Colossus Minerals Inc. (TSX:CSI,OTCQX:COLUF) is a precious metals mining company nearing production at its 75% owned Serra Pelada mine. Serra Pelada, located in the mineral prolific Carajas region in the State of Pará, Brazil, is host to one of the highest grade gold and platinum group metals deposits in the world. Between 1980 and 1986, Serra Pelada was the site of the largest precious metals rush in Latin American history.
Managed by a skilled team of proven mine-builders with years of experience in business, geology, engineering and development, Colossus is well along the path to producing gold and platinum group metals early in the second half of 2013.
- High-grade precious metals project in Brazil—grades at Serra Pelada are among the highest on record
- 110,000 metres drilled to date with significant exploration upside on expanded land package
- Metallurgical processing expected to be straight forward with excellent recoveries
- Project is permitted – environmental, installation & mining licenses acquired in 2010
- Construction underway with first production planned early second half 2013
- Potential to be in lowest cost quartile of producers globally
Colossus Minerals’ flagship project, Serra Pelada is located in the mineral prolific Carajas region in northern Brazil in the State of Pará. The Serra Pelada Project is a joint venture between Colossus (75 percent) and Cooperativa de Mineração dos Garimpeiros de Serra Pelada (“COOMIGASP”) (25 percent). Discovered in 1979, Serra Pelada was home to the largest ever gold rush in Latin America. Artisanal miners hand-dug a pit and mined an estimated 2 million ounces of gold plus unknown quantities of platinum and palladium from Serra Pelada. Historically, the “Central Mineralized Zone” (CMZ) at Serra Pelada was mined along 350 metres strike length to depths of about 110 metres. Access and infrastructure are excellent including roads, power, water and skilled labour.
Serra Pelada Geology
Serra Pelada is a sediment hosted, fully oxidized, high-grade gold-platinum-palladium deposit. Gold-platinum-palladium mineralization at Serra Pelada overprints metasediments occupying the hinge of a large fold. Colossus has outlined multiple mineralized zones including the CMZ and the Lower Limb (formerly the GT Zone). The CMZ comprises a steeply dipping body in the fold hinge zone that extends onto the upper and lower limbs of the fold. The Lower Limb mineralization in general represents shallow dipping gold-platinum-palladium mineralization and predominantly occurs associated with an iron oxide rich breccia.
Lower Limb Zone (Fomerly GT Zone)
Drill results from work conducted on the GT Zone, as it was formerly referred to, and the lower portion of the CMZ demonstrated that the GT Zone and the CMZ are connected. The Company completed the infill drilling on sections 50NE and 100NE and found that the mineralization is contiguous between the GT Zone area through the GT-CMZ gap area and into the lower limb portion of the CMZ — confirming that the zones do connect.
The upper limb mineralization encountered in hole SPD-159 (see June 18, 2012 news release) returned values of 23.49 g/t gold, 0.06 g/t platinum and 0.22 g/t palladium over a 5.30 metre interval making it one of the best upper limb results for the 2012 drill campaign and extends the upper limb mineralization up-dip of the zone by roughly 27 metres. The drilling will continue testing the upper limb at the same time as the lower limb mineralization which is the main focus of the current campaign.
Geological Cross Section 100NE – Connecting the Zones Across the Lower Limb
Elefante Auger Drilling Program
The Elefante Area is located approximately two km southeast of the Serra Pelada deposit. Host rock in this area consists of Archean aged sedimetns belonging to the Rio Fresco Formation which aslo hosts mineralization at Serra Pelada.
Diamond drill results reported in January 2013 indicated that all four diamond drill holes returned values of gold, platinum and palladium with hole EL-12-001 returning the highest grade gold values of 12.64 g/t and 6.34 g/t while hole EL-12-002 returned the best overall platinum and palladium results with 1.27 g/t and 2.04 g/t respectively including a 1.25 metre interval that returned 0.07 g/t gold, 3.67 g/t platinum and 5.89 g/t palladium. These results confirm that mineralization encountered in the soil and auger sampling programs conducted prior to the diamond drilling program continue into bedrock. The Elefante area warrants follow-up drilling.
For a complete table of assay results, please click here.
Moving Forward to Production
Initial production at Serra Pelada is expected to begin early in the second half of 2013 at a rate of 250 tonnes per day (tpd). The Company’s ramp-up plans for reaching 1,000 tpd by the end of Q1 2014 are still on track.
The construction team is expected to turn over the process plant to the operating team by the end of July. The total project is currently 80% complete with 95% of concrete having been poured and civil construction now in its final phases. The civil contractor is now 50% demobilized with the remaining focus on completion of the gold room. Structural steel erection is 35% complete and installation of tanks and principle equipment is well underway.
Colossus plans to extract an initial bulk sample for testing from the CMZ on-site, once the process plant becomes available in August 2013.
Due to the existence of potential new mineralization, the evaluation of different mining methods and the Company’s ability to process on-site, management has decided to expand the size of the planned 1,500 tonne bulk-sample.
Colossus Minerals is nearing production at its Serra Pelada mine located in the mineral prolific Carajas region in the State of Pará, Brazil. The property, the site of the largest precious metals rush in Latin American history, is host to one of the highest grade gold and platinum group metals deposits in the world.
The management team boasts proven mine-builders with years of experience in business, geology, engineering and development. The Company has been granted environmental and mining licences and is in the process of constructing an underground mine at Serra Pelada with production slated for mid-2013.
Claudio Mancuso – Director and Chief Executive Officer
Mr. Mancuso has over 10 years experience in the mining industry and capital markets. Prior to joining Colossus, he served as Vice President, Treasurer of Agnico-Eagle Mines Limited, a position he held since January 2009. Prior to that appointment, he served Agnico-Eagle in various financial management positions. Prior to joining Agnico-Eagle in 2002, he held positions at the Ontario Securities Commission and BDO Dunwoody LLP, a public accounting firm. Mr. Mancuso was appointed to the Colossus Minerals Board of Directors, effective as of October 15, 2012. Mr. Mancuso is a graduate of the University of Waterloo and is a Chartered Accountant.
David Anthony – President and COO
Mr. Anthony is a mining engineer with more than 30 years experience in the mining industry and brings strong engineering and mineral processing expertise. In 2010 and 2011, Mr. Anthony was the Vice President & Senior Project Director, Cliffs Natural Resources Inc. and from 2001 to 2010 Mr. Anthony held senior positions at Barrick Gold in Tanzania responsible for the development of the Bulyanhulu, Buzwagi and Tulawaka mines which are three of the four world-class gold and copper operations which form African Barrick Gold (“ABG”). Mr. Anthony was appointed Chief Operating Officer of ABG in 2009. ABG was listed on the FTSE in 2010 with a market capitalization of $3.8 billion. From 2005 to 2009, Mr. Anthony was the General Manager and Project Director of the Buzwagi Mine for Pangea Minerals Limited. Mr. Anthony also worked for Kinross, as the Project Director, responsible for execution of the Fruta del Norte Project. Prior to his appointment at Colossus is currently the Senior Vice President, Mining of Forbes & Manhattan. Mr. Anthony is also Chairman of Tembo Gold Corp, a Canadian based mine development company, with interests in Tanzania. Mr. Anthony graduated from Queens University in 1979 with a Bachelor of Science in Mining Engineering (Mineral Processing).
Alden Greenhouse, CFA – Chief Financial Officer
Mr. Greenhouse has over 10 years capital markets experience. Prior to joining Colossus, Mr. Greenhouse held various senior positions within RBC Capital Markets in commodity risk management, foreign-exchange and fixed income. Prior to joining RBC, Mr. Greenhouse was a Senior Analyst at Dominion Bond Rating Service. Mr. Greenhouse is a graduate of the Michael G. DeGroote School of Business at McMaster University (B.Com), the London School of Economics, University of London (M.Sc.), and he holds the CFA designation from the CFA Institute.
Graham Long – Vice President, Exploration
Over 25 years’ experience in the mining industry, spent the majority of his career with Agnico-Eagle Mines where he held progressively changing roles from exploration geologist to Exploration Manager for Canada.
Mr. Long has a broad range of mining experience having worked in several operating mines both underground and open-pit as well as experiencing the discovery of a gold deposit and seeing it through to production.
Ann Wilkinson – Vice President, Investor Relations
Ms Wilkinson possesses over 20 years experience in the mining industry in the investor relations and other management roles. Prior to joining Colossus, Ann served as Vice President, Investor Relations of Breakwater Resources Ltd., a position she held from October 2005. Preceding that appointment she was Breakwater’s Corporate Secretary. Before joining Breakwater in 1995 she held a number of roles with several capital market firms and a couple of junior gold exploration companies. Ms Wilkinson has a B.A. (Economics) from the University of Western Ontario.
Jason Brooks, CA – Vice President, Finance
Mr. Brooks has more than 10 years of finance and accounting experience in the mining industry. He most recently served as Assistant Controller of NewGold Inc., an intermediate gold producer. Previously, he spent six years with Barrick Gold Corporation in various financial management positions. Prior to joining Barrick, he spent five years at BDO Dunwoody LLP, a public accounting firm. Mr. Brooks is a graduate of the University of Western Ontario and is a Chartered Accountant.
BOARD OF DIRECTORS
John Frostiak, P. Eng. 1,2,3 – Director and Q.P.
Claudio Mancuso 3 – Director and CEO
Greg Hall 3 – Director, Q.P.
Mel Leiderman 1,2- Director
Douglas Reeson 1,2 – Director
John S.M. Turner – Director
David Garofalo – Director
Alberto Arias – Director
1 Member of the Audit Committee
2 Member of the Corporate Governance and Compensation Committee
3 Member of the Health, Safety and Environmental Committee