Tanzanian Royalty Announces Participation of Jinchuan Mining In Program to Explore and Develop Kabanga Nickel Licenses

SOUTH SURREY, British Columbia--(EON: Enhanced Online News)--Tanzanian Royalty Exploration is pleased to announce that a major Chinese metals company, Jinchuan Mining, has agreed to participate in the exploration and development of the Company’s Kabanga nickel properties in northwestern Tanzania.

“When we acquired the Kabanga licenses several years ago, we recognized the cyclical nature of metal markets and realized that base metal prices including nickel would rebound based on demand from developing economies - especially China”

Following the recent conclusion of an option agreement with Beijing Songshanheli Mining Investment Co. Ltd., which previously held the properties under an exclusive agreement with Tanzanian Royalty, Jinchuan Mining has agreed to act as operator and hold complete financial responsibility for all exploration activities on the nickel exploration licenses.

Jinchuan Group Limited (JNMC), the parent company of Jinchuan Mining, is a large integrated non-ferrous metallurgical and chemical engineering enterprise engaged in mining, concentrating, metallurgy and chemical engineering. It produces nickel, copper, cobalt, rare and precious metals and also some chemical products such as sulphuric acid, caustic soda, liquid chlorine, hydrochloric acid and sodium sulphite, together with some further processed nonferrous metals products.

The group’s output of nickel and platinum group metals respectively accounts for more than 90% of Chinese production. Jinchuan Group is situated in Jinchang, an industrial city in the eastern portion of the Hexi Corridor of Gansu Province. Jinchuan Group is the largest producer of nickel and cobalt in China and its namesake is honoured as the “Nickel City” of China.

The Chinese joint venture partners will hold the right to earn a 100% interest in the Kabanga nickel properties for time-sensitive payments including staged exploration expenditures and a 30-year 3% net smelter royalty in favour of Tanzanian Royalty upon achieving commercial production.

Tanzanian Royalty’s Kabanga properties comprise a project area of 4,200 square kilometres, with targets for nickel, cobalt and PGM mineralization. The project area is situated to the north of the high grade Kabanga nickel deposit which is currently under development by a joint venture consisting of Barrick and Xstrata.

According to James E. Sinclair, Chairman and CEO of Tanzanian Royalty, “The joint participation of these two respected Chinese companies in our Kabanga project is tangible recognition of the potential of this emerging nickel belt and the prospects for further discoveries.”

“When we acquired the Kabanga licenses several years ago, we recognized the cyclical nature of metal markets and realized that base metal prices including nickel would rebound based on demand from developing economies - especially China,” he noted.

“Time has confirmed this observation and we expect to develop a close working relationship with our Chinese partners whose level of integration from exploration to smelting and refining is highly regarded within the global metals industry.”

When the Kabanga properties were first acquired by the Company, individual licenses were selected proximal to strong aeromagnetic anomalies and known gabbro/norite bodies that are believed to represent important stratigraphic controls for the nickel, copper and PGM mineralization in the region. History shows that nickel deposits like Kabanga rarely occur alone, Sinclair emphasized.

Exploration work on the nickel licenses is expected to begin early this year, with Tanzanian Royalty providing logistical and related assistance to Jinchuan and Beijing Songshanheli in several key areas including government relations, license maintenance, corporate filings and the importing of heavy equipment.

China’s friendship with Tanzania extends back decades and its involvement in the east African nation encompasses a wide range of industries including construction, mining and farming. The mutual respect generated by this long association and the joint venture’s close relationship with Tanzanian Royalty will facilitate the entry of the two Chinese companies into the Tanzanian economy, which ranks among the fastest growing on the African continent.

“James E. Sinclair”

James E. Sinclair

Chairman and Chief Executive Officer

For further information, please contact Investor Relations at 1-800-811-3855
Visit our website: www.TanzanianRoyaltyExploration.com

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Cautionary Note to U.S. Investors - The United States Securities and Exchange Commission limits disclosure for U.S. reporting purposes to mineral deposits that a company can economically and legally extract or produce. We use certain terms on this news release, such as “reserves”, “resources”, “geologic resources”, “proven”, “probable”, "measured", "indicated", or "inferred" which may not be consistent with the reserve definitions established by the SEC. U.S. Investors are urged to consider closely the disclosure in our Form 20-F, File No. 001-32500. You can review and obtain copies of these filings from the SEC's website at http://www.sec.gov/edgar.shtml.

Certain information presented in this release may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on numerous assumptions, and involve known and unknown risks, uncertainties and other factors, including risks inherent in mineral exploration and development, which may cause the actual results, performance, or achievements of the Company to be materially different from any projected future results, performance, or achievements expressed or implied by such forward-looking statements. Investors are referred to our description of the risk factors affecting the Company, as contained in our Form 20-F, File No. 001-32500, for more information concerning these risks, uncertainties, and other factors.