BrazMin down on disappointing resource estimate

BrazMin (BZM-T) saw its shares fall on preliminary results from its So Jorge Gold Project in Para State, Brazil.

A press release from the company outlines an indicated resources estimate of 5 million tonnes grading 1.19 grams gold for 191,000 oz.

In Toronto on Sept. 1 the company’s shares were off over 8% or 9 to $1.01 on roughly 10,500 shares.

And while BrazMin’s president and chief executive, Tony Ransom, describes the resource numbers as “disappointing when compared to historical resources”, he says in the release that the company believes it to be a “conservative” estimate.

The resource estimate and metallurgical test-work are for the Wilton Zone at So Jorge.

BrazMin says gold mineralization goes to at least 200 metres below surface and the deposit is considered open at depth and along strike in both directions.

Using a 0.5 gram per tonne gold cut-off, SRK consulting classified only the material in the zone occurring within 100 metres of surface as a mineral resource.

The company says a final technical report will be filed within 45 days.

The company says the Wilton zone has been delineated for 700 metres with an average estimated true thickness of 60 metres. Within the broader zone of mineralization, four main high-grade gold zones, as well as mineralized sub-zones exist.

The mineral resource doesn’t discriminate between the four main high grade gold zones if it did the overall grade may increase while a small number of oz. of contained gold would be lost.

A total of 10,890 metres of core in 55 diamond drill holes were used by SRK in their analysis.

The company says the zone is suitable to be mined as an open pit operation.

Also, metallurgical tests confirm that the project should be responsive to standard gold recovery techniques, BrazMin says.