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Crusader Resources announces BFS progress at flagship Brazilian gold asset (CAS)

This morning saw Crusader Resources (LSE:CAS) announce that it has discovered an opportunity to reduce capex costs at its flagship Borborema Gold Project in Brazil, leading shares to sit at 1.65p in afternoon trading.

As part of an ongoing bankable feasibility study (BFS), Orway Mineral Consultants (OMC) found that the 2Mtpa project’s ore is amenable to single-stage SAG milling. Although work is ongoing, Crusader said this option will reduce upfront capital expenditure compared to the previous three-stage crush/ball mill option. As expected, the firm said heap leach and flotation options have been further evaluated and have been shown not to be optimal.

The analysis is part of the metallurgical testing phase of the BFS, which uses samples originating from eight large diameter diamond drill holes that have provided approximately 6ts of sample from 1,200m of core. Crusader says finalisation of the metallurgical test work and subsequent processing plant flowsheet design is a critical path item for the completion of the BFS for Borborema.

Marcus Engelbrecht, CEO of Crusader said: ‘The metallurgical test work on the Borborema Gold Project BFS is progressing well and is delivering some key positives with regard to optimising work­streams. In particular the results from the OMC review regarding the SAG mill option, as well as the conclusions reached on grind size will have a real and positive impact on capital and operating costs and project economics.’

Borborema is located in the Serido area of north-eastern Brazil and consists of three mining leases covering a total area of 29km2 including freehold title over the central prospect area. When ValueTheMarkets spoke to Engelbrecht in May, he said that Crusader expects to have secured an installation licence that will be required to get Borborema to a decision-to-mine stage. Once Crusader has completed the BFS and got all of the relevant permits, it will focus on getting funding for a 2Mtpa capacity processing plant, expected to cost around $93.4m to build, taking between 12-18 months.

Crusader also owns an advanced exploration stage asset called Juruena, situated in the highly prospective Alta Floresta belt, with a JORC mineral resource estimate of 261koz gold over three key prospects.  Earlier this year, the business kicked off a focused, 30,000m exploration drilling programme at the site using funds from its IPO, with the hope of defining a more substantial resource and, ideally, an economic reserve.

Despite Crusader still waiting on approval for Juruena’s environmental licence, Engelbrecht hopes to have completed an exploration programme and proved an economic reserve at the site by the time Borborema reaches production. The $25m worth of exploration carried out by previous operators has already identified numerous structural trends and seven near-surface, consistently high-grade areas of gold mineralisation.

With these sorts of high-quality deposits presenting themselves all across Alta Floresta, many major mining firms have set up camp in the area surrounding Juruena. These include names like ValeandAnglo American, which recently pegged more than 2m hectares creating speculation that it has found a large copper/gold porphyry. This potential led Engelbrecht to tell us that he believes Juruena could eventually turn out to be a ‘jewel in the crown’ for Crusader.

Author: Daniel Flynn

Disclosure: The author does not own shares in the company mentioned in this article

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