Tanzanian Royalty Announces Results from Drill Program Conducted on Behalf of Sloane Developments

    Trade Symbol:
    TSX: TNX
    AMEX:   TRE

    VANCOUVER, Dec. 17 /CNW/ - Tanzanian Royalty is pleased to announce that
it has received all assay results from a Phase 1 drill program conducted on
behalf of Sloane Developments on the Company's Itetemia Gold Project in
    According to Tanzanian Royalty Chairman and CEO Jim Sinclair, "We are
delighted to have Sloane as a royalty partner and are even more pleased with
the aggressive approach it's taken to exploiting the potential at Itetemia."
    "Without a doubt, Sloane's drill program has greatly enhanced the
economic potential at Itetemia and we see a bright future for this project and
for all the others that we are developing under a royalty strategy that is
truly unique in the minerals industry," Sinclair said.
    The Itetemia Project is located in the western part of the Lake Victoria
Goldfields approximately five kilometres east of Barrick's Bulyanhulu Mine, an
18 million ounce gold deposit. Consequently both power and water supplies are
located within two kilometres of the Itetemia project area.
    In the first phase drill program, 10 Reverse Circulation (RC) holes were
completed aggregating 1,489 metres along with eight diamond holes totaling
2,286.5 metres.
    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 200 metres below surface.
    In order to support the preparation of a resource estimate, drill holes
were sited to provide data at grid points at or below 50 x 50 metres spacing.
A number of deeper holes were also sited to test the extent of the mineralized
body at depth and along strike.
    The drill program indicated that the near surface mineralized zones are
very consistent and they exhibit good open pit potential. Before funding a
second phase drill program next summer, Sloane has informed Tanzanian Royalty
that it intends to complete a 43-101 compliant resource estimate to facilitate
planning for the Phase 2 drill program.
    The following results represent the highlights of the recent drill
program on the Itetemia Gold Project:

    RC Drilling Highlights:
                From    To   (*)Intercept   Gold
    Hole No      (m)    (m)       (m)        g/t   Including     Comments
    GHRC-001       97     102        5      1.69             SE shoot margin
    GHRC-002      106     127       21      1.79     9m at   In shoot
    GHRC-003      133     158       25      2.04    13m at   In shoot
    GHRC-004       92     107       15      4.33     8m at   In shoot
    GHRC-005      104     136       32      2.83    20m at   In shoot
    GHRC-006      127     140       13      7.68     4m at   In shoot
    GHRC-007       76     100       24      0.90     7m at   NW shoot margin
    GHRC-009       65      85       20      0.50             NW shoot margin

    Diamond Drilling highlights:
                From    To   (*)Intercept   Gold
    Hole No      (m)    (m)       (m)        g/t   Including     Comments
    GHDD-033   149.55  170.13     20.58     3.00     2m at   In shoot
    GHDD-034   331.26  349.24     17.98     2.56     1m at   In shoot
    GHDD-035   211.13  229.50     18.37     0.90  2.17m at   NW shoot margin
    GHDD-036   274.88  286.26     11.38     0.60  4.66m at   NW shoot margin
    GHDD-037   189.50  216.97     27.46     2.20  1.00m at   In shoot
    GHDD-038   235.83  260.30     24.47     1.78  5.02m at   In shoot
    GHDD-039   229.67  259.60     29.93     2.01             In shoot
    GHDD-040   233.00  253.60     20.60     1.93    11m at   In shoot

    (*)True thicknesses for these intersections are approximately 50 percent
    of down hole thicknesses.

    Sloane's Royalty Agreement with Tanzanian Royalty calls for a work
commitment of $US1 million within a two-year period of which $400,000 is
expendable in the first year of the agreement and the remaining amount in the
second year. Further provisions call for the completion of a bankable
feasibility study and the announcement of a production decision before the
fifth anniversary of the agreement and the achievement of commercial
production before the seventh anniversary. Sloane has the right to earn 100%
of Tanzanian Royalty's 90% interest in the Itetemia Project in exchange for
meeting its obligations which also include the payment of annual option fees
and a sliding scale royalty at commercial production.

    Service Agreement

    Tanzanian Royalty conducted all field operations for the Itetemia drill
program under a service agreement with Sloane Developments. Drilling was
supervised by John Deane, Tanzanian Royalty's Qualified Person.


    Fire assay with flame AAS finish was conducted by Humac Laboratories in
Mwanza, Tanzania. Standards were inserted in the sample stream sent to Humac,
and subsequent analysis shows that all the standards fall within analytically
acceptable limits. The figures used in this press release are the average
grades taken for between one and three duplicates run by the labs on each

    Qualified Person

    The Company's Qualified Person is Mr. John Deane, the President of
Tanzanian Royalty Exploration Corporation Limited. He has an M.Sc. from the
University of Cape Town (1993) and is a registered scientist with SACNASP
(Reg. No.400005/05).
    Sloane is a private minerals exploration company working in Tanzania
since 2005. The company is pursuing a listing on AIM of the London Stock
Exchange in 2008.

    Respectfully Submitted,

    "James E. Sinclair"

    James E. Sinclair
    Chairman and Chief Executive Officer

    The Toronto Stock Exchange and American Stock Exchange have not reviewed
    and do not accept responsibility for the adequacy or accuracy of this

    Cautionary Note to U.S. Investors - The United States Securities and
Exchange Commission permits U.S. mining companies, in their filings with the
SEC, to disclose only those mineral deposits that a company can economically
and legally extract or produce. We use certain terms on this news release,
such as "measured", "indicated", and "inferred" "resources" that the SEC
guidelines strictly prohibit U.S. registered companies from including in their
filings with the SEC. U.S. Investors are urged to consider closely the
disclosure in our Form 20-F, File No. 0-50634, which may be secured from us,
or 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. 0-50634, for a
more information concerning these risks, uncertainties, and other factors.

For further information:

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

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