Operations

Jardim do Ouro District - Near Mine Exploration

Click to enlargeSerabi’s difficulties through 2008 have highlighted the risks involved in operating from a single mine whilst covering overheads in such a remote area.  Since early 2007, it has been the intention of the company to expand operations and spread the unavoidably high costs of operating in remote locations over more production ounces. With this in mind the Company committed to a 6000 hectare airborne Geophysical Survey, essentially covering the surrounding Jardim do Ouro District, which envelopes the operation. 

The purpose of the survey was to set the company along the path of discovering a second and third mine within easy reach of the current infrastructure, allowing ore to feed a central process plant.  Detailed investigation of the results of the survey and subsequent integration with other geological data demonstrated some 18 anomalies that appear to exhibit very similar characteristics to the Palito deposit itself.  It was highly unfortunate that the results of this survey were only made available to the company in late 2008, by which time the operational problems overshadowed the success of this exploration initiative.  The Board believes that these anomalies currently represent the most attractive targets for the early identification of additional resources within the Palito district and are therefore very eager to test these at the earliest possible opportunity.

We believe testing (through a combination of drilling, further geophysics and geochemistry) and advancing these targets could be achieved with an initial budget of around US$1.4M for the first 12 months followed by a further US$2.2M over a subsequent 12 month period.  It is hoped that on completion of this exploration programme the Company would logically embark upon Geological Resource and Ore Reserve expansion through Feasibility Study and ultimately secure project financing to fund the expansion.