Exploration Firm Reveals Premium Gold Mineralization at Machichie Main
Cabral Gold Inc. (CBR:TSX.V; CBGZF:OTCMKTS) announced the results from 11 more drill holes and two trenches at the Machichi Main gold deposit in the Cuiu Cuiu gold district of Brazil. Read why one expert says the stock is "sitting at a discount."
Cabral Gold Inc. (CBR:TSX.V; CBGZF:OTCMKTS) announced the results from 11 more reverse circulation drill holes and two trenches at the Machichi Main gold deposit in the Cuiu Cuiu gold district of Brazil.
Drill hole RC0515 returned 10 meters at 2.2 grams per tonne gold (g/t Au) from surface and 3 meters at 15.9 g/t Au from 16 meters depth within weathered gold-in-oxide material (saprolite), Cabral said. The same hole also intersected 11 meters at 0.9 g/t Au in fresh rock from 31 meters depth.
"The identification of a new and previously unrecognized parallel zone of mineralization at Machichie Main is a very positive development," President and Chief Executive Officer Alan Carter said. "Together with the other new drill and trench results released today, this underlines the potential of the Machichie Main deposit to make a meaningful contribution to the near-term development plans for the gold-in-oxide material at Cuiu Cuiu, as well as the global resource base within the district."
Further results announced this week include:
Drill hole RC0504, which was drilled at the Machichie Main gold deposit, returned 12 meters at 3.1 g/t Au, including 3 meters at 11.2 g/t Au, in weathered gold-in-oxide material at surface.The drill results from RC504 indicate the presence of a new previously unrecognized mineralized zone located 40 meters north of the main mineralized structure at Machichie Main. The new zone is open to the east and west and will require further drilling.Additional drill results from Machichie Main included 7 meters at 2.8 g/t Au, including 2 meters at 7.5 g/t Au, in hole RC502; and 15 meters at 1.5 g/t Au in RC506. Other notable results included 6 meters at 0.9 g/t Au from RC508, 5 meters at 1.2 g/t Au from RC511, and 2 meters at 6.6 g/t Au from RC519.Trench CT054 also returned 13 meters at 2.3 g/t Au in saprolite material on surface, including 5 meters at 5.8 g/t Au."The trench results are again significant because they confirm the presence of excellent grades within gold-in-oxide material at surface," Carter said. "This bodes very well for our efforts to upgrade the inferred resources at Machichie Main and significantly (update) the PFS (preliminary feasibility) study released in October 2024."
Site of Brazil's Largest Gold Rush
Cabral is a junior resource company engaged in the identification, exploration and development of mineral properties, with a primary focus on gold properties located in Brazil. The company has a 100% interest in the Cuiu Cuiu gold district located in the Tapajos region, within the state of Para in northern Brazil.
Several gold deposits have so far been defined at the Cuiu Cuiu project, which contains National Instrument 43-101-compliant indicated resources of 12.29 Mt of 1.14 g/t Au (450,200 ounces) in fresh basement material and 11.11 Mt of 0.48 g/t Au (171,883 ounces) in oxide material. The project also contains inferred resources of 13.63 Mt of 1.04 g/t Au (455,100 ounces) in fresh basement material and 12.22 Mt of 0.39 g/t Au (151,608 ounces) in oxide material.
The Gold Advisor Senior Analyst Jeff Valks noted on March 26 that an update to the PFS "could be a major catalyst for the stock."The resource estimate for the primary material is based on the NI 43-101 technical report dated Oct. 12, 2022. The resource estimate for the oxide material is based on an NI 43-101 technical report dated Oct. 21, 2024.
"The Tapajos gold province is the site of the largest gold rush in Brazil's history, which, according to the ANM (Agencia Nacional de Mineracao or National Mining Agency of Brazil), produced an estimated 30 million to 50 million ounces of (Moz) placer gold between 1978 and 1995," the company noted. "Cuiu Cuiu was the largest area of placer gold workings in the Tapajos and produced an estimated two million ounces of placer gold historically."
The main objective of the current exploration program is to upgrade a significant portion of the current inferred resources to indicated status so they can be included in the mine plan for the heap leach starter operation, the company said. It is also aimed at shedding light on the underlying primary mineralized zone in the intrusive rocks and collecting additional material for a series of metallurgical column-leach tests.
Company Seeks to Update Resource Estimates
The Gold Advisor Senior Analyst Jeff Valks noted on March 26 that an update to the PFS "could be a major catalyst for the stock."
"An update to last October's PFS is still on track for May," he wrote. "It will include new resource estimates for the MG, Central, and Machichie gold deposits, metallurgical results for Machichie Main, a new reserve estimate base for the gold-in-oxide material, and a revised financial model."
"We also continue to view Cabral as an attractive acquisition target," wrote analysts Don Blyth, Lauren McConnell, and Don MacLean.With "high-grade surface and sub-surface hits now confirmed, and assays still on the way, the Machichie zone is beginning to take on a larger role in Cabral's near-term development plan," he continued.
As Valks wrote, he said the stock was up 6% but was 80% higher than a year ago.
"With five-year highs of CA$0.57/share and assays returning with great results, this stock appears to still be sitting at a discount," he said. "I hold no position, (Gold Advisor Editor) Jeff Clark remains long."
On March 13, in an update flash note about Cabral, analysts for Paradigm Capital noted that they expect the company to upgrade the resources at the project in the updated PFS.
"We also continue to view Cabral as an attractive acquisition target, with G Mining Ventures (GMIN:TSX.V) being the most logical acquirer as it owns the now-operating Tocantinzinho (TZ) mine next door," wrote analysts Don Blyth, Lauren McConnell, and Don MacLean. "But it is not only GMIN . . . with recent exploration successes and so many promising targets left to chase, the Cui? Cui? project is demonstrating stand-alone potential and is likely to start attracting a broader M&A audience, in our opinion."
The Catalyst: Bull Market Could Go Higher
Gold prices came close to hitting new all-time highs above US$3,050 per ounce, even as new statistics showed the U.S. economy was fairly resilient in the final months of 2024, reported Neils Christensen for Kitco on Thursday.
The final reading of the U.S. Gross Domestic Product showed the economy growing by 2.4% in the fourth quarter of 2024, the Bureau of Economic Analysis announced. The data is slightly better than expected. The report also noted that inflation pressures during the fourth quarter were relatively stable.
Streetwise Ownership Overview*
Cabral Gold Inc. (CBR:TSX.V; CBGZF:OTCMKTS)
*Share Structureas of 3/27/2025Source: RefinitivUpdated estimates from the Atlanta Federal Reserve's GDP tracker show the economy declining 1.8% this quarter, Christensen said. Ongoing fears over slower economic activity have helped drive gold prices above $3,000 an ounce.
Some predict even higher prices for gold. On March 11, according to Friesen, DoubleLine Chief Executive Officer Jeffrey Gundlach said, "I think gold will make it to US$4,000. I'm not sure that'll happen this year, but I feel like that's the measured move anticipated by the long consolidation at around US$1,800 on gold."
"Gold is in a secular bull market. We forecast prices to trade between US$3,000-US$3,200 this year," said Alex Ebkarian, chief operating officer at Allegiance Gold, according to a Reuters report.
Ownership and Share Structure
According to Refinitiv, about 7% of the company is owned by insiders and management, while institutions own about 18%. The rest is retail.
Major shareholders include AMS Asset Management with 6.96%, Arbiter Partners Capital Management with 5.74%, Aegis Financial Corp. with 5.71%, the CEO Carter with 5.22%, and Director Lawrence Lepard with 0.62%.
It has 233.49 million shares outstanding and a market cap of CA$86.39 million. It trades in a 52-week range of CA$0.16 and CA$0.39.
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