Rio Madeira

PROJECT

Porto Velho, located on the Madeira River, Brazil

PROJECT OVERVIEW: Rio Madeira AU PROJECT

The Madeira River valley, Rondônia, Brazil
More than 7Moz of gold mined over 20 years.

Over 62,000 hectares. Option to acquire a 70% undivided right in the Rio Madeira Gold Project

60 km west of Porto Velho, Brazil
Primary access by provincial highway 180
Modern industrial infrastructure; transportation, telecommunications, and electrical grid regionally available.
Gold mineralization in ferrocrete/duricrust and paleo-placers
Prospectivity confirmed by historic mining of the Madeira River and river valley channel deposits
Established mining industry and mining act

Regional History

Discovery

Historic Mining

Amazonian rivers wash vast amounts of sediment from the Andes Mountains in western Ecuador and Bolivia.
Early miners panned for gold along the rivers, while modern miners use large dredges, suction hoses and sluices.

Traditionally mined by ‘garimpeiros’,* by excavation both on the banks of the Madeira River in the dry season, and by dredges operating in the Madeira River year-round.
In 1985 an estimated 1400 diesel engine powered dredges operated along the Madeira River with annual production in excess of 120,000 ounces of gold. Gold production peaked in 1990 with annual estimated production of 309,000 ounces.
Estimates of the total gold production along the entire Madeira River, covering some 500km, since the 1970’s are in excess of 7 million ounces of gold.

* ‘wildcat’ artisanal miners of Brazil

ARTISINAL MINING

Rio Madeira Project: Amazonas / Rondônia, Brazil

Gold Dredges on Rio Madeira During Gold Rush in 1980s (Between Porto Velho and Guajará-Mirim, Rondonia

View of pilot house on the dredge.

Detail of cutter head at end of suction line.

Swarm of dredges working a bonanza on the river bottom.

EXPLORATION TARGET

The “Mocururu” gold-bearing duricrust can’t be mined by the artisanal dredges because it is lithified and too “hard” for them to deal with, so they just “throw it overboard.”

This duricrust, which protects the gold-bearing gravel and itself contains gold mineralization, probably formed from 10 to 6 Ma ago, in response to the onset of a dry climate period, subaerial exposure, and lateritic soil formation. (Mörner et al., 2001).

The extent of Mocururu beyond the river and throughout the Madeira river valley has been partially identified.

Determination of the full potential dispersal area is Canary Gold’s opportunity.

EXPLORATION THESIS

The regional geological setting is Precambrian basement overlain by Miocene to Pliocene Amazon Basin sediments consisting of semi-consolidated sands interlayered with silt and clay.

This Amazon Basin sequence includes a medium grained conglomerate known locally as “Mocururu” – a sandstone or conglomerate up to 5m thick.

The Mocururu is a hard ferrocrete/duricrust rock believed to have formed over thousands of years.

Previous studies concluded Mocururu mineralization was the result of the transport and deposition of gold and heavy minerals eroded during the uplift of the Bolivian Andes in a large alluvial fan complex.

Historic studies concluded Mocururu units could be regionally extensive and potentially represent a world class gold exploration target.

REGIONAL DEPOSITS

Gold gravel and conglomerate with laterite to the top (mocururu) at the exposed bottom of the Madeira River, during low-water.

The paleoplacer deposits are regionally covered by a blanket of argillaceous strata, associated with gravel deposits. The younger cover is 5 to 35m thick and was deposited from the Pleistocene to the Holocene.

Mineralization Model: Cross Section

Idealized geological cross-section depicting the hypothetical regional distribution of the gold-bearing sedimentary units that crop out to the bottom of the Madeira River. According with this hypothesis, the gold-placer deposits remain in buried channels (paleocanals) of pleistocenic age.

Alternative Interpretation(s)

Adds to potential of the whole region

Madeira River – AGA Interpretation

HISTORIC EXPLORATION

Stratigraphic Drill Program

A 2012 stratigraphic drilling program was designed to test the exploration model that the Mocururu had the potential to extend outside the immediate vicinity of the Madeira River.

Seven drill holes were undertaken at 4 separate widely spaced locations within the Project. Gold mineralization was encountered in the coarse-grained sandy stratigraphic layers occurring above and below the targeted Mocururu structure.
Buried Mocururu exposed by the Madeira River reported over 1.6 million ounces of gold production.
2012 exploration intersected Mocururu at two of the seven drill holes located in excess of 10km away from the Madeira River. Gold mineralization was reported in the Mocururu and in coarse-grained sandy stratigraphic layers occurring above and below.

Project Area Satellite Results

Canary Gold has the technical capability to identify potential Mocururu mineralization through the identification of historic river channels buried under the Mocururu ferrocrete.