Notice of Annual General Meeting
In spite of the very difficult market conditions for junior companies in the exploration industry over the last few years, we believe Cervantes has had a very successful year in regards to prudent acquisition of assets, and the initial exploration on those assets.
We have secured three very promising and strategically located projects, two of which are in the Meekatharra area, one of Western Australia's most prolific gold producing regions, and another in Payne's Find, effectively covering the majority of an historical goldfield discovered in 1911, containing over 37 historic mines which produced between 1oz and 5 oz's per ton in their heyday. (WAMEX records)
Cervantes carried out an initial drilling program on two of those project areas in 2018, and have additional drilling programs approved, and ready to go subject to tenders for the work programs, expected before the end of the year.
Our Albury Heath project southeast of Meekatharra has some 27,000 ozs of historically drilled resources as previously announced in our releases of the 8 Dec, 2016 and 7 Feb, 2017. Our first pass drilling carried out in March 2018 resulted in sensational 2 oz, 4 oz and 6oz per tonne drill results as follows, and released to the market on the 28 June, 2018 and 17 July, 2018:
17m @ 18.8 g/t from 77m in AHP139, incl 4m @ 52.3 g/t from 86m,
1m @ 14.1 g/t from 58m in AHP120
2m @ 7.0 g/t from 9m in AHP134, incl 1m @ 13.3 g/t from 10m
2m @ 3.2 g/t from 29m in AHP136
1m @ 15.2g/t from 46m in hole 135
8m @ 23.1 g/t from 87m in AHP135, incl 4m @ 30.1 g/t from 87m,
2m @ 67.2 g/t from 27m in AHP116, incl 1m @ 129.3 g/t from 27m
4m @ 9.1 g/t from 19m in AHP119, incl 2m @ 16.5 g/t from 19m
2m @ 18.2 g/t from 4m in AHP127, incl 1m @ 31.4 g/t from 4m
1m @ 31.4 g/t from 36m in AHP128
4m @ 5.8 g/t from 45m in AHP129, incl 1m @ 19 g/t from 45m
3m @ 9.0 g/t from 81m in AHP130, incl 1m @ 21.3 g/t from 82m
5m @ 63.1 g/t from 32m in AHP134, incl 1m @ 202.8 g/t from 33m
We are returning to the Albury Heath project area as a priority for two purposes. One, to carry out additional drilling in and around the high grade results for additional geology before moving to a resource definition programme to lift the resource to a Measured Resource, and secondly a regional drilling program in the surrounding tenements we pegged at the time of acquiring the tenement containing the Albury Heath mine. These target areas in the surrounding tenements have been identified by our Exploration Manager as being possible analogues of the Albury Heath Mine that may replicate the high grade intercepts made in our last drilling program. If successful this project has the potential to be a very early cash earner for the company, as two mills are within close proximity.
Also this year we completed a geochemical exploration program at Payne's Find (now known as the Primrose Project) using Air Core drilling methods to identify possible deep drilling targets for both gold and nickel/cobalt/copper. RAB drilling, by the previous tenement owner, indicated the prospectivity of the area for base metals and cobalt as previously released to the market on the 12th June 2018
The Payne's Find (Primrose) Project area was described by a Government appointed Geologist E de C Clark, who inspected the area on behalf of the Government and the old miners of the day in 1920 as "The gold bearing gneiss is east of the greenstone belt, and are of two lithological types 1) biotite dominant with quartz parallel to the foliation planes 2) mica subordinate to the hornblende. The geology as similar to Westonia (Edna May Mine) elsewhere in the State." (sourced: Mindat website "Paynes Find Goldfield (Goodingnow)"). The board will seek an independent report on this and will advise in due course.
Cervantes intends to drill a series of deep holes not previously carried out in the project area to test this hypothesis, and to also follow up on a Conceptual Gold Target as outlined in a map in our release of the 15th March 2018 created by CSA, that has indicated the gold from the 37 historic mines, may have a major source at depth along the Primrose Shear.
Previous drilling of the Primrose Project area also produced elevated Nickel/Cobalt and Copper that resulted in our Exploration Manager describing the surface results as analagous to the Maggie Hays/Emily May Nickel Mine.(12th June 2018 ASX release) The deep drilling program will also test this theory in the elevated nickel area to the south of the plunging Primrose Shear, as well as determining any large gold potential in that area. Previous RAB drilling also provided elevated gold results of .89g/t over 4m as also released on the 12th June 2018.
Cervantes' Abbott Project is an exploration licence over which we have completed a series of soil sample lines; we will pursue the results in the near future. The main strategic benefit of this EL is that it is only some 22km north-north-west of the Meekatharra township, and it's southern boundary immediately adjoins the northern boundary of Thundelarra Ltd's exciting Garden Gully Gold project, which they presented at the RIU Resource Roadshow in September of this year. Synergies between Thundelarra's project and Abbotts may be exploited in the future as Thundelarra have recently acquired all of the ground to the West of our tenement previously owned by Doray Minerals Ltd
We hope you will support our current capital raising to assist in funding these programs, as any positive results could attract major players to the company and or the project. We have arranged for Cervantes shareholders to have priority to apply for shares via a prospectus. A prospectus does not limit applicants to be Section 708 (sophisticated) investors, and allows smaller investors to participate in this exciting phase of the company's plans.
Gold had a meteoric rise to US$1,366 in April of 2018 and has been in a downturn since as a result of the "Trump Bump", and the rising US$. With the various disruptions to peace in the Middle East, the China versus USA trade war and the European and Global debt issues, gold is making a comeback in recent times. In A$ it is a particularly profitable commodity to produce. With gold there is never a lack of buyers and hedging or funding is considerably better than with most other commodities.
It is the Board's view that both the gold price and the market sentiment towards gold will be greatly enhanced in the near future, and will once again regain its mantle as a dominant metal of interest to not only Australian investors but Global investors.
What makes Cervantes projects more advantageous to other company's projects is their location and access to infrastructure. Sovereign Risk is negligible being in Western Australia as compared to Africa or other high risk nations.
Each project is located close to infrastructure and towns, so eliminating major CAPEX for camp and other facilities, and at this stage any need for a standalone Plant. Payne's Find is only 4.5 hours from Perth on a major highway, with a road house, accommodation, meals and earth moving contractor, and other services, including an airport adjoining the project area.
The previous owners of the Payne's Find tenements, the Taylor family who also worked underground at the old mines, live next door, and have made themselves available to provide firsthand knowledge and experience of the area.
The Meekatharra projects are within 22km of Meekatharra and, more importantly, in close proximity to two existing gold mills, the closest being only approximately 23km away. The owners of both mills are seeking mill feed and could process the ore or buy the projects outright.
We look forward to seeing you at the AGM and providing answers to any questions you may have.
About Cervantes Corporation Limited
Cervantes Corporation Limited (ASX:CVS) is an emerging gold explorer and aspiring gold miner. It has built up a portfolio of gold properties in well-known and historically producing gold districts with a strategy to apply novel exploration and development thinking. Cervantes has identified opportunities in those districts that were overlooked by previous explorers. The company is committed to maximizing shareholder value through the development of those opportunities.
Cervantes Corporation Limited