Cabral Gold (TSXV:CBR) - High-Grade Discovery Fuels Brazil's Next Gold Growth Story

Dec 16, 2024

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Interview with Alan Carter, President & CEO of Cabral Gold Inc.

Our previous interview: https://www.cruxinvestor.com/posts/cabral-gold-tsxvcbr-positive-pfs-shows-low-cost-high-return-gold-starter-operation-6127

Recording date: 13th December 2024

Cabral Gold is advancing its district-scale gold project in Brazil, which currently holds 1.2 million ounces of indicated and inferred resources across multiple deposits. The company recently released a Pre-Feasibility Study (PFS) for a starter oxide gold mine, demonstrating robust economics with a post-tax IRR of 47% at $2,250/oz gold, increasing to 83% at $2,700/oz gold. The project requires a modest initial capital investment of US$37 million.

The starter operation aims to process soft, weathered saprolite material and is expected to produce approximately 20,000 ounces of gold annually at all-in sustaining costs of around $1,200/oz. This strategic approach will allow Cabral to generate cash flow to fund further exploration without diluting shareholders through repeated equity raises.

Beyond the initial mine plan, Cabral's project shows significant exploration potential. The company has identified 4-5 known deposits and over 50 peripheral targets with high-grade gold mineralization. Recent drilling has yielded impressive results, including 11 meters grading 33g/t gold at the new Machichie Northeast discovery, along with other notable intercepts such as 27m @ 6.9g/t and 39m @ 5.1g/t at various targets.

CEO Alan Carter, who was involved in discovering the neighboring Tocantinzinho deposit, highlights the project's scale by comparing soil anomalies: while Tocantinzinho's anomaly spans about one kilometer, Cuiú Cuiú's extends for 7 kilometers and remains open. Historical artisanal gold production at Cuiú Cuiú was reportedly ten times larger than at Tocantinzinho, suggesting significant untapped potential.

The company is currently valued at approximately US$35 million, based on a share price of C$0.22 and 212 million shares outstanding. This translates to roughly US$25 per ounce of gold in the ground, which management considers undervalued compared to peer companies. Carter has demonstrated his confidence in the project by investing nearly $2 million of his own money in Cabral Gold.

The company continues to drill and upgrade its resource base, with recent work focused on converting inferred resources to indicated status. This ongoing work is expected to improve the project's NPV and IRR in the near term. With a clear path to production, significant exploration upside, and strong gold market fundamentals, Cabral Gold appears well-positioned to advance its Cuiú Cuiú project while maintaining focus on shareholder value creation.

View Cabral Gold's company profile: https://www.cruxinvestor.com/companies/cabral-gold