Jazz Resources: Near-Term Cash Flow From High-Grade Gold
Jazz Resources: Near-Term Cash Flow From Flagship High-Grade Gold Project in Brazil
Overview
Artisanal and small-scale mining (ASM) in Brazil is an important part of the country’s economy and culture. Dating as far back as the 17th century, the ASM sector provides livelihood for more than 450,000 traditional ASM miners and their communities.
A significant portion of the ASM sector in Brazil is gold mining which the ASM community relies on. With the price of gold reaching an all-time high in 2020, companies with upside gold projects in Brazil may be of particular interest to investors.
One exploration company poised to benefit from artisanal gold stock piles in Brazil is Jazz Resources (TSXV: JZR.V). In September 2021, the company announced that the assembly of a bulk sampling facility at its Vila Nova Gold project commenced. The plant is expected to create near-term cash flow from a bulk sample as early as November 2021.
Mill components delivered to Villa Nova Gold project site
The company’s flagship Vila Nova Gold project is located in the state of Amap in Brazil. In January 2021, the company closed the acquisition of the Vila Nova Gold project and acquired all of Coltan Gold Minerals’ interest in and to a joint venture royalty agreement between Eco Mining Oil & Gaz Drilling and Exploration EIRELI and Coltan Gold Minerals under a purchase and sale agreement. Jazz Resources has the option and right to acquire 50 percent net profits in the project subject to certain payments.
In June 2021, Jazz Resources reported significant gold results from sampling waste dumps and tailings at the Vila Nova Gold project. The geological report concluded that the Vila Nova Gold project contains gold estimates as high as 9 million tonnes with grades averaging 2.7 g/t. The total estimated gold content on the Vila Nova Gold project is a valuable 700,000 ounces on the 111.7-hectare area that was sampled.
Gold Particles from tailings at Vila Nova Gold Project
Jazz Resources’ flagship asset has significant upside potential based on tailings expansion and ongoing hard rock drilling. The company also owns interests in the Teddy Glacier property and the Spider mine in the province of British Columbia in Canada.
The company is also in a strong position to produce profitable gold in the future. In September 2021, the company announced that assembly of its Gravimetric plant, a bulk sampling facility, at the Vila Nova Gold project began. Capital expenditures on the mill include US$4 million with US$2.8 million already advanced. The Gravimetric plant is being assembled by Brastorno Tecnologia Em Equipamentos Para Minerao.
Jazz Resources strongly believes that it is near-term cash flow with substantial revenues expected as early as November 2021. The company expects that its Gravimetric plant will be able to mill a hefty 800 tonnes per day and with 2 million tonne tailings with one pod to start. The company is also fully permitted to bulk sample up to 600,000 tonnes per year in Brazil.
Clearing of the Vila Nova Bulk Project Mill site
The company is in a good financial position with a current market capitalization of $10 million. The company’s capital structure consists of 20.22 million shares outstanding, 3.74 million warrants at $0.35, 1.5 million options at $0.35 and 8.83 million convertible notes for a total of 34.29 million shares. More than 30 percent of Jazz Resources’ shares are held by insiders. Jazz Resources also announced the closing of its first tranche of non-brokered private placement offering of unsecured convertible debentures totaling $1,300,000 in May 2021.
Jazz Resources values transparency and adherence to local laws and has ensured that all work conducted on the Vila Nova Gold project is conducted with sensitivity to the environment and within ESG parameters.
Jazz Resources’ Company Highlights
- Jazz Resources’ Gravimetric plant at the Vila Nova Gold project is expected to create near-term cash flow from a bulk sample as early as November 2021.
- Jazz Resources’ flagship Vila Nova Gold project is located in the state of Amap in Brazil. The company also owns interests in the Teddy Glacier property and the Spider mine in the province of British Columbia in Canada.
- The Vila Nova Gold project contains gold estimates as high as 9 million tonnes with grades averaging 2.7 g/t. The total estimated gold content on the Vila Nova Gold project is a valuable 756,000 ounces on the 111.7-hectare area that was sampled.
- The company has the option and right to acquire 50 percent net profits in the Vila Nova Gold project subject to certain payments.
- Jazz Resources is led by an experienced management team including the co-founder of HealthTech Connex Inc.
Jazz Resources’ Key Projects
Vila Nova Gold Project
The Vila Nova Gold project is located in the state of Amap in Brazil. Stockpiles of 2 million tonnes are located approximately 1,100 metres from where the mineral processing plant and the tailings dam will be set up. Jazz Resources is entitled to 50 percent of the net gold revenues, while 35 percent is retained for Eco Mining Oil & Gas Drilling and Exploration EIRELI and 15 percent for local co-operatives.
This geological map shows the structures ( faults and folds) where the gold concentration lodes occur
The property features historical exploration consisting of 90 years of hand mining and 25 years of processing from semi-mechanized tailings production. As much as 70 percent of gold remained in the waste materials resulting in low historical recoveries. Assay results have identified an estimated exploration target as high as 9.5 million tonnes of gold tailings with grades between 2.4 to 3.0 grams per tonne. The projected gold content on the property is over 756,000 ounces. There is also a mineable resource equivalent that goes up to 25 tons of gold. To date, 1400 metres have been drilled by EIRELI on the Vila Nova Gold project.
The project is expected to create near-term cash flow from a bulk sample as early as November 2021. The company expects that its mill will be able to produce 800 tonnes per day with 2 million tonne tailings with one pod to start. Capital expenditures on the project are US$4 million with US$2.8 million advanced to date.
Jazz Resources’ Management Team
Robert Klenk – Chief Executive Officer and Director
Robert Klenk has been an integral part of Jazz Resources Inc. since 2015 and has been CEO since April 2017. During his tenure with Jazz Resources, he restructured the company and acquired the company’s flagship Villa Nova Gold project in Amapa, Brazil. The Villa Nova Gold project has encouraging gold results with a potential of over 700,000 ounces.
Klenk has worked on the Chicago Board Options Exchange for West Coast Energy. He was also an investment advisor for Merrill Lynch, CIBC Wood Gundy and Canaccord Genuity in Vancouver, British Columbia. His more than 20 years of experience and business acumen in the fields of finance and pipeline construction will be invaluable in realizing the tremendous potential of Jazz Resources projects. Klenk has an MBA in Finance from the University of British Columbia and a Bachelor of Science in Finance from the University of Illinois.
Kirk Fisher – Director
Kirk Fisher is the co-founder and chief executive officer of HealthTech Connex Inc. Fisher is one of the founding developers of the Health and Technology District. Fisher is also executive vice president of the Lark Group. Fisher has been the director of Jazz Resources Inc. since April 2017.
Fisher has a background in engineering (P.Eng., UBC) and business (MBA, SFU). Fisher also has extensive experience in corporate management, project planning, business operations and investment and strategic business growth. He is well-versed in medical technologies, independent living technologies and digital health technologies. Fisher works closely with many of the clinical, university, and business sector partners of HealthTech Connex. Fisher is also currently co-leading the development of the Health and Technology District adjacent to Surrey Memorial Hospital. HealthTech Connex is a key founding business of the Health and Technology District.