Cerrado Gold Inc. (TSXV: CERT | OTCQX: CRDOF) has provided an update on the Q4 operational results at its Minera Don Nicolas mine, progress with development of the initial heap leach pad at the Las Calandrias deposit, and progress with the ongoing Feasibility Study work at its 100% owned Monte Do Carmo Project in Tocantins.
Mark Brennan, CEO and co-chairman commented “As we indicated earlier in the year, Q4 was expected to be a strong operating quarter for Minera Don Nicolas and we are pleased to report production is expected to be approximately 15,000oz with over 50,000oz produced for the full year, as per guidance.
“Of critical importance to MDN; we have developed a cohesive multi discipline strategy using open pit, heap leach and underground mining methods to grow operations and increase the life of mine. Once we see first pour of gold from the heap leach operations in April, MDN will be set for robust production and cash flow growth.
“We have seen very good progress with the feasibility study at Serra Alta and considering the positive results from the addition of Gogó and additional zones, we have elected to extend the infill drill programme modestly at the Monte Do Carmo property to incorporate these new areas into the feasibility study. “He added.
As the company previously outlined, mine planning at Minera Don Nicolas was scheduled to provide a significant improvement in Q4 2022 versus Q3 and Q2 to reflect the mining sequencing which saw lower grade material during the midpoint of the year.
Cerrado has stated that the new pits are performing better than expected, with new ore control measures resulting in less dilution and higher feed grades to the processing plant. Based upon results to date, Q4 2022 gold production and sales are expected to be more than 15,000oz resulting in full year production exceeding 50,000oz.
Given higher gold production numbers, a decrease in dilution and an increase in the official dollar the AISC is expected to show a significant improvement from the previous quarter. The development of the initial heap leach pad at the company’s Las Calandrias deposit (north) has started with construction under way and a second heap leach pad planned to begin construction at the Martinetas area (south) in 2023.
As previously outlined by Cerrado, the addition of heap leach operations at MDN is targeted to increase production capacity to 90,000oz per annum by year end 2024 and will also reduce all in sustaining costs to ~$1,000/oz by 2024.
The heap leach pad at Calandrias is expected to add 20,000-25,000oz per year over a period of four years with the initial gold pour expected by April 2023 and full ramp up in Q2 2023. Funding for the initial US$25M in capital required to develop the initial heap leach pad is also progressing well with US$8.0M of funding secured.
Funding via the issuance of additional term notes is expected to continue moving forward in conjunction with scheduled internally generated cash flows to fully fund capital requirements out of Argentina.
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