Magellan Minerals Has Embarked On An Exciting Voyage Of Discovery Down In Para State, Brazil
By Alastair Ford
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Having taken service in the rival Spanish crown, Ferdinand Magellan, who was Portuguese himself, actually spent a great deal of time avoiding Portuguese territory. Thus it was that on his great circumnavigation of the world in the early 16th century he anchored some way south of Portuguese interests in Brazil. Exploring up along the coasts of Para state, which is to the north of the country, was definitely out of the question. And, as far as maritime heroes go, it’s one of Britain’s own, who catches the headlines up in Para state. Thomas Cochrane, in the service of the nascent Brazilian state, earned himself the title of Marques de Maranhao from the Brazilian emperor Pedro I, after he bluffed the Portuguese out of Maranhao, and then sent officers to do the same in Para.
These days there are one or two Brits knocking around in Para, but there are plenty of Canadians too, especially in Para’s Tapajos region, where an estimated 20 to 30 million ounces of alluvial gold has been mined by garimpieros since the 1970s. And in the spirit of exploration, if not actually in the spirit of geographical proximity, one of the most promising-looking Canadian explorers in Tapajos has named itself after the great Magellan himself.
Magellan Minerals has been on the ground in Tapajos for a few years now, following its foundation in 2004. The company has pegged 145,000 hectares of ground in the region, and chief executive Alan Carter makes no bones about the strategic position the company has taken down there. “We own about 30 per cent of the district”, he says succinctly, adding that quite simply, Magellan Minerals just followed the garimpieros in. More than a quarter of a million of them have moved to the region since the 1970s, and the gold production has been prolific.
But although Magellan has plenty of alluvial gold on its ground, and plenty of interesting looking vein structures too, the real prize, as Mr Carter sees it, is much greater. In the immediate term Magellan is focussing on its Cuiu Cuiu property, which, according to local and company estimates has yielded between one and two million ounces of gold to the garampieros already. That’s nice for the garampieros, and it’s nice for Magellan too. But what would be really nice would be for the company to establish exactly what’s causing the alluvial fields.
According to Mr Carter, the clue may lie in outcropping granite rocks on Cuiu Cuiu. Strictly speaking, the rocks aren’t outcropping as they lie on the bed of the stream that runs through Cuiu Cuiu, and which so interests the garampieros. The real prize may be underneath, where Magellan is targeting near-surface bulk mineable deposits. The company is midway through a 40 hole drill programme designed to test several gold-in-soil anomalies on Cuiu Cuiu. So far 25 holes have been drilled, and results from some are still pending. But those that are already in give grounds for encouragement. They include one result of 39 metres at 5.13 grammes per tonne, within which 1.5 metres showed 117.26 grammes per tonne. Another hole showed 18 metres at 1.17 grammes per tonne, while a third delivered 4.2 metres at 1.83 grammes per tonne.
If this isn’t enough grounds for encouragement, investors should take a look at the company from another direction – from the vantage point of the markets. Following a listing in Toronto in February, the company’s shares have traded up a few percentage points on the listing price. That’s not too bad, given the state of markets these days, and given that gold has risen and fallen over that period quite dramatically. But mining giant Newmont took eight per cent of Magellan’s shares when the company raised C$11 million on listing. Mr Carter points out that Newmont doesn’t actually have an exploration arm operating in Brazil. So Newmont adds credibility and stability to the share register, and also brings the intriguing possibility of future partnership should Cuiu Cuiu turn out to be something big. What’s more Cuiu Cuiu isn’t Magellan’s only exploration play in Tapajos, so the upside is potentially large indeed. There are also bauxite interests in the west of Para.
In the immediate term, though Magellan will concentrate on getting some resource numbers for the central zone of Cuiu Cuiu, and working up the other zones too. “I think there are multiple deposits at Cuiu Cuiu”, says Mr Carter. Such discoveries might not rival the great discoveries of Ferdinand Magellan, but shareholders won’t mind that. Discovering Magellan Minerals may turn out to have been their best find yet. |
