Updated Coringa PEA Confirms Improved Economics
Updated Coringa PEA Confirms Improved
Economics
Serabi Gold plc (“Serabi” or the
“Company”) (AIM:SRB, TSX:SBI, OTCQX:SRBIF), the Brazilian
focused gold mining and development company, is pleased to announce
the results of an updated Preliminary Economic Assessment (the
“Updated PEA”) for its currently producing, 100%-owned Coringa Gold
Project (“Coringa” or “the Project”), located in Para State,
Brazil. (All financial amounts are expressed in U.S. dollars
unless otherwise indicated).
At the beginning of 2024, it was decided by
Serabi’s management to prepare the Updated PEA that reflects the
Company’s current operating plan for Coringa. The Company commenced
development of Coringa in June 2021 and first gold was produced in
July 2022, and since then 18,458oz have been produced. The current
operations have materially improved the understanding of the
geology, and in particular, the amenability of the deposit to
ore-sorting technology. This has allowed management to adopt a plan
utilising the existing process plant capacity at Palito Complex in
preference to the construction of a full stand-alone process plant
at Coringa, which is significantly cheaper on initial capital,
carries less operational risk and does not compromise the mine
development plan or production rates of Coringa.
HIGHLIGHTS
-
Annual production is estimated at 28,000oz in 2025, and then
averages 36,000oz per year between 2026 and 2031 with an 11-year
mine life until 2034
-
Average Life of Mine (“LOM”) All-In Sustaining Cost (“AISC”) of
$1,241/oz including royalties and refining costs using the Base
Case gold price.
-
The updated Mineral Resource Inventory at Coringa, upon which the
Updated PEA is based were as follows:
-
Measured & Indicated Resources (M&I) 795kt @ 7.03g/t gold
(179koz contained);
-
Inferred Resources 1,454kt @ 5.81g/t gold (271koz contained);
- Mine plan utilises
145koz M&I and 241koz Inferred which equates to 81% of the
total M&I resource inventory and 89% of the inferred
resource.
-
Average LOM gold grades from the mine of 5.38 g/t, which are
increased to 8.50 g/t after ore sorting, producing a total gold
production of 363koz.
-
Under the Base Case scenario, the operation underscores robust
economics:
-
Post-tax NPV10% of $145M;
-
Average annual free cash flow of $19M;
-
Sustaining Life of Mine (“LOM”) capital expenditures of $87M to be
funded from project cash-flow;
-
Mining is by underground shrinkage stoping using a cut-off grade of
3.16 g/t gold. Resource widths and grades within the Updated PEA
mine plan have been further diluted to 1 metre minimum mining
widths.
An interview with Mike Hodgson by Crux
Investor can be accessed here:
https://youtu.be/gnWhxMMfMB8
An interview with Mike Hodgson by BRR
Media can be accessed here :
https://brrmedia.news/Coringa_PEA
Mike Hodgson, CEO of Serabi,
commented:
“In Phase 1 of our growth plan, Serabi is
focused on developing and growing our business and building a
strong gold production base in Brazil. The publication of these
very encouraging results of the Updated PEA is a major milestone in
achieving this objective. Since the original PEA prepared by Global
Resource Engineering (“GRE”), effective 6 September 2019 (“GRE
PEA”), was issued, a number of factors, including the reduction in
trucking costs and the success with ore-sorting changed our view of
the best way to maximise returns from Coringa. Whilst we have
communicated the perceived benefits to investors for some time, we
historically had no independent study that supported this. The
Updated PEA now addresses this. The Updated PEA has an
NPV10% of $145M compared with the GRE
PEA result of only $31M indicating the improved economics of this
revised strategy.
The Updated PEA demonstrates superior
economics to the GRE PEA, supporting an initial 11-year mine life
and a fully-ramped up mine production that will average
approximately 34,000 ounces per annum. Combined with an expectation
of production from Palito of ~25,000 ounces per annum, Serabi
should reach our initial target of 60,000 ounces per annum for the
2026 fiscal year, which maximises the capacity of the Palito
Complex with the best feed grades possible. Phase 2 of our growth
plan will focus on brownfield exploration in 2025 and 2026 which
will determine the quantum and timing of the next phase of Serabi’s
growth, while Phase 3 of our growth plan will determine whether we
add additional processing capacity at Palito Complex or build a
stand-alone operation at Coringa.
The Base Case uses an average gold price of
$2,100/oz and calculates an NPV10% of
$145M. Looking at a scenario using the average 6-month gold price
of $2,280/oz, the NPV10% improves to
$170M, and using the spot gold price of $2,600/oz the
NPV10% is a stand-out $211M.
The Updated PEA demonstrates the robust
viability of our strategy and we believe there is still plenty of
upside. First, the grade uplift of 1.6 times from ROM to sorted ore
is conservative and test-work indicates this can be significantly
enhanced with improvements in controlling and reducing the
production of fines in the crushing circuit. This will result in
better grades, reduced mass and offer the opportunity for
accelerated production. The Updated PEA also does not consider the
longer-term growth potential we believe in at Coringa, and this
will be a high priority for us in 2025. The Base Case economic
analysis indicates an AISC of $1,241/oz. Whilst we have reported a
consolidated AISC for the first six months of 2024 of $1,782/oz,
this has been adversely affected by the lower mined grades and
therefore, production generated from Palito compared with 2022 and
2023, further exacerbated by the accelerated mine development
undertaken at Coringa. By returning Palito to an average mined
grade of 5.5 g/t to 6.0 g/t and with the expectation of an average
AISC for Coringa of below $1,300/oz, on this basis we forecast an
average future AISC for the Company of between $1,300/oz and
$1,360/oz.
The total sustaining capital requirement for
the development of the project in 2025, including further mine
development, is estimated at approximately $14 million. This and
all future sustaining and development capital projected in the
Updated PEA will be funded from the Company’s operational cash
flow. With Coringa located in close proximity to our existing
Palito Complex and based on existing operational cost data at
Coringa, we have provided NCL with actual cost information of the
past few years. This entails that from a cost perspective, the data
used in compiling the Updated PEA is significantly more robust than
might normally be the case with PEA studies.”
Table 1 – Summary of Updated PEA Results
(in Millions)
|
Gold Price (per ounce) |
$1,950 |
BASE CASE
$2,100 |
$2,280 |
SPOT
$2,600 |
|
Pre-tax NPV5% |
$193 |
$230 |
$275 |
$356 |
|
Pre-tax NPV10% |
$151 |
$181 |
$217 |
$281 |
|
Post-tax NPV5% |
$159 |
$184 |
$214 |
$267 |
|
Post-tax NPV10% |
$125 |
$145 |
$169 |
$211 |
|
Project Post-tax Cash Flow |
$210 |
$242 |
$281 |
$350 |
|
Avg. Annual Free Cash Flow |
$16 |
$19 |
$22 |
$27 |
|
Avg. Gross Revenue |
$52 |
$56 |
$61 |
$69 |
The Updated PEA was completed by NCL Ingeniería
y Construcción SpA (“NCL”) of Santiago, Chile, Serabi’s independent
engineering consultant.
The Base Case considers the operation from 1
January 2025 onwards. All prior development and capital
expenditures including 2024 expenditures on the classification
plant, of which US$5 million has been spent to date, are considered
sunk costs and are not included in the evaluation.
This technical report is a preliminary economic
assessment and partially utilises inferred mineral resources.
Inferred mineral resources are considered too speculative,
geologically, to have the economic considerations applied to them
that would enable them to be categorized as mineral reserves and
there is no certainty that the preliminary economic assessment will
be realized. Mineral resources that are not mineral reserves do not
have demonstrated economic viability.
An updated Mineral Resource estimate has been
made using a gold price of $1,950/oz. As of September 2024,
Serabi's median analyst consensus long-term gold price was
approximately $2,200/oz. As of September 28, 2024, the 12-month
trailing average LBMA (AM Fix) gold price was approximately
$2,189/oz. The Base Case utilises a constant gold price of
$2,100/oz and a constant exchange rate of 5.5 BRL per 1.00 USD in
the economic analysis completed for the Updated PEA. Sensitivities
are also shown for the 36-month trailing average LBMA (AM Fix) gold
price of $1,950/oz the 6-month trailing average LBMA (AM Fix) gold
price of $2,280/oz and current spot gold price estimate of
$2,600/oz.
Implications of the Updated PEA Results
for the Consolidated Production and AISC
The Updated PEA demonstrates that over its life,
Coringa will produce on average 36,000oz per annum from 2026 to
2031 (with a range of 29,000oz to 41,000oz over the LOM) at an
average LOM AISC of $1,241/oz.
On 30 June 2024, Serabi reported a Group AISC of
$1,782/oz for the production of 18,010 ounces, of which 9,837oz was
produced at Palito and 8,623oz at Coringa.
During this period, the AISC for Palito Complex
has been adversely affected by the lower grade and therefore lower
production generated from the mined ore tonnage. An average mined
grade of 4.63g/t compares with an average mined grade of 6.08g/t
and 6.15g/t for 2023 and 2022, respectively. The calculated AISC
for Palito for the 6-month period to 30 June of $1,822/oz is
estimated to be $1,534/oz had an average grade of 5.5g/t been
achieved and $1,406/oz at an average grade of 6.0g/t. Such an
increase in average grades would raise annual Palito production for
the same mined tonnage to between 22,000oz and 24,000oz.
By inference, the AISC for Coringa for the same
6-month period was $1,739/oz, reflecting the on-going investment
and prioritisation of mine development over stope production. This
compares to the average LOM AISC projected by the Updated PEA of
$1,241/oz.
With production of 22,000oz to 24,000oz per
annum from Palito and an average production from Coringa of
36,000oz between 2026 and 2031, the Company projects sustainable
production of approximately 60,000oz going forward. With this
assumption, the average AISC would be $1,400/oz to $1,550/oz for
Palito (dependent on grade) and $1,241 for Coringa resulting in a
consolidated average AISC of between $1,300/oz and $1,360/oz.
Further Information
The Coringa project consists of the Coringa gold
deposit and currently comprises four discrete ore bodies which are
included in the mine plan. Other potential ore bodies have been
identified and subject to further evaluation, could extend the
current life of the project. In addition, the Coringa deposit is
hosted within an 8km zone of past artisanal mining activity
comprising a series of shallow pits which exploited the soft,
near-surface oxidised ore but were abandoned at about 20 to 25
metre depths when the artisanal miners encountered the underlying
hard rock sulphide ore.
The access to Serra and three production levels
have been already developed. The Updated PEA anticipates that the
project development will continue with the establishment of mine
portals providing access to the Galena & Mae de Leite (“GAMDL”)
and Meio & Como Quieto (“MCQ”) sectors of the deposit with
access to the Demetrio sector being undertaken later in the mine
life. NCL have considered 2024 as the start of the ramp-up period
which continues through 2025 with the initial development of the
GAMDL and MCQ sectors with 2026 being the first year at full
long-term mining rates. The primary crusher and ore sorter at
Coringa have already been acquired with assembly being completed
prior to commissioning in early Q4-2024.
The full NI 43-101 compliant Technical Report,
supporting the economic results and including the updated mineral
resource statement is being prepared by NCL and is required to be
published with 45 days of this announcement. A further news release
will be made when it becomes available with copies available on the
Company’s website and on SEDAR.
Table 2 – Coringa Updated PEA - Base
Case Metrics
|
|
Unit |
Amount |
|
Gold Price |
$/oz |
$2,100 |
|
Cut-off grade |
g/t |
3.16 |
|
Run of Mine (ROM) Material to Process |
Tonnes |
2,232,919 |
|
Mining Method |
Method |
Shrinkage Stoping |
|
Annual Throughput at 100% Capacity |
Tonnes |
215,000 |
|
Ore Sorter Efficiency (Tonnes) |
% |
61% |
|
Ore Sorter Upgrade |
x |
1.59 |
|
Process Gold Recovery |
% |
97% |
|
Total Gold Production (Recovered) |
Ounces |
363,108 |
|
Mine Life |
Years |
11 |
|
Sustaining Capital Expenditures |
$M |
$87 |
|
Mine Closure Costs |
$M |
$1 |
|
Cash Operating Costs (inc. Royalty + TC/RCs) |
$/oz |
$965 |
|
All In Sustaining Cost (inc. Royalty + TC/RCs) |
$/oz |
$1,241 |
|
Exchange Rate |
R$:US$ |
5.5 |
|
Royalties |
% |
4.00% |
|
Profits Tax Rate |
% |
34% |
*Base Case Metrics are from year
2025+
Coringa Updated Mineral
Resource
The following table sets out the Company’s
Canadian Securities Administrators National Instrument 43-101 (“NI
43-101”) compliant indicated mineral resources of 179,000oz and
inferred mineral resources of 271,000oz estimated as of 6 April
2024. This resource estimate is an update on the estimation issued
by the Company on 6 September 2019 and takes account of additional
drilling results and updated geological interpretation.
Table 3 - Coringa Updated Mineral
Resource Estimate
Classification
|
Quantity |
Grade |
Contained Metal |
|
|
Gold |
Gold |
|
000 't |
g/t |
000' oz |
|
Measured Resources |
172 |
8.96 |
49 |
|
Indicated Resources |
623 |
6.49 |
130 |
|
Measured & Indicated Resources |
795 |
7.03 |
179 |
|
Inferred Resources |
1,454 |
5.81 |
271 |
(1) Mineral Resources are not Mineral Reserves and
have not demonstrated economic viability. Mineral Resources are
reported inclusive of Mineral Reserves. All figures are rounded to
reflect the relative accuracy of the estimates. Mineral Resources
are reported within classification domains inclusive of in-situ
dilution at a cut-off grade of 3.16g/t gold assuming an underground
extraction scenario, an operating cost of $107/t for mining,
crushing and sorting, sorting efficiency of 61% of the tonnes and
1.59 upgrade factor, $88/t for hauling to Palito, processing at
Palito plant and site costs, metallurgical recovery of 97%, 4% on
royalties and 2.3% for refining, insurance, freight and sales, and
a gold price of $1,950/troy oz.
(2) Serabi is the operator and owns 100% of the
Coringa Gold Project such that gross and net attributable mineral
resources are the same. The mineral resource estimate was prepared
by NCL Ingeniería y Construcción SpA in accordance with the
standard of CIM and Canadian National Instrument 43-101, with an
effective date of 6 April 2024 by Mr Nicolás Fuster, who is a
Qualified Person under the Canadian National Instrument 43-101.
(3) NCL believes that the resource estimates shown
in the table above meets the CIM standards for a resource estimate
based on CIM Standards of Mineral Resources and Reserves
Definitions and Guidelines adopted by the CIM council 10 May,
2014 |
The updated mineral resource has been calculated
using an assumption of a 0.7m minimum mining width and using a
cut-off of 3.16 g/t. The mine plan uses a 1.0m minimum mining
width. By comparison the previous estimation undertaken in 2019 by
GRE reported an Indicated Resource of 195,000oz and an Inferred
Resource of 346,000oz. However, this was calculated using at 2g/t
Au COG and an average 0.7m mining width. Following 2 years of
operational activity, the Company prefers to apply a 1.0m minimum
mining width, which is more dilutive, but feels is appropriate.
Mineral Resources Considered in the
Updated PEA
The Updated PEA and the new technical report
that NCL will produce supersedes the previous Preliminary Economic
Assessment produced by GRE dated 19 October 2019.
Empirical findings following two years of
underground operations at Coringa have led the company to consider
more dilution in the mining operation. The GRE PEA did not have the
benefit of these findings and used an average resource minimum
mining width of 0.7m. This meant some resources had widths less
than 0.7m. NCL have taken the view that a 0.7m minimum mining width
should be applied, which means resources with a width less than 0.7
metre are diluted to a 0.7m width. Furthermore, resources included
in the PEA have been further diluted at 0.0 g/t gold grade to a
mineable width of 1.0m.
The following table is provided to illustrate
the utilisation of the NI 43-101 compliant mineral resources within
the mine plan assumed in the Updated PEA and used to derive the
average mined grade. Of the total 2,233kt of ROM feed to be
delivered to the crushing plant 74kt (3%) will be derived from the
Measured Resources, 274kt (12%) will be derived from the Indicated
Resources and 915kt (41%) will be derived from the Inferred
Resource. An additional 969kt (43%) of dilution at a grade of 0g/t
is also included.
Table 4 – Mineral Resources Considered
in the Updated PEA
Classification
|
Quantity |
Grade |
Contained Metal |
|
|
Gold |
Gold |
|
000 't |
g/t |
000' oz |
|
Measured Resources |
74 |
15.32 |
37 |
|
Indicated Resources |
274 |
12.31 |
109 |
|
Inferred Resources |
915 |
8.19 |
241 |
|
Dilution |
969 |
- |
0 |
|
Measured & Indicated Resources |
2,233 |
5.38 |
386 |
Comparison of Updated PEA to GRE
PEA
The Updated PEA envisions a more economically
robust mine plan than the GRE PEA forecasting a post-tax
NPV10% of $145M vs $31M.
Table 5 – Comparison of Updated PEA to
GRE PEA
|
|
|
Updated PEA
2024 |
GRE PEA
2019 |
$ Change |
% Change |
|
Gold Price |
US$/oz |
$2,100 |
$1,275 |
$825 |
65% |
|
Pre-tax NPV5% |
US$M |
$230 |
$56 |
$175 |
313% |
|
Pre-tax NPV10% |
US$M |
$181 |
$37 |
$144 |
387% |
|
Post-tax NPV5% |
US$M |
$184 |
$47 |
$137 |
290% |
|
Post-tax NPV10% |
US$M |
$145 |
$31 |
$114 |
371% |
|
Project Post-tax Cash Flow |
US$M |
$242 |
$72 |
$171 |
238% |
|
Average Annual Free Cash Flow |
US$M |
$19 |
$12 |
$7 |
62% |
|
Average Gross Revenue |
US$M |
$56 |
$43 |
$12 |
29% |
|
Total Gold Production (Recovered) |
Ounces |
363,108 |
288,046 |
75,062 |
26% |
|
Mine Life |
Years |
11 |
9 |
2 |
22% |
Qualified Persons and Quality
Control
The scientific and technical information (“the
Technical Information”) contained in this news release pertaining
to the Coringa gold project has been reviewed and approved by the
following qualified persons under National Instrument 43-101 –
Standards of Disclosure for Mineral Projects ("NI 43-101") in
accordance with the rules of the Canadian Institute of Mining,
Metallurgy and Petroleum ("CIM"), which is an internationally
recognised standard pursuant to the AIM Rules.
- Mr. Carlos Guzmán, RM CMC, FAusIMM,
Principal/Project Director, NCL
- Mr. Gustavo Tapia, RM CMC,
Metallurgical and Process Consultant, GT Metallurgy
- Mr. Nicolás Fuster, RM CMC,
MAusIMM, Geologist
The Technical Information is extracted from
information that has been compiled by Mr Guzmán, Mr Tapia and
Mr Fuster who have carried out the assignment on behalf of the
firm NCL Ingeniería y Construcción SpA (“NCL”). Mr Guzmán, Mr Tapia
and Mr Fuster are each familiar with NI 43-101 and, by reason of
education, experience and professional registration, fulfil the
requirements of a Qualified Person as defined in NI 43-101 and for
the purposes of the AIM Rules. Mr Guzmán, Mr Tapia and Mr Fuster
are responsible for the preparation of the Preliminary Economic
Assessment. Mr Guzmán, Mr Tapia and Mr Fuster have all consented to
the publication of the Preliminary Economic Assessment and Mineral
Resources estimate and the inclusion of the information contained
in this announcement in the form and context in which it
appears.
The PEA study was completed by NCL who is
responsible for the preparation of the overall study including mine
design, mine capital cost, mine operating cost, costing for the
process plant replacement, refurbishment and operating,
construction and operating costs for the tailings management
facilities and economic models.
NCL is not an associate or affiliate neither of
Serabi, nor of any associated company, or any joint-venture
company. NCL’s fees for this Technical Report are not dependent in
whole or in part on any prior or future engagement or understanding
resulting from the conclusions of this report. These fees are in
accordance with standard industry fees for work of this nature, and
NCL’s previously provided estimates are based solely on the
approximate time needed to assess the various data and reach
appropriate conclusions. This report is based on information known
to NCL as of 3 October 2024.
The information contained within this
announcement is deemed by the Company to constitute inside
information as stipulated under the Market Abuse Regulations (EU)
No. 596/2014 as it forms part of UK Domestic Law by virtue of the
European Union (Withdrawal) Act 2018.
The person who arranged for the release of
this announcement on behalf of the Company was Andrew Khov, Vice
President, Investor Relations & Business Development.
About Serabi Gold plc
Serabi Gold plc is a gold exploration, development and production
company focused on the prolific Tapajós region in Para State,
northern Brazil. The Company has consistently produced 30,000 to
40,000 ounces per year with the Palito Complex and is planning to
double production in the coming years with the construction of the
Coringa Gold project. Serabi Gold plc recently made a copper-gold
porphyry discovery on its extensive exploration licence. The
Company is headquartered in the United Kingdom with a secondary
office in Toronto, Ontario, Canada.
Enquiries
SERABI GOLD plc
Michael
Hodgson t
+44 (0)20 7246 6830
Chief
Executive m
+44 (0)7799 473621
Clive
Line t
+44 (0)20 7246 6830
Finance
Director m
+44 (0)7710 151692
Andrew Khov
m
+1 647 885 4874
Vice President, Investor Relations &
Business Development
e
contact@serabigold.com
www.serabigold.com
BEAUMONT CORNISH Limited
Nominated Adviser & Financial Adviser
Roland Cornish / Michael
Cornish t
+44 (0)20 7628 3396
PEEL HUNT LLP
Joint UK Broker
Ross
Allister t
+44 (0)20 7418 9000
TAMESIS PARTNERS LLP
Joint UK Broker
Charlie Bendon/ Richard
Greenfield t
+44 (0)20 3882 2868
CAMARCO
Financial PR - Europe
Gordon Poole / Emily
Hall t
+44 (0)20 3757 4980
HARBOR ACCESS
Financial PR – North America
Jonathan Patterson / Lisa
Micali t
+1 475 477 9404
Copies of this announcement are available from
the Company's website at www.serabigold.com.
See
www.serabigold.com for more information
and follow us on twitter @Serabi_Gold
GLOSSARY OF TERMS
The following is a glossary of technical
terms:
|
“actinolite” |
amphibole silicate mineral commonly found in metamorphic rocks,
including those surrounding cooled intrusive igneous rocks |
|
“Ag” |
means silver. |
|
“alkalic porphyry” |
A class of copper-porphyry mineral deposits characterised by
disseminated mineralisation within and immediately adjacent to
silica-saturated to silica-undersaturated alkalic intrusive centres
and being copper/gold/molybdenum-rich. |
|
“albite” |
is a plagioclase feldspar mineral |
|
“aplite” |
An intrusive igneous rock in which the mineral composition is the
same as granite, but in which the grains are much finer |
|
“argillic alteration” |
is hydrothermal alteration of wall rock which introduces clay
minerals including kaolinite, smectite and illite |
|
“AISC” |
means All-In Sustaining Cost – a non IFRS performance measurement
established by the World Gold Council |
|
“ANM” |
means the Agencia Nacional de Mineral. |
|
“Au” |
means gold. |
|
“assay” |
in economic geology, means to analyse the proportions of metal in a
rock or overburden sample; to test an ore or mineral for
composition, purity, weight or other properties of commercial
interest. |
|
“biotite” |
A phyllosilicate mineral composed of a silicate of iron,
magnesium, potassium, and aluminum found in crystalline rocks and
as an alteration mineral. |
|
“breccia” |
a rock composed of large angular broken fragments of minerals or
rocks cemented together by a fine-grained matrix |
|
“brecciation” |
Describes the process where large angular broken fragments of
minerals or rocks become cemented together by a fine-grained
matrix. |
|
“CIM” |
means the Canadian Institute of Mining, Metallurgy and
Petroleum. |
|
“CIP” or “Carbon in Pulp” |
means a process used in gold extraction by addition of
cyanide. |
|
“chalcopyrite” |
is a sulphide of copper and iron. |
|
“copper porphyry” |
copper ore body formed from hydrothermal fluids. These fluids will
be predated by or associated with are vertical dykes of porphry
intrusive rocks |
|
“Cu” |
means copper. |
|
“cut-off grade” |
the lowest grade of mineralised material that qualifies as ore in a
given deposit; rock of the lowest assay included in an ore
estimate. |
|
“dacite porphyry intrusive” |
a silica-rich igneous rock with larger phenocrysts (crystals)
within a fine-grained matrix |
|
“deposit” |
is a mineralised body which has been physically delineated by
sufficient drilling, trenching, and/or underground work, and found
to contain a sufficient average grade of metal or metals to warrant
further exploration and/or development expenditures; such a deposit
does not qualify as a commercially mineable orebody or as
containing ore reserves, until final legal, technical, and economic
factors have been resolved. |
|
“electromagnetics” |
is a geophysical technique tool measuring the magnetic field
generated by subjecting the sub-surface to electrical
currents. |
|
“epidote” |
is a calcium aluminium iron sorosilicate mineral |
|
“garimpo” |
is a local artisanal mining operation |
|
“garimpeiro” |
is a local artisanal miner. |
|
“geochemical” |
refers to geological information using measurements derived from
chemical analysis. |
|
“geophysical” |
refers to geological information using measurements derived from
the use of magnetic and electrical readings. |
|
“geophysical techniques” |
include the exploration of an area by exploiting differences in
physical properties of different rock types. Geophysical methods
include seismic, magnetic, gravity, induced polarisation and other
techniques; geophysical surveys can be undertaken from the ground
or from the air. |
|
“gold equivalent” |
refers to quantities of materials other than gold stated in units
of gold by reference to relative product values at prevailing
market prices. |
|
“gossan” |
is an iron-bearing weathered product that overlies a sulphide
deposit. |
|
“grade” |
is the concentration of mineral within the host rock typically
quoted as grams per tonne (g/t), parts per million (ppm) or parts
per billion (ppb). |
|
“g/t” |
means grams per tonne. |
|
“granodiorite” |
is an igneous intrusive rock like granite. |
|
“hectare” or a “ha” |
is a unit of measurement equal to 10,000 square metres. |
|
“hematite” |
is a common iron oxide compound |
|
“igneous” |
is a rock that has solidified from molten material or magma. |
|
“indicated mineral resource” |
is that part of a mineral resource for which quantity, grade or
quality, densities, shape and physical characteristics can be
estimated with a level of confidence sufficient to allow the
appropriate application of technical and economic parameters, to
support mine planning and evaluation of the economic viability of
the deposit. The estimate is based on detailed and reliable
exploration and testing information gathered through appropriate
techniques from locations such as outcrops, trenches, pits,
workings and drill holes that are spaced closely enough for
geological and grade continuity to be reasonably assumed. |
|
“inferred mineral resource” |
is that part of a mineral resource for which quantity and grade or
quality can be estimated on the basis of geological evidence and
limited sampling and reasonably assumed, but not verified,
geological and grade continuity. The estimate is based on limited
information and sampling gathered through appropriate techniques
from locations such as outcrops, trenches, pits, workings and drill
holes. |
|
“IP” |
refers to induced polarisation, a geophysical technique whereby an
electric current is induced into the sub-surface and the
conductivity of the sub-surface is recorded. |
|
“intrusive” |
is a body of rock that invades older rocks. |
|
“lithocap” |
Lithocaps are subsurface, broadly stratabound alteration domains
that are laterally and vertically extensive. They form when acidic
magmatic-hydrothermal fluids react with wallrocks during ascent
towards the paleosurface. |
|
“measured mineral resource” |
is that part of a mineral resource for which quantity, grade or
quality, densities, shape, and physical characteristics are so well
established that they can be estimated with confidence sufficient
to allow the appropriate application of technical and economic
parameters, to support production planning and evaluation of the
economic viability of the deposit. The estimate is based on
detailed and reliable exploration, sampling and testing information
gathered through appropriate techniques from locations such as
outcrops, trenches, pits, workings and drill holes that are spaced
closely enough to confirm both geological and grade
continuity. |
|
“mineralisation” |
the concentration of metals and their chemical compounds within a
body of rock. |
|
“mineralised” |
refers to rock which contains minerals e.g. iron, copper,
gold. |
|
“mineral reserve” |
is the economically mineable part of a measured or indicated
mineral resource demonstrated by at least a preliminary feasibility
study. This study must include adequate information on mining,
processing, metallurgical, economic and other relevant factors that
demonstrate, at the time of reporting, that economic extraction can
be justified. A mineral reserve includes diluting materials and
allowances for losses that may occur when the material is
mined. |
|
“mineral resource” |
is a concentration or occurrence of diamonds, natural solid
inorganic material or natural fossilised organic material including
base and precious metals, coal, and industrial minerals in or on
the Earth’s crust in such form and quantity and of such a grade or
quality that it has reasonable prospects for economic extraction.
The location, quantity, grade, geological characteristics and
continuity of a mineral resource are known, estimated or
interpreted from specific geological evidence and knowledge. |
|
“Mo-Bi-As-Te-W-Sn” |
Molybdenum-Bismuth-Arsenic-Tellurium-Tungsten-Tin |
|
“magnetite” |
Magnetic mineral composed of iron oxide found in intrusive rocks
and as an alteration mineral. |
|
“monzodiorite” |
Is an intrusive rock formed by slow cooling of underground
magma. |
|
“monzogranite” |
a biotite rich granite, often part of the later-stage emplacement
of a larger granite body. |
|
“mt” |
means million tonnes. |
|
“NI 43-101” |
means Canadian Securities Administrators’ National Instrument
43-101 – Standards of Disclosure for Mineral
Projects. |
|
“ore” |
means a metal or mineral or a combination of these of sufficient
value as to quality and quantity to enable it to be mined at a
profit. |
|
“oxides” |
are near surface bed-rock which has been weathered and oxidised by
long-term exposure to the effects of water and air. |
|
“paragenesis” |
Is a term used to describe the sequence on relative phases of
origination of igneous and metamorphic rocks and the deposition of
ore minerals and rock alteration. |
|
“phyllic alteration” |
is a hydrothermal alteration zone in a permeable rock that has been
affected by circulation of hydrothermal fluids |
|
“porphry” |
any of various granites or igneous rocks with coarse grained
crystals |
|
“ppm” |
means parts per million. |
|
“proterozoic” |
means the geological eon (period) 2.5 billion years ago to 541
million years ago |
|
“pyrite” |
an iron sulphide mineral |
|
“quartz-alunite ± kaolinite” |
Alunite is a hydroxylated aluminium potassium sulfate mineral. It
presence is typical in areas of advanced argillic alteration and
usually accompanied by the presence of quartz (a crystalline silica
mineral) and sometimes kaolinite.(a clay mineral). |
|
“saprolite” |
is a weathered or decomposed clay-rich rock. |
|
“scapolites” |
are a group of rock-forming silicate minerals composed of
aluminium, calcium, and sodium silicate with chlorine, carbonate
and sulfate |
|
“sulphide” |
refers to minerals consisting of a chemical combination of sulphur
with a metal. |
|
“tailings” |
are the residual waste material that it is produced by the
processing of mineralised rock. |
|
“tpd” |
means tonnes per day. |
|
“vein” |
is a generic term to describe an occurrence of mineralised rock
within an area of non-mineralised rock. |
|
“VTEM” |
refers to versa time domain electromagnetic, a particular variant
of time-domain electromagnetic geophysical survey to prospect for
conductive bodies below surface. |
|
“vuggy” |
a geological feature characterised by irregular cavities or holes
within a rock or mineral, often formed by the dissolution or
removal of minerals leaving behind empty spaces |
Assay Results
Assay results reported within this release include those provided
by the Company's own on-site laboratory facilities at Palito and
have not yet been independently verified. Serabi closely monitors
the performance of its own facility against results from
independent laboratory analysis for quality control purpose. As a
matter of normal practice, the Company sends duplicate samples
derived from a variety of the Company's activities to accredited
laboratory facilities for independent verification. Since mid-2019,
over 10,000 exploration drill core samples have been assayed at
both the Palito laboratory and certified external laboratory, in
most cases the ALS laboratory in Belo Horizonte, Brazil. When
comparing significant assays with grades exceeding 1 g/t gold,
comparison between Palito versus external results record an average
over-estimation by the Palito laboratory of 6.7% over this period.
Based on the results of this work, the Company's management are
satisfied that the Company's own facility shows sufficiently good
correlation with independent laboratory facilities for exploration
drill samples. The Company would expect that in the preparation of
any future independent Reserve/Resource statement undertaken in
compliance with a recognized standard, the independent authors of
such a statement would not use Palito assay results without
sufficient duplicates from an appropriately certificated
laboratory.
Forward-looking statements
Certain statements in this announcement are, or may be deemed to
be, forward looking statements. Forward looking statements are
identified by their use of terms and phrases such as ‘‘believe’’,
‘‘could’’, “should” ‘‘envisage’’, ‘‘estimate’’, ‘‘intend’’,
‘‘may’’, ‘‘plan’’, ‘‘will’’ or the negative of those, variations or
comparable expressions, including references to assumptions. These
forward-looking statements are not based on historical facts but
rather on the Directors’ current expectations and assumptions
regarding the Company’s future growth, results of operations,
performance, future capital and other expenditures (including the
amount, nature and sources of funding thereof), competitive
advantages, business prospects and opportunities. Such forward
looking statements reflect the Directors’ current beliefs and
assumptions and are based on information currently available to the
Directors. Several factors could cause actual results to differ
materially from the results discussed in the forward-looking
statements including risks associated with vulnerability to general
economic and business conditions, competition, environmental and
other regulatory changes, actions by governmental authorities, the
availability of capital markets, reliance on key personnel,
uninsured and underinsured losses and other factors, many of which
are beyond the control of the Company. Although any forward-looking
statements contained in this announcement are based upon what the
Directors believe to be reasonable assumptions, the Company cannot
assure investors that actual results will be consistent with such
forward looking statements.
Qualified Persons Statement
The scientific and technical information contained within this
announcement has been reviewed and approved by Michael Hodgson, a
Director of the Company. Mr Hodgson is an Economic Geologist by
training with over 30 years' experience in the mining industry. He
holds a BSc (Hons) Geology, University of London, a MSc Mining
Geology, University of Leicester and is a Fellow of the Institute
of Materials, Minerals and Mining and a Chartered Engineer of the
Engineering Council of UK, recognizing him as both a Qualified
Person for the purposes of Canadian National Instrument 43-101 and
by the AIM Guidance Note on Mining and Oil & Gas Companies
dated June 2009.
Notice
Beaumont Cornish Limited, which is authorised and regulated in the
United Kingdom by the Financial Conduct Authority, is acting as
nominated adviser to the Company in relation to the matters
referred herein. Beaumont Cornish Limited is acting exclusively for
the Company and for no one else in relation to the matters
described in this announcement and is not advising any other person
and accordingly will not be responsible to anyone other than the
Company for providing the protections afforded to clients of
Beaumont Cornish Limited, or for providing advice in relation to
the contents of this announcement or any matter referred to in
it.
Neither the Toronto Stock Exchange, nor any
other securities regulatory authority, has approved or disapproved
of the contents of this news release
Serabi Gold (LSE:SRB)
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Serabi Gold (LSE:SRB)
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