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BBX Holdings acquires 51% stake in promising gold project in Brazil

Last updated: 11:27 27 Oct 2011 AEDT, First published: 10:27 27 Oct 2011 AEDT

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BBX Holdings (ASX: BBX) has signed an option to acquire Mundo Minerals’ (ASX: MUN) 51% interest in the Chapada Gold project in Brazil, which shows potential for a bulk tonnage low to medium grade gold deposit amenable to open pit mining.

Chapada is easily accessible, situated within the Tocantins Tectonic Province approximately 200 kilometres south-east of Palmas in central Brazil.

The project covers numerous artisanal mine workings to depths of 110 metres below surface, concentrated along a north-east trending zone extending over a 700 metre strike length.

Gold production since 1985 has been estimated to be in the order of 300,000 ounces at an average grade in excess of 20 grams per tonne of gold.

To secure the 51% interest, BBX paid an initial option fee of A$50,000 and will pay a further $800,000, of which $450,000 is payable upon exercise of the option and $350,000 is payable by 31 July 2012.

In addition, the company can acquire up to an 80% interest in the project by funding to completion a feasibility study with a minimum JORC Resource of 350,000 ounces of gold equivalent.

BBX will review data including geological mapping, geochemical sampling, underground sampling, an electromagnetic geophysical survey and 9,974 metres of drilling, including 7,275 metres of diamond drilling, completed on Chapada.

The Chapada Gold Project is currently subject to a Joint Venture Agreement between Mundo (51%) and Rio Gameleira (49%). Rio Gameleira is a partnership between Anglo Ashanti Gold (NYSE: AU) and IAMGOLD (NYSE: IAG TSX: IMG).

BBX is also advanced in pursuing other mature mineral properties in South America.

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