Cabral Enters into NSR Royalty Agreement with Osisko Gold Royalties on the Cuiú Cuiú Gold Project, Brazil
Cabral Enters into NSR Royalty Agreement
with Osisko Gold Royalties on the Cuiú Cuiú
Gold Project, Brazil
Vancouver, British Columbia--(Newsfile Corp. - July 12, 2023) -
Cabral Gold Inc.
(TSXV: CBR) (OTC
PINK: CBGZF)
("Cabral" or the
"
Company
") is pleased to announce that it has entered into a royalty
agreement with Osisko Gold Royalties Ltd. ("Osisko") (OR: TSX & NYSE) pursuant to which Osisko has
agreed to purchase a 1% net smelter return ("NSR") royalty on the Cuiú Cuiú gold project for a total cash
consideration of US$5 million.
Highlights
Osisko has agreed to purchase a 1% NSR royalty on the Cuiú Cuiú gold project for a cash
consideration of US$5 million (C$6.6M). The consideration will be paid in two tranches; US$2.5
million on closing and US$2.5 million following the registration of certain security pledges which is
expected during July 2023
The royalty applies to the area containing the existing resources as well as the surrounding land
package
This investment allows Cabral to accelerate the ongoing Prefeasibility Study that is currently being
undertaken by Ausenco do Brasil Eugenharia Ltda. ("Ausenco") and is expected to be completed
during Q4 2023. It also provides strategic flexibility and optionality regarding any future project
financing process
The investment represents a strong endorsement of the Cuiú Cuiú gold project from a leading
public royalty company with well-respected technical expertise
Alan Carter, Cabral's President and CEO commented, "This transaction with Osisko allows us to take
a major step forward in achieving our objective of near-term production, and as a result, should deliver
meaningful value to our shareholders. It will also reduce share dilution and provide us with a strong
balance sheet moving forward. Perhaps most importantly, it will provide us with strategic flexibility and
options regarding future project financing processes. This financing will enable us to accelerate the
Prefeasibility study regarding the trial mining and heap-leach processing exploiting near-surface
oxide gold mineralization at Cuiú Cuiú that is being undertaken by Ausenco".
Cuiú Cuiú Project
Cuiú Cuiú is an advanced gold exploration and development project located in the state of Para, Brazil,
immediately adjacent to the Tocantinzinho gold project which is currently under construction.
The Cuiú Cuiú project hosts NI 43-101 compliant mineral inventory of 21.6 M @ 0.87 g/t gold
(604,000oz) in the Indicated Resources category and 19.8 Mt @ 0.84 g/t gold (534,500 oz) in the
Inferred Resources category.
A Prefeasibility Study considering potential exploitation of weathered oxide saprolitic gold mineralization
is currently being undertaken by Ausenco and is expected to be completed during Q4 2023. If positive,
the study should pave the way for a construction decision for trial mining and heap-leach processing of
the near-surface oxide gold mineralization at Cuiú Cuiú.
Details of the Transaction
Cabral has granted Osisko a
1% NSR royalty from the production of all products from the Cuiú Cuiú
property. The total consideration is US$5 million which will be paid in two tranches; US$2.5 million on
closing and US$2.5 million following the registration of certain security pledges, which is expected
during July 2023.
Following the completion of a Feasibility Study, Cabral will pay Osisko US$250,000 on the date thereof
and each subsequent anniversary of said completion by way of an advance payment, until the
commencement of commercial production. These payments shall be credited against future royalty
payments due under the Agreement.
The terms of the transaction allow Cabral to use a portion of the proceeds for general working capital
purposes.
The parties have agreed to a registration and pledge of shares in Cabral Gold B.C., and Cabral's wholly
owed subsidiary in Brazil. The transaction also grants Osisko certain additional rights on future royalty
and stream financings.
About Cabral Gold Inc.
The Company 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 Cuiú Cuiú gold district located in the Tapajós Region, within the state of Pará in
northern Brazil. Two main gold deposits have so far been defined at the Cuiú Cuiú project which contains
National Instrument 43-101 compliant Indicated resources of 21.6Mt @ 0.87 g/t gold (604,000 oz) and
Inferred resources of 19.8Mt @ 0.84 g/t gold (534,500 oz).
The Tapajós Gold Province is the site of the largest gold rush in Brazil's history producing an estimated
30 to 50 million ounces of placer gold between 1978 and 1995. Cuiú Cuiú was the largest area of placer
workings in the Tapajós and produced an estimated 2Moz of placer gold historically.
FOR FURTHER INFORMATION PLEASE CONTACT:
"Alan Carter"
President and Chief Executive Officer
Cabral Gold Inc.
Tel: 604.676.5660
Neither the TSX Venture Exchange nor its Regulation Services Provider (as such term is defined in
the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this
release.
Forward-looking Statements
This news release contains certain forward-looking information and forward-looking statements within
the meaning of applicable securities legislation (collectively "forward-looking statements").
The use of
the words "will", "expected" and similar expressions are intended to identify forward-looking
statements.
These statements involve known and unknown risks, uncertainties and other factors that
may cause actual results or events to differ materially from those anticipated in such forward-looking
statements.
Such forward-looking statements should not be unduly relied upon. The Company
believes the expectations reflected in those forward-looking statements are reasonable, but no
assurance can be given that these expectations will prove to be correct.
To view the source version of this press release, please visit
https://www.newsfilecorp.com/release/173232