Brazilian Gold Corporation
TSX VENTURE : BGC

Brazilian Gold Corporation

May 16, 2011 09:00 ET

Brazilian Gold Makes Significant New Discovery-Substantial Gold Mineralization Revealed from Phase One Drilling at Rio Novo Project, Brazil

VANCOUVER, BRITISH COLUMBIA--(Marketwire - May 16, 2011) - Brazilian Gold Corporation (TSX VENTURE:BGC) ("Brazilian Gold" or the "Company") is pleased to announce drill results from the first two diamond drill holes of its Phase One (10 holes in approx. 3,000 m) drill program on its wholly owned Rio Novo Project situated within the Tapajós Mineral Province (TMP) of northern Brazil. The project is located approximately 50 kilometres southwest of the Company's advance stage São Jorge gold deposit and is accessed by the Transgarimpeiro Highway.

Highlights

  • Drill hole JAD-002-11 intersected 1.32 grams/tonne gold over 74.0 metres with high grade intervals of 40.78 grams/tonne over 2.0 metres and 6.62 grams/tonne over 2.0 metres (Table 1).
  • Drill hole JAD-003-11 intersected 0.78 grams/tonne gold over 79.7 metres with high grade intervals of 7.30 grams/tonne over 4.9 metres, 9.15 grams/tonne over 1.0 metre, and 13.3 grams/tonne over 1.0 metre (Table 1).
  • The two holes tested the western portion of a large (1,000 m by 200-300 m) east-west trending chargeability anomaly.
  • Drill holes JAD-001-11, JAD-005-11 and JAD-006-11 intersected larger intervals with a higher frequency of quartz+sulphide veins than those intersected in JAD-002-11 and JAD-003-11 suggesting the gold mineralization could extend over a 400 metre strike length and be increasing in grade and size to the east; assays are pending.
  • Alteration and mineralization intersected in the current drill program is open in all directions.
  • A second, parallel chargeability anomaly occurs approximately 400 metres to the north and has been partially tested by two drill holes in the Phase One drill program.

Commenting on the results of the Phase One drill program Ian Stalker, CEO of Brazilian Gold, said, "The Company is extremely encouraged by this new gold discovery at Rio Novo and given the size of the chargeability anomaly, the potential to find additional near surface gold mineralization appears to be very high. Rio Novo is strategically located near our flagship São Jorge project and could provide additional feed to a central processing facility at this project if it is not a standalone operation."

Drill hole JAD-002-11 intersected 1.32 grams/tonne gold over 74.0 metres with high grade intervals of 40.78 grams/tonne over 2.0 metres and 6.62 grams/tonne over 2.0 metres, and drill hole JAD-003-11 intersected 0.78 grams/tonne gold over 79.70 metres with high grade intervals of 7.30 grams/tonne over 4.90 metres, 9.15 grams/tonne over 1.0 metre, and 13.3 grams/tonne over 1.0 metre (Table 1). These two holes tested the western portion of a large east-west trending chargeability anomaly.

Table 1: Rio Novo drill intersections.
Hole IDSectionFrom (m)To (m)Interval (m)Au g/t
JAD-002-118200E248.0322.073.01.32
includes8200E272.0274.02.040.78
includes8200E320.0322.02.06.62
JAD-003-118200E89.5169.279.700.78
includes8200E89.594.44.907.31
includes8200E160.0161.01.09.15
includes8200E168.2169.21.013.3
8200E254.2259.55.31.34
Note: True widths are not known at this time and the large composite intervals in each drill hole are a result of a few narrow high grade veins (<3 cm) within an overall interval that is anomalous in gold compared to the rest of the hole.

The drill program is designed to test an east-west trending chargeability anomaly that measures approximately 1,000 metres long by 200 to 300 metres wide that is coincident with a garimpeiro pit that exposed auriferous quartz+sulphide veins over a 50 metre width. Nine drill holes (2,847 m) have been completed to date on three sections (8200E, 8400E and 8600E) space 200 metres apart with 3 holes per section; a 10th hole is currently in progress on Section 8800E located 200 metres east of previous drilling. The drill holes have been drilled towards the north at -60 to -55° to test the width of the anomaly. A second, parallel weaker IP chargeability anomaly occurs approximately 400 metres north of the above anomaly has been partially tested by two drill holes in the Phase One drill program. To view a plan map and cross section image please visit the following link:

http://media3.marketwire.com/docs/bgc516i.jpg

All drill holes completed to date in the Phase One drill program have intersected sericite+pyrite+chalcopyrite altered felsic volcanic rocks (ignimbrites) cut by quartz+calcite +sphalerite+galena veins and veinlets that in some intervals form stockwork zones. The deeper parts of some drill holes (JAD-002, -003, -004) terminated in similarly altered quartz-feldspar granite porphyry. Drill holes JAD-001-11, JAD-005-11 and JAD-006-11 intersected larger intervals with higher frequency of quartz+sulphide veins than those intersected in JAD-002-11 and JAD-003-11 suggesting the mineralization could extend over a 400 metre strike length and be increasing in grade and size to the east; assays are pending. The gold mineralization appears to have been deposited in an epithermal to porphyry style environment and the Company is waiting for further drill results to understand the grade, size and geometry of this mineralization.

The Rio Novo project consists of five exploration concessions for a total area of 44,576 hectares. The Phase One drill program and IP survey covers a small part (<5%) of this area and additional known targets including mineralization exposed in garimpeiro pits and regional geophysical targets on the property will be followed up in 2011 with prospecting, mapping and sampling.

Drill results from the remaining holes will be release as they are received, verified and interpreted. The Company apologizes for the long turnaround time taken to process and subsequently report assay results as our laboratory, like many other laboratories in the world today, is experiencing delays in keeping up with the volume of samples currently being submitted for analysis.

Laboratory Procedures

Drill core is sampled at 2 metre or smaller intervals using a diamond saw. One half of the sample is archived and the other half is dispatched to Acme Analytical Laboratories Ltd.'s sample preparation facility in Itaituba, Brazil, where the sample is crushed, split and pulverized to -200 mesh. The pulp is shipped to Santiago, Chile or Vancouver, Canada for gold fire assay. Acme Analytical Laboratories Ltd. is an internationally certified ISO 9001 laboratory. Brazilian Gold's Quality Assurance – Quality Control Program involving the insertion of appropriate blanks, standards and duplicates was employed with acceptable results.

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 acquisition, exploration and development of mineral properties in northern Brazil. The Company has a portfolio of ten grass-roots to development stage gold projects (8 projects in the Tapajós and 2 projects in the nearby Alta Floresta Gold Province) with drill programs (4 drill rigs) currently underway on the São Jorge, Rio Novo and Pista Manual projects.

The São Jorge development project hosts an NI43-101 indicated resource of 343,000 ounces (8.3 Mt grading 1.3 g/t gold) and an inferred resource of 458,000 ounces (12.6 Mt grading 1.1 g/t gold) using a 0.5 gram/tonne cut-off (Coffey Mining, Sept. 14, 2010). The Company has commissioned Coffey to complete a Preliminary Economic Assessment (PEA) or Scoping Study that will look at various development and production scenarios to determine the financial viability of the project. The study is expected to be completed in May 2011 and dependent on project economics, the Company plans to embark on a pre-feasibility/feasibility study soon thereafter.

Brazilian Gold owns a 75% interest in the Rea Uranium Project in northeastern Alberta, which is currently being operated by AREVA, who are earning 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
    +1 604 677-6243 (FAX)

    Brazilian Gold Corporation
    Joanne Yan
    President and Director
    +1 604 602-8188
    +1 604 677-6243 (FAX)

    Brazilian Gold Corporation
    Tom Hart
    Investor Relations
    +1 403 701-4278