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Date: Feb 21, 2014


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High Grade Brazilian Opportunity

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Gold Price:

$1763.48   -1.42

Simple Average

07/01/13-10/31/13 $1,325.31
01/01/13-06/14/13 $1,543.17
07/01/12-12/14/12 $1,687.83
01/01/12-06/30/12 $1,656.81
11/08/11-12/14/11 $1,721.19

Serra Pelada is situated in the mineral prolific Carajas region near the towns of Curionopolis and Parauapebas, Para State, northern Brazil, where access and infrastructure are excellent. There are no weather impediments in the area where Serra Pelada is located.


Serra Pelada Garimpo, 1983

Discovered in 1979, Serra Pelada hosted the largest ever gold rush in Latin America. During the 1980s, up to 80,000 garimpeiros (artisanal miners) produced an estimated 2 million ounces of gold plus platinum and palladium, from a 400m x 300m x 100m hand dug open pit. Garimpeiro production declined due to pit wall collapse and flooding causing the cessation of bedrock mining since the late 1980s.

Vale, which held the underlying title to Serra Pelada until 2007, explored the area from 1980 to 1998, completing more than 200 drill holes in the Serra Pelada mineralised system.

850.425/90 - Area A showing collars of Vale's historical drilling (black), Colossus' Phase I drilling (red), and Colossus' Phase II drilling (aqua)
850.425/90 - Colossus concession showing collars of Vale's historical drilling (black), Colossus' Phase I drilling (red), and Colossus' Phase II drilling (aqua)

COOMIGASP, a registered Brazilian cooperative company, was granted Exploration License 1485 (DNPM process 850.425/90) by the Ministry of Mines & Energy in February, 2007. This 100 hectare license is centered on the Serra Pelada pit.

In July 2007, COLOSSUS and COOMIGASP formed a partnership to develop the remaining bedrock mineralisation at Serra Pelada. Under the terms of this joint venture, COLOSSUS will manage and operate the project, earning a majority interest by funding exploration and paying COOMIGASP a premium for the gold reserve established by the joint venture. Details of this agreement may be found in Colossus Minerals Prospectus on www.sedar.com. COOMIGASP will separately develop the 'monteira' (tailings and waste from the Serra Pelada garimpo), with initial financial and technical assistance from COLOSSUS.

774 Hectares of additional ground contiguous to Serra Pelada
774 Hectares of additional ground contiguous to Serra Pelada

In March 2010, the Company successfully acquired 774 Hectares of additional ground contiguous to Serra Pelada. The ownership structure of the total land package remains 75% to Colossus and 25% to Coomigasp.


The mineralization at Serra Pelada is hosted by metasedimentary rocks of the Rio Fresco Group. The lithologies include metaconglomerate, metasandstone, dolomitic carbonate and metasiltstone. About five kilometres east of the deposit, mafic-ultramafic rocks of the Rio Novo Group outcrop, composed of tholeiitic and calc-alkaline lavas with intercalations of banded iron formation, metamorphosed to amphibolite facies. The Rio Novo Group forms the basement in the Serra Pelada area. The nature of the contact between the Rio Fresco Group with the underlying Rio Novo Group is uncertain because of the absence of good exposures.

The metasedimentary rocks of the Rio Fresco Group that overlie the Rio Novo Group at Serra Pelada are, from oldest to youngest, composed of quartzite at the base, carbonates, and metasiltstone at the top. These rocks have been intruded by diorite and subsequently by mafic dykes.

Locally, two intrusive phases have been recognized close to or within the Serra Pelada tenement area: (i) Archean metadiorite; and (ii) mafic dykes. The metadiorite displays evidence of metamorphism through foliation and prograde mineral associations, whereas the mafic dykes are post-metamorphism as they display preserved original randomly-orientated massive igneous textures.


The main Au-Pt-Pd mineralized zone at Serra Pelada cropped out in what is now the northern end of the open pit and was mined over about 300 metres of strike length to the southwest and to depths of around 120 metres in the pit. The Vale and Colossus drilling demonstrate that the mineralization continues at depth under the southern half of the pit, strikes more or less continuously at least 500 metres to the southwest to the boundary of 850.425/90, and is open to the southwest of this boundary. In this area mineralization has been encountered at depths of 250-350 metres below surface. The mineralization has been oxidized by supergene process to depths in excess of 300 metres below surface.

The CMZ overprints metasediments occupying the hinge and inner limbs of a northwest-facing, southwest-plunging, reclined synclinorium that plunges gently southwest from the historical open pit. Some Au-Pt-Pd mineralization to the east and west of the main zone has also been encountered in the drilling. Some of this was mined in sections of the Serra Pelada pit.

The CMZ is characterized by intense carbon and also argillic alteration, inboard of siliceous alteration mantling the synclinorial hinge. The highest grades of gold, platinum and palladium typically occur in the steeply dipping hinge at the contact between the metasiltstone and de-calcified carbonate ("sandstone"). This zone has up to 150 metres vertical extent and in places is more than 50 metres wide. Mineralization is fracture-controlled at all scales, associated with steep, post-D2 faulting that provided conduits for the mineralizing fluids. On the limbs of the syncline, mineralization and alteration form shallowly dipping, broadly stratabound zones, apparently associated with overprinting D2 fold-fault systems.

Au-PGE mineralization is spatially and temporally associated with intense hydrothermal carbon and argillic (kaolinite-mica) alteration and to a minor extent with iron oxide-rich breccias. Alteration is fracture controlled at all scales and is strongest in fault-related siltstone breccias. Carbon-rich and argillic alteration involved de-silicification but broadly synchronous siliceous alteration, mainly replacing calcareous sandstones, discontinuously mantles the CMZ.

The Au, Pt and Pd in the Serra Pelada deposit generally occur together in relatively constant proportions, suggesting that they were deposited from a single hydrothermal fluid, in which they most likely travelled as chloride complexes. The geochemistry of mineralization and alteration is consistent with acidic (pH<4), highly oxidized, metal-transporting brine being introduced along structurally controlled zones, and reacting with the intensely reducing carbon-rich environment concentrated in the synclinal fold hinge.

Construction and Development
General Site Plan
General Site Plan

Underground Development

As of September 19, 2013, the Company had completed approximately 2,200 metres of total development; 1,400 primary and 800 metres of secondary development. In August, the Company completed 85 metres of development over a 24 day period advancing on four separate faces.  The Company ceased development for a seven day period to complete the first phase of the ventilation system expansion (discussed below).  The 85 metres of development in August consisted of 37 metres in the main decline, 30 metres of secondary excavation for a permanent pumping station, three metres in the northern access and 15 metres in the ventilation access drift and other secondary development.  Over the 24 day period prior to the shutdown to complete the ventilation system expansion, the Company averaged approximately 3.5 metres per day.

 As previously announced, some dewatering wells and pumps were not performing to design specifications and, as a result, the Company required additional dewatering capacity in order to mine the Central Mineralized Zone ("CMZ") in a sustainable, effective and efficient manner. As a result, the Company is expanding its dewatering capacity.  As of September 17, 2013, six of the originally planned ten wells are pumping and total dewatering output is approximately 800 m3 per hour.  Currently, total output exceeds the recharge rate by approximately 75% and total output is expected to reach approximately 1,500 m3 per hour by December 2013.  A new 250 m3 per hour well is currently being drilled and is expected to be operational by the end of October.  To provide additional contingency, the Company has recently initiated an additional 250 m3 per hour well.  Contractors have been mobilized and the additional well will be operational by the end of December.  Since the previous development update, the Company has also decided to refurbish three of the original wells which were planned to be abandoned.  These three refurbished wells will provide an additional 100 m3 per hour of contingency capacity.  Excavation for a permanent underground pumping station was completed in August and civil work and mechanical installation will continue throughout the end of September and early October.  Once completed, the permanent pumping station will provide 800 m3 per hour of pumping capacity from underground, which is over three times the current underground inflow of 250 m3 per hour. 

As previously disclosed, the ventilation system requires expansion to provide sufficient air to support four crews and sets of equipment. The expansion work includes widening and concrete lining the artisanal shaft which will be used as a ventilation raise and development of a drift to tie the ramp to this ventilation raise at depth. The project to upgrade the ventilation system is approximately 55% complete.

The first phase of the ventilation system expansion was completed in August.  The first phase involved moving vent fans from surface to the current ramp access to the artisanal shaft, and civil works involved with installing the fans in this new location.  This first phase expansion has increased airflow underground from 10m3/s to 45m3/s by drawing air through the artisanal shaft with increased fan and reticulation capacity.  This first phase expansion allows the Company to begin ramping-up development crews and equipment to remain on track with its previously disclosed development objectives.

The Company anticipates it will begin feeding the process plant late in the fourth quarter of 2013 and continues to make progress in its mine planning activities.  Management previously laid out the month by month schedule for development for the remainder of 2013. Specifically, the Company's schedule for the advancement of development at the Serra Pelada Mine for July and August, with the actual results for the respective months, is laid out in the following table: 


Activity – Set out July 15, 2013


July 2013

Progress decline, and advance pump station and vent access.

  • Decline development – 47 metres
  • Pump station development – 12 metres
  • North access – 11 metres
  • Vent access and other secondary development – 14 metres

August 2013

Continue to progress decline, advance development of pump station, and continue to advance vent access. Install interim expansion (Phase I) of the ventilation system.

  • Decline development – 37 metres
  • Pump station development – 30 metres
  • North access – 3 metres
  • Vent access and other secondary development – 15 metres
  • Development stopped 7 days & the first phase of the ventilation system expansion completed
  • Ventilation expansion increased air flow from 10m3/s to 45m3/s and allows for ramp-up of crews and equipment to begin in September

Process Plant

The various phases of the process plant construction, along with respective percentages complete are presented in the table below.


August 13

Sept. 17

Total Project



Process Plant









Civil construction



Structural steel fabrication



Structural, mechanical, piping & electrical installation






Power house



Ventilation Upgrade Phase I



Ventilation Upgrade Phase II



Tailings impoundment facility



Rehabilitation of dewatering bore field



Expansion of dewatering capacity



Process plant construction is progressing well. Significant milestones achieved since the last development update include:

  • Inspection of buildings for the purpose of signing off handover of facilities to the Company is advanced.  Commissioning of unit operations is underway.
  • The primary crusher area's structural steel, platework and associated equipment installation is 100% complete. Electrical and instrumentation installations are approaching completion.  Commissioning of the primary crusher continued in August.
  • The reagent handling area structural steel, platework and associated equipment installation is 100% complete.  Electrical and instrumentation installations are progressing.
  • All of the structural steel and platework is 100% erected. 
  • Mechanical installations and piping in the grinding building are progressing well with this area now 90% complete.
  • Significant progress has been made in erecting the conveyor systems. Conveyor belts are installed and ready for commissioning.
  • The primary screen, scrubber and a number of tanks have been installed in the Scrubbing & Screening building.  Installation of pipe and electrical equipment has been advanced to +50%.
  • Civil construction of the gold room is complete.  Erection of tanks and other mechanical installations in the gold room area are progressing.


Other infrastructure construction is progressing as planned.  The power house is complete and commissioned. The Company is currently running two of the four generators and electrical reticulation across the project site is complete.  Connection to the grid has been achieved and commissioning of the power line was started the second week of August 2013. This facility will go live September 26, 2013.

Construction of the tailings dam was slowed due to issues of payment and contractor access.  Nonetheless, as of September 17, 2013, this component of the project is 80% complete with the clearing, diversion structures, spillway, and foundation complete.  Bulk earthworks are advanced and project completion is now scheduled for late September 2013.