Projects - Brazil

Jatobá Project

Both the Jatobá and Tanque Fundo Projects are located in the major Proterozoic gold mineralised belt of the Cuiabá Basin. The Cuiabá Basin is well known for coarse gold within quartz vein systems.

Licence	Type	Grant Date	Holder	Interest Earning or Held	Royalty (in addition to 1% CFEM Royalty)	Future Payments
866505	EL	13/05/2005	CMGM	100%	1.5%	US$500,000 on decision to mine.  US$1,000,000 if >5year mine life.
866020	EL	04/06/2007	CMGM	100%	N/A	N/A

The Project area covers 9,013Ha.

Tenement 866020 is subject to DNPM approval for the second term, a further three years of exploration tenure.

Jatobá is a famous garimpo, located approximately 20km southeast of Cuiabá. High grade gold laterite deposits 1-3m deep were the source of a major gold rush into the area in the late 1970s. Surface laterite over an area of approximately 3x1km has been removed and processed using a combination of hammer mills and sluice boxes leaving large tailings mounds and dams.

Removal of the surface deposits exposed the quartz reefs which were mined by open pit methods using small scale equipment. Within the tenement area open pit mining to depths of approximately 50m has been undertaken. Mining was suspended in the 1990s due to poor gold recoveries from a small, inefficient plants.

Location of Jatobá Tenements

Mining of laterite mineralisation has occurred over an area of approximately 3x1km and was typified by coarse nuggetty gold. Quartz veins exposed in the mottled zone after removal of the lateritic zone are evident over a similar area. Two vein directions are apparent; a northeast vein set (040º- 060º) concordant with bedding and a northwest striking, vertical vein set (330º- 340º). A number of northwest striking pits of varying depth and strike extent have been developed over approximately 1km of strike, exploiting the northwest vein systems.

Extensive areas of laterite at Jatobá mined down to the pallid zone, exposing numerous mineralised quartz reefs. Note: Two main quartz reef directions (northeast and northwest) in the right photograph

Mineralisation within the main pit consists of two parallel northwest vertical quartz veins, approximately 30-50cm wide with strongly developed ladder veins on the southwest side of the vertical veins. The ladder veins extend up to 20m from the vertical veins with a general horizontal attitude to slight dip (5-10º) to the southwest. Vein mineralogy consists of vuggy to massive white to glassy quartz with limonite developed from oxidation of pyrite, kaolinite and sericite.

The lateritised host fine siltstones are moderately to strongly ferruginous, chloritic and are deeply weathered to at least the base of the pit. Composite chip sampling of the vertical vein sets returned gold values of 8-182g/t Au over widths of 1-2m. Composite chip sampling over the ladder veins at the base of main Jatobá Pit have returned grades of 2.8g/t Au over 5m. Further sampling in the central-northern wall of the pit also resulted in mineralisation of 18.85g/t Au over 1m from quartz veining and altered wallrock.

The Main Pit at Jatobá looking towards the southeast along the main mineralised northwest/southeast mineralised structure. Mining ceased in September 2006.

Jatobá main open pit workings with significant gold values shown

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