-Market Election may not be
made with respect to the stock of any Subsidiary PFIC. Hence, a Mark-to-Market Election will not be effective to eliminate the
application of the default PFIC rules, described above, with respect to deemed dispositions of Subsidiary PFIC stock, or excess
distributions with respect to a Subsidiary PFIC.



A U.S. Holder that makes a timely and effective
Mark-to-Market Election with respect to common shares generally will be required to recognize as ordinary income in each tax year
in which the Company is a PFIC an amount equal to the excess, if any, of the fair market value of such shares as of the close
of such taxable year over the U.S. Holder’s adjusted tax basis in such shares as of the close of such taxable year. A U.S.
Holder’s adjusted tax basis in the common shares generally will be increased by the amount of ordinary income recognized
with respect to such shares. If the U.S. Holder’s adjusted tax basis in the common shares as of the close of a tax year
exceeds the fair market value of such shares as of the close of such taxable year, the U.S. Holder generally will recognize an
ordinary loss, but only to the extent of net mark-to-market income recognized with respect to such shares for all prior taxable
years. A U.S. Holder’s adjusted tax basis in its common shares generally will be decreased by the amount of ordinary loss
recognized with respect to such shares. Any gain recognized upon a disposition of the common shares generally will be treated
as ordinary income, and any loss recognized upon a disposition generally will be treated as an ordinary loss to the extent of
net mark-to-market income recognized for all prior taxable years. Any loss recognized in excess thereof will be taxed as a capital
loss. Capital losses are subject to significant limitations under the Code.



Each U.S. Holder should consult its own tax
advisor regarding the availability and desirability of, and procedure for, making a timely and effective Mark-to-Market Election
with respect to the common shares.



Foreign Tax Credit



A U.S. Holder that pays (whether directly or
through withholding) Canadian income tax in connection with the ownership or disposition of common shares may (under certain circumstances)
be entitled to receive either a deduction or a credit for such Canadian income tax paid generally at the election of such U.S.
Holder. Generally, a credit will reduce a U.S. Holder’s U.S. federal income tax liability on a dollar-for-dollar basis,
whereas a deduction will reduce a U.S. Holder’s income subject to U.S. federal income tax. This election is made on a year-by-year
basis and applies to all creditable foreign taxes paid (whether directly or through withholding) by a U.S. Holder during a year.





114





Complex limitations apply to the foreign tax
credit, including the general limitation that the credit cannot exceed the proportionate share of a U.S. Holder’s U.S. federal
income tax liability that such U.S. Holder’s “foreign source” taxable income bears to such U.S. Holder’s
worldwide taxable income. In applying this limitation, a U.S. Holder’s various items of income and deduction must be classified,
under complex rules, as either “foreign source” or “U.S. source.” Generally, dividends paid by a non-U.S.
corporation should be treated as foreign source for this purpose, and gains recognized on the sale of securities of a non-U.S.
corporation by a U.S. Holder should be treated as U.S. source for this purpose, except as otherwise provided in an applicable
income tax treaty and if an election is properly made under the Code. However, the amount of a distribution with respect to the
common shares that is treated as a “dividend” may be lower for U.S. federal income tax purposes than it is for Canadian
federal income tax purposes, resulting in a reduced foreign tax credit allowance to a U.S. Holder. In addition, this limitation
is calculated separately with respect to specific categories of income. The foreign tax credit rules are complex, and each U.S.
Holder should consult its own U.S. tax advisor regarding the foreign tax credit rules.



Special rules apply to the amount of foreign
tax credit that a U.S. Holder may claim on a distribution, including a constructive distribution, from a PFIC. Subject to such
special rules, non-U.S. taxes paid with respect to any distribution in respect of stock in a PFIC are generally eligible for the
foreign tax credit. The rules relating to distributions by a PFIC and their eligibility for the foreign tax credit are complicated,
and a U.S. Holder should consult its own tax advisor regarding their application to the U.S. Holder.



Receipt of Foreign Currency



The amount of any distribution or proceeds
paid in Canadian dollars to a U.S. Holder in connection with the ownership of common shares, or on the sale or other taxable disposition
of common shares will be included in the gross income of a U.S. Holder as translated into U.S. dollars calculated by reference
to the exchange rate prevailing on the date of actual or constructive receipt of the payment, regardless of whether the Canadian
dollars are converted into U.S. dollars at that time. If the Canadian dollars received are not converted into U.S. dollars on
the date of receipt, a U.S. Holder will have a basis in the Canadian dollars equal to their U.S. dollar value on the date of receipt.
Any U.S. Holder who receives payment in Canadian dollars and engages in a subsequent conversion or other disposition of the Canadian
dollars may have a foreign currency exchange gain or loss that would generally be treated as ordinary income or loss, and generally
will be U.S. source income or loss for foreign tax credit purposes. Different rules apply to U.S. Holders who use the accrual
method with respect to foreign currency.



Each U.S. Holder should consult its own U.S.
tax advisor regarding the U.S. federal income tax consequences of receiving, owning, and disposing of Canadian dollars.



Information Reporting; Backup Withholding



Under U.S. federal income tax law, certain
categories of U.S. Holders must file information returns with respect to their investment in, or involvement in, a non-U.S. corporation.
For example, U.S. return disclosure obligations (and related penalties) are imposed on individuals who are U.S. Holders that hold
certain specified foreign financial assets in excess of certain threshold amounts. The definition of “specified foreign
financial assets” includes not only financial accounts maintained in non-U.S. financial institutions, but also, if held
for investment and not in an account maintained by certain financial institutions, any stock or security issued by a non-U.S.
person, any financial instrument or contract that has an issuer or counterparty other than a U.S. person and any interest in a
non-U.S. entity. A U.S. Holder may be subject to these reporting requirements unless such U.S. Holder’s common shares are
held in an account at certain financial institutions. Penalties for failure to file certain of these information returns are substantial.
U.S. Holders should consult with their own tax advisors regarding the requirements of filing information returns on IRS Form 8938,
and, if applicable, filing obligations relating to the PFIC rules, including possible reporting on an IRS Form 8621.





115







Payments made within the U.S. or by a U.S.
payor or U.S. middleman of (a) distributions on the common shares, and (b) proceeds arising from the sale or other taxable disposition
of common shares generally will be subject to information reporting. In addition, backup withholding, currently at a rate of 24%,
may apply to such payments if a U.S. Holder (a) fails to furnish such U.S. Holder’s correct U.S. taxpayer identification
number (generally on IRS Form W-9), (b) furnishes an incorrect U.S. taxpayer identification number, (c) is notified by the IRS
that such U.S. Holder has previously failed to properly report items subject to backup withholding, or (d) fails to certify, under
penalty of perjury, that such U.S. Holder has furnished its correct U.S. taxpayer identification number and that the IRS has not
notified such U.S. Holder that it is subject to backup withholding. Certain exempt persons generally are excluded from these information
reporting and backup withholding rules. Backup withholding is not an additional tax. Any amounts withheld under the U.S. backup
withholding rules will be allowed as a credit against a U.S. Holder’s U.S. federal income tax liability, if any, or will
be refunded, if such U.S. Holder furnishes required information to the IRS in a timely manner. The information reporting and backup
withholding rules may apply even if, under the Canada-U.S. Tax Convention, payments are eligible for a reduced withholding rate.



The discussion of reporting requirements set
forth above is not intended to constitute an exhaustive description of all reporting requirements that may apply to a U.S. Holder.
A failure to satisfy certain reporting requirements may result in an extension of the time period during which the IRS can assess
a tax, and, under certain circumstances, such an extension may apply to assessments of amounts unrelated to any unsatisfied reporting
requirement. Each U.S. Holder should consult its own tax advisor regarding the information reporting and backup withholding rules.



THE ABOVE SUMMARY IS NOT
INTENDED TO CONSTITUTE A COMPLETE ANALYSIS OF ALL U.S. TAX CONSIDERATIONS APPLICABLE TO U.S. HOLDERS WITH RESPECT TO THE OWNERSHIP,
EXERCISE OR DISPOSITION OF COMMON SHARES. U.S. HOLDERS SHOULD CONSULT THEIR OWN TAX ADVISORS AS TO THE TAX CONSIDERATIONS APPLICABLE
TO THEM IN THEIR PARTICULAR CIRCUMSTANCES.







Tanzania



Taxation



Tax in Tanzania is levied based on residence
and source. Resident persons are taxed on worldwide income whilst non-residents are only taxed on income sourced in Tanzania.
An individual is considered to be Tanzanian resident if he has a permanent home in Tanzania and is present during any part of
the year, he was resident in Tanzania during the year of income for periods amounting in aggregate to 183 days or more; or if
he was in the United Republic in that year of income and each of the two preceding years of income for periods averaging more
than 122 days in each such year of income.



The minimum annual income tax threshold is
TShs. 2,040,000 or TShs. 170,000 per month. Income Tax Rates vary from Nil up to 30%. Prevailing corporate income tax rate is
30%.





116







Value Added Tax (“VAT”)



|Taxable Supplies                                        | Rate
|------------------------------------------------------- | ----
|Supply
    of goods and services in Mainland Tanzania   | 18% 
|Import
    of goods and services in Mainland Tanzania   | 18% 
|Export
    of goods and services from Mainland Tanzania | 0%  
|Special
    relief to some entities/items               | 10% 



VAT registrable threshold is TShs. 40 Million (or about US$25,000
at prevailing exchange rates).



Withholding Tax



Withholding tax is charged at the rates specified below:



|                                                              | Resident | Non-Resident
|------------------------------------------------------------- | -------- | ------------
|Dividend                                                      | 10%      | 10%         
|Dividend
    from  listed on the Dar es Salaam Stock Exchange | 5%       | 5%          
|Interest                                                      | 10%      | 10%         
|Royalties                                                     | 0%       | 15%         
|Management
    Fees                                           | 5%       | 15%         
|Professional
    Fees                                         | 5%       | 15%         
|Rent,
    Premium for Use of Property                         | 10%      | 15%         
|Pension/Retirement
    Annuity                                | 10%      | 15%         
|Service
    fee                                               | 5%       | 15%         
|Insurance
    premium                                         | 0        | 5%          



Special Rates for Persons Engaged in “Mining Operations”
Rates



|                                            | Resident | Non-Resident
|------------------------------------------- | -------- | ------------
|Technical
    Services to Mining Operations | 5%       | 15%         
|Management
    Fee                          | 0%       | 15%         



Capital Gains Taxation



0% applies to capital gains on the sale of
shares listed at the DSM Stock Exchange. Normal pay as you earn rates with a marginal rate of 30% applies to capital gains by
resident individuals, 30% applies to capital gains by corporations.





117







Thin capitalisation



For exempt controlled entities, the interest
expense that is allowable for tax purposes is restricted to debt and equity ratio of 7 to 3. Debts and equity are defined terms
in the legislation. Any interest expense relating to debts exceeding this ratio is permanently disallowed.



Stamp duty



Stamp duty is chargeable on various legal documents
and agreements (e.g. transfer of shares, issue of shares, etc.) generally at ad valorem rates of up to 1%.



Customs Duty



There are three import duty rates: 0% for capital
goods and raw materials, 10% for semi – finished goods and 25% for finished final consumer goods.



Mining Sector



The Tax Incentives and Investment allowances
are designed to encourage industrial growth and attract foreign investments. They are granted for capital expenditure on hotels
and manufacturing and mining operations. The allowance is a deduction in computing taxable income.



For companies investing in the Mining Industries
(Mineral mining Rights Holders) specific tax incentives are applicable to their investments. These are:-



| | (i) | Indefinite carry forward of losses.
| | --- | -----------------------------------



| | (iii) | 15% additional Capital Expenditure
                                         on unredeemed qualifying Capital Expenditure for Mining Operators who had entered into
                                         Agreement with the Government before 1st July 2001, under the Mining Acts.
| | ----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The government of Tanzania also imposes a
royalty on the gross value of all production equal to 5% for diamonds and 4% for metallic minerals (including copper, silver,
gold and platinum group minerals).



Double Taxation Agreement



Tanzania has tax treaties to prevent double
taxation with Canada, Denmark, Finland, India, Italy, Norway, South Africa, Sweden and Zambia. Tanzania is also in the process
of negotiating treaties with several countries including Belgium, Burundi, Iran, Lebanon, Malaysia, Mauritius, Pakistan, and Rwanda.



F.       Dividends
and Paying Agents



Not applicable.



G.       Statement
by Experts



Not applicable.





118







H.       Documents
on Display



The Company files annual reports and other
information with the SEC. You may read and copy any document that it files at the SEC’s Public Reference Room at 100 F Street,
NE, Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for more information about the Public Reference Rooms. The SEC
also maintains a website, www.sec.gov, where you may obtain our reports. The Company also files certain reports with the Canadian
Securities Administrators that you may obtain through access of the SEDAR website, www.sedar.com.



Copies of the Company’s material contracts
are kept in the Company’s principal executive office.



I.       Subsidiary
Information



Not applicable.



| | Item 11. | Quantitative
                                         and Qualitative Disclosures About Market Risk
| | -------- | ---------------------------------------------------------------------------------------------------



The Company is exposed to market risk, primarily
related to foreign exchange and metals prices (gold in particular). The Company uses the Canadian dollar as its reporting currency,
but the Company converts Canadian dollars to U.S. dollars, and then U.S. dollars to Tanzanian schillings. The Company is therefore
exposed to foreign exchange movements in Tanzania where the Company is incurring costs in conducting exploration activities. Most
of the Company’s exploration work is conducted in U.S. dollars; however, some general and administrative expenses are paid
in Tanzanian schillings.





The following table sets forth the percentage of the Company's
administrative expense by currency for the year ended August 31, 2018.



By Currency



|                       | 2018
|---------------------- | ----
|Canadian
    Dollar    | 20% 
|U.S.
    Dollar        | 25% 
|Tanzanian
    Shilling | 55% 
|Total:                 | 100%



Such administrative expense by currency may
change from time to time, but it has been roughly the same year to year. Further, the Company incurred net exploration costs
of $(507,838) and $1,168,935 for the years ended August 31, 2018 and 2017 respectively, which are primarily paid in U.S.
dollars.



The Company has not entered into any material
foreign exchange contracts to minimize or mitigate the effects of foreign exchange fluctuations on the Company's operations. Based
on prior years, the Company does not believe that it is subject to material foreign exchange fluctuations. However, no assurance
can be given that this will continue to be true in the future.



The market prices of most precious metals,
including gold, have generally increased over the past three years, but are subject to market fluctuations based primarily on
supply and demand.



The following table sets out the cumulative
average prices of gold for the past five years, based on the London Metals Market afternoon price fix in U.S. dollars:



119







|2018
        (Average to November 30) | 2017     | 2016     | 2015     | 2014    
|------------------------------------- | -------- | -------- | -------- | --------
|$1,256.31                             | 1,256.31 | 1,250.74 | 1,160.06 | 1,266.40



| | Item 12. | Description
                                         of Securities Other than Equity Securities
| | -------- | -----------------------------------------------------------------------------------------------



Not applicable



Part II



| | Item 13. | Defaults,
                                         Dividend Arrears and Delinquencies
| | -------- | -------------------------------------------------------------------------------------



None.



| | Item 14. | Material
                                         Modifications to the Rights of Security Holders and Use of Proceeds
| | -------- | ---------------------------------------------------------------------------------------------------------------------



At the annual general and special meeting held
on March 1, 2012 the shareholders approved the Shareholder Rights Plan (the “Rights Plan”).



On November 23, 2011, the Directors of the
Company approved the adoption of the Rights Plan designed to encourage the fair and equal treatment of shareholders in connection
with any take-over bid for the outstanding common shares of the Company. The Company’s board is not aware of any specific
take-over bid for the Company that has been made or is contemplated. In the event that a take-over bid is made for the Company’s
common shares in the future, the Rights Plan is intended to provide the Company’s board with adequate time to assess a take-over
bid, to consider alternatives to a take-over bid and to provide the Company’s shareholders with time to assess a take-over
bid. Under the Rights Plan, offers that satisfy certain standards designed to protect shareholder interests will be considered
to be “Permitted Bids”. Specifically, a Permitted Bid must be made to all shareholders of the Company and must be
outstanding for a minimum period of 60 days, among other conditions. If a bid does not qualify as a Permitted Bid, shareholders
other than the acquiring person and joint actors will become entitled to exercise the rights to acquire the Company’s common
shares at a significant discount to the prevailing market.



A complete copy of the Rights Plan can be obtained
either by accessing it on SEDAR (www.sedar.com) or upon written request to the Company,
free of charge.



| | Item 15. | Controls
                                         and Procedures
| | -------- | ----------------------------------------------------------------



Disclosure Controls and Procedures



The Company’s management, with the participation
of its Chief Executive Officer and Chief Financial Officer, as of the end of the period covered in this report, evaluated the
effectiveness of its disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) and
concluded that they are appropriately designed and operating effectively to ensure that information required to be disclosed by
the Company in reports that the Company files or submits under the Exchange Act is recorded, processed, summarized and reported
within the time periods specified in SEC rules and forms.





120







Management’s Annual Report on Internal Control Over Financial
Reporting



Management of the Company is responsible for
establishing and maintaining adequate internal control over financial reporting for the Company as defined in Rule 13a-15(f) under
the Exchange Act. Management of the Company is responsible for establishing and maintaining adequate internal control over financial
reporting for the Company.  The Company’s management, including its Chief Executive Officer and Chief Financial Officer,
conducted an evaluation of the effectiveness of its internal control over financial reporting as of August 31, 2018.  In
making this assessment, the Company’s management used the criteria established in Internal Control – Integrated Framework
2013, issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”).  The Company’s
management has completed their review and testing of the Company’s internal control over financial reporting and concluded
that they are appropriately designed and operating effectively as of August 31, 2018.





The Public Company Accounting Oversight Board’s
Auditing Standard No. 5 defines a material weakness as a control deficiency, or a combination of control deficiencies, such that
there is a reasonable possibility that a material misstatement of the Company’s annual financial statements will not be
prevented or detected.



This annual report does not include an attestation
report of the Company’s independent registered public accounting firm regarding internal control over financial reporting.
Because the Company is a non accelerated filer, the Company’s management’s report was not subject to attestation by
the Company’s independent registered public accounting firm pursuant to the rules of the SEC that permit us to provide only
management’s report in this annual report.



Because of the inherent limitations in all
control systems, no evaluation of controls can provide absolute assurance that all control issues, if any, within our company
have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that
breakdowns can occur because of simple error or mistake.



Changes in Internal Controls over Financial Reporting





During the year ended August 31, 2018, there
were no changes in the Company’s internal control over financial reporting that have materially affected, or are reasonable
likely to materially affect, its internal control over financial reporting.



| | Item 16 A. | Audit Committee
                                         Financial Expert
| | ---------- | -------------------------------------------------------------------------



The Company’s Board has determined that
Dr. Norman Betts qualified as an Audit Committee financial expert. Dr. Betts is an “independent director”, as defined
under NI 52-110 and as defined pursuant to National Association of Securities Dealers (NASD) Rule 4200(a)(15) (as such definition
may be modified or supplemented). The SEC has indicated that the designation of an audit committee financial expert does not make
that person an “expert” for any purpose, impose any duties, obligations, or liability on that person that are greater
than those imposed on members of the audit committee and board of directors who do not carry this designation, or affect the duties,
obligations, or liabilities of any other member of the audit committee.



| | Item 16 B. | Code of
                                         Ethics
| | ---------- | -------------------------------------------------------



The Company has a Code of Ethics and Business
Conduct that applies to the Company’s directors, officers, employees and consultants. In addition, the Company has a Code
of Ethical Conduct for Financial Managers that applies to its principal executive officer, principal financial officer, principal
accounting officer, controller and other persons performing similar functions. A copy of the Company’s Code of Ethics and
Business Conduct and Code of Ethical Conduct for Financial Managers can be found on its website at www.tanzanianroyalty.com. The
Company will report any amendment or waiver to the Code of Ethics on its website within five business days of such amendment or
waiver.





121





The Company undertakes to provide any person
without charge a copy of its code of ethics. Persons requesting a copy should address their request to Corporate Secretary, Tanzanian
Royalty Exploration Corporation, Suite 202, 5626 Larch Street, Vancouver, BC, V6M 4E1.



| | Item 16 C. | Principal
                                         Accountant Fees and Services
| | ---------- | -------------------------------------------------------------------------------



The Company’s independent auditor for
the fiscal year ended August 31, 2018 and 2017 was Dale Matheson Carr-Hilton Labonte LLP, Chartered Professional Accountants.



The Company’s Audit and Compensation
Committee pre-approves all services provided by its independent auditors. All of the services and fees described below were reviewed
and pre-approved by the audit committee.



The following summarizes the significant professional
services rendered by Dale Matheson Carr-Hilton Labonte LLP for the year ended August 31, 2018 and 2017.



|Fiscal Year Ending August 31 | Audit
    Fees                              | Audit
    Related Fees | Tax
    Fees | All
    Other Fees
|---------------------------- | ------------------------------------------- | ---------------------- | ------------ | ------------------
|2018                         | Canada
    – $88,000
    Tanzania - $15,000 | Nil
    Nil            | Nil
    Nil  | Nil
    Nil       
|2017                         | Canada
    – $80,000
    Tanzania - $15,000 | Nil
    Nil            | Nil
    Nil  | Nil
    Nil       





| | Item 16 D. | Exemptions
                                         from the Listing Standards for Audit Committees
| | ---------- | ---------------------------------------------------------------------------------------------------



Not applicable.



| | Item 16 E. | Purchases
                                         of Equity Securities by the Issuer and Affiliated Purchasers
| | ---------- | ---------------------------------------------------------------------------------------------------------------



Not applicable.





| | Item 16 F. | Change
                                         in Registrant’s Certifying Accountant
| | ---------- | -------------------------------------------------------------------------------------





Not applicable.



| | Item 16 G. | Corporate
                                         Governance
| | ---------- | -------------------------------------------------------------



The Company’s common shares are listed
on the NYSE American. Section 110 of the NYSE American Company Guide permits NYSE American to consider the laws, customs and practices
of foreign issuers in relaxing certain NYSE American listing criteria, and to grant exemptions from NYSE American listing criteria
based on these considerations. A company seeking relief under these provisions is required to provide written certification from
independent local counsel that the non-complying practice is not prohibited by home country law. The following is a description
of the significant ways in which the Company’s governance practices differ from those followed by domestic companies pursuant
to NYSE American standards:





122





Shareholder Meeting Quorum Requirement.The NYSE American minimum quorum requirement for shareholder meeting is 33 1/3% of the outstanding shares of common stock. 
In addition, a company listed on NYSE American is required to state its quorum requirement in its bylaws.  The Company’s
quorum requirement is set forth in its bylaws.  The Company’s bylaws provide that a quorum at any meeting of shareholders
shall be persons present not being less than two in number and who hold or represent not less than 20% of the total number of
the issued shares of the Company.



Proxy Delivery Requirement. NYSE American
requires the solicitation of proxies and delivery of proxy statements for all shareholder meetings, and requires that these proxies
be solicited pursuant to a proxy statement that conforms to the proxy rules of the SEC. The Company is a foreign private issuer
as defined in Rule 3b-4 under the Exchange Act, and the equity securities of the Company are accordingly exempt from the proxy
rules set forth in Sections 14(a), 14(b), 14(c) and 14(f) of such Act.  The Company solicits proxies in accordance with applicable
rules and regulations in Canada.



Shareholder Approval Requirements. NYSE
American requires a listed company to obtain the approval of its shareholders for certain types
of securities issuances, including private placements that may result in the issuance of common shares (or securities convertible
into common shares) equal to 20% or more of presently outstanding shares for less than the greater of book or market value of
the shares.  In general, there is no such requirement under the rules of the TSX unless the transaction results in a change
of control.  The Company will seek a waiver from NYSE American’s shareholder approval requirements in circumstances
where the securities issuance does not trigger such a requirement under the rules of the TSX.



The foregoing is consistent with the laws,
customs and practices in Canada.



| | Item 16 H. | Mine Safety
                                         Disclosure
| | ---------- | ---------------------------------------------------------------



The Company is in the exploration stage and its mining properties
are located outside the United States.



Part III



| | Item 17. | Financial
                                         Statements
| | -------- | -------------------------------------------------------------



Not applicable.



| | Item 18. | Financial
                                         Statements
| | -------- | -------------------------------------------------------------



The consolidated financial statements are prepared in accordance
with International Financial Reporting Standards asissued by the International Accounting Standards Board and are expressed in
Canadian dollars.



123







| | Item 19. | Exhibits
| | -------- | --------





|Exhibit No. | Name                                                                                                                                                          
|----------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------
|1.1         | Articles and Bylaws of Tan Range Exploration Corporation,
    as amended. (1)                                                                                 
|1.2         | Certificate of Amendment for Change of Name dated
    February 28, 2006 (6)                                                                                   
|1.3         | Certificate of Amendment and Registration of Restated
    Articles dated March 7, 2008 for increase in the maximum number of directors to eleven (6)          
|2.1         | Employee Share Ownership Plan (2003) (1)                                                                                                                      
|2.2         | 2001 Stock Option Plan (1)                                                                                                                                    
|2.3         | Shareholder Rights Plan (2)                                                                                                                                   
|2.4         | 2011 Shareholder Rights Plan (9)                                                                                                                              
|2.5         | Restricted Stock Unit Incentive Plan (4)                                                                                                                      
|2.6         | Amended Restricted Stock Unit Incentive Plan (8)                                                                                                              
|4.1         | Subscription and Property Option Agreement dated May 31, 1999 between
    the Company and Barrick Gold Corporation (2)                                        
|4.2         | Option Agreement dated December 14, 2001 between Tanzam 2000 Limited
    and Barrick Exploration Africa Limited (2)                                           
|4.3         | Letter of Intent dated January 20, 2003 between the Company and Northern
    Mining Explorations Ltd., as amended by Letter Agreement dated March 18, 2003 (2)
|4.4         | Letter of Intent dated July 21, 2003 between the Company and Ashanti
    Goldfields (Cayman) Limited (2)                                                      
|4.8         | Option Agreement dated September 7, 2004 between the Company and Northern
    Mining Explorations Ltd. (3)                                                    
|4.9         | Purchase and Sale Agreement dated September 26, 2006 between the Company
    and Ashanti Goldfields (Cayman) Limited (4)                                      
|4.10        | Option and Royalty Agreement dated January 25, 2007 between the Company
    and Sloane Developments Ltd. (5)                                                  
|4.12        | March 27, 2009 Subscription Agreement for purchase of 248,139 common
    shares with James E. Sinclair (6)                                                    
|4.13        | February 23, 2009 Subscription Agreement for purchase of 189,036 common
    shares with James E. Sinclair (6)                                                 
|4.14        | February 1, 2009 Subscription Agreement for purchase of $3,000,000 of
    common shares with James E. Sinclair (6)                                            
|4.15        | August 24, 2010 Subscription Agreement for purchase of 144,430 common
    shares with James E. Sinclair (7)                                                   
|4.16        | Heads of Agreement dated December 16, 2010 between the Company and State
    Mining Corporation (8)                                                           
|           

124







|Exhibit No. | Name                                                                                                                                                                                                                                                                           
|----------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|4.17        | Joint Venture Agreement dated October 25, 2011 between the
    Company and State Mining Corporation (8)                                                                                                                                                                        
|4.18        | Kigosi Access Agreement dated December 10, 2012 between the Company and
    The Director of Wildlife, Wildlife Division, Ministry of Natural Resources and Tourism (10)                                                                                                        
|4.19        | Securities Purchase Agreement dated December 9, 2014 with JGB (Cayman)
    Weston Ltd. (11)                                                                                                                                                                                    
|4.20        | Registration Rights Agreement dated December 9, 2014 with JGB (Cayman)
    Weston Ltd. (11)                                                                                                                                                                                    
|4.21        | 8% Original Issue Discount Senior Convertible Debenture to JGB (Cayman)
    Weston Ltd. (11)                                                                                                                                                                                   
|4.22        | Escrow Agreement dated December 9, 2014 with JGB (Cayman) Weston Ltd.
    and Wells Fargo Bank, National Association (11)                                                                                                                                                      
|4.23        | Common Stock Purchase Warrant dated December 9, 2014 to JGB (Cayman) Weston Ltd. (11)                                                                                                                                                                                          
|4.24        | Continuing Guaranty from Itetemia Mining Company Limited,
    Lunguya Mining Company Ltd., Tancan Mining Company Limited, Tanzania American International Development Corporation 2000 Limited,
    Buckreef Gold Company Limited and Northwest Basemetals Company Limited (11)
|4.25        | Secured Gold Loan Agreement dated June 22, 2015 with Hoffman Heritage
    Ranches LLC (12)                                                                                                                                                                                     
|4.26        | Secured Gold Loan Agreement dated June 22, 2015 with William L. Holter
    (12)                                                                                                                                                                                                
|4.27        | Secured Gold Loan Agreement dated October 19, 2015 with Edward F. Marin
    Family LLC (15)                                                                                                                                                                                    
|4.28        | Secured Gold Loan Agreement dated October 19, 2015 with David Ponelli
    (15)                                                                                                                                                                                                 
|4.29        | Secured Gold Loan Agreement dated May 16, 2016 with Structural Logistics,
    LLC (15)                                                                                                                                                                                         
|4.30        | Secured Gold Loan Agreement dated June 27, 2016 with Edward F. Marin
    Family LLC (15)                                                                                                                                                                                       
|4.31        | Secured Gold Loan Agreement dated June 28, 2016 with David Ponelli (15)                                                                                                                                                                                                        
|4.32        | Secured Gold Loan Agreement dated January 19, 2018 with Structural Logistics, LLC *                                                                                                                                                                                            
|4.33        | Form of Loan Agreement Amendment *                                                                                                                                                                                                                                             
|4.34        | Secured Gold Loan Agreement dated January 19, 2018 with Dennis and Jane Smith *                                                                                                                                                                                                
|4.35        | Secured Gold Loan Agreement dated March 1, 2018 with Dennis and Jane Smith *                                                                                                                                                                                                   
|4.36        | Secured Gold Loan Agreement dated June 11, 2018 with Kelly Mckennon *                                                                                                                                                                                                          
|4.37        | Form of Secured Loan Agreement *                                                                                                                                                                                                                                               
|4.38        | Securities Purchase Agreement dated September 1, 2016 (13)                                                                                                                                                                                                                     
|4.39        | Registration Rights Agreement (13)                                                                                                                                                                                                                                             
|8.1         | List of Subsidiaries (15)                                                                                                                                                                                                                                                      
|12.1        | Certification of the Principal Executive Officer
    under the Sarbanes-Oxley Act *                                                                                                                                                                                            
|12.2        | Certification of the Principal Financial Officer
    under the Sarbanes-Oxley Act *                                                                                                                                                                                            
|13.1        | Certification under Section 1350 *                                                                                                                                                                                                                                             
|15.1        | Consolidated Financial Statements for the years ended August 31, 2018 and 2017 *                                                                                                                                                                                               
|15.2        | Management’s Discussion and Analysis for the years ended August 31, 2018 and 2017 *                                                                                                                                                                                            
|15.3        | Consent of DMCL Chartered Professional Accountants
    LLP dated November 29, 2018 *                                                                                                                                                                                           
|15.4        | Item 16F Confirmation Letter from Ernst & Young LLP, Chartered Professional
    Accountants, dated November 5, 2016 (16)                                                                                                                                                       
|15.5        | 2016 Incentive Stock Option Plan (14)                                                                                                                                                                                                                                          
|15.6        | Consent of Crundwell Metallurgy (Crundwell) *                                                                                                                                                                                                                                  
|15.7        | Consent of Virimai Projects (Virimai) *                                                                                                                                                                                                                                        
|101.1**     | Interactive Data Files (XBRL-Related Documents).                                                                                                                                                                                                                               





125







*
Filed herewith



** As permitted by Rule 405 of Regulation S-T, the registrant’s
XBRL (eXtensible Business Reporting Language) information will be furnished in an amendment to this Form 20-F that will be filed
no more than 30 days after the date hereof.







| | (1) | Previously
                                         filed with the SEC on Form 20-F Registration Statement on March 15, 2004
| | --- | ----------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                             

| | (2) | Previously
                                         filed with the SEC on Amendment No. 1 to Form 20 Registration Statement on June 28, 2004
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                             

| | (3) | Previously
                                         filed with the SEC on Form 20-F Annual Report on February 10, 2005
| | --- | ----------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                       

| | (4) | Previously
                                         filed with the SEC on Form 20-F Annual Report on November 30, 2006
| | --- | ----------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                       

| | (5) | Previously
                                         filed with the SEC on Form 20-F Annual Report on November 30, 2007
| | --- | ----------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                       

| | (6) | Previously
                                         filed with the SEC on Form 20-F Annual Report on November 27, 2009
| | --- | ----------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                       

| | (7) | Previously
                                         filed with the SEC on Form 20-F Annual Report on November 30, 2010
| | --- | ----------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                       

| | (8) | Previously
                                         filed with the SEC on Form 20-F Annual Report on December 12, 2011
| | --- | ----------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                       

| | (9) | Previously
                                         filed with the SEC on Form 20-F Annual Report on November 27, 2012
| | --- | ----------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                       

| | (10) | Previously
                                         filed with the SEC on Form 20-F Annual Report on November 15, 2013
| | ---- | ----------------------------------------------------------------------------------------------------------------------
| |      |                                                                                                                       

| | (11) | Previously
                                         filed with the SEC on Form 6-K filed on December 15, 2014
| | ---- | -------------------------------------------------------------------------------------------------------------
| |      |                                                                                                              

| | (12) | Previously
                                         filed with the SEC on Form 20-F/A Annual Report on April 11, 2016
| | ---- | ---------------------------------------------------------------------------------------------------------------------
| |      |                                                                                                                      

| | (13) | Previously
                                         filed with the SEC on Form 6-K filed on September 7, 2016  
| | ---- | ---------------------------------------------------------------------------------------------------------------
| |      |                                                                                                                
| | (14) | Previously
                                         filed with the SEC on Form 6-K filed on January 30, 2017   
| |      |                                                                                                                
| | (15) | Previously
                                         filed with the SEC on Form 20-F/A filed on December 5, 2017
| |      |                                                                                                                
| | (16) | Previously
                                         filed with the SEC on Form 20-F filed on November 28, 2016 





















126









SIGNATURE



The registrant hereby certifies that it meets
all of the requirements for filing this Form 20-F and that it has duly caused and authorized the undersigned to sign this Annual
Report on its behalf.





Date	November 29, 2018





|TANZANIAN ROYALTY EXPLORATION CORPORATION
|-----------------------------------------
|                                         
|By:                                      
|                                         
|                                         
|                                         











127