Brazil has emerged as a gold region of note for some Western Australian mining juniors, including recently listed Mundo Minerals Ltd and Troy Resources NL.
Brazil has emerged as a gold region of note for some Western Australian mining juniors, including recently listed Mundo Minerals Ltd and Troy Resources NL.
West Perth-based gold miner Mundo Minerals has accelerated its exploration and development activities within its Brazilian projects, including the Engenho and Tocantins gold projects.
After completing a review of all geological data, the company announced a new resource upgrade at its Engenho project, which is expected to support a significant increase in gold production and projected cash flows.
The initial mineral resource for Engenho included in Mundo’s prospectus was 1.13million tonnes at 5.82 grams per tonne, containing 211,600 ounces of gold (using a 4g cut-off).
This has since been upgraded to an estimated 1.82 mt at 5.59g/t containing 326,500 ounces of gold, representing a 54 per cent increase.
Mundo’s chief executive officer John Langford said the resource upgrade was based on a re-evaluation of the original model of the project’s ore body, including a recalculation of the ore body model to provide a more accurate interpretation of the ore geometry.
“This work, which has been completed in parallel with the finalisation of our prospectus and ASX listing, has generated a very positive outcome for the project,” he said.
Mundo has also commenced diamond drilling at its Tocantins Gold project in central Brazil, with drilling scheduled to continue until May 2007.
The initial program will target 5,000 metres of drilling to test high level geothermal anomalies on tenements which cover three large greenstone belts.
The miner is earning 51 per cent interest by spending approximately $1.65 million on exploration, which may increase to 80 per cent equity on any resource discovered by taking the resource through to bankable feasibility study.
The company also commenced diamond drilling at its Torrecillas gold project in Peru, scheduled to continue until February 2007.
Mundo closed its initial public offering oversubscribed on November 5 after raising $15 million.
At the time of listing, Mr Langford said the company had already recruited South American technical operational teams and drilling contractors in the 12 months prior to listing.
“We have been able to access drilling contractors and skilled personnel in South America, avoiding many of the capacity constraints and skills shortages we are seeing in the resource sector in Australia,” he said.
Since listing at 30 cents on November 15, the company has risen to a high of 37 cents earlier this week.
Meanwhile, West Perth gold mining and exploration company Agincourt Resources Ltd announced it would sell its Brazilian Adorinhas Gold project to fellow West Perth company Troy Resources NL for around $13.2 million.
Troy will purchase all shares in Agincourt’s Brazilian subsidiary for an initial payment of US$9.1 million, with an additional US$1 million to be paid after completion of all transfers and approvals.
Agincourt said in an announcement that, while the site had potential for reasonable returns, the capital costs were too high and did not meet the company’s strategic objectives.
The company said it would use funds from the sale to strengthen its cash reserves and enable a greater focus on project development and current exploration efforts.
Completion of the transaction is conditional on the execution of a formal sale and purchase agreement, currently under negotiation.
Andorinhas has a JORC compliant indicated and inferred resource of 4 mt at 3.4g/t for 435,000 contained ounces of gold as calculated by consultants Snowden.