UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

_________________________



FORM 20-F

(Amendment No. 3)

_________________________



| | ☐ | 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, 2017                                           





|☐ | 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

Toronto, Ontario

M5C 1P1

(Address of Principal Executive Offices)



James Sinclair

Chief Executive Officer

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: 121,784,619. (as of August 31, 2017)



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
and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405
of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant
was required to submit and post such files).

☐ Yes     ☐
No



Indicate by check mark whether the registrant is a large accelerated
filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer” 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













Explanatory Note



This Amendment No. 3 (this “Amendment
No.3”) amends our Annual Report on Form 20-F for the year ended August 31, 2017, of Tanzanian Royalty Exploration Corporation
(the “Company,” “we”, “our”) which we originally filed with the Securities and Exchange Commission
(the “SEC”) on November 29, 2017, (the “Original Filing”), as amended on December 5, 2017 (“Amendment
No. 1”), and as further amended on March 16, 2018 (“Amendment No. 2”). Amendment No. 2 was filed to amend certain
information contained in the “Cautionary Note to U.S. Investors Concerning Estimates of Mineral Resources” and Item
4 regarding our properties in response to certain comments raised the staff of the SEC. We are filing this Amendment No. 3 to revise
certain information regarding our properties, including that we are currently focusing only on the Buckreef property.



Other than the items outlined above, there are
no changes to the Original Filing as amended in Amendments No. 1 and No. 2. Except as set forth herein, this Amendment No. 3 does
not reflect events occurring after the date of the Original Filing, as amended in Amendments No. 1and 2, or modify or update those
disclosures that may be affected by subsequent events. Such subsequent matters are addressed in subsequent reports filed by us
with the SEC. For ease of reference, we have included our changes in Amendments No. 1 and 2 into this Amendment No. 3 and this
Amendment No. 3 amends and restates the Form 20-F in its entirety.



No changes were made to our financial statements.





















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
|                                                                            | A.                                                   
|                                                                            | B.                                                   
|Item 2.                                                                     | Offer Statistics and Expected Timetable              
|Item 3.                                                                     | Key Information                                      
|                                                                            | A.                                                   
|                                                                            | B.                                                   
|                                                                            | C.                                                   
|                                                                            | D.                                                   
|Item 4.                                                                     | Information on the Company                           
|                                                                            | A.                                                   
|                                                                            | B.                                                   
|                                                                            |                                                      
|                                                                            |                                                      
|                                                                            | C.                                                   
|                                                                            | D.                                                   
|                                                                            |                                                      
|                                                                            |                                                      
|                                                                            |                                                      
|                                                                            |                                                      
|                                                                            |                                                      
|Item 4A.                                                                    | Unresolved Staff Comments                            
|Item 5.                                                                     | Operating and Financial Review and Prospects         
|                                                                            | A.                                                   
|                                                                            | B.                                                   
|                                                                            | C.                                                   
|                                                                            | D.                                                   
|                                                                            | E.                                                   
|                                                                            | F.                                                   
|Item 6.                                                                     | Directors, Senior Management and Employees           
|                                                                            | A.                                                   
|                                                                            | B.                                                   
|                                                                            | C.                                                   
|                                                                            | D.                                                   
|                                                                            | E.                                                   
|Item 7.                                                                     | Major Shareholders and Related Party Transactions    
|                                                                            | A.                                                   
|                                                                            | B.                                                   





i







|           | C.                                                                           | Interests of Experts and Counsel                        | 97 
|---------- | ---------------------------------------------------------------------------- | ------------------------------------------------------- | ---
|Item 8.    | Financial Statements                                                         | 97                                                     
|           | A.                                                                           | Consolidated Statements and Other Financial Information | 97 
|           | B.                                                                           | Significant Changes                                     | 98 
|Item 9.    | The Offering and Listing                                                     | 98                                                     
|           | A.                                                                           | Offering and Listing Details                            | 98 
|           | B.                                                                           | Plan of Distribution                                    | 99 
|           | C.                                                                           | Markets                                                 | 99 
|           | D.                                                                           | Selling Shareholders                                    | 99 
|           | E.                                                                           | Dilution                                                | 99 
|           | F.                                                                           | Expenses of the Issue                                   | 99 
|Item 10.   | Additional Information                                                       | 99                                                     
|           | A.                                                                           | Share Capital                                           | 99 
|           | B.                                                                           | Articles of Association and Bylaws                      | 100
|           | C.                                                                           | Material Contracts                                      | 104
|           | D.                                                                           | Exchange Controls                                       | 105
|           | E.                                                                           | Taxation                                                | 107
|           | F.                                                                           | Dividends and Paying Agents                             | 113
|           | G.                                                                           | Statement by Experts                                    | 114
|           | H.                                                                           | Documents on Display                                    | 114
|           | I.                                                                           | Subsidiary Information                                  | 114
|Item 11.   | Quantitative and Qualitative Disclosures About Market Risk                   | 114                                                    
|Item 12.   | Description of Securities Other than Equity Securities                       | 115                                                    
|Part II    | 115                                                                         
|Item 13.   | Defaults, Dividend Arrears and Delinquencies                                 | 115                                                    
|Item 14.   | Material Modifications to the Rights of Security Holders and Use of Proceeds | 115                                                    
|Item 15.   | Controls and Procedures                                                      | 115                                                    
|Item 16 A. | Audit Committee Financial Expert                                             | 116                                                    
|Item 16 B. | Code of Ethics                                                               | 116                                                    
|Item 16 C. | Principal Accountant Fees and Services                                       | 117                                                    
|Item 16 D. | Exemptions from the Listing Standards for Audit Committees                   | 117                                                    
|Item 16 E. | Purchases of Equity Securities by the Issuer and Affiliated Purchasers       | 117                                                    
|Item 16 F. | Change in Registrant’s Certifying Accountant                                 | 117                                                    
|Item 16 G. | Corporate Governance                                                         | 117                                                    
|Item 16 H. | Mine Safety Disclosure                                                       | 118                                                    
|Part III   | 118                                                                         
|Item 17.   | Financial Statements                                                         | 118                                                    
|Item 18.   | Financial Statements                                                         | 118                                                    
|Item 19.   | Exhibits                                                                     | 118                                                    









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 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”).
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.



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.



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 lawful 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 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.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|BLEG                    | Acronym for “bulk leach extractable gold” sampling.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|dyke                    | A tabular body of igneous rock that has been injected while molten into a fissure.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|exploration information | Geological, geophysical, geochemical, sampling, drilling, trenching, analytical testing, assaying, mineralogical, and metallurgical and other similar information concerning a particular property that is derived from activities undertaken to locate, investigate, define or delineate a mineral prospect or mineral deposit.                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|fault                   | A planar fracture or discontinuity in a volume of rock, across which there has been significant displacement.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|                        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|feasibility study       | Is a comprehensive technical and economic study of the selected development option for a mineral project that includes appropriately detailed assessments of realistically assumed mining, processing, metallurgical, economic, marketing, legal, environmental, social and governmental considerations 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.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        





2







|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.                                                                                                                                                                                                                                                                                                                                                                                             
|                           |                                                                                                                                                                                                                                                                                                                                                                                                                                     
|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.                                                                                                                                                                                                                                                                                                                                                                                         
|                           |                                                                                                                                                                                                                                                                                                                                                                                                                                     
|overburden                 | A general term for any material covering or obscuring rocks from view.                                                                                                                                                                                                                                                                                                                                                              





3







|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.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|------------------------------------------------------ | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|ppm or parts per million                               | A unit of measurement which is 1000 times larger than parts per billion (i.e. ppb); 1 ppm is equivalent to 1000 ppb, and is also equivalent to 1 gram/tonne.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|prefeasibility study and preliminary feasibility study | Each mean 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 open pit, is established and an effective method of mineral processing is determined. It includes a financial analysis based on reasonable assumptions on mining, processing, metallurgical, economic, marketing, legal, environmental, social and governmental considerations 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 classified as a Mineral Reserve.
|                                                       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|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.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                





4







|test pits                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | Shallow holes dug at spots along the strike of any mineralization or, if it is disseminated, anywhere in the area where the shallow holes might reach mineralized bedrock.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|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.                                                                                                                                                                                                                                                                                                                                                                                                
|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 November 27, 2010, 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:
|Measured Mineral Resource                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | That part of a Mineral Resource for which quantity, grade or quality, densities, shape, and physical characteristics are so well established that they can be estimated with confidence sufficient to allow the appropriate application of technical and economic parameters, to support production planning and evaluation of the economic viability of the deposit.  The estimate is based on detailed and reliable exploration, sampling and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes that are spaced closely enough to confirm both geological grade and continuity.
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|Indicated Mineral Resource                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | That part of a Mineral Resource for which quantity, grade or quality, densities, shape and physical characteristics, can be estimated with a level of confidence sufficient to allow the appropriate application of technical and economic parameters, to support mine planning and evaluation of the economic viability of the deposit.  The estimate is based on detailed and reliable exploration and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes that are spaced closely enough for geological and grade continuity to be reasonably assumed.                          





5







|Inferred 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.                                                                                                                                                                                                                                                                                                                                                                                        
|------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|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.
|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.                                                                                                                                                                                                                                                                               
|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, 2017, 2016, 2015, 2014 and 2013 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):



|                                 | 2017($)           | 2016($)           | 2015 ($)          | 2014 ($)          | 2013 ($)         
|-------------------------------- | ----------------- | ----------------- | ----------------- | ----------------- | -----------------
|Operations:                      |                   |                   |                   |                   |                  
|                                 |                   |                   |                   |                   |                  
|Revenues                         | $              -- | $              -- | $              -- | $              -- | $               -
|                                 |                   |                   |                   |                   |                  
|Net loss                         | (6,434,112)       | (12,781,902)      | (8,995,697)       | (2,416,265)       | (3,225,998)      
|                                 |                   |                   |                   |                   |                  
|Basic and diluted loss per share | (0.05)            | (0.12)            | (0.09)            | (0.02)            | (0.03)           





7









|                             | 2017        | 2016         | 2015        | 2014        | 2013       
|---------------------------- | ----------- | ------------ | ----------- | ----------- | -----------
|Balance sheet:               |             |              |             |             |            
|                             |             |              |             |             |            
|Working Capital (deficiency) | (6,552,376) | (11,836,214) | (4,684,253) | 1,325,667   | 5,416,104  
|                             |             |              |             |             |            
|Total Assets                 | 51,353,088  | 49,885,545   | 53,108,859  | 52,792,901  | 58,193,340 
|                             |             |              |             |             |            
|Net Assets                   | 36,254,043  | 35,156,483   | 46,072,190  | 51,503,996  | 52,319,699 
|                             |             |              |             |             |            
|Share Capital                | 125,174,377 | 122,380,723  | 120,532,634 | 117,153,440 | 115,614,202
|                             |             |              |             |             |            
|Number of Shares             | 121,784,619 | 109,068,492  | 107,853,554 | 101,325,880 | 100,922,582
|                             |             |              |             |             |            
|Deficit                      | 96,566,577  | 90,600,819   | 77,970,955  | 69,095,649  | 67,117,263 



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   
|-------------------- | ------- | ---------- | ------ | ------
|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
|2013                 | 1.011   | 1.0554     | 1.0578 | 0.971 



The following table sets forth the high and
low exchange rate for the past six months. As of August 31, 2017, the exchange rate was CDN $1.2535 for each US$1.00.



|Month          | High   | Low   
|-------------- | ------ | ------
|October 2017   | 1.2893 | 1.2472
|September 2017 | 1.2480 | 1.2128
|August 2017    | 1.2755 | 1.2482
|July 2017      | 1.2982 | 1.2447
|June 2017      | 1.3504 | 1.2977
|May 2017       | 1.3743 | 1.3446



B.       Capitalization
and Indebtedness



Not applicable.





8







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



The Company has decided to begin production at the Buckreef
Project after preparing an NI43-101 compliant Mining Feasibility Report published in April 2017. The production plans contained
therein include process plant schedule and financial analysis projections for the Buckreef encompassing the Buckreef Main, South,
Eastern Porphyry, Bingwa and Tembo deposits. Management has recommended immediate implementation of the mining and processing plan
once the renewal certificate has been received from the Ministry of Mines. The Mining Feasibility report as published is the bankable
feasibility study that may be subject to future unforeseen risks.



The Company has decided to begin production
at the Buckreef Project based on the latest and comprehensive pit-design optimized mining feasibility study or bankable feasibility
study, which is a more common practice within the mining industry, and therefore may subject it to some unforeseen business risks.
 The Company’s decision to begin production at the Buckreef Project was based on prior historical and current information,
drilling programs, modeling, and positive metallurgical testing.  Therefore, its decision to begin production at the Buckreef
Project was based on detailed information which may or may not be representative of information regarding the mine based on the
latest independent and comprehensive study results that were published in April 2017.  In addition, basing its decision to
begin production on this updated information may make the Company susceptible to risks, including:





|• | 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;
|  |                                                                                                                                                                                    







9









|• | that metallurgical testing is always in development and may not be representative of results of all the
deposits that make up the Buckreef Project; and
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                        
|• | that the Company may have underestimated capital and operating costs despite the independent and comprehensive
bankable mining feasibility study.      
|  |                                                                                                                                                        



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, 2017, the Company had a net loss of $6,434,112 and an accumulated deficit on August
31, 2017 of $96,566,577. The Company has never generated revenues and does not expect to generate
revenues from operations until one or more of its properties are placed in production. There is a risk that none of the Company’s
properties will be placed in production.



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



All of the 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,
President and Director, former Chief Executive Officer. Investors must be willing to rely to a significant extent on their discretion
and judgment. The Company does not have employment contracts with the President and Chief Executive Officer. The Company maintains
key-man life insurance on the President and Chief Executive Officer.



The Company will need additional
capital.



As at August 31, 2017, the Company had cash
and cash equivalents of $1,011,293 costs to fund its plan of operations and may need to raise additional capital. 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.



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





10







Based on the Company’s current funding
sources and taking into account the working capital position and capital requirements at August 31, 2017, 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 2018 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 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 cash flow. Any work on the Company’s properties may 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.



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



The Company
may be characterized as a passive foreign investment company (“PFIC”). If it is determined to be a PFIC,
its U.S. shareholders may suffer adverse tax consequences. Under the PFIC rules, for any taxable year that the Company’s
passive income or its assets that produce passive income exceed specified levels, it will be characterized as a PFIC for U.S. federal
income tax purposes. This characterization could result in adverse U.S. tax consequences for the U.S. shareholders, which may include
having certain distributions on the Company’s common shares and gains realized on the sale of its 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 the Company’s common shares and certain distributions.



Certain
elections may be made to reduce or eliminate the adverse impact of the PFIC rules for holders of the Company’s 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 “Taxation – Material United States Federal Income Tax Considerations”.



Risks relating to the Mining Industry



The Company cannot accurately
predict whether commercial quantities of ores will be established.



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 mineralized material 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 mineralized material will not in fact be realized or that an identified mineralized
deposit, if any, will ever qualify as a commercially mineable or viable reserve.





11







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 a diamond drilling program on the Buckreef Project and has
been reviewing the results of the drilling program in the context of analyzing the economic significance of the deeper 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. Although the discovery of a
resource may result in substantial rewards, few explored properties are ultimately developed into producing mines. Significant
expenditures may be required to locate and establish reserves, to develop metallurgical processes and to construct mining and processing
facilities at a particular 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 programmes 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 programmes.



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.



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, or they may be subject to challenge or impugned in the future. See “Mineral
Properties”.



Mining exploration, development
and operating activities are inherently hazardous.





12







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 unfavourable 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.



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



Laws and regulation govern the development,
mining, 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 Company’s mineral interests in Tanzania
are held under prospecting licenses granted pursuant to the Mining Act, 2010 (Tanzania) for a period of up to four years,
and are renewable two times for a period of up to two years each. There are initial 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 kilometres, 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.



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.





13







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.



The Company’s business
activities are conducted in Tanzania.



The Company’s principal exploration and
development properties are currently located in the United Republic of Tanzania, Africa. 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.



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 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, labour unrest, risks of war or civil unrest, government and civil unrest, regional expropriation
and nationalization, renegotiation or nullification of existing concessions, licences, permits and contracts, artisanal 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.





14







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, artisanal 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.



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 Mkt corporate governance requirements that are available to foreign private issuers.





15







United States 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.



Common Share prices will
likely be highly volatile, and investment could decline in value or the entire investment may be lost.



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.





The Company’s common shares must meet the requirements
of the NYSE MKT.



The NYSE MKT rules provides that the NYSE MKT
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 MKT 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, there is no assurance that the Company’s common
shares will continue to be listed on the NYSE MKT.



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



Sales of a significant number of the Company’s
common shares in the public market could harm the market price of its common shares and make it more difficult for the Company
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.





16







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).



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, 2017, the Company
reported a net loss of $6,434,112. Included in the net loss is $124,717 of mineral properties and deferred exploration expenses
that was written off relating to abandoned mineral properties. The Company incurred deferred exploration expenditures of $1,242,162
during the year ended August 31, 2017.



In connection with the Company’s disclosure
of mineral resources and the cut-off grade associated with each mineral resource, 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.



Significant Acquisitions and Significant Dispositions



The Company’s principal capital expenditures
and divestitures (including interests in other companies and amounts invested) for the last three fiscal years are described as
follows:



The Company awarded a contract to Venmyn Independent
Projects (Pty) Limited, a subsidiary of Venmyn Rand (Pty) Limited, to undertake an update of the 21 August 2012 National Instrument
43-101 Independent Technical Report on the Buckreef Project in Tanzania. The updated report is dated February 24, 2014 (the “Updated
Buckreef Technical Project”) and it was filed on SEDAR on February 24, 2014. See “Mineral Properties”.
Further to this, the Company awarded another contract to MaSS Resources Pvt Ltd of Tanzania to undertake an NI 43-101 Compliant
updated Buckreef Pit Optimized Resource Technical Mining Feasibility Report that was completed and published on 5th
April 2017. Major Assumptions in the report included a gold price of $1250/oz, an effective Tax Rate of 15.25%; a Royalty Rate
of 4.3%; transport refining cost of $15.00/oz Au and discount rate of 5%.



On July 30, 2018, we filed 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 on Form 6-K for July 2018 with the SEC.





17







The Company wound down the pilot heap leach
and Carbon-in-Column pilot ore processing program at its Buckreef redevelopment gold project, located in the Lake Victoria Goldfields
of Tanzania in September 2016. In addition, the Company has also completed a significant portion of the Buckreef main Pit preparation,
including grade control drill-hole marking and surveying, road detour surveys and cost estimations, Tailings Storage Facility site
preparation, installation of the process plant crusher circuit, Carbon-in-Column process plant designs and site plan designs. The
Company also produced an updated internal report on the financial projections for the Buckreef Mine Closure Conceptual Plan.



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, in exchange for annual rental/option payments and post-production
royalty payments or with a view to direct development of a mine 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.



Plan of Operations



Exploration Activities



All of the properties in which the Company holds
an interest are in the exploration, preliminary economic assessment or extraction (pre-production) stages of mining. Mineral exploration
and extraction 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.





18







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.



The Company continued its efforts for the “farming-out”
of identified properties for royalty agreements with other mining companies, and continues to examine and review other exploration
opportunities in Tanzania.



The following is a map of our primary properties.















19













Highlights for the year ended August 31, 2017



Financial:





|• | Subsequent to the period, the Company received loans in the amount of US$339,710 maturing in 1 year 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 loan may be converted into common
shares of the Company at the sole discretion of the lender at an exercise price of US$0.36 per share. Interest is payable quarterly,
either in cash or in shares at the option of the lender at a price of US$0.36 per share.                                                                                                                                                                                     
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|• | In connection with the loans, the Company paid a finder’s fee via the issuance of an aggregate
of 214,864 common shares.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|• | The Company also entered into extension agreements in regards to USD$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.
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 







20









|• | 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 the 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 stock and warrants for US$1.25 million. The common stock 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 shares of Common Stock with an exercise price of US$0.8291 per share. The common stock 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 stock becomes effective.



On September 26, 2016, the Company closed the
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 shares
of common stock to the investor. The investor also received five-year warrants to purchase 4,017,857 shares of common stock 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 stock issued or issuable to the investor upon exercise of warrants being declared effective by the U.S.
Securities and Exchange Commission (“SEC”). The SEC declared the Company’s Form F-3 Registration Statement registering
the stock effective on September 23, 2016.



Buckreef Project: Mine Development and Operations



Q1_2017 (September 2016 – November 2016)





|• | The Company successfully completed the renewal application process for the 12 Buckreef Buziba project
Prospecting Licenses (PLs). Renewal certificates for all 12 PLs were received after successful payment of the annual rental fee
payments for the period 2016-2017.                                                                        
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|• | The Company also successfully engaged with the Mining Commissioner on requested additional technical
information related to the renewal application for the Buckreef Special Mining License (SML04/92).                                                                                                                                         
|• | The Company also engaged a local Tanzanian consultant group, MaSS Resources Consulting Company who commenced
the Review and Update of the Buckreef Preliminary Economic Assessment Report (published in 2012 & 2014) by Venmyn Deloite Resource
Consultants Ltd. of SA into an NI 43-101 compliant Buckreef Technical Mining Feasibility Report.
|  |                                                                                                                                                                                                                                                                                                                                                 



Q2_2017 (December 2016 – February 2017)





|• | The Company received the Buckreef Gold Mine Company Environmental Management Plan Upgrade certification
from NEMC.
|- | ------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                   





21









|• | The Company also received the Buckreef SML04/92 Special Mining Licence Renewal offer letter from the
Ministry of Energy & Minerals. Renewal period was for a further 10 years to 2027. Annual rental fees for the SML were paid
upfront to June 2018 as per regulations.
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|• | MaSS Resources in consultation with company qualified technical persons, continued work on updating the
Buckreef Technical Mining Feasibility Report.                                                                                                                   
|• | The National Audit Office of Tanzania (NAOT) team led by the Deputy Auditor General and in the company
of senior personnel from Stamico audited the Buckreef Project JV working partnership and current status.                                                         
|• | Stamico MD made a presentation to the relevant Parliamentary Committee overseeing all government related
JV projects in Tanzania to brief the government on project status.                                                                                             
|• | Emisha Mining Solutions, a South African based consultant company continued work on the new CIL process
plant design.                                                                                                                                                   
|  |                                                                                                                                                                                                                                                                         



Q3_2017 (March 2017 – May 2017)





|• | The Company received a letter of notification requesting the presence of Chairman and CEO to attend the
official signing ceremony for the Buckreef renewal certificate issuance which was scheduled to be held at Dodoma on 7th March 2017.
Ceremony was however postponed indefinitely as the Minister was busy with other issues.                      
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|• | In addition, the Company hosted a delegation of MPs that make up the Parliamentary Mining Audit Committee
(PMAC) on Energy & Minerals at Buckreef on 22nd March 2017 whose task was to assess the Buckreef Gold project re-development
progress since the signing of the Tanzam2000 and State Mining Corporation Joint Venture Agreement in October 2011.
|• | Ground-work on the Buckreef project resumed with the main activity being marking and initial clearing
of the site covered by the Buckreef main pit outline.                                                                                                                                                                                              
|• | Site marking and survey pick-ups of the planned Grade Control drill-holes commenced.                                                                                                                                                                                                                                                                     
|• | The Company also completed and successfully published the NI 43-101 Compliant updated Buckreef Pit Optimized
Resource Technical Mining Feasibility Report during the quarter.                                                                                                                                                                            
|  |                                                                                                                                                                                                                                                                                                                                                          



Q4_2017 (June 2017 – August 2017)





|• | Tanzania suspended granting of new mining licenses and froze the renewal of expired mining permits until
further notice under their new legislative changes that seek to enable the government to re-negotiate of Mining Developments Agreements
among other things.                                                                                                                               
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|• | The Company successfully completed ground clearing and surveying the demarcated Buckreef mega-pit outline.                                                                                                                                                                                                                                                                                         
|• | In addition, all the proposed Grade Control drill collars were marked and surveyed covering the entire
Buckreef mega-pit site.                                                                                                                                                                                                                                                                     
|• | The company also commenced ground clearing of the two sites proposed for the construction of the tailings
storage facility (TSF) for the Buckreef mining operation.                                                                                                                                                                                                                                
|• | The company also commenced work on an updated internal report on the financial projections for the Buckreef
Mine Closure Conceptual Plan.                                                                                                                                                                                                                                                          
|• | Artisanal mining activities at the Buziba, Eastern Porphyry Prospect, Bingwa Prospect, Kihesa Area and
Tembo North have persisted throughout the 4th quarter as efforts to evict the artisanal miners from these areas have been unsuccessful
and/or tied up by local government authorities to the issue of the outstanding land compensation for house-holders within the special
mining license.
|  |                                                                                                                                                                                                                                                                                                                                                                                                    





22







Exploration



Following the Company’s decision to include
mine development to its strategy of generating maximum revenue from its extensive portfolio of properties and with the rising costs
of maintaining prospecting and other licenses in Tanzania, management decided to review, revamp and clean up the TRX PL portfolio
with a view to discard certain licenses and/or alternatively farm them out in JV packages.



A detailed in-house geological review reports
on each respective project area and its potential for discovery of gold mineralization were reviewed by the executive technical
team and their recommendations are now being implemented. The in-house review of all the company’s various Prospecting License
(PL) holdings established three project categories Retention, Joint Venture & Discard/Abandon as described in the respective
sections below:



Projects/Licenses to Retain (Mining projects)



|• | Buckreef – 12 PLs & 1 SML            
|- | -------------------------------------
|• | Buziba – 1 PL                        
|• | Itetemia – 8 PLs & 1 ML (Application)
|• | Kigosi – 13 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 2017 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 five prospects namely Buckreef, Bingwa, Tembo, Eastern Porphyry and Buziba. 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 2017:





|• | No mining or ore processing activities conducted at the Buckreef project during the year. Status of the
project for the year-ended 31st August 2017 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
2017 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 2017, 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 NI43-101 Compliant updated Buckreef Pit Optimized Resource Technical Mining Feasibility Report was
completed and published. Major Assumptions in the report included a gold price of $1250/oz, an effective Tax Rate of 15.25%; a
Royalty Rate of 4.3%; transport refining cost of $15.00/oz Au and discount rate of 5%.
|  |                                                                                                                                                                                                                                                                                                                            







23







The Study results 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:



|• | Conventional open pit mining methods selected in pit designs.                                                                                                                                 
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|• | Over LoM, a total of 17.49Mt 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.                                                                             
|• | 1.064Moz 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.
|• | 0.91Moz of gold will be produced over the life of the project.                                                                                                                                
|• | Initial capital cost outlay estimated at US 32.5 Million with a Life of mine cost over the three
phases of $59.6 million and sustaining capital, excluding closure costs.                     
|• | Cash operating costs of $696/oz produced equivalent US $35.95 per tonne milled.                                                                                                               
|• | Generation of a positive NPV of $243 million at a 5% discount rate and an IRR of 53.7%                                                                                                        
|  |                                                                                                                                                                                               



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:











|• | PL and SML annual fees for 2017/2018 paid up.                                                                                                                                                                           
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|• | The Buckreef Renewal Licence SML04/92 certificate issuance ceremony was postponed indefinitely
by the Ministry of Energy and Minerals (MEM) after the Minister failed to sign the document as planned on 7th March 2017.
|  |                                                                                                                                                                                                                         







24















Itetemia Project



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 by CSA Australia Pty (Ltd) (“CSA”). The gold
resource numbers for the GHR are as at 30th May 2016 using a cut-off grade of 1.0g/t: -









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.





25







As of the 31st August 2017, the retained
portion of the Itetemia project area has 8 active PLs and 1 ML application all covering a surface area of 41.23km2.
The Itetemia Project license status and statutory liabilities are as shown in the table below:













|• | All the Itetemia PLs nominated for retention by the company have outstanding annual fee payments as shown
above.                                                                                                                                                                     
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|• | Two (2) PLs expired in June 2017 and applications for renewal are now overdue while one (1) PL will expire
in October 2017 and is now due for renewal application submission.                                                                                                        
|• | Renewal applications for 4 of the critical licenses are still being processed and application fee payment
was completed and posted online. We now await offer letters.                                                                                                               
|• | The ML application is still under review for close to 2 years now and no response on the delayed application
have been received from MEM offices. The ML application covers three (3) licenses viz 9198/2013, 9229/2013 & 9374/2013 that
have now also expired or are soon to expire.
|  |                                                                                                                                                                                                                                                                                      







Kigosi Project



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.



Kigosi Gold Project: Historical published Resource/Reserve results





26













The table below shows the status (as of 31st
August 2017) of the Kigosi Project license portfolio (identified as critical to the project) has 13 active PLs and 1 ML all covering
a surface area of 177.01km2. The license status and statutory liabilities are as shown in the table below:



Kigosi Gold Project PL Portfolio Status – PLs Proposed
for Retaining











| | • | All the Kigosi PLs nominated for retention by the company have outstanding annual fee payments.
| | - | -----------------------------------------------------------------------------------------------

| | • | Kigosi ML payments all up to date and the 2017/2018 annual fees are due in October 2017.
| | - | ----------------------------------------------------------------------------------------

| | • | PLs highlighted in red text have technically expired and no renewal application has been submitted
due to the outstanding annual fee payments and prevailing uncertainty with the new laws enacted recently with especial reference
to game reserves.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Luhala Project



The Luhala Project is an advanced stage 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.



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 to-date resulted in the estimation, by CSA,
of the following Mineral Resources for Luhala as at 8th March 2011 using a cut-off grade of 1.0g/t:





27







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 quarter 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 - PLs Proposed for Retaining









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

| | • | Online renewal application for PL8937/2013 was successfully lodged on
the MEM portal. Application fee payment has been done and posted inline.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------

| | • | Response from MEM awaited.
| | - | --------------------------



As of 31st August 2017, the Projects
to Retain license portfolio’s outstanding and current financial liabilities and obligations arising from unpaid rents
including the penalties are US$125,974 as summarized in the table below.



Liabilities - PLs to Retain (Mining Projects)









Projects Licenses to Joint Venture





|• | Biharamulo – 6 PLs
|- | ------------------
|• | Lunguya – 8 PLs   
|• | Manonga – 6 PLs   
|• | Ushirombo – 2 PLs 
|  |                   







28







Prospecting Licenses within four project areas,
identified as Biharamulo project, Lunguya project, Manonga project and Ushirombo 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 2017 are summarized in the section below.



Biharamulo project area



No 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 5 contiguous PLs.
Joint Venture Partner for the Project are being sought.



The Biharamulo Project license status and statutory
liabilities are as shown in the table below:



Biharamulo Gold Project PL Portfolio Status - PLs Proposed for
JV partnerships









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

| | • | PL highlighted in red technically expired on 7th February
2017. No renewal application was submitted due to the outstanding annual fee payments. PL still considered by MEM as still registered
to the company.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | PL highlighted in purple expire in mid-2018 but due to non-payment
of annual fees, we have received Notice of Default letters from MEM. The licenses will forfeit to the state if no payments are
made with the statutory 3-month period.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Lunguya project area



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.









29







The Lunguya Project license status and statutory liabilities are
as shown in the table below:



Lunguya Gold Project PL Portfolio Status - PLs Proposed for JV
partnerships







| | • | All the Lunguya PLs nominated for potential JV partnerships by the company
have outstanding annual fee payments as shown in the table 11a above.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------

| | • | PL highlighted in red technically expired and no renewal applications
were submitted due to the outstanding annual fee payments. PL still considered by MEM as registered to the company.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Manonga project area



No work done. The
Manonga Project licences are 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. Geophysical anomalies
to the North of the Resolute Golden Pride closed mine and that at Igurubi (PL8957/2013, PL8964/13) could turn out prospective if
more detailed prospecting work is completed on the area to the east.



The Manonga Project license status and statutory liabilities are
as shown in the table below:



Manonga Gold Project PL Portfolio Status - PLs Proposed for JV
partnerships









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

| | • | PL highlighted in red technically expired and no renewal applications
were submitted due to the outstanding annual fee payments. PL still considered by MEM as registered to the company.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | One of the PLs is also under a default notice and will forfeit as the
default notice period has also matured.
| | - | -------------------------------------------------------------------------------------------------------------



Ushirombo project area



No work done. Ushirombo
Gold Project is a brown field stage gold project focusing on the finding of gold deposit in the 12km long x 6km wide Ushirombo
Gold Corridor in the Ushirombo area. Historical exploration work indicates that gold prospectivity in the area include anomalous
au-in-soil, RAB drilling, pit sample, grab sample localities established by BEAL and TRE previous works within the Ushirombo Gold
Corridor (UGC).









30







The Ushirombo Project license status and statutory liabilities are
as shown in the table below:



Ushirombo Gold Project PL Portfolio Status - PLs Proposed for
JV









| | • | All the Ushirombo PLs nominated for potential joint venture agreements
by the company have outstanding annual fee payments as shown in the table above.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | PL highlighted in red technically expired and no renewal applications
were submitted due to the outstanding annual fee payments. PL still considered by MEM as registered to the company.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



One of the PLs is also under a default notice
and will forfeit as the default notice period has also matured.



As of 31st August 2017, the Projects
to JV license portfolio’s outstanding and current financial liabilities and obligations arising from unpaid rents including
the penalties are US$182,715 as summarized in the table below.



Liabilities - PLs to JV (Exploration Projects)









Projects Licenses to Discard/Abandon

| | • | Biharamulo – 2 PLs
| | - | ------------------

| | • | Kabanga – 2 PLs
| | - | ---------------

| | • | Kanegele – 10 PLs & 1 Application
| | - | ---------------------------------

| | • | Kigosi – 19 PLs
| | - | ---------------

| | • | Kibara – 3 PLs
| | - | --------------

| | • | Kongwa- 1 PL
| | - | ------------

| | • | Luhala – 2 PLs
| | - | --------------

| | • | Mwadui – 4 PLs
| | - | --------------

| | • | Nzega – 2 PLs
| | - | -------------

| | • | Nyanzaga – 2 PLs
| | - | ----------------

| | • | Tulawaka – 4 PLs
| | - | ----------------

| | • | Shinyanga – 1 PL
| | - | ----------------



Prospecting
Licenses within the eleven (11) project areas, identified as above were selected as possible licenses to discard and surrender
back to the Ministry of Mines or respective original JV partners. Brief descriptions of PL holdings and financial obligation status
for each respective project area as of 31st August 2017 are summarized in the section below.



Biharamulo project area



No work done. Historical preliminary exploration
results showed a very low to negligent potential for gold mineralization within some of the PLs that make up the regional Biharamulo
project. Consequently, it has been recommended that these licenses 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:





31







Biharamulo Gold Project PL Portfolio Status - PLs Proposed for Discard









| | • | The two (2) Biharamulo PLs nominated for discarding or surrender to
MEM by the company have outstanding annual fee payments as shown in the table above.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | Both PLs have technically expired as per the dates in the table above.
No renewal applications were submitted due to the outstanding annual fee payments. PL still considered by MEM as registered to
the company.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Kabanga Nickel project area



No work done. Though
the Kabanga Nickel project was abandoned some years back, two licenses have been pending surrender to the Ministry of Energy and
Minerals since 2013.The license status and statutory liabilities for these PLs are as shown
in the table below:



Kabanga Nickel Project PL Portfolio Status - PLs Proposed for
Discard









| | • | Surrender fees for the two remaining Kabanga PLs were never paid.
| | - | -----------------------------------------------------------------

| | • | The two PLs have since technically expired though they still appear
under our portfolio on the MEM portal.
| | - | ----------------------------------------------------------------------------------------------------------



Kanegele project area



No work done. Kanegele
Gold Prospect is a green stage exploration project that just barely got off the ground. Historical preliminary exploration results
showed a very low to negligent potential for gold mineralization within some of the PLs that make up the regional Kanegele project.
Consequently, it has been recommended that these licenses be abandoned or returned to original owners to cut liabilities. However,
an Australian based company, Liontown Company that has since closed shop in Tanzania had initiated talks with TRX top management
on the possible takeover/JV of the entire project.

The license status and statutory liabilities for these PLs are as
shown in the table below:



Kanegele Gold Project PL Portfolio Status - PLs Proposed for
Discard









| | • | All the Kanegele PLs nominated for potential discard by the company
have outstanding annual fee payments as shown in the table above.
| | - | -------------------------------------------------------------------------------------------------------------------------------------

| | • | PL highlighted in red technically expired and no renewal applications were submitted due to the
outstanding annual fee payments. PL still considered by MEM as registered to the Company.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | PLs highlighted in purple are active but officially notified to us as being in default. The default
notice gives us 3 months in which to pay all outstanding fees failure to do that will result in automatic forfeiture of the license.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





32







Kigosi Project



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 preliminary exploration results showed a very low to negligent potential
for gold mineralization within some of the PLs that make up the regional Kigosi project. Consequently, it has been recommended
that these licenses 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:



Kigosi Gold Project PL Portfolio Status - PLs Proposed for Discard









| | • | All the Kigosi PLs nominated for discard or surrender to MEM by the
company have outstanding annual fee payments as shown in the table above.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------

| | • | PLs highlighted in blue technically expired between 7th June
2016 to 30th December 2016. No renewal applications were submitted due to the outstanding annual fee payments. PLs still
considered by MEM as still registered to the company.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | PLs highlighted in red expired on 7th February 2017 and 26th
March 2017 respectively.
| | - | -------------------------------------------------------------------------------------

| | • | PL highlighted in purple is active but officially notified to us as
being in default. The default notice gives us 3 months in which to pay all outstanding fees failure to do that will result in automatic
forfeiture of the license.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Kibara project area



No work done. Kibara
Gold Prospect is a green field exploration project focusing on the finding of gold prospects like those in the Mara-Musoma belt
which are mostly located near the major NE and NW regional shear structures. Historical preliminary exploration results showed
a limited potential for gold mineralization within some of the PLs that make up the regional Kibara project. Gold prospectivity
target areas on the Kibara Project should be located within the two-major regional structural shears, namely the NE-SW shears and
the NW-SE shears, with most favorable loci where the two structures crosscut e.g. Suguti, Sirori Simba, Maji Moto and Buhemba prospects
areas.







33







Consequently, it has been recommended that these licenses 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:



Kibara Gold Project PL Portfolio Status - PLs Proposed for Discard









| | • | All the Kibara PLs nominated for potential discard by the company have
outstanding annual fee payments as shown in the table above.
| | - | -----------------------------------------------------------------------------------------------------------------------------------

| | • | PLs highlighted in red technically expired and no renewal applications were submitted due to the
outstanding annual fee payments. PL still considered by MEM as registered to the company.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | All the PLs under a default notice and will forfeit as the default notice period has also matured.
| | - | --------------------------------------------------------------------------------------------------



Kongwa Gold project area



As of 31st August 2017, Ministry of Energy and
Minerals (MEM) portal posting shows that, the single remaining Kongwa PL has forfeited to the ministry.



Luhala Project



No work done during the reporting period. Historical
preliminary exploration results showed a very low to negligent potential for gold mineralization within some of the PLs that make
up the regional Luhala project. Consequently, it has been recommended that these licenses 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:



Luhala Gold Project PL Portfolio Status - PLs Proposed for Discard









| | • | All the Luhala PLs nominated for discarding or surrender to MEM by the
company have outstanding annual fee payments as shown in the table above.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------

| | • | PLs highlighted in red technically expired between 4th May
2016 and 20th October 2016. No renewal applications were submitted due to the outstanding annual fee payments. PLs still
considered by MEM as still registered to the company.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Mwadui project area



No work done during the reporting period. The
Mwadui Diamond Project is a brown field exploration project that focused on the initial identification of regional-scale targets
for the development of diamondiferous kimberlite pipes in the Mwadui area kimberlite province. Preliminary drilling completed on
some of the high magnetic dipolar signatures on kimberlitic pipes along the NE & NW dykes in the Mwadui Project area resulted
in the identification of areas with potential diamondiferous gravels that could be further tested for economic kimberlite pipes.





34







Consequently, it has been recommended that these
licenses 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:



Mwadui Diamond Project PL Portfolio Status - PLs Proposed for
Discard









| | • | All the Mwadui PLs nominated for potential discard by the company have
outstanding annual fee payments as shown in the table above.
| | - | -----------------------------------------------------------------------------------------------------------------------------------

| | • | PL highlighted in red technically expired and no renewal applications
were submitted due to the outstanding annual fee payments. PL still considered by MEM as registered to the company.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | One of the PLs is also under a default notice and will forfeiture as the default notice period
has also matured.
| | - | ----------------------------------------------------------------------------------------------------------------



Nzega Gold project area



No work done during the reporting period. The
Nzega gold project is a greenfield stage project focused on looking for the Golden Pride mine style of mineralization on the anomalous
gold areas defined by soils, BGC, Auger drilling and grab sampling. Historical preliminary exploration results showed a very low
to negligent potential for gold mineralization within the remaining PLs that make up the regional Nzega project. Consequently,
it has been recommended that these licenses 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:



Nzega Gold Project PL Portfolio Status - PLs Proposed for Discard









| | • | The single Nzega PL nominated for potential discard by the company has
outstanding annual fee payments as shown in the table above. The PL has technically expired and no renewal applications were submitted
due to the outstanding annual fee payments. PL still considered by MEM as registered to the company.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | The renewal application for PL8480/2012 was approved by MEM but despite
Tanzam not taking up the offer, it remains on our portfolio.
| | - | ------------------------------------------------------------------------------------------------------------------------------------



Nyanzaga Gold project area



No work done during the reporting period. The
Nyanzaga gold project is a brownfield stage project focusing on the finding of a gold resource like the recently established Nyanzaga
Mine now under development. Historical preliminary follow-up RC drilling intercepted the potential strike extension of the regional
shear zone but the assay results returned very sporadic anomalous gold values (<1.0g/t Au). Consequently, it has been recommended
that these licenses be abandoned or returned to original owners to cut liabilities.









35







The license status and statutory liabilities for these PLs are as
shown in the table below:



Nyanzaga Gold Project PL Portfolio Status - PLs Proposed for
Discard









| | • | All the Nyanzaga PLs nominated for potential discard by the company
have outstanding annual fee payments as shown in the table above.
| | - | -------------------------------------------------------------------------------------------------------------------------------------

| | • | Both PLs highlighted in red technically expired and no renewal application
were submitted due to the outstanding annual fee payments. PLs still considered by MEM as still registered to the company.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Shinyanga Gold project area



No work done during the reporting period. The
Shinyanga gold project is a brownfield stage project focusing on the finding of remnant greenstone slivers that could host gold
deposits. Historical preliminary exploration results showed a very low to negligent potential for gold mineralization within the
remaining PLs that make up the regional Shinyanga project. Consequently, it has been recommended that these licenses 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:



Shinyanga Gold Project PL Portfolio Status - PLs Proposed for
Discard









| | • | The remaining Shinyanga PL nominated for potential discard by the
company has outstanding annual fee payments as shown in the table above.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------

| | • | The PL highlighted in purple is active but officially notified to us as being in default. The
default notice gives us 3 months in which to pay all outstanding fees failure to do that will result in automatic forfeiture of
the license.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Tulawaka Gold project area



No work done during the reporting period. The
Tulawaka Gold Project is a green stage project that was aimed at generating similar deposits to the Tulawaka Gold mine (now operated
as Stamigold). Historical preliminary exploration results showed a very low to negligent potential for gold mineralization within
the remaining PLs that make up the regional Tulawaka project. Consequently, it has been recommended that these licenses 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:



Tulawaka Gold Project PL Portfolio Status - PLs Proposed for
Discard









| | • | All the Tulawaka PLs nominated for potential discard by the company
have outstanding annual fee payments as shown in the table above.
| | - | -------------------------------------------------------------------------------------------------------------------------------------

| | • | PL highlighted in red technically expired and no renewal applications
were submitted due to the outstanding annual fee payments. PL still considered by MEM as registered to the company.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





36









All the PLs also under a default notice
and will forfeit as the default notice period has also matured.



As of 31st August 2017, the Projects
to Discard/Abandon license portfolio’s outstanding and current financial liabilities and obligations arising from
unpaid rents including the penalties are US$572,841 as summarized in the table below.



Liabilities - PLs to Discard/Abandon (Exploration Projects)









License Relinquishment



Following the Company’s decision to include
mine development to its strategy of generating maximum revenue from its extensive portfolio of properties and with the rising costs
of maintaining prospecting and other licenses in Tanzania, management decided review, revamp and clean up the TRX PL portfolio
with a view to discard certain licenses and/or alternatively farm them out in JV packages.



A detailed in-house geological reviews of each
respective project area and its potential for discovery of gold mineralization was submitted to a technical team that review the
merits and de-merits of each project in Tanzania.



This exercise culminated in the establishment
of all outstanding, current and future financial liabilities and obligations arising from our total land-holdings as summarized
in the above sections.

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.





37







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.



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 4% of all gold produced. The applicable regulatory body in
Tanzania is the Ministry of Energy and Minerals.





38







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.
| | --- | --------------------------------------------------------------------





39







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 also decided to morph into a junior mining company using its Buckreef project as the flagship. 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
avtivities 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. Feasibility studies have been compeletd and published on the
Buckreef, Kigosi and Itetemia Projects with all pertinent details.



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.



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                                                                                                                





40







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

|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.                                                                                                                                                                                                                                         
|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.
|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.                                                                                                                               
|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.                                                                                                                                                            





41







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

|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.                                          



The technical content of the following discussion
regarding the Buckreef Project in Tanzania is summarized from the Buckreef Property technical report dated February 24, 2014 entitled
Updated National Instrument 43-101 Independent Technical Report on the Buckreef Project in Tanzania for Tanzanian Royalty Exploration
Corporation prepared by Venmyn Rand (Pty) Limited and compiled by Fiona Harper, D. Richards and Andrew Neil Clay (the “Updated
Buckreef Technical Report”). The Updated Buckreef Technical Report was filed on SEDAR on February 24, 2014. A further
updated National Instrument NI43-101 compliant Technical Report dated 27th April 2017 and entitled the Updated
Independent Technical Mining Reserve Estimate and Economic Feasibility Study on the Buckreef Gold Mine Project, Tanzania, East
Africa prepared by MaSS Resources was filed on SEDAR on April 5, 2017.



On July 30, 2018, 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 was 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.





42







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:-





|• | 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.





43







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:-



| | • | 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.





44







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.



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



The Buckreef Gold Mine was an underground mine
operated by the Tanzanian State during the late 1980s. 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. 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. 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.





45







The Company acquired the rights to the Buckreef
Project early in 2011 and results of the current metallurgical and geotechnical diamond drilling programs, as well as detailed
RC and diamond mineral resource drilling programs, are incorporated in the Updated Buckreef Technical Report. 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.



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%.



Recent heap leach metallurgical testwork indicate
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.



Current (2016) metallurgical testwork indicate
positive results from carbon-in-column leach test for all three (3) resources types, oxide; transition and sulphide resources.
For the oxide and transition resources overall recovery achieved is in the low 90s while for sulphide resources, recoveries are
in the upper 80s.



Previous Mineral Resource
and Mineral Reserve Estimates



Hellman & Schofield (Pty) Ltd (“Hellman
and Schofield”) was retained by the Company to undertake the Mineral Resource estimation for the Buckreef Project
reported in the technical report effective June 30, 2011 entitled “National Instrument 43-101 Technical Report on Tanzanian
Royalty Exploration Corporation’s Buckreef Gold Project in Tanzania” prepared by Venmyn Rand (Pty) Limited and
compiled by Fiona Harper, Andrew Neil Clay and Nicholas J. Johnson (the “Buckreef Technical Report”).



The Mineral Resource estimates were based partially
on a historic dataset that has been verified and deemed suitable for Mineral Resource estimation (Hellman and Schofield 2007),
as well as Iamgold exploration data, which is similarly of a standard compliant with National Instrument and JORC reporting requirements.
The Mineral Resources were estimated using Multiple Indicator Kriging techniques in GS3 software produced by Hellman and Schofield.
The model estimates resources into panels, which approximate the drillhole sample spacing throughout the majority of the study
area. The Mineral Resource estimates within each panel were classified according to the distribution of sampling in the kriging
neighbourhood and took into account the uncertainty in the estimates related to the proximity and distribution of the informing
composites.





46







Summary of Mineral Resources of the Buckreef Project (Cut-Off
0.5g/t Au) - Dec 2011



|DEPOSIT        | MEASURED    | INDICATED      | INFERRED           | MEASURED & INDICATED
|-------------- | ----------- | -------------- | ------------------ | --------------------
|               | Tonnes (Mt) | Au Grade (g/t) | Contained Au (Mcz) | Tonnes (Mt)         
|Buckreef       | 5.176       | 2.05           | 0.341              | 3.706               
|Buziba-Busolwa |             |                |                    | 35.270              
|Bingwa         |             |                |                    |                     
|Tembo          |             |                |                    |                     
|TOTAL          | 5.17        | 2.05           | 0.34               | 38.97               



Source: Hellman and Schofield 2007, 2011; Venmyn 2011.

Mineral Resources inclusive of Mineral Reserves.

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

Estimates over variable widths of 3m to 40m

Bulk Density ranges from 2.0g/cm3 to 2.8g/cm3

Inconsistencies in totals are due to rounding down

55% attributable to the Company

Cut-off grade 0.5g/t Au



Mineral Resource and
Mineral Reserve Estimates: Venymn 2014



A Mineral Resource estimate was completed on
the BRMA based on the geological models supplied by CAE Mining. The Mineral Resource estimate was informed by both the diamond
drilling and reverse circulation drilling results and a Mineral Resource block model was confined by wireframed interpretations
of the volumes of the individual prospects as developed by CAE Mining using DatamineTM Studio 3 (version 3.21.7164). Venmyn
Deloitte carried out the grade estimation using Ordinary Kriging (OK), using DatamineTM Studio 3 (version 3.20.5321).



The Buckreef Project was modelled for gold grade
only using the shell of the wireframe models as hard boundaries. Only data within the wireframes were used in the estimate. The
variograms ranges were used to define the search ellipse and each domain was estimated separately. The definition of narrow mineralised
stringers which frequently change strike direction posed a difficulty to the estimation process but this issue was solved by the
use of local anisotropy Kriging (LAK) for the stringers implemented through DatamineTM's dynamic anisotropy functions. Specific
Gravity values from all prospects and the three alteration zones namely; fresh, transitional and oxide are sufficient for the estimation
purposes. Topographic surface models were provided by the Company.



NI 43-101 Compliant Mineral Resource Estimate for BRMA as at
29 November 2013



|PROSPECT             | MEASURED | INDICATED           | INFERRED           
|-------------------- | -------- | ------------------- | -------------------
|Volume
        (Mm3) | SG       | Tonnes
        (Mt) | Grade
        (g/t)
|Sub-total            | 3.260    | 2.73                | 8.902              
|Sub-total            | 0.032    | 2.69                | 0.087              
|Sub-total            | 0.006    | 2.70                | 0.017              
|Sub-total            | 0.387    | 2.34                | 0.906              
|Total                | 3.685    | 2.69                | 9.912              
|TOTAL                | 3.68     | 2.69                | 9.91               

Source: Venmyn Deloitte 2013, CAE Mining 2013 and TRX 2013





47







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

Mineral Resources reported inclusive of Mineral Reserves (although
no Mineral Reserves are reported)

Cut-off Grade 0.5 g/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 TRX



The Company has incurred total net costs (after
recoveries, if any) of $3,064,543 on the Buckreef Project for the year ended August 31, 2017.



The cut-off grade calculations for the Buckreef
Project were based on costs from the Buckreef Project PEA and at the June 2011 gold spot price of approximately USD1,500/oz and
a three year trailing average of USD1,024/oz. The economic cut-off grade thus calculated ranges from 0.39g/t Au to 0.6g/t Au which
shows that reasonable prospects for economic extraction are possible from grade of 0.39g/t and above. TRX made a strategic decision
to publish the Mineral Resource estimate at an average of 0.5g/t Au cut-off as a reasonably conservative position.



The Exploration Target estimate column contained
in the foregoing chart was prepared in accordance to the NI 43-101 guidelines of the Canadian securities administrators. It should
be noted that Exploration Targets are conceptual in nature and there has been insufficient exploration to define them as Mineral
Resources, and, while reasonable potential may exist, it is uncertain whether further exploration will result in the determination
of a Mineral Resource under NI 43-101. The Exploration Target stated above is not being reported as part of any Mineral Resource
or Mineral Reserve.



New Mineral Resource and Mineral Reserve Estimates: MaSS
Resources 2017



MaSS Resources (Pvt.) Ltd was commissioned by
Tanzam2000, a subsidiary to Tanzanian Royalty Exploration Corporation to produce an independent NI43-101 compliant mine design
and costing Feasibility Study on the Buckreef Gold Mine Project located in the Lake Victoria Goldfields, Geita District, in North
Central Tanzania. This report provides a technical updated reserve estimate, open pit mine design and financial model Feasibility
Study on the gold mineralization at the Buckreef Project, incorporating historical recommendations from previous studies as well
as current and future projected economic considerations. This study was completed during November 2016 to April 2017.



The scope of work for this study included the
following:



| | • | 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
| | - | ----------------------------------------------------------





48







This technical mining study is based on the
2014 mineral resource estimate as published by Venymn Deloitte. Mass Resources essentially overhauled and improved on the original
overall mining philosophy previously expounded in the 2012 PEA report. This essentially consists of several conventional open pit
layouts with access to the orebodies provided via a series of ramps into the pits.



The reserves for Buckreef project as developed
by MaSS Resources are NI43-101 compliant. Reserves were calculated by first optimizing pit shells using preliminary economic parameters
and then utilizing the optimized pits as templates for design of pit phases and the ultimate pit. Reserves were calculated using
Measured and Indicated resources contained inside of the pit designs. Full Grade Ore cut-off grade (FGO) calculations rely on inputs
from this study and other sections of the Buckreef Feasibility study. Reserves were based on $1100/oz-Au; 0.59g/t & 0.63g/t-Au
FGO was used for reserve calculation.



MaSS established that, at the 0.59 g/t cut-off
base case, the geological resource model yields a global pit design optimized reserve of 17.6Mt grading at 1.89g/t including the
existing mined stockpile and containing 1,070,012 troy ounce gold as summarized in the table below.



NI 43-101 Compliant Pit Optimized Mineral Reserve Estimate for
BRMA as at April 27, 2017









Source: MaSS Resources 2017

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

Mineral Resources reported inclusive of Mineral
Reserves

Cut-off Grade 0.59 g/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 17.49Mt 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.
| | - | -----------------------------------------------------------------------------------------------------------------

| | • | 1.064Moz 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.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | 0.91Moz of gold will be produced over the life of the project.
| | - | --------------------------------------------------------------

| | • | Initial capital cost outlay estimated at US 32.5 Million with a Life of mine cost over the three
phases of $59.6 million and sustaining capital, excluding closure costs.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | • | Cash operating costs of $696/oz produced equivalent US $35.95 per tonne milled.
| | - | -------------------------------------------------------------------------------

| | • | Generation of a positive NPV of $243 million at a 5% discount rate and an IRR of 53.7%
| | - | --------------------------------------------------------------------------------------





49







The Company has incurred total net costs (after
recoveries, if any) of $3,064,543 on the Buckreef Project for the year ended August 31, 2017.



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.





50







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.



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.





51







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.



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.





52







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.



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 2017 is summarized as follows:





53







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.                                                                                           
|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.              





54







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

|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.                                                                                                                                              



The Company has incurred total net costs (after
recoveries, if any) of $87,507 on the Kigosi Project for the year ended August 31, 2017.



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.





55







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                                                                                               
|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      | 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.





56







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.



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.





57







During the period ended August 31, 2017, no
direct property work was conducted on the Lunguya property.



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



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.





58







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:



| | 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.





59







History



The exploration history of the Itetemia Property from 2006 to 2015
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.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|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 | 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.





60







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.





61







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, 2017, no
direct property work was conducted on the Itetemia property.



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, 2017.



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 2015 is summarized as:





62







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 | Company  | No fieldwork conducted. Property maintenance observed.



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.





63







Exploration



During the period ended August 31, 2017, 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, 2017.



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, 2017 and 2016, 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.





64







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.





65







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, 2017,
the Company wrote off $124,717 of costs related to its mineral properties (2016 – $3,516,268). 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, 2017 and 2016 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, 2017, the Company had current
assets of $1,922,088, compared to $1,032,319 on August 31, 2016. The increase is mainly due to the cash inflow of $5,589,501 (2016
- $nil) in connection with the proceeds of the private placements, net of issue costs, closed during September 2016 as well as
inflows from proceeds of convertible loans issued of $1,181,993 (2016 - $221,115). This was offset by outflows in regards to expenditures
on exploration of $1,568,614 (2016 - $688,296) and cash used in operations of $4,283,489 (2016 - $1,914,495). Mineral properties
and deferred exploration assets were $46,920,303 as at August 31, 2017, compared to $45,802,858 at August 31, 2016.





66







Net loss for the year ended August 31, 2017
was $6,434,112, compared to a net loss of $12,781,902 in the comparable year ended August 31, 2016. The main difference in net
loss between the two periods is due to the following fluctuations:



| | • | An increase in consulting fees for the year ended August 31, 2017 to $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 expense amounting
to $458,700 for the year ended August 31, 2017 as compared to $623,716 for comparable period in 2016.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | • | An increase in professional fees expense to $754,738 for the year ended August 31, 2017, compared
to $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.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | • | Higher share based payment expense of $1,772,663 during the year ended August 31, 2017, as compared
to a recovery of $38,996 during the 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 of the audited consolidated
financial statements for the year ended August 31, 2017 and 2016 for details of RSU’s and stock options issued).
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | • | A decrease in the loss on the revaluation of derivative liability and
change in value of warrant liability to $nil and $nil respectively for the year ended August 31, 2017 as compared to a
loss of $3,905,000 and $946,600 respectively for the year ended August 31, 2016. During theyear ended August 31, 2017,
as a result of the change in functional currency, gains and losses on derivative instruments are no longer recognized.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | • | 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.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The remainder of the expenses primarily decreased
in comparison to the prior period as the Company looked to be more cost effective as it worked towards securing additional financing
and moving its Buckreef project into production. These variances are further discussed below.



Share Capital:



During the year ended August 31, 2017, the Company
issued 695,991 shares (2016 – 50,000 shares) pursuant to the RSU plan with a value of $1,040,990 (2016 - $120,500). The Company
issued 814,089 (2016 – 536,137) shares with a value of $542,447 (2016 - $372,130) in connection with interest payments related
to the bullion loans outstanding. The Company issued 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, respectively. The Company also completed its private placement
financing in September 2016 issuing 7,197,543 shares for proceeds, net of issue costs, of $5,589,501 (2016 - $nil). In connection
with the private placement closed in September 2016, the Company also issued 3,146,944 (2016 – 233,258) shares pursuant to
cashless exercise of warrants issued on the private placement. 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.





67









|                                                                                                   |  | C$ (000) |       
|-------------------------------------------------------------------------------------------------- |  | -------- | ------
|Funds available August 31, 2016                                                                    |  |          | 85    
|Proceeds from private placements, net of issue costs                                               |  |          | 5,590 
|Net proceeds from convertible loans                                                                |  |          | 1,182 
|Net proceeds (repayments) from loans from related parties                                          |  |          | (33   
|Mineral property expenditures including licences, environmental and exploration, net of recoveries |  |          | (1,568
|General corporate expenses                                                                         |  |          | (4,245
|Funds available August 31, 2017                                                                    |  | $        | 1,011 



At August 31, 2017, the Company had a working
capital deficiency of $6,552,376 (August 31, 2016 – $11,836,214 working capital deficiency), had not yet achieved profitable
operations, has accumulated losses of $96,566,577 (August 31, 2016 – $90,600,819) 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, 2017, 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. In September 2016, the Company raised US$5
Million 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.



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;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





68







| | • | 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.



Results of operations



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.



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.





69







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.



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 of 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.





70







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.



Fiscal year ended August 31, 2016 compared to fiscal year
ended August 31, 2015



Net additions to mineral properties and deferred
exploration costs for the year ended August 31, 2016 were $1,168,935, net of recoveries from the sale of gold of $279,203, compared
to $3,331,566 for the year ended August 31, 2015. The amount has decreased as compared with the prior year as the Company has had
to allocate limited resources on core and crucial activities at the Buckreef property and other properties to keep the properties
in good standing due to the limited financial resources as a result of difficult market conditions. During the comparable period,
the Company was in the process of actively bringing the Buckreef into production and as such incurred higher additions as compared
to the current period once the financial difficulties hit the Company beginning with the second quarter in 2015. As the Company
was under Force Majeure on its Buckreef Project for much of the year, only limited expenditures to keep the project ongoing were
incurred.



The Company also incurred property, plant and
equipment additions of $157,862 (2015 - $668,005). The amount was higher during the comparative period as the Company continued
to finalize construction of the heap leach pads and processing plant which began during the year ended August 31, 2014. Exploration
activities have reduced as the Company was under Force Majeure on its Buckreef project for much of the year, and is working to
continue towards the commencement of production and continue exploration work on other projects in its portfolio and at the same
time is conscious about conserving its cash in the current economic downturn.



Net loss for the year ended August 31, 2016
was $12,781,902, compared to a net loss of $8,995,697 for the comparable year ended August 31, 2015. For the three month period
ended August 31, 2016 and 2015, there was a net loss of $5,509,566 compared to a net loss of $2,030,188, respectively. The main
difference in net loss between the comparable periods ended August 31, 2016 and 2015 is mainly due to the variances discussed above.





71







Variances in the remaining expenditures is set out below:



For the year ended August 31, 2016, depreciation
expense was $478,699, compared to $384,708 for the year ended August 31, 2015. The increase of $93,991 is due to additions to property,
plant and equipment over last year resulting in higher amounts of depreciation on overall capital assets. The capital expenditure
for the year ended August 31, 2016 was $157,862 as compared to $668,005 in the year ended August 31, 2015. Capital expenditures
were higher in the comparable period and commencing from the fourth quarter of fiscal 2014 due to construction of the heap leach
pads and processing plant. The processing plant is currently not yet being depreciated as it is currently still under testing and
commissioning.



Consulting fees for the year ended August 31,
2016 were $432,316, compared to $246,147 in the comparable year ended August 31, 2015. 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. Consulting fees
for the three months ended August 31, 2016 were $204,446 compared to $98,337 in the comparable period ended August 31, 2015. The
expense for the three month period increased due to the same reason as the increase for the year.



Directors’ fees for the year ended August
31, 2016 were $285,188, compared to $367,524 in the comparable year ended August 31, 2015. For the three month period ended August
31, 2016, director fees amounted to $54,890 (2015 - $129,702). 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.



Office and general expenses for the year ended
August 31, 2016 were $246,938, compared to $326,088 in the comparable year ended August 31, 2015. Office and general costs decreased
between the comparable periods due to cost reduction measures across all areas of the Company in light of the current economic
conditions and resources available to the Company. For the three month period ended August 31, 2016, office and general expenses
were $87,752 compared to $128,983 in the comparable period ended August 31, 2015. The expense for the three month period increased
due to the same reason as the increase for the year.



Shareholder information costs for the year ended
August 31, 2016 decreased to $249,645 from $361,265 for the comparable year ended August 31, 2015. The decrease is due to the additional
reporting requirements in connection with the convertible senior note financing and operational updates during the comparable quarter.
For the three month period ended August 31, 2016, shareholder information costs were $99,299 compared to $17,167 for the three
month period ended August 31, 2015. The reason for the increase for the three month period is due to various filings and activity
close to the end of the year as the Company lifted force majeure and worked towards the financings closed subsequent to year end.



Professional fees decreased by $292,871 for
the year ended August 31, 2016 to $387,177 from $680,048 for the year ended August 31, 2015. Professional fees were higher during
the comparable quarter as the Company dealt with tax litigation in Tanzania, increased accounting costs surrounding the convertible
senior note financing transaction and various business consulting fees on strategy regarding financings. For the three month period
ended August 31, 2016 professional fees went from $244,297 for the three month period ended August 31, 2015 to $127,180. The expense
for the three month period decreased due to the same reason as the decrease for the year.



Salaries and benefits expense decreased to $623,716
for the year ended August 31, 2016 from $1,053,364 for the year ended August 31, 2015. 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, 2016 and 2015 were $57,778 and $279,072 respectively.





72







Share based payments for the year ended August
31, 2016 resulted in a recovery of $38,996, compared to an expense of $506,747 in the comparable year ended August 31, 2015. Share
based payments vary depending on the number of equity based compensation options issued and vesting. See note 6 of the audited
consolidated financial statements for the years ended August 31, 2016 and 2015 for details. The decrease is mainly due to RSUs
forfeited during the year. Director fee RSU expense was $157,813 and $192,468 respectively for the years ended August 31, 2016
and 2015.



For the year ended August 31, 2016, travel and
accommodation expense increased by $3,174 from $58,507 in 2015 to $61,681. For the three months ended August 31, 2016 and 2015,
travel and accommodation expense increased by $664 from $22,562 in 2015 to $39,773. Travel and accommodation expense increased
in the fourth quarter due to timing of travel during the year but remained consistent overall with the previous year.



For the year ended August 31, 2016, the foreign
exchange gain was $111,352 compared to an exchange gain of $390,459 for the same year ended August 31, 2015. The Tanzanian Shilling
exchange rate increased from 1,587 at August 31, 2015 to 1,635 at August 31, 2016. The US Dollar exchange rate increased from 1.3157
at August 31, 2015 to 1.312 at August 31, 2016.



The interest accretion expense for the year
ended August 31, 2016 was $1,028,568, compared to $738,134 for the year ended August 31, 2015. Interest accretion in the current
period represent interest in connection with the gold loan bullion loans, which increased as compared to the year ended August
31, 2015. Interest accretion in the comparative period mainly represent interest in connection with the convertible senior notes,
which were fully converted during the year ended August 31, 2015.



During the nine month period ended May 31, 2016,
the Company agreed to abandon and wrote off $3,516,268 in expenses in various project areas (2015 – wrote off $2,233,843)
(see note 4 of the audited consolidated financial statements for the three and years ended August 31, 2016 and 2015 for details).
The Company is continuously evaluating its mineral properties Licenses and Carry Forward Balances and makes adjustments as deemed
necessary to reflect current plans to explore and develop licenses into the future.



A loss of $946,600 (2015 – gain of $324,000)
was recognized during the year ended August 31, 2016 in connection with the revaluation of the warrant liability. Warrant liability
is revalued at every reporting period using the Black-Scholes model. See note 6 of the audited consolidated financial statements
for the years ended August 31, 2016 and 2015 for details.



A loss of $3,905,000 (2015 – $150,000
gain) was recognized during the year ended August 31, 2016, in connection with the revaluation of the derivative liability. The
derivative liability is revalued at every reporting period using the Black-Scholes model. See note 19 and 22 of the audited consolidated
financial statements for the years ended August 31, 2016 and 2015 for details.



A loss on the amendment of the convertible senior note financing
resulting from the amendment of the terms of the financing on March 25, 2015 as described earlier which resulted in a loss of $nil
(2015 - $2,057,506) for the year ended August 31, 2016.



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.





73







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, 2017, 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, 2017.



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, 2017, 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, 2017 the Company had a working
capital deficiency of $6,552,376 (August 31, 2016 – $11,836,214 working capital deficiency), had not yet achieved profitable
operations, has accumulated losses of $96,566,577 (August 31, 2016 – $90,600,819) 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, 2017, amounts capitalized in
respect of mineral properties were $46,920,303, being an increase from August 31, 2016 when the balance was $45,802,858.





74







During the fiscal year ended August 31, 2017,
the Company capitalized mineral property exploration costs of $1,242,162 on its mineral resource properties, compared to fiscal
2016 when the Company capitalized mineral property exploration costs of $1,168,935.



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.



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.



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 March
16, 2016. There are no family relationships between the directors and officers.







75









|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, ConnecticutPresident and Director     | President 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             | Chartered Professional Accountant, currently serving as Chief Financial Officer, Controller and Accountant for a number of junior mining companies. | Officer only                            
|Donna M. Moroney
Vancouver, BCCorporate Secretary               | President and Owner of Wiklow Corporate Services Inc.                                                                                               | Officer only                            



Directors and Senior Management



James E. Sinclair, President and Director, former Chief
Executive Officer



Mr. Sinclair is the President and Directror,
former CEO of the Company. 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.







76









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 82, 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 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 since 2008 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
currently serves on the Board of Governors of Trent University where she is a member of its Executive Committee and Chair of its
Nominating and Governance Committee. She is also Chair of The Living City 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 61, devotes approximately 10% of her time to the business and affairs of the
Company.





77







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



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.



Donna M. Moroney, Corporate Secretary:



Ms. Moroney has over 30 years of experience
in regulatory and corporate compliance in both Canada and the United States, and as a senior officer of various public companies.
As President and owner of Wiklow Corporate Services Inc. since 2008, she assists companies in the resource, financial and technology
sectors in maintaining the securities and exchange demands on public companies, as well as keeping them up-to-date on relevant
issues, policies and working practices. Ms. Moroney also assists companies reporting in the U.S. in preparing registration statements,
quarterly and annual financial filings and other various facets of meeting U.S. securities requirements. She also leads workshops
that provide a practical guide for public companies in meeting their securities regulatory compliance requirements. She currently
serves as a director or senior officer for seven public companies. Ms. Moroney, age 55, devotes 30% of her time to the business
and affairs of the Company.





78







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
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (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
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





79







| | (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
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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.





80







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.



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.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



Based on the foregoing definition, the Company
had six NEOs for the fiscal year ended August 31, 2017: Jeffrey Duval, CEO, James E. Sinclair, President and Director,
former CEO; Joseph Kahama, former Chairman and COO (Tanzania); Marco Guidi, CFO, Corporate Accountant, Peter Zizhou, General Manager
and Donna M. Moroney, Corporate Secretary.





81







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, 2017, 2016 and
2015:



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                             | 201720162015                                       | 222,378 (1)NilNil                | NilNilNil                      | NilNilNil                       | 460,000(12)NilNil                                            | NilNilNil                 | NilNilNil                           | NilNilNil                      
|James Sinclair,President and Director, former CEO    | 201720162015                                       | 167,624 (1)104,987 (2)94,395 (3) | NilNil206,123 (5)              | NilNilNil                       | 138,00012)NilNil                                             | NilNilNil                 | NilNilNil                           | NilNilNil                      
|Joseph Kahama, (6)Former Chairman and COO (Tanzania) | 201720162015                                       | Nil65,975 (2)125,323 (3)         | NilNil206,123 (7)              | NilNilNil                       | NilNilNil                                                    | NilNilNil                 | NilNilNil                           | NilNilNil                      
|Marco Guidi, (9)CFO                                  | 201720162015                                       | 75,00075,00077,375               | NilNilN/A                      | NilNilN/A                       | 27,60012)NilN/A                                              | NilNilN/A                 | NilNilN/A                           | NilNilN/A                      
|Donna M. Moroney,Corporate Secretary                 | 201720162015                                       | 60,00060,00060,000               | Nil24,100 (10)N/A              | NilNilN/A                       | 13,80012)N/AN/A                                              | NilN/AN/A                 | NilN/AN/A                           | NilN/AN/A                      
|Peter Zizhou, (11)General Manager                    | 201720162015                                       | 213,746214,958 (2)88,017         | NilN/AN/A                      | NilN/AN/A                       | NilN/AN/A                                                    | NilN/AN/A                 | NilN/AN/A                           | NilN/AN/A                      

| | (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%.
| | ---- | --------------------------------------------------------------------------------------------------------------------------------------------------



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.





82







Incentive Plan Awards



Outstanding share-based awards and option-based
awards



|Option-based Awards                               | Share-based Awards
|------------------------------------------------- | ------------------
|Name                                              | Year              
|Jeffrey Duval,Acting CEO                          | 20172016 
2015    
|James Sinclair,President and Director, former CEO | 20172016 
2015    
|Joseph Kahama,Former Chairman and COO (Tanzania)  | 20172016 
2015    
|Marco Guidi,CFO                                   | 20172016 
2015    
|Donna M. Moroney,Corporate Secretary              | 20172016 
2015    
|Peter Zizhou,General Manager                      | 20172016 
2015    

| | (1) | Valued at $0.49 per RSU granted on April 8, 2015.
| | --- | -------------------------------------------------



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                                                            | 24,100                                                        | Nil                                                                                      
|Peter Zizhou,General Manager                       | Nil                                                            | Nil                                                           | Nil                                                                                      





83







Long Term Incentive Plan Awards to NEOs



The Company has made long-term incentive plan
awards during the fiscal year ended August 31, 2017 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.





84







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, 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 years ended August 31, 2015, August 31, 2014 and August 31, 2013 vested during fiscal year ended August
31, 2017:



|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  
|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  
|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 $0.49 per RSU
| | --- | -----------------------

| | (2) | Valued at $2.70 per RSU
| | --- | -----------------------

| | (3) | Valued at $3.58 per RSU
| | --- | -----------------------



RSUs Granted to Directors and Named Executive Officers During
the Fiscal Year Ended August 31, 2016:



There were no RSUs granted to directors and
Named Executive Officers during the fiscal year ended August 31, 2016.





85







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
|--------------- | -------------- | ---------------- | -------------------------- | -------------- | ---------------
|Rosalind Morrow | April 10, 2013 | 9,602            | $34,375                    | 3 years        | April 10, 2016 
|Norman Betts    | April 10, 2013 | 11,470           | $38,000                    | 3 years        | April 10, 2016 

(1)       Valued at $3.58
per RSU



The following RSUs granted to directors and
officers during the fiscal year ended August 31, 2015 vested during fiscal year ended August 31, 2016 (shares have not yet been
issued):



|Name            | Date of Grant | No. of Shares(1) | Cash Compensation Election | Vesting Period | Expiration Date
|--------------- | ------------- | ---------------- | -------------------------- | -------------- | ---------------
|Ulrich Rath     | April 8, 2015 | 77,168           | $37,812                    | 1 year         | April 8, 2016  
|Rosalind Morrow | April 8, 2015 | 168,367          | $Nil                       | 1 year         | April 8, 2016  

(1)Valued at $0.49 per RSU



Outstanding RSUs



RSUs granted to directors and executive officers
during fiscal year 2015 are outstanding as of August 31, 2017.



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.



86









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:



|                                                                                    | 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                        | 46,000                    | 82,000  
|William Harvey   | 37,813         | Nil                 | 37,813                        | 46,000                    | 83,813  
|Rosalind Morrow  | Nil            | Nil                 | Nil                           | 46,000                    | 46,000  
|Abdulkarim Mruma | Nil            | Nil                 | Nil                           | Nil                       | Nil     
|Ulrich Rath      | 37,813         | Nil                 | 37,813                        | 460,000                   | 497,813 



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.





87







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%.



There were no RSUs granted to the directors
under the Amended RSU Plan during the fiscal year ended August 31, 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 March 16, 2016,
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.





88







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
| | --- | -----------------------------------





89







| | 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.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 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.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





90







| | 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.
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------





91







| | 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.
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | 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.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------







92







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
|------------------------------- | ----------------------------------- | ------------------ | -------- | --------------
|2017                            | Canada – $80,000
Tanzania - $15,000 | Nil
Nil            | Nil
Nil  | Nil
Nil       
|2016                            | Canada – $88,000
Tanzania - $14,265 | Nil
Nil            | Nil
Nil  | Nil
Nil       





93







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, 2017.



|Name of Owner                                         | Number of Shares Owned | Percentage (1)
|----------------------------------------------------- | ---------------------- | --------------
|Betts, Norman                                         | 125,799                | <0.01%        
|Guidi, Marco                                          | 0                      | N/A           
|Harvey, William                                       | 310,424                | 0.25%         
|Moroney, Donna                                        | 12,427                 | <0.01%        
|Morrow, Rosalind                                      | 669,784                | 0.55%         
|Rath, Ulrich E.                                       | 172,003                | 0.14%         
|Sinclair, James E.                                    | 1,987,397              | 1.63%         
|All directors and named executive officers as a group | 3,277,834              | 2.69%         

|(1) |  | Calculation based on 121,784,619 shares of common stock outstanding as of August
31, 2017.
|--- |  | ------------------------------------------------------------------------------------------





94







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, 2017, 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) | Based on the issued and outstanding shares of the Company of 121,784,619 shares as at August
31, 2017.
| | --- | ------------------------------------------------------------------------------------------------------

| | (2) | As per information provided pursuant to sec. 2.2 of NI 62-103 an Alternative Monthly Report
filed on SEDAR on January 9, 2015.
| | --- | ------------------------------------------------------------------------------------------------------------------------------



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,
2017:



|Jurisdiction of Shareholders of Record | Number of Shareholders | Number of Common Shares | Percentage of Total Issued Shares | Percentage of Total Holders
|-------------------------------------- | ---------------------- | ----------------------- | --------------------------------- | ---------------------------
|United States                          | 1,438                  | 59,159,900              | 48.58%                            | 81.52%                     
|Canada                                 | 214                    | 60,488,060              | 49.67%                            | 12.13%                     
|Other Countries                        | 112                    | 2,136,659               | 1.75%                             | 6.35%                      
|TOTAL                                  | 1,764                  | 121,784,619             | 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.





95







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



|Years ended,   | Notes | August 31, 2017 | August 31, 2016
|-------------- | ----- | --------------- | ---------------
|Legal services | (i)   | $82,455         | $10,363        
|Rent           | (ii)  | $Nil            | $15,199        
|Consulting     | (iii) | $203,274        | $157,637       
|Consulting     | (iv)  | $172,330        | $33,838        



(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, 2017, the legal expense charged by the
firm was $82,455 (2016 - $10,363). As at August 31, 2017, $370,940 remains payable (August 31, 2016 - $327,766).



(ii) During the year ended August 31, 2017, $nil (2016 - $15,199)
was paid to a company associated with the Company’s former Chairman and COO and his spouse for office rental.



(iii) During the year ended August 31, 2017, $203,274 (2016 - $157,637)
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.



(iv) During the year ended August 31, 2017, $172,330 (2016 - $33,838)
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, 2017, the Company has a receivable
of $37,247 (August 31, 2016 - $3,903) from an organization associated with the Company’s President and former CEO and current
director and from current officers and directors.



As at August 31, 2017, the Company has a receivable
of $nil (August 31, 2016 - $5,541) from the former general manager of the Company for amounts advanced on his behalf.



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, 2017, the remaining balance
outstanding under finance lease obligations after the settlements described above is $56,631 (August 31, 2016 - $370,103) and is
repayable within 1 year, as such, the finance lease obligation is classified as a current liability.





96







(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, 2017                 | August 31, 2016                   
|----------- | ------------------------------- | ----------------------------------
|            | Fees, salaries and benefits (1) | Share based payments (2), (3), (4)
|Management  | $    525,102                    | $    1,175,439                    
|Directors   | 111,625                         | 673,200                           
|Total       | $    636,727                    | $    1,848,639                    



|(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, 2017, included in trade and
other payables is $638,000 (August 31, 2016 - $576,000) 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, 2017 $nil (August 31, 2016 - $86,000) 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, 2017 and 2016 with the Report of Independent
Registered Public Accounting Firm, comprised of:



| | (a) | Consolidated Statements of Financial Position as of August 31, 2017 and 2016;
| | --- | -----------------------------------------------------------------------------



| | (b) | Consolidated Statements of Comprehensive Loss for the years ended August 31, 2017 and 2016;
| | --- | -------------------------------------------------------------------------------------------



| | (c) | Consolidated Statements of Changes in Equity for the years ended August 31, 2017 and 2016;
| | --- | ------------------------------------------------------------------------------------------



| | (d) | Consolidated Statements of Cash Flows for the years ended August 31, 2017 and 2016; 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.





97







Legal Proceedings



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



B.       Significant
Changes



None.



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 MKT LLC (“NYSE
MKT”) under the symbol “TRX”



As of August 31, 2017, there were 1,438 registered
shareholders in the United States holding 48.58% of the Company’s outstanding common shares, representing approximately 81.52%
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
MKT.



The following sets forth the high and low prices
expressed in U.S. Dollars on the NYSE MKT and in Canadian Dollars on the TSX for the past full six months and through August 31,
2017, for each quarter for the past two fiscal years and for the past five years.



|                             |  | NYSE MKT                |      |  | TSX                | 
|---------------------------- |  | ----------------------- | ---- |  | ------------------ | 
|                             |  | (United States Dollars) |      |  | (Canadian Dollars) | 
|                             |  | High                    |      |  | Low                | 
|Last Six Months              |  |                         |      |  |                    | 
|October 2017                 |  |                         | 0.30 |  |                    | 
|September 2017               |  |                         | 0.33 |  |                    | 
|August 2017                  |  |                         | 0.45 |  |                    | 
|July 2017                    |  |                         | 0.48 |  |                    | 
|June 2017                    |  |                         | 0.56 |  |                    | 
|May 2017                     |  |                         | 0.52 |  |                    | 
|                             |  |                         |      |  |                    | 
|For the Fiscal Quarter Ended |  |                         |      |  |                    | 
|August 31, 2017              |  |                         | 0.56 |  |                    | 
|May 31, 2017                 |  |                         | 0.59 |  |                    | 
|February 28, 2017            |  |                         | 0.63 |  |                    | 
|November 30, 2016            |  |                         | 1.13 |  |                    | 
|                             |  |                         |      |  |                    | 
|August 31, 2016              |  |                         | 1.49 |  |                    | 
|May 31, 2016                 |  |                         | 0.57 |  |                    | 
|February 29, 2016            |  |                         | 0.34 |  |                    | 
|November 30, 2015            |  |                         | 0.38 |  |                    | 
|                             |  |                         |      |  |                    | 
|For Fiscal Year Ended        |  |                         |      |  |                    | 
|August 31, 2017              |  |                         | 1.13 |  |                    | 
|August 31, 2016              |  |                         | 1.49 |  |                    | 
|August 31, 2015              |  |                         | 2.45 |  |                    | 
|August 31, 2014              |  |                         | 4.06 |  |                    | 
|August 31, 2013              |  |                         | 5.34 |  |                    | 





98







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 MKT 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, 2017, there were 121,784,619 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.





99







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, 2014                         | 101,325,880   | 117,153,437 
|Add:Issued pursuant to Restricted Share Unit Plan               | 174,608       | 729,699     
|Finders fee on convertible senior note financing                | 400,000       | 264,000     
|Shares issued on amendment of convertible senior note financing | 500,000       | 250,000     
|Redemption of convertible senior notes                          | 5,010,518     | 1,958,397   
|Finder’s fee on loan agreement                                  | 442,548       | 177,019     
|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   | $128,787,377



Shares are issued by the Company with the regulatory
acceptance of the Toronto Stock Exchange and NYSE MKT, upon resolution of the Board of Directors of the Company. As of August 31,
2017, there are a total of 121,784,619 common shares issued and a further 520,000 common shares reserved for issuance under outstanding
RSUs, 3,750,000 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”;
| | - | ---------------------------------------------------------------------------





100







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



| | • | 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).





101







2% Convertible Notes and Warrants



On September 1, 2016, we entered into a Securities
Purchase Agreement with Crede, the selling shareholder, pursuant to which we may sell Notes in the aggregate principal amount of
up to $3,750,000 and Series B Warrants to purchase our common shares. Pursuant to this agreement, we sold $1,250,000 common shares
and Series A Warrants to purchase 1,840,400 common shares at an exercise price of $0.8291 per common share for an aggregate purchase
price of $1,250,000.



Notes.The Notes bear interest at the rate
of 2.0% per annum on the outstanding principal amount, with interest-only payments due monthly and all principal and interest due
ten years from the issuance date.



Prepayment. The Company may not prepay
any portion of the principal amount of the Note without the prior written consent of the holder.



Conversion.The Notes, and, at the election
of the holder, interest thereon, are convertible into our common shares at the election of the holder thereof at a conversion price
equal to (a) the lower of: (i) the closing bid price of the common shares on the day prior to the date of the Securities Purchase
Agreement, or (ii) the closing bid price of the common shares on the day prior to the Effective Date of this Registration Statement,
(b) less five cents per share, subject to anti-dilution provisions, including stock dividends and stock splits, subsequent rights
offerings, pro rata distributions, a fundamental transaction and in certain limited instances for a period of ninety (90) days
following the Effective Date of this Registration Statement, the issuance of common shares or common share equivalents at a price,
or exercise or conversion price, at less than the then current Note conversion price. Notwithstanding the foregoing, the Notes
held by a particular holder will not be convertible to the extent that such conversion would result in such holder owning more
than (i) 9.9% of the number of common shares outstanding after giving effect to the issuance of common shares issuable upon conversion
of the Notes calculated in accordance with Section 13(d) of the Exchange Act; or (ii) 9.9% of the number of common shares outstanding
after giving effect to the common shares issuable upon the conversion of the Note calculated in accordance with Section 102 and
102.1 of Part XX of the Securities Act (Ontario). Notwithstanding anything in the Notes to the contrary, the total number of common
shares issuable to the holder, including the common shares issuable upon conversion of the Note and all other common shares issued
to the holder by virtue of any conversion or exercise or exchange of convertible or exercisable or exchangeable securities into
common shares, when aggregated (as calculated pursuant to Section 13(d) of the Exchange Act and Rule 13d-3 promulgated thereunder)
shall be limited to 21,704,630 common shares, which was 19.9% of the issued and outstanding common shares as of the date of the
Securities Purchase Agreement.



Redemption. Upon a change in control, the
holder of the Note may require us to redeem the Note for the outstanding principal balance payable in cash or, at the holder’s
option, common shares at the then conversion price. The Company’s right to elect to redeem the Notes with common shares is
subject to the satisfaction of certain equity conditions, including the effectiveness of a registration statement covering the
resale of such shares, the listing of such shares on a trading market, the holder’s lack of material non-public information
about the Company, and no event of default.



Warrants.In connection with the Securities
Purchase Agreement for the common shares and the Notes, the Company issued to the selling shareholder initial Series A Warrants
to purchase 1,840,400 common shares and in connection with the purchase of the Notes, Series B Warrants to purchase 3,609,934 common
shares. The Series A Warrants and Series B Warrants are exercisable immediately for a period of five years from the date of their
issuance for cash, at their respective exercise prices, or if the exercise price exceeds the market price for the common shares,
on a cashless exercise basis, based on a formula in the Warrants, subject to adjustment in the event of stock dividends and splits,
or sales or grants of common shares. The holder shall not have the ability to exercise the Warrants in the event that upon the
exercise, the Warrants, the holder and its affiliates would exceed the Beneficial Ownership Limitations.





102







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.





103







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 two years:



|Date             | Names of Parties                | Description of General 
Nature of the Contract | Consideration Paid; 
Terms and Conditions                                                          
|---------------- | ------------------------------- | ---------------------------------------------- | ---------------------------------------------------------------------------------------------------
|June 1, 2017     | New Direction IRA               | Secured Gold Loan Agreement                    | US $340,210.88 for one year term                                                                   
|June 1, 2017     | Wilt Family Trust               | Secured Gold Loan Agreement                    | US $433,301.99 for one year                                                                        
|March 31, 2017   | Witt Family Trust               | Secured Gold Loan Agreement                    | US $150,000 for one year term                                                                      
|March 31, 2017   | New Direction IRA (F. Graziano) | Secured Gold Loan Agreement                    | US $100,000 for one year term                                                                      
|March 31, 2017   | William Holter                  | Secured Gold Loan Agreement                    | US $100,000 for one year term                                                                      
|March 31, 2017   | Structural Logistics            | Secured Gold Loan Agreement                    | US $100,000 for one year term                                                                      
|May 16, 2016     | Structural Logistics, LLC       | Secured Gold Loan Agreement                    | US$104,540 for one year term, and renewable for one year                                           
|October 19, 2016 | David Ponelli                   | Secured Gold Loan Agreement                    | US$500,000 for three year term, and renewable for one year                                         
|October 19, 2016 | Edward F. Marin Family LLC      | Secured Gold Loan Agreement                    | US$500,000 for three year term, and renewable for one year                                         
|June 22, 2015    | Hoffman Heritage Ranches LLC    | Secured Gold Loan Agreement                    | US$1,015,000 in gold for a term of one year, maturing on June 22, 2016                             
|June 22, 2015    | William L. Holter               | Secured Gold Loan Agreement                    | US$515,000 in gold for a term of one year, maturing on June 22, 2016                               
|December 9, 2014 | JGB (Cayman) Weston Ltd.        | Securities Purchase Agreement                  | 8% Original Issue Discount Senior Convertible Debenture in the principal sum of up to US$15 Million





104







|Date | Names of Parties | Description of General 
Nature of the Contract | Consideration Paid; 
Terms and Conditions
|---- | ---------------- | ---------------------------------------------- | -----------------------------------------

|December 9, 2014 | JGB (Cayman) Weston Ltd.                                            | Registration Rights Agreement                                                | Obligation to file Registration Statement in the US covering the resale of securities under the Securities Purchase Agreement                                                                                                                
|---------------- | ------------------------------------------------------------------- | ---------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|December 9, 2014 | JGB (Cayman) Weston Ltd.                                            | 8% Original Issue Discount Senior Convertible Debenture due December 9, 2016 | Principal Sum of up to $15 Million                                                                                                                                                                                                           
|December 9, 2014 | JGB (Cayman) Weston Ltd. and Wells Fargo Bank, National Association | Escrow Agreement                                                             | Deposit of US$9,115,000 in escrow pursuant to Securities Purchase Agreement                                                                                                                                                                  
|December 9, 2014 | JGB (Cayman) Weston Ltd.                                            | Common Stock Purchase Warrant                                                | To purchase up to 982,143 common shares at a price of US$0.98 per share, on or before December 9, 2019                                                                                                                                       
|December 9, 2014 | JGB (Cayman) Weston Ltd.                                            | Continuing Guaranty                                                          | For 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



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.





105







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.



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.





106







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.



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%.





107











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 MKT) 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.



Material United States
Federal Income Tax Considerations



The following
summary describes certain material U.S. federal income tax considerations generally applicable to U.S. Holders (as defined below)
with respect to the ownership and disposition of the Company’s common shares. It addresses only U.S. Holders that hold common
shares as capital assets within the meaning of Section 1221 of the Internal Revenue Code of 1986, as amended (the “Code”)
(generally, assets held for investment purposes). The following summary does not purport to be a complete analysis of all of the
potential U.S. federal income tax considerations that may be relevant to particular U.S. Holders in light of their particular circumstances,
nor does it deal with persons that are subject to special tax rules, such as brokers, dealers in securities or currencies, financial
institutions, mutual funds, insurance companies, tax-exempt entities, qualified retirement plans, U.S. Holders that own stock constituting
10% or more of the Company’s voting power (whether such stock is directly, indirectly or constructively owned), regulated
investment companies, common trust funds, U.S. Holders subject to the alternative minimum tax, U.S. Holders holding common shares
as part of a straddle, hedge or conversion transaction or as part of a synthetic security or other integrated transaction, traders
in securities that elect to use a mark-to-market method of accounting for their securities holdings, U.S. Holders that have a “functional
currency” other than the U.S. dollar, U.S. expatriates, and persons that acquired common shares as part of a compensation
transaction. In addition, this summary does not address persons that hold an interest in a partnership or other pass-through entity
that holds common shares, or tax considerations arising under the laws of any state, local or non-U.S. jurisdiction or other U.S.
federal tax considerations (e.g., estate or gift tax) other than those pertaining to the income tax. Furthermore, this summary
does not address the U.S. federal income tax considerations that may be relevant to non-U.S. Holders of common shares.



The following
is based on the Code, Treasury regulations promulgated thereunder (“Treasury Regulations”), and administrative
rulings and court decisions, in each case as in effect on the date hereof, all of which are subject to change, possibly with retroactive
effect.



As used
herein, the term “U.S. Holder” means a beneficial owner of common shares that is (i) a citizen or individual resident
of the U.S., (ii) a corporation (or an entity classified as a corporation for U.S. federal income tax purposes) created or organized
in or under the laws of the U.S. or any political subdivision thereof, (iii) an estate, the income of which is subject to U.S.
federal income taxation regardless of its source, or (iv) a trust if (A) a U.S. court is able to exercise primary supervision over
its administration and one or more U.S. persons, within the meaning of Section 7701(a)(30) of the Code, have authority to control
all of its substantial decisions or (B) it has properly elected under applicable Treasury Regulations to be treated as a U.S. person.





108







The tax
treatment of a partner in a partnership (or other entity classified as a partnership for U.S. federal income tax purposes) may
depend on both the partner’s and the partnership’s status and the activities of such partnership. Partnerships that
are beneficial owners of the Company’s common shares, and partners in such partnerships, should consult their own tax advisors
regarding the U.S. federal, state, local and non-U.S. tax considerations applicable to them with respect to the ownership and disposition
of common shares.



This summary
is of a general nature only. It is not intended to constitute, and should not be construed to constitute, a legal or tax opinion
or legal or tax advice to any particular U.S. Holder. U.S. Holders should consult their own tax advisors as to the tax considerations
applicable to them in their particular circumstances.



Ownership
and Disposition of Our Common Shares



Distributions.
Subject to the discussion below under “Material United States Federal Income Tax Considerations — Passive Foreign Investment
Company Rules,” distributions made with respect to the Company’s common shares (including any Canadian taxes withheld
from such distributions) generally will be included in the gross income of a U.S. Holder as dividend income to the extent of the
Company’s current and accumulated earnings and profits, as determined under U.S. federal income tax principles. A corporate
U.S. Holder will not be entitled to a dividends received deduction that is otherwise generally available upon the receipt of dividends
distributed by U.S. corporations.



If any
dividends are paid in Canadian dollars, the amount includible in gross income will be the U.S. dollar value of such dividend, calculated
by reference to the exchange rate in effect on the date of actual or constructive receipt of the payment, regardless of whether
the payment is actually converted into U.S. dollars. If any Canadian dollars actually or constructively received by a U.S. Holder
are later converted into U.S. dollars, such U.S. Holder may recognize currency gain or loss on the conversion, which will be treated
as ordinary gain or loss. Such gain or loss generally will be treated as gain or loss from sources within the U.S. for U.S. foreign
tax credit purposes.



A U.S.
Holder may be entitled to deduct or claim a credit for Canadian withholding taxes, subject to applicable limitations in the Code.
Dividends paid on common shares are expected to be treated as income from sources outside the U.S. and generally will be “passive
category income” for U.S. foreign tax credit limitation purposes. The rules governing the foreign tax credit are complex
and the availability of the credit is subject to limitations. U.S. Holders should consult their own tax advisors regarding the
availability of the foreign tax credit in their particular circumstances.



Distributions
in excess of the Company’s current and accumulated earnings and profits, if made with respect to the Company’s common
shares, will be treated as a return of capital to the extent of the U.S. Holder’s adjusted tax basis in such common shares,
and thereafter as capital gain recognized on a sale or exchange.



The Company
does not anticipate paying distributions on its common shares in the near future.



Dispositions.
Subject to the discussion below under “Material United States Federal Income Tax Considerations — Passive Foreign Investment
Company Rules,” upon the sale, exchange or other taxable disposition of the Company’s common shares, a U.S. Holder
generally will recognize capital gain or loss equal to the difference between (i) the amount of cash and the fair market value
of any other property received upon the sale, exchange or other taxable disposition and (ii) the U.S. Holder’s adjusted tax
basis in such common shares. Capital gain or loss recognized upon a sale, exchange or other taxable disposition of the common shares
will generally be long-term capital gain or loss if the U.S. Holder’s holding period with respect to such common shares disposed
of is more than one year at the time of the sale, exchange or other taxable disposition. The deductibility of capital loss is subject
to limitations. For U.S. foreign tax credit purposes, any capital gain or loss generally will be treated as gain or loss from sources
within the U.S.





109







Tax Filing Requirements. The ownership
of the Company’s common shares may require a U.S. Holder to file certain Internal Revenue Service forms including but not
limited to Form 8938.



Passive
Foreign Investment Company Rules



Certain
U.S. federal income tax rules generally apply to a U.S. person that owns or disposes of stock in a non-U.S. corporation that is
treated as a passive foreign investment company (a “PFIC”). The Company would be a PFIC for U.S. federal income
tax purposes in any taxable year if 75% or more of its gross income would be passive income, or on average at least 50% of the
gross value of its assets is held for the production of, or produces, passive income. For these purposes, passive income generally
includes dividends, interest, certain rents and royalties, and the excess of gains over losses from certain commodities transactions
and cash is considered a passive asset. Because the Company generates no revenue, and because of its cash balance, it may be characterized
as a PFIC.



If we
are a PFIC, and you are a U.S. Holder, then unless you make one of the elections described below, you generally will be subject
to special rules with respect to (a) any gain realized on the sale or other disposition of the common shares and (b) any “excess
distribution” by us to the U.S. Holder in respect of the common shares (generally, your ratable portion of distributions
in any year which are greater than 125% of the average annual distribution received by you in the shorter of the three preceding
years or your holding period for the common shares). Under the PFIC rules: (i) the gain or excess distribution would be allocated
ratably over the U.S. Holder’s holding period for the common shares, (ii) the amount allocated to the taxable year in which
the gain or excess distribution was realized or to any year before the Company became a PFIC would be taxable as ordinary income
and (iii) the amount allocated to each other taxable year would be subject to tax at the highest tax rate in effect in that year
and an interest charge generally applicable to underpayments of tax would be imposed in respect of the tax attributable to each
such year. In addition, dividend distributions made to you will not qualify for the lower rates of taxation applicable to long-term
capital gains under U.S. tax rules. Because a U.S. Holder that is a direct (and in certain cases indirect) shareholder of a PFIC
is deemed to own its proportionate share of interests in any lower-tier PFICs, U.S. Holders should be subject to the foregoing
rules with respect to any of the Company’s subsidiaries characterized as PFICs, if it was deemed a PFIC.



A U.S.
Holder may be able to avoid many of these adverse tax consequences if it elects to mark the common shares to market on an annual
basis. However, any such mark-to-market election would not be available for a lower-tier PFIC. If a U.S. Holder makes the mark-to-market
election, the U.S. Holder generally will recognize as ordinary income any excess of the fair market value of the common shares
at the end of each taxable year over their adjusted tax basis, and will recognize an ordinary loss in respect of any excess of
the adjusted tax basis of the common shares over their fair market value at the end of the taxable year (but only to the extent
of the net amount of income previously included as a result of the mark-to-market election). If a U.S. Holder makes the election,
the U.S. Holder’s tax basis in the common shares will be adjusted to reflect these income or loss amounts. Any gain recognized
on the sale or other disposition of common shares in a year when the Company is a PFIC will be treated as ordinary income and any
loss will be treated as an ordinary loss (but only to the extent of the net amount of income previously included as a result of
the mark-to-market election). The mark-to-market election is available only if the Company is a PFIC and the common shares are
“regularly traded” on a “qualified exchange.” The common shares will be treated as “regularly traded”
in any calendar year in which more than a de minimis quantity of the common shares are traded on a qualified exchange on at least
15 days during each calendar quarter (subject to the rule that trades that have as one of their principal purposes the meeting
of the trading requirement as disregarded). The NYSE MKT is a qualified exchange for this purpose and, consequently, if the common
shares are regularly traded, the mark-to-market election will be available to a U.S. holder. U.S. Holders are urged to consult
their tax advisors with respect to the availability and tax consequences of a mark-to-market election with respect to the Company’s
common shares.





110







If the
Company is deemed to be a PFIC, it does not currently intend to provide the information necessary for U.S. Holders to make qualified
electing fund elections if it was treated as a PFIC for any taxable year. U.S. Holders should consult their tax advisors to determine
whether any of these elections would be available and if so, what the consequences of the alternative treatments would be in their
particular circumstances.



A U.S. Holder
will be required to file Internal Revenue Service Form 8621 if such U.S. Holder owns common shares in any year in which the Company
is classified as a PFIC. This filing requirement is in addition to the U.S. Holder’s obligation to file other Internal Revenue
Service forms with respect to the Company’s common shares, including Form 8938.



The U.S.
federal income tax rules relating to PFICs are complex. Prospective U.S. investors are urged to consult their own tax advisers
with respect to the acquisition, ownership and disposition of the common shares, the consequences to them of an investment in a
PFIC, any elections available with respect to the common shares and the IRS information reporting obligations with respect to the
acquisition, ownership and disposition of the common shares.



Information
Reporting and Backup Withholding Tax



In general,
information reporting will apply to dividends in respect of the Company’s common shares and the proceeds from the sale, exchange
or redemption of the common shares that are paid to a U.S. Holder within the United States (and in certain cases, outside the United
States), unless such U.S. Holder is an exempt recipient. A backup withholding tax may apply to such payments if such U.S. Holder
fails to provide a taxpayer identification number or certification of other exempt status or fails to report in full dividend and
interest income. Backup withholding tax is not an additional tax. A U.S. Holder subject to the backup withholding tax rules will
be allowed a credit of the amount withheld against such U.S. Holder’s U.S. federal income tax liability or, if backup withholding
results in an overpayment of U.S. federal income tax, such U.S. Holder may be entitled to a refund, provided that, in each case,
the requisite information is correctly furnished to the Internal Revenue Service in a timely manner. U.S. Holders should consult
their own tax advisors as to the information reporting and backup withholding tax rules.



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.





111







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%.



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%         





112







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.



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.





113







G.       Statement
by Experts



Not applicable.



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, 2017.



By Currency



|                   | 2017
|------------------ | ----
|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, 2017 and 2016 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.





114







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:



|2017
        (Average to November 30) | 2016     | 2015     | 2014     | 2013    
|------------------------------------- | -------- | -------- | -------- | --------
|$1,256.31                             | 1,250.74 | 1,160.06 | 1,266.40 | 1,411.23



| | Item 12. | Description of Securities Other than Equity Securities
| | -------- | ------------------------------------------------------



The 2016 Incentive Stock Option Plan of the
Company was approved by shareholders at the Annual and Special Meeting of the Company on February 16, 2017.



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.





115







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, 2017.  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, 2015.



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.



Changes in Internal Controls over Financial Reporting



During the year ended August 31, 2017, 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.





116







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, 2017 and 2016 was Dale Matheson Carr-Hilton Labonte LLP, Chartered Professional Accountants, and
the Company’s independent auditor for the fiscal year ended August 31, 2015 was Ernst & Young LLP, Chartered ProfessionalAccountants.



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, 2017 and 2016.



|Fiscal Year Ending August 31 | Audit Fees                          | Audit Related Fees | Tax Fees | All Other Fees
|---------------------------- | ----------------------------------- | ------------------ | -------- | --------------
|2017                         | Canada – $80,000
Tanzania - $15,000 | Nil
Nil            | Nil
Nil  | Nil
Nil       
|2016                         | Canada – $88,000
Tanzania - $14,265 | 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 MKT. Section 110 of the NYSE MKT Company Guide permits NYSE MKT to consider the laws, customs and practices of foreign
issuers in relaxing certain NYSE MKT listing criteria, and to grant exemptions from NYSE MKT 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 MKT standards:



Shareholder Meeting Quorum Requirement.
The NYSE MKT minimum quorum requirement for shareholder meeting is 33 1/3% of the outstanding shares of common stock.  In
addition, a company listed on NYSE MKT 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.





117







Proxy Delivery Requirement. NYSE MKT 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 MKT 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
MKT’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.



| | 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)                                                                                                                      







118







|Exhibit No. | Name                                                                                                                                                               
|----------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------
|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)                                                           
|4.15        | 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)                                                                    
|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)                                                                           











119







|Exhibit No. | Name                                                                                                                                                                                                                                                                    
|----------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|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 Decemer 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 Loan Agreement dated May 16, 2016 with William L. Holter (15)                                                                                                                                                                                                   
|4.31        | Secured Gold Loan Agreement dated June 27, 2016 with Edward F. Marin Family LLC (15)                                                                                                                                                                                    
|4.32        | Secured Gold Loan Agreement dated June 28, 2016 with David Ponelli(15)                                                                                                                                                                                                  
|4.33        | Loan Agreement dated June 30, 2016 with David Schectman(15)                                                                                                                                                                                                             
|4.34        | Securities Purchase Agreement dated September 1, 2016 (13)                                                                                                                                                                                                              
|4.35        | 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)                                                                                                                                                                                                                                   
|15.1        | Consolidated Financial Statements for the years ended August 31, 2017 and 2016 (15)                                                                                                                                                                                     
|15.2        | Management’s Discussion and Analysis for the years ended August 31, 2017 and 2016 (15)                                                                                                                                                                                  
|15.3        | Consent of DMCL Chartered Professional Accountants
    LLP dated November 29, 2017 (15)                                                                                                                                                                                 
|15.4        | Item 16F Confirmation Letter from Ernst & Young
        LLP, Chartered Professional Accountants, dated November 25, 2016 (16)                                                                                                                                           
|15.5        | 2016 Incentive Stock Option Plan(14)                                                                                                                                                                                                                                    





* Filed herewith

| | (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
| | --- | -----------------------------------------------------------------------------





120









|(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



















121









SIGNATURE



The registrant hereby certifies that it meets
all of the requirements for filing this Amendment No. 3 to Form 20-F and that it has duly caused and authorized the undersigned
to sign this Annual Report on its behalf.





Date     August 17, 2018







| |  | TANZANIAN ROYALTY EXPLORATION CORPORATION
| |  | -----------------------------------------
| |  |                                          
| |  | By:                                      
| |  |                                          
| |  |                                          
| |  |                                          





















122