Brazilian Gold Corporation
TSX VENTURE : BGC

Brazilian Gold Corporation

May 26, 2011 09:00 ET

Brazilian Gold Commences Extensive New Exploration Activities at Three Gold Projects in the Tapajos Mineral Province, Brazil

VANCOUVER, BRITISH COLUMBIA--(Marketwire - May 26, 2011) - Brazilian Gold Corporation (TSX VENTURE:BGC) ("Brazilian Gold" or the "Company") is pleased to announce the commencement of three new exploration programs on its São Jorge, Pista Manual and Surubim projects, located in the Tapajós Mineral Province (TMP) of northern Brazil. The Company currently has four drill rigs in operation and has active exploration programs underway on five gold projects, including its advance stage São Jorge project. Two additional drill rigs are scheduled to be contracted by the end of the second quarter bringing the total number of rigs to six.

Highlights

  • São Jorge project: A large (100 line km) soil sampling and induced polarization (IP) survey is currently in progress. The objective is to increase the existing resource of 800,000 ounces by identifying potential along strike extensions to the deposit.
  • Pista Manual project: The Phase One drill program (1,000 m) is designed to test down dip and along strike of vein and stockwork systems that have been exposed in trenches.
  • Surubim project: Crews are mobilizing to the project site to complete a line-cutting program (112 line km) for the upcoming IP survey and drill programs, which are scheduled to start in June. The Phase One drill program (3,000 m) will target down dip of historic shallow drill holes (36 holes in 4,621 m) that include high grade intersections of 2.52 grams/tonne gold over 37 metres (DD06SB18), 6.97 grams/tonne gold over 21.9 metres (DD06SB04) and 6.97 grams/tonne gold over 12 metres (DD06SB25).
  • Operational synergies with the Company's existing property portfolio, including the advanced stage São Jorge project.

On the São Jorge project, the Company is completing a soil sampling and an induce polarization (IP) survey (100 line km) to identify potential near surface extensions to the deposit along strike. The soil sampling program is approximately 75% complete and the IP survey (Fugro Brazil) is approximately 20% complete.

Results and final interpretation from these programs are expected in July and drill testing of identified targets will start shortly thereafter. The objectives of these programs are to identify additional near surface mineralization that will add to the targeted 1.2 to 1.4 million ounces in the current drill program, which is targeting down dip of the deposit between 200 to 300 metres below surface. An infill sampling program of historic drill holes is nearly complete and is expected to add ounces to the existing resource. These unsampled intervals were assigned an arbitrary value of 0.01 grams/tonne gold in the resource estimate completed by Coffey Mining (Sept. 14, 2010) and results to date show that some of these intervals contain sub-economic to economic grades. An updated NI43-101 resource estimate is scheduled for completion in Q4 2011 or Q1 2012.

A drill rig was mobilized to the Pista Manual project in the first week of May. The Phase One drill program (1,000 m) is designed to test down dip of the Inferninho and Pista Manual quartz vein and stockwork systems that have been exposed in a number of trenches. Concurrent with the drill program, a small infill soil sampling program will be completed to delineate a number of gold in soil anomalies identified in a previous widely spaced geochemical survey. The objective of the drill program is to determine the style, tenor and grade of mineralization at depth below previous surface sampling.

Line cutting crews are mobilizing to the Surubim project to complete a 112 kilometre grid for an upcoming IP survey. The IP survey is scheduled to begin in July once the crew has completed the São Jorge survey. A Phase One drill program (3,000 m) will target down dip of historic shallow drill holes (36 holes in 4,621 m) that included high grade intersections of 2.52 grams/tonne gold over 37 metres (DD06SB18), 6.97 grams/tonne gold over 21.9 metres (DD06SB04) and 6.97 grams/tonne gold over 12 metres (DD06SB25); the drill program is scheduled to begin in June. Once the IP survey is completed, a Phase Two drill program (2,000 m) will test new IP targets and along strike extensions of known mineralization.

The objectives of these programs are to identify extensions to the three known mineralized zones and to identify new areas of mineralization for an initial NI43-101 resource estimate, to be completed in Q4 2011 or Q1 2012.

Ian Stalker, CEO of Brazilian Gold, said: "I am delighted to announce the stepping up of exploration at our highly prospective project sites in northern Brazil. Brazilian Gold currently has five active exploration campaigns in the Tapajós Mineral Province. The scale of these activities showcases our commitment to the identification of a large-scale economically mineable resource. I am particularly excited about the drilling campaign that is currently in progress at São Jorge, which has the potential to host substantially more gold resources than the 800,000 ounces already identified."

The Company has a number of drill hole samples from São Jorge, Rio Novo and Boa Vista projects in the laboratory and will be releasing these results in the next few weeks, once they have been received, verified and interpreted.

Option Grant

Brazilian Gold would like to announce the granting of 700,000 stock options to its senior exploration team in Brazil under its Incentive Stock Option Plan. The options are exercisable for a five year period at an exercise price of $1.30 per share and are subject to a three year vesting provision.

Garnet Dawson, M.Sc., P.Geo. (British Columbia), Vice President, Exploration for the Company and a Qualified Person, as defined by National Instrument 43-101, has reviewed and approved the technical disclosure contained in this News Release.

About Brazilian Gold Corporation

Brazilian Gold Corporation is a Canadian based public company with a focus on the acquisition, exploration and development of mineral properties in northern Brazil. It is the largest holder of exploration concessions (3,546 km2) in the underexplored Tapajós Mineral Province, which historically produced over 30 million ounces of gold largely from alluvial deposits. The Company has drill programs (4 drill rigs) currently underway on the São Jorge, Rio Novo and Pista Manual projects.

Brazilian Gold owns a 75% interest in the Rea Uranium Project in northeastern Alberta, which is currently being operated by AREVA, which will earn up to a 50% interest by completing an additional Cdn$2.84 million in expenditures by Dec. 31, 2013.

Some statements in this news release contain forward-looking information, including without limitation statements as to planned expenditures and exploration programs. These statements address future events and conditions and, as such, involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the statements. Such factors include without limitation the completion of planned expenditures, the ability to complete exploration programs on schedule and the success of exploration programs.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or the accuracy of this news release.

Contact Information

  • Brazilian Gold Corporation
    Ian (John) Stalker
    CEO and Director
    1 604 602-8188

    Brazilian Gold Corporation
    Joanne Yan
    President and Director
    1 604 602-8188

    Brazilian Gold Corporation
    Tom Hart
    Investor Relations
    1 403 701-4278
    www.braziliangold.ca