Cabral Gold (TSX-V:CBR) has closed a C$45 million ($45.4 million) private placement with Peruvian mining group Alpayana as it prepares for first gold production at its Cuiú Cuiú Project in Brazil.
The company issued 34.6 million units at C$1.30 each to Alpayana, giving the strategic investor a 9.99% stake. Each unit comprises one common share and half a warrant exercisable at C$1.70 until February 2028.
The placement provides funding to accelerate expansion of Cabral’s phase-one heap leach operation and advance development of a larger phase-two hard rock mining operation.
CEO Alan Carter says the investment represents strong endorsement of the project and development strategy.
“This strategic investment allows us to accelerate the expansion of our phase one mine in the coming months, as well as the development of what we expect will be a much larger phase two hard rock mining operation at Cuiú Cuiú,” Carter notes.
Alpayana Chairman Alejandro Gubbins says the investment reflects confidence in Cabral’s team and the geological potential of the Cuiú Cuiú district.
“As a private group with four decades of continuous operations in Latin America, we are proud to extend our long-term, responsible approach to mining into Brazil’s newest and most exciting gold district,” Gubbins adds.
Under an investor rights agreement, Alpayana can participate in future equity financings and nominate one director to Cabral’s board while maintaining at least 9% ownership.
The Cuiú Cuiú Project hosts indicated resources of 12.29 million tonnes (Mt) at 1.14 grams per tonne gold in fresh material and 13.56Mt at 0.50g/t in oxide, with additional inferred resources.
Cabral Gold expects to enter commercial production at its phase one heap leach operation in the December quarter.
Write to JC Villarba at Mining.com.au
Images: Cabral Gold
