Cerrado GOLD Provides Update ON the Las Calandrias Heap Leach Project at Its Minera Don Nicolas MINE IN Argentina
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October 18, 2022 www.cerradogold.com
CERRADO GOLD PROVIDES UPDATE ON THE LAS CALANDRIAS HEAP LEACH
PROJECT AT ITS MINERA DON NICOLAS MINE IN ARGENTINA
• First production expected in second quarter 2023
• Highlights for the project include:
o Project represents the first stage of the MDN growth program to deliver production
rate of approximately 90,000 ounces per annum and All In Sustaining Costs (“AISC”)
below US$1,000 per ounce by 2024
o Imminent growth to come from the development of heap leach operations at Las
Calandrias and s ubsequently from the Martinetas area to process lower grade
material
o Las Calandrias first gold pour targeted for 2Q 2023
o All engineering and testing completed, including Infill drilling, metallurgical testing
and detailed design
o Permitting is well advanced and all remaining approvals are expected during Q4
2022
o Long-lead items have been ordered and construction to commence in Q 4 2022 as
planned
TORONTO, ONTARIO – Cerrado Gold Inc. [TSX.V: CERT][OTCQX:CRDOF] (“Cerrado” or the “Company”) is
pleased to provide an update on the progress of its development of the gold heap leach project at the
Las Calandrias deposit at its Minera Don Nicolas Mine located in Santa Cruz, Argentina (“MDN”). The heap
leach production strategy follows extensive review of the potential to utilize alternative production
technologies at MDN with the aim of mining lower grade material not being delivered to the CIL plant.
As initially outlined in a press release dated February 9, 2022, t he addition of heap leach operations at
MDN is targeted to increase production rates to 90,000 ozs per annum from the 2022 rate of
approximately 50,000 ozs with a reduction in AISC to below $1,000 ozs by 2024. Production growth and
cost reduction is planned from the development of two heap leach operations, firstly at Las Calandrias
and secondly at the Martinetas area.
The initial heap leach operation located at Las Calandrias is expected to commence production in Q2
2023. The Company has budgeted approximately US$25 million in development capital in 2022 and 2023
to construct the project. Financing of development is expected to be predominately from sources internal
to Argentina.
The Company has completed all metallurgical works, geotechnical testing of the site and a detailed design
of the crushing circuit and heap leach pad . License and permit submissions have been completed and
main orders for crushing and construction of the pad have been placed or are in final negotiations. First
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material is expected to be loaded on the pad towards the end of Q1 2023, and the first gold production
is expected in Q2 2023.
Mark Brennan, CEO and Co -Chairman commented “As we prepare to enter the Construction Phase at the
Las Calandrias project, work to date has confirmed ou r expectations of the viability of using heap leach
methodologies to more fully exploit the known resources at MDN as seen at neighbouring operations . As a
result, we are now one step closer to delivering on the first stage of our production growth strategy at MDN by
utilizing lower grade material that would otherwise not be processed. The Calandrias project is the first step in
our goal to reach production rates of 90,000 ounces per annum with reduced AISC’s at MDN by the end of
2023.”
Production Plan
The Company has developed an internal mine plan to process lower grade and transitional material
through a purpose-built heap leach facility at Las Calandrias. Extraction will be conducted via open pit
mining at an estimated life of mine strip ratio of 0.75:1. A plan view of the current pit design is s hown
below in Figure 1.
Figure 1. Las Calandrias Pit Design
Metallurgical Testing
The company has completed all Metallurgical work at Las Calandrias and expects an average recovery of
67% from processing the Oxide and Transitional material. Recoveries in the primary zone are currently
around 36% on average, with grades 30% higher than i n the oxide and mixed zones. Testing to date has
confirmed the following Au recovery rates for each ore type.
Ore Type Au Recovery
Oxide 70%
Mixed or Transitional 50%
Primary 36%
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Plant Design
The Las Calandrias plant will be constructed to have a 2Mtpa capacity through a two -stage crushing
process and pad design that will be built in stages. Water required for processing is currently expected
to be sourced through third party purchases, however, ongoing hydrological drilling could add additional
proprietary sources w hich would deliver a positive impact on operating costs and productions rates. A
layout of the pad and ancillary infrastructure is shown below in Figure 2.
Figure 2. Pad and Plant Design
Las Calandrias Infill
During late 2021 and in 2022 MDN completed a n infill drill program to support its understanding of the
resource and to make a development decision. During this program a further 3 ,582m were drilled
(1,320m DDH and 2,262m RC) in addition to the historical holes and assays.
A summary of the Total Exploration holes at the Las Calandrias property are presented below:
Hole Type # Holes Metres
DDH 210 24,583
RC 45 2,424
Grand
Total 255 27,007
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The company has received assays for all drilling to date at Las Calandrias. Drill hole locations and
composites are provided in in Figure 3. and Tables 2. and 3. below.
Figure 3. Las Calandrias Plan view and drill hole locations
Table 2. Drill Hole locations
Hole_ID UTM E UTM N Elevation Depth Dip Azimuth
E-D21-093 2614267 4724147 153.7 60 61 39
E-D21-094 2614322 4724144 151.7 60 61 38
E-D21-095 2614299 4724114 149.9 60 60 40
E-D21-096 2614343 4724106 151.5 60 60 38
E-D21-097 2614378 4724057 154.7 60 60 40
E-D21-098 2614353 4724075 149.6 60 60 40
E-RC21-001 2614295 4724173 156.3 54 60 40
E-RC21-002 2614287 4724232 157.9 54 60 40
E-RC21-003 2614252 4724221 163.7 54 60 40
E-RC21-004 2614225 4724238 166.3 54 60 40
E-RC21-005 2614236 4724271 165.7 54 60 40
E-RC21-006 2614208 4724315 163.9 54 60 40
E-RC21-007 2614156 4724267 168.5 54 60 40
E-RC21-008 2614092 4724226 163.9 54 60 20
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E-RC21-009 2614067 4724268 159.4 54 60 40
E-RC21-010 2614121 4724284 163.9 54 60 40
E-RC21-011 2614014 4724269 163.6 54 60 40
E-RC21-012 2614011 4724211 157.8 54 60 40
E-RC21-013 2614374 4724097 150.8 54 60 40
E-RC21-014 2614029 4724192 153.3 54 60 40
LC-D21-001 2613898 4724641 184.8 60 59 21
LC-D21-002 2614110 4724593 174.8 60 61 20
LC-D21-003 2614122 4724624 169.2 60 61 18
LC-D21-004 2614133 4724575 169.5 60 61 20
LC-D21-005 2614150 4724522 167.0 60 61 19
LC-D21-006 2614160 4724556 164.4 60 62 20
LC-D21-007 2614170 4724587 162.9 60 61 20
LC-D21-008 2614176 4724508 169.5 60 61 20
LC-D21-009 2614166 4724483 172.1 60 61 20
LC-D21-010 2614208 4724468 164.6 60 61 10
LC-D21-011 2614220 4724505 164.6 60 61 20
LC-D21-012 2614240 4724481 165.6 60 62 19
LC-D21-013 2614277 4724475 166.5 60 61 21
LC-D21-014 2614259 4724431 165.7 60 61 21
LC-D21-015 2614316 4724411 155.8 60 61 21
LC-D21-016 2614340 4724373 151.8 60 60 20
LC-RC21-001 2614142 4724384 166.8 54 60 20
LC-RC21-002 2614094 4724391 172.0 54 60 20
LC-RC21-003 2614068 4724350 168.1 54 60 20
LC-RC21-004 2614000 4724349 175.9 54 60 20
LC-RC21-005 2613980 4724532 183.4 54 60 20
LC-RC21-006 2613980 4724409 173.7 54 60 20
LC-RC21-007 2614069 4724449 178.9 54 60 20
LC-RC21-008 2614111 4724480 172.7 54 60 20
LC-RC21-009 2614013 4724479 180.7 54 60 20
LC-RC21-010 2613996 4724499 179.4 54 60 20
LC-RC21-011 2613967 4724497 181.9 54 60 20
LC-RC21-012 2613933 4724495 177.4 54 60 20
LC-RC21-013 2613963 4724690 182.9 54 60 20
LC-RC21-014 2613925 4724709 185.2 54 60 20
LC-RC21-015 2613908 4724666 184.7 54 60 20
LC-RC21-016 2613899 4724640 185.1 54 60 20
LC-RC21-017 2613826 4724592 179.7 54 60 20
LC-RC21-018 2613816 4724567 176.7 54 60 20
LC-RC21-019 2613768 4724714 183.9 54 60 20
LC-RC21-020 2613781 4724741 185.3 54 60 20
LC-RC21-021 2613790 4724792 177.9 54 60 20
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LC-RC21-022 2613736 4724791 176.8 48 60 20
LC-RC21-023 2613758 4724760 181.3 54 60 20
LC-RC21-024 2613568 4724821 160.0 54 60 20
LC-RC21-025 2613576 4724739 169.6 54 60 20
LC-RC21-026 2614353 4724411 156.2 54 60 20
LC-RC21-027 2614330 4724452 158.6 54 60 20
LC-RC21-028 2614245 4724399 159.9 54 60 20
LC-RC21-029 2613256 4724445 154.9 54 60 20
LC-RC21-030 2613283 4724373 152.6 54 60 20
LC-RC21-031 2613434 4724513 153.4 54 60 20
LC-RC21-032 2613528 4724460 155.8 54 60 20
LC-RC21-033 2613555 4724370 154.7 54 60 20
LC-RC21-034 2613610 4724436 158.3 54 60 20
LC-RC21-035 2613090 4724381 151.6 54 60 20
*Collar coordinates by GNSS TP-20 UTM Coordinates, Datum: SAD69 / zone 22S.
*Azimuth Set by compass
*Dip and drill hole trajectory by DEVIFLEX Devico
Table 3. Drill Hole Composites
Holeid Domain from to Au_ppm Ag ppm
E-D21-095 Transition 8.0 22.0 0.76 2.66
E-D21-096 Transition 22.7 28.1 0.85 4.39
E-D21-097 Oxide 2.0 16.0 1.02 11.21
E-D21-097 Transition 16.0 34.0 0.83 6.56
E-D21-097 Primary 54.0 60.0 1.78 10.07
E-D21-098 Oxide 0.2 8.0 0.57 5.57
E-D21-098 Transition 14.0 24.0 0.59 5.92
E-RC21-004 Primary 20.0 26.0 1.54 10.53
E-RC21-005 Oxide 2.0 20.0 4.56 16.38
E-RC21-006 Oxide 16.0 30.0 1.24 7.11
E-RC21-006 Primary 30.0 36.0 1.85 6.83
E-RC21-008 Oxide 0.0 34.0 0.70 2.36
E-RC21-009 Oxide 18.0 36.0 0.54 1.34
E-RC21-009 Primary 40.0 54.0 1.54 6.19
E-RC21-010 Oxide 12.0 32.0 1.32 4.88
E-RC21-012 Oxide 2.0 10.0 0.44 2.13
E-RC21-012 Transition 16.0 26.0 1.01 4.75
E-RC21-012 Primary 38.0 44.0 3.97 13.87
E-RC21-013 Oxide 0.0 16.0 1.99 11.66
E-RC21-014 Oxide 6.0 18.0 0.66 1.57
LC-D21-003 Oxide 1.2 12.0 0.49 1.08
LC-D21-005 Oxide 8.0 18.0 0.59 1.08
LC-D21-005 Oxide 24.0 38.0 0.39 0.53
LC-D21-008 Oxide 16.0 21.4 0.81 2.99
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LC-D21-009 Oxide 6.0 16.0 0.47 0.56
LC-D21-009 Transition 22.0 29.0 0.49 2.13
LC-D21-011 Oxide 2.0 10.0 0.39 1.01
LC-D21-012 Oxide 0.0 14.0 0.76 2.00
LC-D21-013 Oxide 18.0 27.5 0.30 0.98
LC-D21-013 Transition 27.5 33.4 0.55 1.62
LC-D21-014 Oxide 6.0 22.0 0.64 1.76
LC-D21-014 Primary 54.0 60.0 2.17 3.70
LC-RC21-001 Oxide 2.0 10.0 1.40 3.07
LC-RC21-001 Oxide 30.0 46.0 0.61 7.86
LC-RC21-001 Primary 46.0 54.0 1.82 12.67
LC-RC21-002 Oxide 14.0 32.0 0.60 10.36
LC-RC21-003 Oxide 38.0 46.0 0.44 8.58
LC-RC21-004 Oxide 28.0 36.0 0.66 4.40
LC-RC21-004 Oxide 42.0 52.0 0.50 18.16
LC-RC21-007 Oxide 20.0 36.0 0.66 4.59
LC-RC21-007 Oxide 38.0 44.0 0.32 2.17
LC-RC21-008 Oxide 4.0 16.0 0.53 4.25
LC-RC21-012 Oxide 12.0 18.0 0.37 5.10
LC-RC21-013 Primary 44.0 52.0 0.81 88.80
LC-RC21-017 Oxide 2.0 8.0 0.94 1.93
LC-RC21-017 Primary 48.0 54.0 1.00 54.66
LC-RC21-018 Primary 46.0 54.0 0.84 33.13
LC-RC21-019 Oxide 46.0 52.0 0.54 14.97
LC-RC21-022 Oxide 8.0 22.0 0.53 7.24
LC-RC21-022 Oxide 26.0 34.0 1.05 16.82
LC-RC21-024 Oxide 2.0 20.0 0.63 21.60
LC-RC21-028 Oxide 8.0 22.0 0.67 3.12
Economic cut-off grade applied in the composites varies according to Domain. Primary; 0.3 g/t Au; Transition:
0.4 g/t Au; and Primary 0.81 g/t Au
Quality Assurance and Quality Control
Analytical work of MDN reported drill holes was carried out by Alex Stewart international, Argentina S.A.
Labs (ASI). The facilities of the prep lab and assay lab are in San Julian, 184 Km from MDN mine
operations. MDN sends out 10% of samples to check at ALS international labs (ALS) with the prep l ab
located in Mendoza and assay labs in Lima, Peru and Vancouver, Canada. In the main laboratory ASI
(Mendoza), the samples are systematically analyzed for gold (ppm) and silver (ppm) by fire assay (Au4-50
+ AgICP-AR-39) regarding the over limits with fire assay results greater than 10 ppm, a second assay is
applied including gravimetric finishing (FA50GRAV), with respect to silver, analyzes greater than 200ppm
are carried out by AgFA50GRAV.
ASI has routine quality control procedures which ensure that every batch of samples includes three
sample repeats, two commercial standards and blanks. Cerrado used standard QA/QC procedures, when
inserting reference standards and blanks, for the drilling program. The Reference material used are from
CDN Resource Laboratories Ltd. Included in the batches following MDN internal protocols.
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The historic database was verified by AGP in 2018. In addition, AGP verified the assay data provided by
the company against the assay certificates provided by the laboratories: ALS (Mend oza) and ASi
(Mendoza), as provided by New Dimension. AGP verified approximately 20% of New Dimension’s
database across all drill campaigns with any errors corrected prior to finalizing the drillhole database.
SRK undertook an assessment of the geological model in 2021 and made a number of recommendations
that have since been adopted. MDN has reviewed and updated the information into the geological model
with the latest drillhole information and using the recommendations of SRK.
Metallurgical testing work was carried out by National University of San Juan, Institute of Mining
Investigations. MDN send half core samples for sample preparation to the lab. The laboratory has routine
quality control procedures which ensure that testing is to Approved and recogn ised Standards.
Review of Technical Information
The scientific and technical information in this press release has been reviewed and approved by
Clinton Swemmer, P.Eng., Vice President, Technical Services for Cerrado Gold Inc., who is a Qualified
Person as defined in National Instrument 43-101.
Mark Brennan David Ball
CEO and Co Chairman Vice President, Corporate Development
Tel: +1-647-796-0023 Tel: +1-647-796-0068
[email protected] [email protected]
About Cerrado
Cerrado is a Toronto based gold production, development and exploration company focused on gold
projects in the Americas. The Company is the 100% owner of both the producing Minera Don Nicolás
mine in Santa Cruz province, Argentina, and the highly prospect ive development project, Monte Do
Carmo located in Tocantins State, Brazil.
At Minera Don Nicolas, Cerrado is maximising asset value through further operation optimization and
continued production growth. An extensive campaign of exploration is ongoing to further unlock
potential resources in our highly prospective land package.
At Monte Do Carmo, Cerrado is rapidly advancing the Serra Alta deposit through Feasibility and
production. The Serra Alta deposit Indicated Resources of 541 kozs of contained gold and Inferred
Resources of 780 kozs of contained gold. The Preliminary Economic Assessment demonstrates robust
economics as well as the potential to be one of the industry’s lowest cost producers. Cerrado also holds
an extensive and highly prospective 82,542 ha land package at Monte Do Carmo.
For more information about Cerrado please visit our website at: www.cerradogold.com.
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