Operations

Jardim do Ouro District Exploration

The Jardim do Ouro District is the area within five kilometres of the Palito Gold Mine. Within this area Serabi has nine targets which could develop into satellite ore bodies of the Palito Main Zone.

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Palito West

Palito West is a high grade mineralised structure thought to be similar to those found at the nearby Palito Main Zone mining operation, situated approximately 250 metres to the south-west of the Palito mine in close proximity to the Ruari's Ridge prospect.  The conceptual development plan for Ruari's Ridge involves the construction of a decline access which would intersect the Palito West structure and thus enable early access to ore production during the development phase of this satellite mining operation.  Further drilling is underway to establish the extent of the mineralissation, which remains open at depth and along strike to the south-east.

Chico da Santa

Situated some 300 metres north-east of the current Palito Main Zone based mine, early exploration identified three mineralised structures running parallel to the Palito Main Zone associated with old garimpeiro workings.  Preliminary interpretation of a recently completed ground electromagnetic geophysics survey (EM) has enhanced the understanding of the Chico da Santa prospect.  Significantly two (2) additional potentially mineralised structures have been defined using the survey, bringing the total to five (5).  Early drill results indicate the presence of high-grade, gold-copper veins which extend to within just 100 metres of the existing underground mining operation at Palito.

Detailed evaluation of this prospect is continuing with the objective of possibly commencing production from this satellite deposit during 2008. 

Bill’s Pipe

This prospect located approximately 500 metres north of the Palito Main Zone, has been the focus of an eleven hole, shallow reverse circulation drill programme to test a major gold geochemical anomaly and encouraging trench sample results.  So far the mineralisation has been difficult to correlate between drill holes and may be related to supergene enrichment and dispersion within the saprolite profile surrounding very high grade but narrow zones of vein hosted mineralisation.

Ruari’s Ridge

This prospect is positioned approximately 500m to the south-west of Palito in an area of strong geochemical anomalies on the flank of a geophysical magnetic high.  Preliminary drilling identified sub-parallel zones of gold and copper mineralisation extending over 600 metres strike and 200 metres down dip.  Follow-up drilling and trenching has confirmed the presence of at least three or four sub-parallel zones of gold-copper mineralisation, extending the total inferred strike extension of gold-copper mineralisation to 950 metres along strike and 300 metres vertically.

Trenching along this feature has revealed regular occurance of gossaniferous veins along the central portion of the main soil geochemistry anomaly, confirming continuity of mineralisation over 400 metres strike.  In addition, the occurence of a further gossaniferous altered outcrop returning more than 13 g/t gold some 400 metres south-east of these trenches and directly along strike, indicates a potential surface exposure of 800 metres.

Furthermore, positive drill intersections 150 metres north-west of the gossaniferous trenches, are thought to indicate a further extension of the same mineralisation, resulting in a cumulative total of at least 950 metres of inferred strike extent of the Ruari's Ridge mineralisation.

The results from diamond drilling also indicate high-grade mineralisation persists to 300 metres vertically beneath the central mineralised trench intercepts, compared with 200 metres previously.  This drilling shows that parallel zones of mineralisation  also exists in the central part of the strike, with up to three additional zones identified parallel to the main zone.

Detailed evaluation of this prospect is continuing with additional drilling and trenching, combined with an exploration drive along the main mineralised feauture in the second half of 2007.  If successful, the intention is to commence production from this satelllite deposit during 2008. 

Rio Novo South

Located 5 kilometres to the south-east of Palito and directly along the strike of the Palito Main Zone, Rio Novo South has extensive evidence of historical artisanal mining, including 29 shafts over a strike length of 300 metres.  An extensive geochemical survey conducted in 2006 identified two gold-in-soil anomalies of approximately 1.5 kilometres each.  Follow-up geochemical work and drilling will be carried out in order to investigate the nature of these anomalies.

Tatu

Tatu is located approximately 2.5 km north-east of the Palito mine site and contains extensive garimpeiro workings over an area of approximately 800 metres by 100 metres.  The mineralisation appears to be associated with a linear shaped valley, corresponding to locally dominant east-west structures.  Both shear related and stockwork mineralisation has been identified at this location.  Sampling taken from a garimpeiro stockpile at Tatu has returned values up to 193 g/t gold from rock chips and 16 g/t gold from tailings.  A detailed 16.5 time line kilometre ground magnetometer survey has been carried out, identifying a significant magnetic anomaly coincident with gold-in soil geochemistry anomalies and areas of past mining activity.  A scout drill programme is planned.

Antonio’s Gossan

Located approximately 600 metres to the north-west and along strike from the last section of the Palito Main Zone, Antonio’s Gossan is believed to be the strike extension of the Palito Main Zone.  This area has been the subject of auger sampling and subsequent trenching.  Initial sampling of the Gossan was by hand dug trench, resulting in rock chip samples of up to 17.0 g/t gold.  The trenching, down to a depth of 3 metres, has indicated the presence of three distinct veins over a total width of 15 metres.  Assays of the channel sample from these veins yielded gold values of 0.32 g/t gold and 18.0 g/t silver.

Copper Hill

Copper Hill is located approximately 800 metres west-north of the Palito mine site and marks the location of a major copper and peripheral gold soil anomaly, coincident with a large magnetic and induced polarisation (IP) anomaly (approximately 1 kilometre in diameter).  To date, limited drilling in this area intersected a strong magnetite bearing, coarse-grained granodiorite, associated with extensive disseminated sulphides (pyrite and chalcopyrite) and a number of narrow veins of quartz with sulphides.  Results to date indicate sub-economic grades, but demonstrate the existence of a large mineralised system which requires further work.

Pele

Located in the same area as Tatu, this is a strong gold geochemical anomaly correlated with a major regional structure.