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Brazil-focused miner Serabi Gold (LON: SRB) (TSX: SBI) said on Monday that Vale (NYSE: VALE) has decided to withdraw from a copper exploration alliance formed in May 2023.
The company, which also outlined progress in exploration at its Palito Complex in the country’s north, noted that it remains optimistic as there already are “a number of other groups keen to partner” with them. No names were provided in the statement.
Shares in the company fell more than 5% in London to 65.96p and 5.4% in Toronto to C$1.23 on the announcement, leaving the company with a market capitalization of £49.97 million ($63.2m)
Serabi said that drilling at the Palito Complex, which includes the Palito underground gold mine and the São Chico satellite deposit, helped it identify high-grade intercepts from the São Domingos property and a new porphyry copper-gold system near the Matilda target.
Chief executive Mike Hodgson said the company has revised its initial geological interpretation and is “significantly closer” to identifying the source that has supported extensive artisanal workings in the area.
“Drilling completed in January has confirmed that the Ganso Target is the preserved upper portion of a porphyry system,” Hodgson said in the statement.
“This is important, not only for Serabi but also for the entire Tapajos region, as it confirms that despite the old age of the rocks, the region has a huge untested potential as a source of porphyry style copper or copper-gold and epithermal gold mineralization.”
The Tapajos region, in the Brazilian state of Para, is reported to be the world’s third largest alluvial gold field.
Serabi Gold has repeatedly said it believes the region is a major, under-explored mineral province as historical data shows that artisanal miners, called “garimpeiros,” have mined about 30 million ounces of gold mostly from alluvial and surface weathered bedrock deposits in the region since the 1970s.
The planned 2024 exploration program, Serabi said, will focus on brownfield exploration at Coringa and Palito to increase resources. The company will also continue testing and delineating new targets within the Serabi exploration tenement package, including the prospect of further definition drilling at Matilda.
Coringa, located 200km (125 miles) away from Serabi’s Palito gold mining complex in the country’s north, is expected to double the company’s gold output once at full tilt.
The company’s total gold production last year hit 33,153 ounces, a 4.2% improvement 2022. The Coringa project contributed production of a record 2,694 gold ounces and it is forecast to yield an average of 38,000 ounces once it achieves nameplate capacity.
New targets continue to be identified and most have not been drilled, which means that more news can be expected during the year from the exploration activities, Serabi Gold said.
