Cabral Gold - Unlocking Near-Term Cash Flow and World-Class Exploration Upside

• Cabral Gold is focused on near-term gold production in the Tapajos Region, in Brazil.
• The company is conducting a pre-feasibility study on the oxide cap of their Cuiú Cuiú project, which contains 1.2 million ounces of gold indicated and inferred.
• Cabral Gold is well-funded with about $7 million in the bank, including a recent $5 million royalty deal with Osisko Gold Royalties.
• Their primary goal is to complete the pre-feasibility study and secure project financing for construction by March or April.
• Cabral Gold plans to start production, initially exploiting oxide material, with the aim of achieving cash flow by late 2024 or early 2025. They are strategically located near a large gold development project by G Mining, which adds to their potential value.

About Cabral Gold

Cabral Gold is a Canadian mining company focused on advancing its Cuiú Cuiú gold project located in northern Brazil. The Cuiú Cuiú project contains indicated and inferred resources of 1.1 million ounces of gold, with significant exploration upside to expand the resource base. Led by a team of mining veterans, Cabral Gold is executing a dual-track strategy to realize near-term cash flow from high-grade oxide deposits while advancing studies on the large-scale hard rock development. With a tight share structure and funds in the bank, Cabral Gold offers investors exposure to potentially near-term production combined with substantial long-term resource growth potential.

Interview with President & CEO, Alan Cabral

Near-Term Production Potential

A key part of Cabral Gold’s strategy is advancing the high-grade oxide portion of the Cuiú Cuiú deposit to production in the near-term. Cabral has engaged leading engineering firm Senko to complete a pre-feasibility study (PFS) examining a simple heap leach operation mining the oxide cap at Cuiú Cuiú.

The oxidized material at Cuiú Cuiú extends up to 60 meters from surface and requires no crushing or grinding due to its soft, weathered nature, resulting in low expected capital and operating costs. Cabral estimates initial capital cost requirements of only US$25-30 million. With permitting activities already underway and a 6-8 month targeted construction period, first gold production could potentially be achieved by the end of 2024.

Near-term cash flow from the oxide heap leach operation would allow Cabral to fund ongoing exploration and development of the larger hard rock resource at Cuiú Cuiú while reducing dilution for shareholders.

World-Class Exploration Potential

While the oxide cap offers a rapid pathway to production and cash flow, the primary value driver for Cabral Gold lies in the exploration upside at Cuiú Cuiú and across its regional land package covering over 28,000 hectares in Brazil’s underexplored Cuiú Cuiú gold district.

The current 1.1 million ounce gold resource at Cuiú Cuiú remains open for expansion, with over 90% of the ounces contained within hard rock mineralization that has seen only limited drilling to date. Noteworthy intercepts outside the existing resource include 5m @ 14.3 g/t gold and 5m @ 12.7 g/t gold.

Meanwhile, exploration across the broader 28,000-hectare land position has outlined over 50 additional high-grade gold targets analogous to Cuiú Cuiú, demonstrating the potential for Cabral to delineate entirely new deposits and greatly expand resources across its regional portfolio.

Recent drilling results continue to demonstrate this upside, with new discoveries at the Machichie and Alonso targets returning intercepts including 8m @ 9.3 g/t gold and 4m @ 13.2 g/t gold respectively.

World-Class Neighbors Validate District Potential

The potential of the Cuiú Cuiú district is further validated by activity of major mining companies active nearby. Most notably, G Mining is currently constructing its US$500 million Tocantinzinho gold project immediately adjacent to Cabral’s land position. The Cuiabá project contains reserves of 2 million ounces of gold.

During the Brazilian gold rush in the early 20th century, artisinal miners recovered 200,000 ounces of gold from streams within the Cuiabá project area. Critically, the adjacent Cabral concession saw placer production of over 2 million ounces, demonstrating the substantial hard rock potential underlying Cabral’s property.

With G Mining driving regional infrastructure development and its Cuiabá project shining a spotlight on the region, Cabral is well-positioned to demonstrate similar world-class potential across its portfolio.

Well-Funded for Near-Term Catalysts

In August 2023, Cabral completed an oversubscribed private placement raising gross proceeds of C$7 million, positioning the company to aggressively advance exploration and development initiatives over the coming 12-18 months.

Additionally, the company recently completed a royalty agreement with Osisko Gold Royalties securing an additional US$5 million in funding. With approximately C$7 million in the treasury and an ongoing focus on prudent cash management, Cabral is fully funded as it works to deliver key near-term catalysts.

Upcoming catalysts include the completion of the PFS study on the oxide portion of the deposit in early 2024. This study will be an important de-risking event for the project and is expected to outline robust economics on the starter operation. The PFS will feed into a construction decision targeted for mid-2024.

Meanwhile, the company will continue its active drill program focused on expanding resources at Cuiú Cuiú in addition to testing the numerous other regional targets. A steady stream of exploration results will demonstrate additional upside for investors throughout 2023.

Attractive Valuation Compared to Peers

With a current market capitalization of approximately C$25 million and enterprise value of C$15 million, Cabral Gold trades at a significant discount compared to peers on both an absolute and per ounce basis.

Many other junior gold developers with projects in Brazil and South America trade at over C$50 per ounce of gold in the ground. At the current share price, Cabral trades at under C$15 per ounce. This valuation discrepancy provides substantial upside potential as the company continues advancing the project.

Conclusion

For investors seeking leverage to the gold price along with an attractive risk-reward profile, Cabral Gold presents a compelling opportunity. Near-term catalysts provide a clear path towards production and cash flow in a rising gold price environment, reducing financing risks. Meanwhile, the expansive regional land package provides world-class resource growth potential through ongoing exploration and discovery.

With a tight share structure, strong insider ownership, and funding in place to achieve key milestones, Cabral represents an asymmetric investment opportunity with factors in place to drive significant shareholder value creation. The current valuation continues to present an attractive entry point for exposure to this unique gold development story.