Newton Interviews - Alan Carter Cabral Gold

Peter Bell’s
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Deep Dives with the Most
#InterestingExecutives
Cabral Gold
(TSXV:CBR)
Read on as Dr. Alan Carter, CEO of Cabral Gold, runs through some important
photographs from the field in Brazil. Just think, what would Jim Rogers do?
Recorded May 26, 2018 at the Metals Investor Forum.

Alan Carter
Cabral Gold
Page 1
Peter Bell: Hello Alan! I gather you were recently at a conference in Brazil called the
SIMEXMIN Mineral Explorations Conference.
Alan Carter: Hi Peter. Yes, it was in Minas Gerais in a beautiful city called Ouro Preto. It’s a
historic mining town that is the best preserved colonial city in Brazil called Ouro
Preto – black gold.
Peter Bell: Black gold. Not “Texas Tea”. Why black?
Alan Carter: Because of the platinum – the gold there is coated with platinum, which causes it
to look black.
Peter Bell: Did they figure that out? Were they able to get the metallurgy on that? Was it a
problem at all or?
Alan Carter: They must have separated it somehow. It was a very wealthy city. Beautiful
churches. I've got some photos.
Peter Bell: Not your first time there?
Alan Carter: No, definitely not my first time going there. I've been there 3 or 4 times before.
Look cobbled streets.
Peter Bell: It looks a bit like Italy. Beautiful. And Adrian MacArthur was there with you?
Alan Carter: Yes, Adrian was there and Ruari our country manager.
Peter Bell: And Sergio.
Alan Carter: He's actually country manager for Altamira, but he's a significant shareholder in
Cabral too.
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Alan Carter
Cabral Gold
Page 2
Peter Bell: What did Sergio and Ruari do?
Alan Carter: Well, that’s a great question. Sergio and Ruari, the two of them, put Palito mine
into production. That's the biggest gold mine in the whole Tapajos right now. They
built that mine.
Peter Bell: When was that?
Alan Carter: That would have been quite a long time ago, around 15 years ago.
Peter Bell: Is it still going?
Alan Carter: Yes, it is still going. I was looking at this map of the Tapajos the other day, Peter.
And there's seven gold deposits in this area with resources. How many have we
been involved in? 4 of the 7 – Coringa, Palito, Cuiú Cuiú, and Tocantinzinho. We've
been involved in 4 of the 7, all of which are discovery or production stories.
Peter Bell: Great to hear that they found Palito and put it into production. I love these
exploration teams that know how to operate a mine, it's so important.
Alan Carter: They sure do. The company they founded is called Serabi Gold, which is listed on
the London AIM. Look it up. They now own Coringa. They actually bought it from
Anfield. Serabi is called “Serabi” because it's Sergio, Rory, and Bill. SER-RAH-BEE.
Peter Bell: I didn't know that.
Alan Carter: It’s interesting that Palito has copper values, too. Very high copper values. It's not
just a gold mine, they produce copper and gold.
Peter Bell: What about the deposit type there?
Alan Carter
Cabral Gold
Page 3
Alan Carter: High-grade veins. There's speculation that there may be a porphyry system driving
the whole thing, but whether it’s a porphyry system or not there are certainly good
gold veins.
Peter Bell: And this word, porphyry – this is something of a new word in the Brazilian
geological community.
Alan Carter: It's something that most Brazilian geologists have not been familiar with because
it's not traditional porphyry terrain. The geology of northern Brazil is a lot older
rocks than the Andes or the Cordillera, so it's not traditionally a place you go
looking for porphyries. I think it's fair to say many Brazilian geologists have no
experience with porphyry type deposits.
Peter Bell: Yes, especially if they've focused in-country.
Alan Carter: It's a big deal for somebody to find a porphyry in Brazil because it’s an area where
you generally wouldn't expect it to occur. And where there's one porphyry, there’s
usually more. They are usually part of a belt.
Peter Bell: And the scale here. This Tapajos trend looks as if it’s a few hundred kilometers
here. There’s almost 50 kilometers just between Cuiú Cuiú and Tocantinzinho! And
to hear about you being involved in 4 of 7 discoveries. That’s pretty special.
Alan Carter: It's a big belt and we’ve been working there for a while now. I’m fairly sure there
will be additional discoveries made in the belt because it's largely unexplored,
Peter.
There is another thing about this belt that is very unusual. When you look at gold
belts around the world, particularly areas that produce a lot of placer gold, there
is usually one very large gold deposit discovered with 10-20 million ounces. There
Alan Carter
Cabral Gold
Page 4
is always one big one, but there hasn’t been one found like that here yet. It's a bit
unusual when you look at all the placer gold production from the 1980s. There
should be one really big gold deposit there, statistically. If you think there should
be a gold deposit here and I'm one of those ones that believes there must be a
really big deposit here somewhere, then the question is: where are you going to
find it? Well, Cuiú Cuiú was the largest area of placer gold production and I believe
it has the best chance of being the largest gold deposit in belt. I think that's borne
out by the size of the soil anomaly and everything else, too.
Peter Bell: And once the construction decision is made by Eldorado Gold for Tocantinzinho,
that's going to be the third largest gold producer in Brazil.
Alan Carter: It will be a big gold mine.
Peter Bell: And how about the NSR?
Alan Carter: We sold that to Sailfish.
Peter Bell: Is that public?
Alan Carter: Yes. The value was about $11.5 million.
Peter Bell: I had wondered what that number would be for that NSR – whether it would be
$100 million or something. I wonder how they value these things. TZ is something
like 2 million ounces, right?
Alan Carter: Yes.
Peter Bell: I can just imagine 2 million ounces at TZ with a strike length of what 3 or 5
kilometers. It was fun to go through all those reports on TZ and compare their
Alan Carter
Cabral Gold
Page 5
exploration drilling and yours at Cuiú Cuiú. The salami and the smoky textures in
the rocks – what was that about?
Alan Carter: They described some of the textures in their core as salami texture. It looks like it
a bit, I guess.
Peter Bell: Chorizo! That language didn’t come in from you guys when you were working at
TZ did it?
Alan Carter: No. I think it's a descriptor they have come up with. Not something most geologists
would recognize.
Peter Bell: And this conference with Adrian, he's a recent hire but you’ve known him for
years.
Alan Carter: Yes. We’ve hired him on a contract basis now. He's not permanent yet, but he's
doing a fantastic job for us.
Peter Bell: And how about Ruari as the country manager?
Alan Carter: Rory is a geologist, but he's also an excellent administrator. Rory looks after the
legal side of things with land administration and just making sure we've got people
sorted out.
Peter Bell: Are they based in the town of Itaituba?
Alan Carter: Adrian is based on site at Cuiu Cuiu, Ruari is based in Itaituba .
A number of soybean terminals are being built on the river in the town of Itaituba
and there are many trucks going north along this road, which is about 800
Alan Carter
Cabral Gold
Page 6
kilometers from the soybean fields to the south. Those soybeans used to go south,
but that’s changing with the new roads.
The airport at Itaituba was the busiest airport in the world during the 70's and 80's
during the gold rush. In 1981-'82, it had more takeoffs and landings than
Heathrow, Dallas, or Chicago.
Peter Bell: Wow. And this is Brazil highway 163.
Alan Carter: That highway used to be un-paved. The trucks never went north. Now that it's
paved, there are 5,000 trucks a day going along there during harvest time. 5,000
trucks a day, Peter. I've never seen anything like it.
Peter Bell: And that's happening now?
Alan Carter: Right now. We’ve driven by numerous trucks in succession. Just driving past every
one. And then the road is open for 10 minutes before you come up on another
group of them. Every pull off and every turn off has a truck or two there. It's
bizarre.
Alan Carter: Have a look at these photos of the soybean terminals. This is the Tapajos river and
you can see that they are starting to build these soy terminals.
The size of these barges is a bit hard to comprehend from the photos. That little
tug boat is pulling a bunch of these barges loaded with soy. This is big business.
This area is going through a massive boom not like anything I’ve ever seen in all
my years here.
Peter Bell: Amazing. It looks like there’s a lot of forest around now, but the development is
starting in a big way.
Alan Carter
Cabral Gold
Page 7
Alan Carter
Cabral Gold
Page 8
Alan Carter: Agriculture is a big part of the Brazilian economy. The second biggest part of the
economy is mining and mining is on it's way back now with everything that’s going
on. You can see part of the Itaituba in the photos. The Tapajós river is huge here,
about 3 kilometers across.
Alan Carter: You can see a couple photos from our office in town next. That's the main street
Cuiú Cuiú during the rainy season. This is one of the garimpeiro ladies, Anne
Marita, who gave me the sample we have at the booth here.
Peter Bell: A lady?
Alan Carter: She's one of the most successful garimpeiro in the village.
Alan Carter
Cabral Gold
Page 9
Peter Bell: Great.
Alan Carter: This is the school. We're gonna do something for these kids. We fixed the roof
already, but we will do more.
Alan Carter
Cabral Gold
Page 10
Alan Carter: This is our office again when we had a community meeting talking about what we
can do for the community.
Alan Carter
Cabral Gold
Page 11
Peter Bell: The garimpeiros?
Alan Carter: Yes, and their families. Everyone, really. You can see Ruari there, who is our
country manager. Rocks everywhere in our office.
Alan Carter
Cabral Gold
Page 12
Alan Carter: Next, I can show you one of the areas with high grade gold we’ve talked about.
There are a lot of spots like this. This is pretty typical for the Tapajos.
Alan Carter
Cabral Gold
Page 13
Alan Carter: The miners wash off the soil, which can be about 8 meters thick. They strip the soil
off and exposed the weathered bedrock, which is what we're sampling. Do you see
all these brown lines? Those are quartz veins – a mineralized zone.
Peter Bell: Doesn’t look like a bad width there!
Alan Carter
Cabral Gold
Page 14
Alan Carter: Yes, that's a good width. They're 15 meters wide!
Alan Carter: This is what the miners do to the soil cover – they point the hose at
the base of the soil cover, it collapses and forms a slurry. The slurry runs down
these channels into a pond at the bottom and is sucked up a pipe, then put through
a table where they collect the gold. It’s not very efficient, but it works.
Peter Bell: Sounds like they could be picking up some gold from the bedrock itself, the
saprolite?
Alan Carter: That stuff is generally harder. They're mostly looking at the gold in the soil.
Peter Bell: Right, placer gold.
Alan Carter
Cabral Gold
Page 15
Alan Carter: Although this isn't really a true placer deposit – it’s more of saprolite setting.
Peter Bell: You sure get lots of exposure when you come into these places where they were
working. You’ve mentioned before that the cover is too thick to trench in some
cases and I can understand that after looking at these photos.
Alan Carter: Here is a photo of these banded sediments. Do you see these lines? This is a
transported overburden sitting right on top of mineralized bed rock. There's no
soil anomaly here because the bedrock is masked by this unit. It has a cap on it.
Peter Bell: And if that cap wasn't there then the gold would come up into the soils?
Alan Carter: Yes.
Peter Bell: Interesting. Is it some kind of clay?
Alan Carter: Yes, probably. Whatever it is, it doesn’t have any gold in it. So, it can’t release any
gold as it gets weathered and the soils above it don’t get it any gold either.
Alan Carter
Cabral Gold
Page 16
Peter Bell: Is that cap a new thing that you're seeing?
Alan Carter: Yes. We weren't aware of that before. Previously, we thought there was only gold
underneath the places where we had gold in soils, but this demonstrates that
there is gold underneath other places that don’t have gold in the soils.
Alan Carter
Cabral Gold
Page 17
Peter Bell: Right. I noticed that one of those recent high-grade gold samples came from a
place that was outside the gold-in-soils anomaly. I thought that was super
important. I didn’t know what the cause was, geologically, but I figured it was very
important.
Alan Carter: It is. This is Ruari going down a shaft.
Peter Bell: Wait? A shaft!
Alan Carter: Some of the garimpeiros have put in shafts that are only about 20 meters deep.
They chase the high-grade, right?
Alan Carter
Cabral Gold
Page 18
Peter Bell: What are they doing when they get to the bottom of the shaft? Are they in the
saprolite at that point?
Alan Carter: Some of it ends up being harder than they thought. Ruari went down there and
when he came up, he was completely soaked because it was so wet down there.
There’s some of the hard rock. It's all shot-through with quartz veins.
Peter Bell: Nice. You must have had a field day! Have you done any sampling of that?
Alan Carter: Yes, we have. This sample in the picture above is from another area that is
completely shot through. I think this is Machiche. It's a wider zone, just north of
Alan Carter
Cabral Gold
Page 19
Moreira Gomes. We put one drill hole into this and got 3.3 meters at 7 grams. Look
at it! All the white stuff is alteration and the brown lines are veins coming through.
Peter Bell: Great.
Alan Carter: Here’s the main street of the village.
Alan Carter
Cabral Gold
Page 20
Peter Bell: I don’t see any cars, but I see a dirtbike!
Alan Carter: There’s an interesting area on the edge of the Central Zone, which has 600,000
ounces. We didn't drill here yet, but they were mining it. We don’t have any drill
holes under this yet.
Peter Bell: Interesting to see how they’ve built those into the soils. Those are pretty narrow
entry ways. Nice vertical extent, though.
Alan Carter: Yes, it is. It may be wider than it looks.
Peter Bell: Would you trench that at first or what?
Alan Carter: We've already sampled this.
Peter Bell: Would you want to start drilling here? The ground looks like it would be pretty soft
at surface.
Alan Carter: We're gonna have to be careful.
Peter Bell: Always!
Alan Carter: Here’s the airstrip at the village of Cuiú Cuiú. You can see the original airstrip to
the right, but then it got too crowded around there. It's too narrow and dangerous,
so they built a new one.
Peter Bell: I can’t imagine all the opportunity around here. All the soybean export will create
some opportunity and the Tocantinzinho project is getting close to a production
decision, too. This could be a great area for adventurous investors. I can’t help but
think, “What would Jim Rogers do?”
Alan Carter
Cabral Gold
Page 21
Peter Bell: How much do the placer miners follow the old stream beds?
Alan Carter: That’s a big part of it. They've gone up from the main stream into the flood plain.
Peter Bell: Is there much ground water? I guess they use that with their slurry. This is basically
hydraulic mining, right?
Alan Carter
Cabral Gold
Page 22
Alan Carter: Yes, that's right.
Peter Bell: Cool. That’s played a big role in the history of gold mining.
Alan Carter: Here's one of these soy bean terminals at Itaituba again. These things are huge.
Peter Bell: Well, I hear that it’s 40% of the entire world’s soybean production.
Alan Carter: It's just a massive business. They are bringing it in on trucks, conveying it into these
massive silos, sending it out onto these barges, and then barging it down the river
to the coast.
Peter Bell: Sounds like a massive infrastructure build-out happening now.
Alan Carter: There are about six or seven of these terminals, but there are plans to build 50-60.
Alan Carter
Cabral Gold
Page 23
Peter Bell: And at this conference in Minas Gerais again, I saw mention of at least one speech
about Tapajos gold. Somebody from the geological survey of Brazil.
Alan Carter: I didn't catch that talk, but there were several talks on the Tapajos.
Peter Bell: Time well spent at the conference?
Alan Carter: Yes, very much so.
Peter Bell: It’s every two years, I believe. Have you been to prior ones?
Alan Carter: Yes, I've been to two or three prior ones. It's basically a technical conference for
geologists involved in the mining business. It has a mining and exploration focus.
Alan Carter
Cabral Gold
Page 24
Peter Bell: Conferences with an exploration focus can be super important. It’s such a niche
part of the industry, but so important.
Alan Carter: They bring in international speakers. This year, they brought in a number of
speakers internationally: Mike Doggett, who you may know. He came in from
Vancouver to talk about copper. We had a professor from the Laurentian
University out east there who came to give a keynote address on porphyries. He
gave the keynote address on porphyries to a big room and it was packed. There
was probably 100 people just standing at the back. There was a lot of interest. I'm
optimistic. There was a lot of interest from major companies.
Peter Bell: Did you meet anybody new?
Alan Carter: Yes – its always good to make new acquaintances and touch base with old ones.
Peter Bell: You didn't have a booth there?
Alan Carter: No booth for us. It was mostly service companies that had booths.
Peter Bell: Good to hear you’re out on the floor hunting for opportunity. I'm sure your
shareholder base will be glad to hear all that. Not just boots on the ground in the
field, but presence in the cities there. All your long-term involvement in Brazil fits
with that.
And how about this resource estimate? One of the friends online said, "I think it's
gonna be a non-event." I said "okay, you can think that." I've crunched my
numbers and I think it's good.
Alan Carter: I can’t comment on that Peter.
Peter Bell: My suggestions of 5 million ounces may be overdone?
Alan Carter
Cabral Gold
Page 25
Alan Carter: Yes. We're likely not going to get anywhere close to that with this estimate, but it
will be another step along the way.
Peter Bell: A great first step for Cabral Gold itself as a new company.
Alan Carter: And it's only going to cost us about $100,000 for the updated estimate.
Peter Bell: Good to see you deliver that within a year of going public. 6 months, even.
Alan Carter: I’d like to see another resource estimate out in a year.
Peter Bell: That would be good. And with all the trenching that you’re doing.
Alan Carter: That’s right. Our trench data can be used for an estimate.
Peter Bell: Thank you very much for the conversation, Alan. Great to see what it looks like on
the ground there and everything you’re up to.
Disclaimers
This document contains statements that are forward looking statements and are subject to
various risks and uncertainties concerning the specific factors disclosed under the heading “Risk
Factors” and elsewhere in the Company’s periodic filings with Canadian securities regulators. Such
information contained herein represents management’s best judgment as of the date hereof
based on information currently available. The Company does not assume the obligation to update
any forward-looking statement.
Peter Bell has been compensated to prepare and distribute this material.

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Peter Bell’s

Recorded May 26, 2018 at the Metals Investor Forum.

Peter Bell: Black gold. Not “Texas Tea”. Why black?

Peter Bell: Not your first time there?

Peter Bell: And Sergio.

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Peter Bell: What did Sergio and Ruari do?

Peter Bell: When was that?

Peter Bell: Is it still going?

Peter Bell: I didn't know that.

Peter Bell: What about the deposit type there?

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Peter Bell: Yes, especially if they've focused in-country.

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Alan Carter: It will be a big gold mine.

Peter Bell: And how about the NSR?

Alan Carter: We sold that to Sailfish.

Peter Bell: Is that public?

Alan Carter: Yes. The value was about $11.5 million.

Alan Carter: Yes.

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Peter Bell: And how about Ruari as the country manager?

Peter Bell: Are they based in the town of Itaituba?

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Peter Bell: Wow. And this is Brazil highway 163.

Peter Bell: And that's happening now?

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Peter Bell: A lady?

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Peter Bell: Great.

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Peter Bell: The garimpeiros?

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Peter Bell: Doesn’t look like a bad width there!

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Alan Carter: Yes, that's a good width. They're 15 meters wide!

Peter Bell: Right, placer gold.

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Alan Carter: Yes.

Peter Bell: Interesting. Is it some kind of clay?

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Peter Bell: Is that cap a new thing that you're seeing?

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Alan Carter: It is. This is Ruari going down a shaft.

Peter Bell: Wait? A shaft!

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Peter Bell: Great.

Alan Carter: Here’s the main street of the village.

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Peter Bell: I don’t see any cars, but I see a dirtbike!

Alan Carter: Yes, it is. It may be wider than it looks.

Peter Bell: Would you trench that at first or what?

Alan Carter: We've already sampled this.

Alan Carter: We're gonna have to be careful.

Peter Bell: Always!

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Alan Carter: Yes, that's right.

Peter Bell: Sounds like a massive infrastructure build-out happening now.