Cerrado Gold Reports New Mineral Resource for Its Serra Alta Deposit, Tocantins State, Brazil

• New Serra Alta resource of 541,000 Indicated gold ounces and 780,000 Inferred gold ounces
• Expanded Resource to be Used to Deliver New Preliminary Economic Assessment in the coming weeks

Toronto, Ontario–(Newsfile Corp. – August 4, 2021) – Cerrado Gold Inc. (TSXV: CERT) (OTCQX: CRDOF) (“Cerrado” or the “Company”) is pleased to announce an updated mineral resource prepared by Micon International Limited at the Serra Alta deposit within its Monte do Carmo Gold Project in the State of Tocantins, Brazil. The update integrated the successful results of Phase 1 drilling initiated in October 2020 and finalized in April of this year with the previous drill results.

Serra Alta Updated Resource Highlights

• Total Indicated Resource of 9,108,000 tonnes at 1.85 g/t Au, containing 541,000 oz Au

• Total Inferred Resource of 13,197,000 tonnes at 1.84 g/t Au, containing 780,000 oz Au

• Notable Increase in total Mineral Resource: 62% more gold ounces from previous estimate (December 2018)

• Higher Confidence level: 41% of metal in Indicated category

• Over 99 % of the gold in the Indicated Resources category is included in the constraining pit shell, the other 0.4% is considered underground

• Over 90.5% of the Inferred Resource is included in pit shell, the other 9.2% is considered underground

• Excellent conversion rate of previous Inferred Resource into indicated confirms sound domaining and interpolation strategy

• Confirmation of Serra Alta as the anchor deposit of the district, as exploration continues

• Potential for replicating mineral endowed zones like Serra Alta or individual blocks within Serra Alta on regional scale remains high from Cerrado perspective

Mark Brennan, CEO and Co-Chairman commented, “We are extremely pleased with the updated resource estimate for the Serra Alta deposit, highlighting not only significant growth in contained ounces but also the significant improvement in the confidence of a large portion of the current resource base, as seen in the new Indicated Resources, which gives us strong confidence in high conversion rates going forward”. He continued “Further, this expanded resource base will be used in the upcoming Preliminary Economic Assessment for the Serra Alta deposit which will look at higher throughput and production rates relative to the previous study.“

The new Mineral Resource estimate was completed by Micon International Limited (Table 1) after completion of the Phase 1 drill program (See Cerrado’s April 22, 2021 Press Release) that focused primarily on resource extension and category conversion. The Phase 1 drilling phase added substantive information to previous Cerrado and historic drilling that formed the basis of the previous Resource Estimate (Table 2) also prepared by Micon and disclosed in April 2019 (Effective day December 2018). The new resource estimate is now the basis of the undergoing PEA being carried out by GE21 which is expected to be completed in the near future.

Table 1. Serra Alta Mineral Resource Statement – Effective Date July 21, 2021

Estimate Notes:

1. Mineral resources were estimated by Mr. B. Terrence Hennessey, P.Geo. and Mr. Alan J. San Martin, MAusIMM (CP) of Micon International Limited. (“Micon”), a Toronto based consulting company, independent of Cerrado Gold. Both Mr. Hennessey and Mr. San Martin meet the requirements of a “Qualified Person” as established by the Canadian Institute of Mining, Metallurgy and Petroleum (CIM) Definition Standards for Mineral Resources and Mineral Reserves (May 2014) (“the CIM Standards”).
2. Mineral resources are not mineral reserves and therefore do not have demonstrated economic viability.
3. The Serra Alta estimate has been completed entirely using Leapfrog Geo – EDGE software.
4. The estimate is based on a long-term gold price of US$ 1,600 per ounce and economic cut-off grades 0.30 g/t Au (Open Pit) and 1.10 g/t (Underground).
5. Open Pit constrained resources are reported within an optimized pit shell; underground resources are reported within continuous and contiguous shapes which lie adjacent to and below the ultimate open pit shell and interpreted to be recoverable utilizing standard underground mining methods.
6. The mineral resource estimate has an effective date of July 21, 2021.
7. The Serra Alta gold deposit was modelled by Cerrado using a wireframe constructed based on a 0.1 g/t Au cut-off grade and a few vein interpretations.
8. Rock density was assigned to different lithologies based on the geological and mineralization models, using calculated average values of 2.624 g/cm3 in granite, 2.65 g/cm3 in volcanics and 2.60 g/cm3 inside mineralization wireframes.
9. Grade capping was used to control the influence of outliers in the estimate, raw assays were composited to 1.0 m and then assessed for capping. Grade capping used throughout the deposit was 45 g/t Au for the main broad envelope and 8.0 g/t Au for the interpreted veins.
10. The block model gold grades were estimated using the Ordinary Kriging interpolation method with searching parameters derived from geostatistical analysis performed within the mineralization wireframes. Variogram ranges go from 90 m to 150 m in the major axis.
11. The estimate assumes a metallurgical recovery of 98.5% gold, based on completed test-work to date.
12. The estimate assumes the following costs: Mining (Pit) US$ 2.00/t, Mining (Pit Waste) US$ 1.70/t, Mining (Underground) US$ 40.00/t, Processing US$10.78/t, and G&A of US$ 2.00/t.
13. The pit constrained resource is reported within an optimized pit shell that assumed a maximum slope angle of 55 degrees. Open pit mining recovery was assumed to be 100%. Open pit dilution was assumed to be 0%. Underground mining recovery was assumed to be 100%. Underground dilution was assumed to be 0%.
14. Micon has not identified any legal, political, environmental, or other risks that could materially affect the potential development of the mineral resource estimate.
15. The mineral resource estimates are classified according to the CIM Standards which define a Mineral Resource as “a concentration or occurrence of solid material of economic interest in or on the earth’s crust in such form, grade or quality and quantity that there are reasonable prospects for eventual economic extraction. The location, quantity, grade or quality, continuity and other characteristics of a mineral resource are known, estimated, or interpreted from specific geological evidence and knowledge including sampling.
16. The mineral resource was categorized based on the geological confidence of the deposit into inferred and indicated categories. An inferred mineral resource has the lowest level of confidence. An indicated mineral resource has a higher level of confidence than an inferred mineral resource. It is reasonably expected that the portions of the inferred mineral resources could be upgraded to indicated mineral resources with additional infill drilling.
17. All procedures, methodologies and key assumptions supporting this mineral resource estimate are included in a NI 43-101F1 Technical Report which will be available at

    
    Table 2. Mineral Resource Comparison (December 2018 and July 2021)

    To view an enhanced version of Table 2, please visit:
    https://orders.newsfilecorp.com/files/6185/92020_tbl2full.jpg

    To view the source version of this press release, please visit https://www.newsfilecorp.com/release/92020

    Advertisement