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Multiple high grade intercepts into the undeveloped Gabi Vein at Sao Chico offer significant resource growth potential

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·25-min read
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For immediate release

21 December 2021

Serabi Gold plc
(“Serabi” or the “Company”)

Sao Chico and Coringa Update - Multiple high-grade intercepts into the undeveloped Gabi Vein at Sao Chico offer significant growth potential

Serabi Gold plc (AIM:SRB, TSX:SBI), the Brazilian-focused gold mining and development company, is pleased to provide assay results from recent drillholes and historical holes previously unlogged into the recently identified Gabi Vein, which lies just outside the current Sao Chico mine workings, at its Palito Complex, Para State, northern Brazil.

A PDF version of this announcement, including all images, can be accessed using the following link - https://bit.ly/3FmnYy8

Highlights

  • On 13 August 2021 the Company announced remodelling and interpretation of historic data had identified a parallel structure named the Gabi Vein, located approximately 70 metres to the south of the Main Vein.

  • Since this time, three new surface holes have been completed with significant intersections as follows:

    • 21-SC-212 intersected 0.80 metres @ 10.02 g/t gold at depth of 175.94 metres

    • 21-SC-221 intersected 0.30 metres @ 6.61 g/t gold at depth of 235.17 metres

    • 21-SC-224 intersected 0.30 metres @ 7.06 g/t gold at depth of 303.80 metres

  • As well as these three new holes, during the second half of 2021, 146 historical holes have been relogged and resampled where significant intersections were observed. The following significant results from historical underground drillholes intersecting the Gabi Vein have been recorded:

Hole

From

To

Apparent Width (m)

Gold Grade

(Au g/t)

SÃO CHICO UNDERGROUND DD DRILLING

19-SCUD-223

125.61

126.05

0.44

18.65

19-SCUD-241

204.80

205.52

0.72

31.45

19-SCUD-268

190.25

190.98

0.73

11.04

19-SCUD-298

166.77

167.23

0.46

9.93

19-SCUD-303

236.73

237.30

0.57

34.71

20-SCUD-412

165.05

166.15

1.10

24.14

20-SCUD-413

183.50

184.20

0.70

4.34

20-SCUD-414

164.95

165.25

0.30

10.76

20-SCUD-419

228.48

229.54

1.06

42.53

21-SCUD-488

13.90

14.60

0.70

14.10

21-SCUD-508

46.33

46.85

0.52

7.70

  • The following significant results from historical surface drillholes intersecting the Gabi Vein have been recorded:

Hole

From

To

Apparent Width (m)

Gold Grade

(Au g/t)

SÃO CHICO SURFACE DD DRILLING

11-SC-005

40.75

42.04

1.29

10.00

11-SC-012

40.00

41.60

1.60

10.00

13-SC-047

167.50

168.15

0.65

4.93

13-SC-051

53.40

53.90

0.50

30.81

13-SC-054

76.40

77.40

1.00

189.60

15-SC-105

94.25

94.75

0.50

5.26

21-SC-212

68.35

69.15

0.80

10.02

incl

68.35

68.70

0.35

20.50

21-SC-221

72.55

72.85

0.30

6.61

21-SC-224

76.10

76.40

0.30

7.06

Mike Hodgson, CEO of Serabi, commented:

“These recent assay results into the newly identified Gabi Vein at Sao Chico are very exciting. They clearly illustrate the lateral potential that exists at Sao Chico. With multiple payable drill hole intercepts into the vein covering a strike length of over 1,000 metres and depth of 400 metres, it demonstrates potential to add significant additional mineral resources from this new ore zone, which also appears amenable to selective mining. With the Gabi Vein just 70 metres south of current mine development, access is simple and during the early part of 2022 confirmatory infill drilling will be conducted.

“Coringa mine development is continuing as planned and I was at site last week to observe progress first hand. I am delighted to report we are scheduled to intersect the first of three veins at approximately 340 metres RL elevation before the end of the year. The ground conditions are excellent, and after installing some initial rock support around the portal, the Coringa rock conditions look every bit as good as we see at Palito. I will be looking forward to reporting on the first intersections into the Serra zone early in the new year.

“Staying with Coringa, on 6 December we were subject to informal news in Brazil, that suggested the granting of future licenses at our Coringa project would be dependent upon the completion of an indigenous impact study. I can confirm that today all current licenses are valid and in good standing, and it remains very much business as usual at Coringa, with the mine under development. Contrary to the news reports we are advised that a formal decision by all three judges that are considering the matter has yet to be made and to date all prior court hearings have suggested an indigenous impact study will not be required. Nonetheless following meetings with the regulatory authorities and the indigenous communities during the third quarter of 2021, Serabi undertook to voluntarily initiate a study to assist the regulatory authorities with their consideration of the Installation Licence application. We therefore do not expect these reported matters to adversely impact the granting of the Installation Licence and are still planning to commence construction of the Coringa processing plant in the middle of 2022.”

RESULTS

The Gabi Vein lies 70 metres south of the Main Vein and current mine infrastructure. This vein was originally intersected in the initial 2011 drilling campaign where deeper drilling targeting the Main Vein cut the Gabi Vein in the shallow portion of the drill holes. It has since been intersected in the 2013, 2015, 2019 and 2021 drilling campaigns, though each campaign was targeting the Main Vein and not Gabi. In 2015, a cross cut on level 186mRL was driven to investigate the structure, but results were disappointing and further investigation was postponed, with priority given to continued exploration and evaluation of the wider Main Vein. Nevertheless, drillholes designed to intersect the adjacent Main Vein continued to cut the Gabi Vein, and this catalysed a second review.

Figure 1 - Plan view of the Sao Chico veins

To access a detailed image of the Plan view of the Sao Chico veins please use the following link - https://bit.ly/3pbUMUz

Figure 2 - Long Section of the Gabi Vein

To access a detailed image of the Long Section of the Gabi Vein please use the following link - https://bit.ly/32mOcBD

2021 Drilling Results

Three new surface holes have been drilled into the Gabi vein with the following significant intercepts:

0.30m @ 6.61g/t Au (21-SC-221)
0.30m @ 7.06g/t Au (21-SC-224)
0.80m @ 10.02g/t Au (21-SC-212)

Eighteen underground drill holes were undertaken this year with significant intercepts including:

0.55m @ 18.24g/t Au (21-SCUD-544)
0.61m @ 1.45g/t Au (21-SCUD-542)
0.70m @ 14.10g/t Au (21-SCUD-488)
0.52m @ 7.70g/t Au (21-SCUD-508)
0.60m @ 3.28g/t Au (21-SCUD-567)
0.50m @ 4.10g/t Au (21-SCUD-570)

It is only after the more recent underground holes had been drilled that the presence and geometry of the Gabi Vein was defined. This prompted a second look at 146 previously unsampled historical holes, that had targeted the Main Vein. The result of this re-interpretation involved a major re-logging, sampling and assaying campaign on many historical cores during the second half of this year. Whilst many of these holes did not show significant mineralization, some certainly do as can be seen from the table below with some excellent intersections with very mineable widths and grades, with strong grade and width continuity. Information gaps still remain but there are now multiple payable drill hole intercepts into the Gabi Vein.

Hole 21-SC-212 recorded 10.50 g/t Au over 0.35 metres in a shallow intersection 50 metres from surface, whilst hole 19-SCUD-303 intersected 34.71 g/t Au over 0.57 metres, and at -250 metres RL, approximately 400 metres deeper. Drillholes now intermittently cover a strike length of approximately 1,000 metres and a depth of 400 metres. There appears to be a strong structural and grade opportunity to add significant additional resource from this new ore zone, which, like the Main Vein, has significant depth potential.

The results of new and historical holes newly sampled and assayed and not previously disclosed are tabulated below:

Hole

Target

East

West

RL

Depth (m)

Dip/Azm

From

To

Apparent Width (m)

Gold Grade

(UTM- WGS84)

(UTM- WGS84)

(°/°UTM)

(Au g/t)

SÃO CHICO UNDERGROUND DD DRILLING

17-SCUD-132

Gabi

614286.12

9290260.76

162.77

30.90

0.07/153.39

10.70

11.20

0.50

1.77

18-SCUD-192

Gabi

613845.91

9290387.69

27.01

80.26

-19.69/206.56

55.40

55.90

0.50

4.32

19-SCUD-223

Gabi

613974.66

9290378.88

-27.15

144.55

-41/194

125.61

126.05

0.44

18.65

19-SCUD-235

Gabi

614149.22

9290369.47

6.37

269.20

-53/200

241.93

243.00

1.07

0.90

19-SCUD-241

Gabi

614149.86

9290369.30

6.76

216.85

-41/164

204.80

205.52

0.72

31.45

19-SCUD-268

Gabi

614081.56

9290366.32

6.42

207.25

-46.49/208.52

190.25

190.98

0.73

11.04

19-SCUD-279

Gabi

614081.49

9290366.20

6.52

198.55

-41.2/204.58

168.00

168.80

0.80

3.79

19-SCUD-298

Gabi

613862.07

9290388.00

-21.62

258.50

-64/181

166.77

167.23

0.46

9.93

19-SCUD-300

Gabi

613860.91

9290389.00

-21.62

254.95

-59.1/218

141.09

141.79

0.70

1.21

19-SCUD-303

Gabi

613860.91

9290389.00

-21.62

302.45

-3.2/234.08

236.73

237.30

0.57

34.71

19-SCUD-305

Gabi

613863.38

9290386.00

-21.62

282.00

-62.2/161

233.60

234.55

0.95

1.31

20-SCUD-320

Gabi

614081.69

9290366.21

8.72

180.00

-43.1/198.58

168.75

169.75

1.00

0.64

20-SCUD-337

Gabi

614149.39

9290371.99

8.00

323.85

-12.9/127.88

295.82

296.12

0.30

0.61

20-SCUD-394

Gabi

614285.31

9290291.50

222.22

65.10

-35/208

49.49

50.21

0.72

0.88

20-SCUD-401

Gabi

614286.15

9290291.73

222.22

67.50

-10/154

44.90

45.70

0.80

3.00

20-SCUD-410

Gabi

614126.23

9290365.28

6.14

210.45

-40.4/207.38

178.61

179.61

1.00

2.13

20-SCUD-412

Gabi

614126.55

9290365.47

6.46

192.00

-38.4/201.18

165.05

166.15

1.10

24.14

20-SCUD-413

Gabi

614126.58

9290365.46

6.22

219.50

-45.7/199.78

183.50

184.20

0.70

4.34

20-SCUD-414

Gabi

614126.89

9290365.41

6.59

183.15

-37.8/193.08

164.95

165.25

0.30

10.76

20-SCUD-419

Gabi

614126.89

9290365.45

6.41

237.20

-51.3/192.48

228.48

229.54

1.06

42.53

20-SCUD-421

Gabi

614127.42

9290365.56

6.70

192.25

-39/178.78

178.17

178.56

0.39

1.42

21-SCUD-483

Gabi

614409.27

9290195.09

90.94

192.40

-35.1/320.18

30.88

31.04

0.16

1.38

21-SCUD-485

Gabi

614409.81

9290194.42

90.93

162.80

-47.9/320.48

35.81

36.00

0.19

1.83

21-SCUD-488

Gabi

614409.92

9290194.34

90.95

194.70

-56/321.68

13.90

14.60

0.70

14.10

21-SCUD-493

Gabi

614410.84

9290194.48

90.88

166.85

-63.5/348.68

48.83

49.12

0.29

0.63

21-SCUD-505

Gabi

614412.79

9290194.50

90.93

142.00

-43/45.98

41.53

42.00

0.47

0.57

21-SCUD-508

Gabi

614412.38

9290194.11

91.04

167.65

-57.7/40.78

46.33

46.85

0.52

7.70

21-SCUD-541

Gabi

614209.33

9290241.01

87.32

60.40

-43.57/164.81

18.64

18.94

0.30

0.86

21-SCUD-547

Gabi

614170.23

9290255.24

87.30

54.90

-41.36/197.12

41.68

41.96

0.28

0.69

21-SCUD-557

Gabi

614135.93

9290257.79

58.68

414.10

-1.9/209.71

41.00

42.22

1.22

1.05

21-SCUD-563

Gabi

614135.97

9290257.81

58.46

401.60

-10.2/208.91

51.19

51.59

0.40

2.85

21-SCUD-565

Gabi

614134.35

9290258.49

58.75

300.25

-0.9/242.51

43.15

43.80

0.65

0.58

21-SCUD-567

Gabi

614319.36

9290236.79

89.39

65.20

-10/176.27

32.76

33.36

0.60

3.28

21-SCUD-568

Gabi

614319.30

9290237.51

89.52

49.00

-31/180.86

30.52

31.08

0.56

1.51

21-SCUD-569

Gabi

614137.24

9290256.48

58.45

405.30

-4.3/177.91

36.00

36.70

0.70

1.37

21-SCUD-570

Gabi

614318.92

9290236.78

89.42

72.15

-14/207.03

38.80

39.30

0.50

4.10

21-SCUD-571

Gabi

614319.09

9290237.05

89.13

66.65

-31/203.24

35.12

35.40

0.28

1.12

SÃO CHICO SURFACE DD DRILLING

11-SC-005

Gabi

613937.84

9290269.24

279.44

191.15

-55/10

40.75

42.04

1.29

10.00

11-SC-006

Gabi

613977.08

9290263.18

278.27

203.15

-55/11

65.15

66.40

1.25

1.07

11-SC-012

Gabi

614330.02

9290217.45

281.00

76.85

-55/11

40.00

41.60

1.60

10.00

11-SC-021

Gabi

613926.97

9290232.83

288.07

220.10

-55/11

83.94

85.25

1.31

10.00

13-SC-044

Gabi

614095.67

9290242.42

271.26

201.70

-58.7/37.1

44.90

45.20

0.30

1.80

178.95

179.30

0.35

1.22

13-SC-047

Gabi

613949.52

9290210.18

287.97

283.35

-60/15

167.50

168.15

0.65

4.93

13-SC-050

Gabi

614078.93

9290201.21

280.73

257.35

-60/15

65.50

66.15

0.65

0.71

188.20

189.10

0.90

0.52

13-SC-051

Gabi

614301.47

9290279.68

263.61

76.55

-55/187.5

53.40

53.90

0.50

30.81

13-SC-054

Gabi

614342.80

9290284.22

265.25

98.10

-60/187.5

76.40

77.40

1.00

189.60

15-SC-068

Gabi

613918.18

9290300.35

275.00

140.05

-60.04/22.44

14.45

15.25

0.80

0.77

51.25

51.80

0.55

0.57

15-SC-070

Gabi

613897.54

9290301.53

274.92

150.35

-53.3/19.74

36.65

37.55

0.90

0.75

15-SC-098

Gabi

613754.99

9290345.20

263.19

119.90

-55.1/20.24

68.70

69.10

0.40

0.80

78.20

78.50

0.30

0.64

15-SC-104

Gabi

614328.01

9290284.92

263.64

135.15

-60/202.84

81.40

82.65

1.25

0.69

15-SC-105

Gabi

614288.17

9290294.38

260.34

110.75

-61.1/200.44

94.25

94.75

0.50

5.26

15-SC-106

Gabi

614063.92

9290158.72

291.73

297.40

-59.7/18.54

151.40

151.90

0.50

0.53

15-SC-107

Gabi

614025.59

9290172.27

286.11

292.25

-62/21.64

95.10

96.40

1.30

0.69

15-SC-108

Gabi

613995.13

9290187.85

281.39

289.90

-58.3/16.44

108.65

109.25

0.60

0.66

154.20

154.60

0.40

1.29

191.60

191.95

0.35

0.50

18-SC-131

Gabi

613424.61

9290449.59

251.04

234.45

-46.09/18

45.96

46.66

0.70

0.67

19-SC-152

Gabi

614324.85

9290082.74

309.78

378.94

-60.5/8.6

268.81

269.36

0.55

0.56

20-SC-163

Gabi

614378.60

9290069.51

306.14

391.57

-60.7/354.5

247.00

247.40

0.40

2.01

21-SC-212

Gabi

613329.16

9290489.87

239.61

175.94

-45/18

68.35

69.15

0.80

10.02

incl.

68.35

68.70

0.35

20.50

21-SC-221

Gabi

613319.09

9290491.28

238.88

235.17

-45.8/24.21

72.55

72.85

0.30

6.61

21-SC-224

Gabi

613289.52

9290500.07

235.37

303.80

-49.7/343.2

76.10

76.40

0.30

7.06

99.25

99.80

0.55

0.98

Reported intercepts calculated based on a minimum weighted average grade of 0.5g/t Au using a 0.5g/t Au weighted average lower cut and a maximum internal waste interval of 1.2m based on ALS and Serabi´s on-site lab reported analyses. Some of the assay results reported above include those provided by the Company's own on-site laboratory facilities at Palito and have not 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 recognised standard, the independent authors of such a statement would not use Palito assay results without sufficient duplicates from an appropriately certificated laboratory.





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 Clive Line, Director.

Enquiries:

Serabi Gold plc

Michael Hodgson

Tel: +44 (0)20 7246 6830

Chief Executive

Mobile: +44 (0)7799 473621

Clive Line

Tel: +44 (0)20 7246 6830

Finance Director

Mobile: +44 (0)7710 151692

Email: contact@serabigold.com

Website: www.serabigold.com

Beaumont Cornish Limited
Nominated Adviser and Financial Adviser

Roland Cornish / Michael Cornish

Tel: +44 (0)20 7628 3396

Peel Hunt LLP
Joint UK Broker

Ross Allister / Alexander Allen

Tel: +44 (0)20 7418 9000

Tamesis Partners LLP
Joint UK Broker

Charlie Bendon / Richard Greenfield

Tel: +44 (0)20 3882 2868

Camarco
Financial PR

Gordon Poole / Nick Hennis

Tel: +44(0) 20 3757 4980

Copies of this announcement are available from the Company's website at www.serabigold.com.

Neither the Toronto Stock Exchange, nor any other securities regulatory authority, has approved or disapproved of the contents of this announcement.

See www.serabigold.com for more information and follow us on twitter @Serabi_Gold

GLOSSARY OF TERMS

Ag

means silver.

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.

CIM

means the Canadian Institute of Mining, Metallurgy and Petroleum.

chalcopyrite”

is a sulphide of copper and iron.

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 ore body 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.

“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.

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 similar to granite.

hectare” or a “ha

is a unit of measurement equal to 10,000 square metres.

“igneous”

is a rock that has solidified from molten material or magma.

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.

"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.

“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.

“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 Resource

is a concentration or occurrence of diamonds, natural solid inorganic material, or natural solid fossilized 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.

“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 mine

Mo-Bi-As-Te-W-Sn”

Molybdenum-Bismuth-Arsenic-Tellurium-Tungsten-Tin

“monzogranite”

a biotite rich granite, often part of the later-stage emplacement of a larger granite body.

“mt”

means million tonnes.

“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.

“ppm”

means parts per million.

“Probable Mineral Reserve”

is the economically mineable part of an Indicated and, in some circumstances, a Measured 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.

“Proven Mineral Reserve”

is the economically mineable part of a Measured Mineral Resource. A Proven Mineral Reserve implies a high degree of confidence in the Modifying Factors

“saprolite”

is a weathered or decomposed clay-rich rock.

sulphide

refers to minerals consisting of a chemical combination of sulphur with a metal.

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.

Assay Results
The assay results reported within this release include those provided by the Company's own on-site laboratory facilities at Palito and these will not have 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 recognised standard, the independent authors of such a statement would not use Palito assay results without sufficient duplicates from an appropriately certificated laboratory.

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 26 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, recognising 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.

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. A number of 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.

ENDS

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