Cabral Gold (CBR) - Hitting High-Grade Gold & 90,000m of Drilling

Cabral Gold Inc. is a mineral exploration company focused on gold and copper. The company's key assets include the Cuiú Cuiú Project in Northern Brazil, the Tapajos Region, and the Bom Jardim project. The company was founded in 2014 and is headquartered in Vancouver, Canada. 

Matt Gordon caught up with Alan Carter, President, CEO, and Director, Cabral Gold. Dr. Carter is a Co-founder at Peregrine Metals Ltd. and Cuprum Resources Ltd. He currently serves as a Director and Chairman at both Fremont Gold Inc. and Altamira Gold Corp. His educational credentials include a B.Sc. degree in Geology from the University of Nottingham, U.K., and a Ph.D. degree in gold geochemistry and structural geology from the University of Southampton, U.K. He also co-founded Magellan Minerals Inc. which was acquired by Anfield Gold Corp. in 2016. Alan founded Cabral Gold in late 2016 and took the company public in November 2017. 

Company Overview

Cabral Gold is a publicly-traded company focused on advancing its flagship, district-scale Cuiú Cuiú Gold Project in Brazil. The company is looking to grow its existing resource through trenching, sampling and drilling. Magellan Brazil is the company’s subsidiary. It is listed on the Toronto Stock Exchange (TSX-V: CBR), the OTC Markets (OTCQX: CBGZF), and the Frankfurt Stock Exchange (FRA: C3J). 

Cabral Gold currently has 4 drill rigs employed at its Cuiú Cuiú Gold Project. The 2018 estimate had a 1Moz resource and was based on 30,000m drilling. Since then, the company has drilled an additional 30,000m and discovered multiple new deposits, including 3 new oxide deposits and 2 hard rock deposits. 

The company strongly believes in the district-scale potential of the Cuiú Cuiú Project. Presently, the company has close to 50 targets here along with 2 deposits that were identified back in 2018. In the past 12 months, the company has discovered at-surface oxide deposits that feature unconsolidated material. It is confident about the potential of its 2 hard rock deposits. 

The 4 drill rigs employed in the district are focused on the hard rock upside of the deposits. As of April 2021, the company has discovered an additional deposit. It has 3 oxide blankets with unconsolidated material. This means that the material can be extracted without conducting any drilling or blasting. This allows for significantly lower mining costs, especially at surface. This material was assumed to be waste back in 2018, and the company was looking to get it stripped to access the underlying deposits. 

The major focus for the company is to drill off these oxide blankets. It is confident about 2 of the deposits and is looking to include them in the upcoming resource update that is planned for 2022. Additionally, the company is also looking to publish a global resource estimate for the district, for the oxide and hard rock material. 

At the Central Zone, the company is anticipating the presence of a 3rd oxide deposit in recent months. Here, the company has found grades of over 80m of 0.7g and 50m of 1g. The company is now confident about the dimension of its second deposit and has plans to drill off the 3rd one.

As it has a better estimation of the size of the first 2 deposits, there’s a significant upside. In the past few months, the company has sent around half a ton of material to a lab in Reno, Nevada. The Nevada lab specialises in heap leach metallurgical studies. The assay results are expected by April-May 2022. These metallurgical test results will provide information on the leachability of the material. 

Operating Considerations

The company’s overall mining costs are significantly lower as no drilling and blasting is required. This has a major impact on the overall processing costs because the company does not need a massive amount of energy, ball mills, secondary or tertiary circuits to process the oxide material. The heap leach operations are extraordinarily cheap and highly efficient. In fact, the capital costs are fractional when compared to a big hard rock operation.

Right next door to the company’s operations is G Mining. The latter recently published a Feasibility Study. As per the study, the company has a $500M CapEx (Capital Expenditure). In comparison, Cabral Gold’s heap leach operation and operating costs for the oxide material will be much lower.

Ongoing Operations

Over the course of the next few months, Cabral Gold is looking to drill off the 3rd deposit at the Central Zone. There are some very thick sections of the oxide material at this deposit. The upcoming metallurgical test results in April-May will serve as a major catalyst. 

Following this, Cabral Gold is looking to conduct a Scoping Study on the oxide material. In the meantime, several rigs are targeting the hard rock material at the 2 existing deposits identified in 2018. These deposits have observed significant growth since. 

Over the last 3 months, the company has released highly favourable results on the 2 new hard rock discoveries at Machichie and the PDM target. It is looking to advance all the discoveries within this region. 

Cabral Gold is looking to mine the oxide material first as it sits on top of the underlying hard rock deposits. This material was originally assumed to be waste and was planned to be stripped off. The dumping of millions of tons of material would require significant energy and costs. Instead of removing the waste, the company will now mine and process the material. This way, the material offers potential for massive revenue generation. 

Analyst-based estimates show that the company’s operation will have similar costs to other heap leach operations around the world. Based on the grades and the all-in mining and processing costs on a per ounce basis, the overall costs are estimated to be around $1000/oz. Based on these estimates, the company anticipates that it will generate $850 in profit from each ounce of gold recovered through heap leaching. Though the grades for oxide material are lower, the costs are much lower, serving as a revenue-generation opportunity. 

Material Grades

As per the 2018 resource estimate, the material grades were between 1g/t-1/2g/t. It is important to note that this estimate was based on 30,000m drilling. Since then, the company has drilled an additional 30,000m and over the course of the next 6-9 months, it plans to drill 30,000m more.

The 2018 resource estimate was conducted by Micon International Limited, a Toronto engineering firm. It is important to note that a lot of high-grade material wasn’t included in the estimate. This is because, during the resource estimate, a top cut was established. If the drill results are above the top cut, then it isn’t included in the estimate. For Cabral Gold, the 2018 resource estimate has varying top cuts based on different zones. The top cuts range between 2g-20g. This means that the multi-ounce drill intercepts were not included in the estimate. 

As per the company, about 0.5Moz of the high-grade mineralization from 2018, wasn’t included in the resource estimate. Back then, the company did not have sufficient drill information to provide the shapes of the high-grade zones at MG and Central deposits. Due to this, it was difficult to separately model the high-grade zones in the estimate. 

Cabral Gold is currently prioritising drilling at the high-grade zones to develop a model. At the Central Zone, the company has found grades of 23.8m at 5.5g. The grades also featured up to 2oz-3oz material. Back in December 2021, the company found a lot of material with similar grades in its new, high-grade discovery at PDM. This brand-new zone features 22.4m of 4.8g. It has a lot of high-grade material in several areas of the underlying hard rock. 

Targets 2022 and Beyond

Cabral Gold is currently focused on 3 major objectives for its district-scale project. 

The first objective is to define the high-grade zones that are present within the primary hard rock deposits. This includes the Central and MG deposits which were originally discovered in 2018. The major focus is on the high-grade zones within these deposits. In addition, the company has 2 new high-grade zones in the hard rock material that weren’t included in the resource update. One of these zones is the Machichie area where the company is currently carrying out trenching with a 300m step-out. It has received promising results 300m west from the westerly drill hole. The PDM target area is also a major point of focus.

The second objective is to advance the various oxide deposits which were discovered within the last 12 months. This would enable the company to get into production in the short term and generate a significant amount of revenue through the mining and processing of the oxide material. 

The third objective is to test out some of the regional targets around the claim block. This area features a vein that outcrops at the surface. Based on the trenching results and limited drilling, the company has found spectacular numbers from these targets. The Central southeast target is planned for 4-5 drill holes and is located 500m away from one of the known deposits. 

The company also has a new Escondido target which was identified over the past 3 months. It has a giant mag feature which is similar to the MG Gold deposit. The company has found multi-gram numbers in the stream sediment. The stream sediment anomalies at the Escondido target are substantially higher than usual. The company anticipates that the target is associated with something more significant. 

Funding Considerations

Cabral Gold has the funding to carry out its current drill program up to June 2022. Following this, it plans to raise additional capital. The promising drill results over the past 3 months have resulted in an upward movement in the company’s stock. 

The company anticipates that its land package will be a massive gold-producing district. This region is known for the gold rush that happened 40 years ago and back then, it had the biggest placer footprint. In fact, the historic footprint is around 10 times bigger than the G Mining’s mine next door. 

To find out more, go to the Cabral Gold website