I keep trying to make an especially valid point that gold and silver resource stocks are cheaper than they have ever been relative to both commodities and the S&P. Lots of other writers have woken up to the idea that the general stock market has already jumped off a very tall cliff. And it’s a long long way to the bottom. All that stupid money that flowed into NFTs and SPACs and cliptocurrencies is going to be looking for a new, safer home shortly.
The quality of juniors in the resource space is better than I have ever seen it. We don’t have five or 10 high quality companies, we have hundreds. All selling at the lowest relative prices in history. Regardless of what happens in Canada as Trudeau goes full Nazi or Ukraine as the U.S. goes tone deaf stupid, the overall markets are going to continue to crash for years. Gold and silver remain the only markets that have not been hitting new highs. But they will.
I wrote about Cabral Gold Inc. (CBR:TSX.V; CBGZF:OTCMKTS) as recently as two months ago. It continues to have outstanding drill results being released almost weekly. The company is in the midst of a 25,000 meter drill program at its 100% owned premier Cuiú Cuiú gold project in central Brazil. From 1978 until 1995, this region in Brazil had the biggest placer gold rush in history with estimates of production between 20 and 30 million ounces.
Cabral owns the richest part of that gold rush at Cuiú Cuiú where about 2 million ounces of placer gold was produced. The 2021 drill program consisted of just over 25,000 meters of drilling. As of the start of January, there were still 33 holes with assays pending.
The holes that have been released have been excellent. When drilling gold projects you want to either get long intervals of low-grade material or shorter intervals of high-grade material. Cabral is getting both. In a press release dated Feb. 10, Cabral announced 23.8 meters of 5.5 g/t Au from hole DDH250.
That of course is an excellent hole, but the same hole showed a remarkable 84.9 meters of 0.7 g/t gold as well. That hit was from surface in oxidized material directly above the unoxidized high-grade material I showed above. When dealing with oxide gold at surface, it is far cheaper to process than the hard rock but higher-grade material deeper in the system. Cabral has been using a 0.35 cutoff for their 43-101 released in June of 2021 for the open pit material, so 0.7 g/t gold is highly economic using simple and cheap gravity recovery.
Cabral has a next door neighbor named G Mining Ventures (GMIN:TSX.V) that offers some interesting comparisons. G Mining has a similar grade to that of Cabral but has slightly more than twice the 43-101 resources. G Mining bought the project from Eldorado Gold late last October for $110 million in shares. G Mining has raised $70 million in cash to put the project into production, aiming for starting construction in Q3 of 2022 and full-scale production in Q3 of 2024.
The G Mining project is named Tocantinzinho, however since only three people in Brazil can pronounce the name, for simplicity purposes everyone calls it the TZ project.
The Cuiú Cuiú property produced 2 million ounces of placer gold during the 1978-1995 gold rush, while the TZ property only produced about 200,000 ounces. The ratio of placer gold production to current resource at TZ is 1:10. The ratio of placer gold production to current resource at Cuiú Cuiú is a tiny 1:0.5. Since the placer gold began as hard rock, to have more placer production suggests also having more hard rock potential.
G Mining seems to have excellent institutional backers and is well cashed up to production. If for no other reason than having a rich neighbor next to you, everything that
G Mining does to tell its story will also rub off on Cabral.
Cabral does an excellent job of telling its story. Everyone interested in hearing about a real gold project in a safe jurisdiction with a lot of potential for growth, go to their presentation.
Cabral Gold is an advertiser. I participated in the last PP they did and bought some more shares in the open market lately. In my view, they are absurdly cheap. The stock has had a 60% drop in the last 12 months, yet the company is coming up with great assays every week. You should do your own due diligence.
Cabral Gold
CBR-V $.385 (Feb. 14, 2022)
CBGZF OTCBB 141.7 million shares
Cabral Gold website
Bob Moriarty
President: 321gold
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Bob Moriarty founded 321gold.com, with his late wife, Barbara Moriarty, more than 16 years ago. They later added 321energy.com to cover oil, natural gas, gasoline, coal, solar, wind and nuclear energy. Both sites feature articles, editorial opinions, pricing figures and updates on current events affecting both sectors. Previously, Moriarty was a Marine F-4B and O-1 pilot with more than 832 missions in Vietnam. He holds 14 international aviation records.
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