Junior Rea Gold (REO-T) has signed a letter of intent to acquire the Pitangui gold project in Brazil.
Terms of the agreement call for the company to pay owner Luxembourg-based Minorco a total of US$5.1 million in staged payments over two years.
Pitangui, which is situated in the Quadrilatero Ferrifero mining district, is an advanced-stage project hosting four gold deposits with an estimated resource of 5.3 million tonnes grading 0.16 oz. gold per tonne. The property is 87 miles northwest of Belo Horizonte.
The deposits are structurally controlled and shear-hosted, typical of classic Archean quartz-carbonate gold systems.
The Turmalina deposit, the most advanced of the four, has been drill-defined over a strike length of 200 metres and a downdip length of 500 metres.
In 1992, Minorco examined the possibility of supplementing feed to its Nova Lima plant with material from Turmalina, and conducted development work on two levels of the deposit in preparation for production. Turmalina was later placed on care and maintenance, however.
Rea’s goal is to complete enough drilling to upgrade the current resource to a reserve.
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