Cabral Gold

Cabral Gold Inc. (TSXV: CBR, OTCQB: CBGZF) is a junior gold development company focused on the identification, exploration, and development of gold properties in Brazil. The company holds a 100% interest in the Cuiú Cuiú gold district located in the Tapajós Region within Pará State in northern Brazil. The project contains National Instrument 43-101 compliant Indicated resources of 12.29Mt @ 1.14 g/t gold (450,200oz) in fresh basement material and 13.56Mt @ 0.50 g/t gold (216,182oz) in oxide material, along with Inferred resources of 13.63Mt @ 1.04 g/t gold (455,100oz) in fresh basement material and 6.4Mt @ 0.34 g/t gold (70,569oz) in oxide material.

The Cuiú Cuiú project is strategically positioned in the Tapajós Gold Province, the site of Brazil's largest historical gold rush that produced an estimated 30-50 million ounces of placer gold between 1978 and 1995. The Cuiú Cuiú area was the largest placer working region in the Tapajós, producing approximately 2 million ounces historically. The company's flagship asset sits adjacent to GMining's major Tocantinzinho gold mine, providing infrastructure advantages and validating the geological potential of the district.

The investment opportunity centres on Cabral's advanced-stage gold-in-oxide starter operation (Stage 1), which provides a compelling near-term production pathway with attractive economics. The recently completed Updated Prefeasibility Study demonstrates significant financial improvements over the previous study, with the base case after-tax NPV increasing nearly 200% from US$25.2 million to US$73.9 million, while the after-tax IRR rose from 47% to 78% using a base case gold price of US$2,500/oz.

The starter operation represents a low-risk entry point to gold production, utilizing heap leach technology on weathered oxide material that requires no drilling or blasting. This approach generates substantial early cash flows while conducting pre-stripping activities that expose underlying primary gold mineralization, reducing future waste mining costs for the larger hard rock development. The operation is designed to allow the Company to be self-funding for continued exploration aimed at expanding the much larger hard rock resource base as it advances towards the company's long-term strategic goal (Stage 2) of developing the region's second major gold mine.

The current elevated gold price environment further enhances the opportunity, with spot gold at US$3,340/oz driving the after-tax IRR to 139% and the after-tax NPV to US$137 million. The project demonstrates strong leverage to gold prices while maintaining robust economics across various price scenarios.

The management team brings extensive experience in mining operations and Brazilian regulatory environments. President and CEO Alan Carter is credited with co-discovering the Tocantizinho gold deposit and leads the organization with a focus on advancing the project towards production. The management team also includes Brian Arkell, Vice President of Exploration and Technical Services, Ruari McKnight, Country Manager, John Sestan VP Project Development, Samantha Shorter, CFO and also recently appointed Luiz Celar as Construction Manager. 

A significant recent addition to the board is Vinícius Resende Domingues, General Manager of Regulatory Affairs at Vale S.A., Brazil's largest mining company. Domingues brings substantial regulatory expertise and extensive networks within Brazil's mining sector. His background includes engineering degrees from the University of Brasília, an MBA in Project Management, and a Master's in Economics. His appointment represents a strategic enhancement to the company's ability to navigate Brazilian regulatory processes and advance toward production decisions.

The board's addition of such senior regulatory expertise from Vale, combined with existing technical capabilities, positions the company well for the transition from exploration to production. The team's focus on attracting experienced professionals indicates management's commitment to building the necessary capabilities for successful project development.

Cabral's growth strategy centers on using its near-term oxide starter operation to generate the cash flows necessary to fund its foundation for longer-term expansion. The starter project will process 1,000,000 tonnes per year through heap leaching operations over an initial 6.2-year mine life, generating cash flows to fund continued exploration and development activities. The operation targets initial gold production in the second half of 2026, following an anticipated final investment decision in Q3 2025.

The intermediate strategy focuses on expanding oxide resources at existing targets, particularly the Jerimum Cima and PDM deposits, which is likely to extend mine life or increase processing capacity. The company has identified space for a fifth heap leach pad in the plant layout, enabling potential capacity expansion if additional oxide resources are defined. Recent drilling has discovered a fifth gold-in-oxide blanket at Jerimum Cima, providing immediate expansion opportunities.

The long-term strategy centres on developing the primary hard rock resources, which represent approximately 80% of total project resources. The oxide operation creates an established operating platform and infrastructure base while generating cash flows to support the aggressive exploration program required for primary resource expansion. This approach de-risks the transition to larger-scale hard rock mining by establishing operational capabilities and cash generation ahead of major capital commitments.

The Updated Prefeasibility Study demonstrates compelling financial metrics across multiple gold price scenarios. At the base case gold price of US$2,500/oz, the project generates an after-tax NPV of US$73.9 million and an after-tax IRR of 78%, with payback occurring in 10 months from production startup. Initial capital requirements are US$37.7 million, representing capital intensity of US$334 per annual ounce of production capacity.

Production economics are equally attractive, with life-of-mine gold production of 113,155 ounces at an all-in sustaining cost of US$1,210/oz. The first 24 months generate 43,342 ounces, providing strong early cash flows that enhance investment returns. Operating costs total US$18.22 per tonne processed, with contract mining costs representing the largest component at US$7.08 per tonne.

The project demonstrates strong operational leverage, with probable reserves increasing 54% to 128,903 ounces while initial capital costs remained essentially unchanged. Processing capacity increased 39% from the previous study, enabling economies of scale that improve unit economics. The waste-to-ore ratio improved to 0.78, indicating efficient resource utilization.

Sustaining capital requirements are minimal at US$8.02 million over the mine life, primarily for waste facility expansions. This limited ongoing capital requirement enhances cash flow generation and return metrics. The project's financial sensitivity analysis demonstrates robust returns across varying gold prices, with break-even economics maintained even at significantly lower commodity prices.

Cabral Gold presents a compelling investment opportunity in the gold sector, offering near-term production potential with strong financial returns in a favoured mining jurisdiction. The company's Updated Prefeasibility Study demonstrates significant improvements in key financial metrics, with the project generating attractive returns across various gold price scenarios. The addition of experienced regulatory expertise to the board, combined with advanced financing discussions, positions the company well for successful project development.

The investment thesis is strengthened by the project's location in a proven gold district, the straightforward nature of heap leach operations, and the strategic value of establishing an operating platform for future expansion. While typical development risks exist, the company has demonstrated progress in addressing key challenges through strategic appointments, ongoing permitting activities, and comprehensive technical studies.

The current elevated gold price environment enhances investment returns, though the project maintains viable economics across various commodity price scenarios. For investors seeking exposure to near-term gold production with expansion potential in South America, Cabral Gold offers a differentiated opportunity with clear development milestones and experienced technical management. The combination of robust project economics, strategic location advantages, and management's focus on systematic development creates a favorable risk-adjusted return profile for natural resource investors.