Alvo Minerals Limited (ASX: ALV) has announced a significant step towards expanding its portfolio with a proposed acquisition of the Lavra Velha Gold-Copper Project in Bahia State, Brazil, from Pan American Silver Corp. The move is underpinned by a non-binding Letter of Intent, granting Alvo a 45-day exclusivity period to conduct due diligence, which is reportedly well-advanced. The Lavra Velha Project boasts a Foreign NI 43-101 Mineral Resource Estimate of 520,000 ounces of gold. Alvo intends to re-estimate the resource according to the JORC Code (2012), incorporating updated metals pricing, as the current estimate is based on a US$1,650/oz gold price.
The project is considered an Iron Oxide Copper Gold (IOCG) style deposit, exhibiting shallow, high-grade gold and silver intersections, and significant copper and silver intercepts at depth. Preliminary metallurgical testing suggests gold recoveries exceeding 90% for oxide and transitional mineralization.
To finance the acquisition and initial exploration, Alvo is launching a 1-for-2 pro rata Non-Renounceable Entitlement Offer to raise up to A$3.5 million at A$0.06 per share, with attaching options. Proceeds will be allocated to due diligence, the upfront cash payment for the acquisition (US$1 million), continued exploration across Alvo’s existing projects, new project assessment, and working capital.
Alvo’s Managing Director, Rob Smakman, expressed enthusiasm for the proposed acquisition, highlighting the ‘exceptional exploration upside’ and the project’s potential to complement Alvo’s existing Palma Cu-Zn Project. The acquisition aligns with Alvo’s strategic intent to grow through discovery in Brazil, leveraging management’s track record in the region, in a context of all-time high gold prices and an improving copper market.
The Entitlement Offer opens on 9 April 2025 and closes on 16 April 2025. Discovery Capital Partners are acting as Financial Advisor and Lead Manager.
