serabi mining plc 
annual report and accounts 2005
serabi mining plc annual report and accounts 2005
serabi mining plc
cleary court 2123 st swithins lane
london ec4n 8ad
tel 44 020 7220 9550
fax 44 020 7220 9555
email contactserabiminingcom
web wwwserabiminingcom serabi mining plc is a gold mining and exploration
company currently focused on the tapajos geological
province of northern brazil the tapajos region is a
major underexplored mineral province from which
artisanal miners “garimpeiros” are thought to have
extracted some 30 million ounces of gold mostly from
alluvial and weathered bedrock deposits since the 
early 1970’s the company has established the first
significant hardrock mining operation in the region at
the 100 owned palito gold mine in addition serabi
has amassed a sizeable land position in the tapajos
where advanced exploration and drilling is currently
underway serabi’s goal is to become a lowcost longlife
multimine producer using the experience at palito as
the guide for further mining developments 
t he d esign p ortfolio
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Summary:
 serabi mining plc annual report and accounts 2005 4
chief executive’s statement 
let me begin by congratulating all our employees on
successfully expanding production at the palito gold
mine during 2005 we believe that the palito gold
mine forms the template for developing additional
projects for serabi in brazil a country with vast gold
mining potential
palito gold mine
overview
the palito gold mine performed well during 2005
achieving total production of 17261 ounces of gold
equivalent a total of 59387 tonnes of ore from the
palito main zone was mined during 2005 of which
54993 tonnes was development and shrinkage stope
ore from underground and 4394 tonnes from surface
material the ore head grade during the year averaged
92 gt and gold recovery averaged 894 an analysis
of the operating performance of the mine on a
quarterly basis illustrates the dramatic improvements
made at the operation throughout the year
mining
during the second quarter of 2005 serabi reported
to shareholders that the rate of mining was becoming
a bottleneck in terms of our ability to increase
production indeed the impact of this was evident
in the quarterly decrease in tonnes mined during the
third quarter as compared to the second quarter
following a detailed assessment of potential solutions
it was decided to introduce mechanised longhole
stoping as a new mining technique and to initiate
decline access to the lower sections of the palito
main zone 
table 1 palito gold mine operating summary for 2005
year ended
q1 q2 q3 q4 december 2005
mining rate
underground tonnes 9964 13589 12381 19059 54993
per day 110 150 135 207 151
open cut
1
tonnes 4394 4394
per day 48 48
total mined tonnes 9964 13589 12381 23453 59387
per day 110 150 135 255 163
milling rate
milled tonnes8222140061431521415 57958
per day 92 154 156 233 159
head grade gramstonnes 93 86 121 77 92
recovery  842 882 902 918 894
production
gold ounces 2077 3427 5005 4837 15345
copper tonnes 224 382 810 747 2162
gold equivalent ounces 2262 3747 5724 5528 17261
1
november and december only includes compressor lode oxide material and other surface ore from palito north 3
serabi mining plc annual report and accounts 2005 5
“longhole stoping will enable us to increase production
levels from the mine reduce our operating costs on a per
tonne basis and improve safety and working conditions for
our employees”
the decline will allow serabi to move away from the
generally labour intensive mining method of shrinkage
stoping in favour of the more productive longhole
stoping mining method the decline was well
advanced by year end and equipment required to
undertake longhole stoping is expected to arrive at
palito during the first quarter of 2006 we expect to
begin to see the benefits of the new mining method
in the second quarter of 2006 specifically longhole
stoping will enable us to increase production levels
from the mine reduce operating costs on a per tonne
basis and improve safety and working conditions for
our employees 
notwithstanding other shorterterm initiatives were
undertaken leading to a noticeable increase in mining
output in the fourth quarter this reflected much
improved rates of development inevitably affecting
grades in the shortterm but laying the foundations
for improved production scheduling and grades 
during 2006 
plant
the process plant performed exceptionally well during
the year with gold recovery rates showing a steady
quarterly improvement ending the year averaging
918 in the fourth quarter plant capacity also
increased throughout the year according to a three
phase improvement plan
the first debottlenecking phase was completed
relatively quickly and at minimal cost this optimisation
of the palito plant resulted in improved throughput to
just above 150 tonnes per day during the second and
third quarters accompanied by increased gold
recovery rates
the second upgrade phase was initiated later in the
year and the benefits of this phase became evident
during the fourth quarter the upgrade involved the
addition of a few key items most notably a third
ball mill which will reduce downtime and provide a
sustainable capacity of between 300 to 350 tonnes
per day
we await the outcome of a new longterm mine plan
before beginning a third and final expansion phase 
of the plant if results support further expansion 
we would expect daily palito capacity could be
increased further through modular expansion of 
the existing plant with potential to establish a regional
processing centre for satellite projects in the jardim 
do ouro district
palito main zone resource estimate
serabi employs its own drill crews and completed a
total of 18235 metres of core drilling from surface
during 2005 considerably greater than the company’s
target of 12000 metres most of this drilling was
new mechanised drilling equipment underground drillers at work serabi mining plc annual report and accounts 2005 6
chief executive’s statement continued
undertaken on and around the palito main zone in
order to assist with mine planning and expand the
quality and quantity of the resource base it is
noteworthy that the drilling programme also led to
the discovery of the compressor lode located within
25 metres of the palito main zone the compressor
lode has turned out to be a series of at least four
highgrade veins that have been incorporated into 
the mine plan for 2006 
based on this drilling and extensive underground
sampling a new jorc resource estimate for the 
palito main zone was carried out at year end by
independent consultants hellman and schofield pty 
as a result of the review total resources increased
by 74 to 825900 gold equivalent ounces compared
with the previous december 2004 estimate
the quality of the resource also improved with 
a substantial move from the inferred resource 
category to the indicated resource category indicated
resources now comprise 90 of the total resource
ounces at the palito main zone 
in addition the strike length of the resource on
the palito main zone increased from 900 metres to
1050 metres and the current maximum depth of
the resource increased by 100 metres to the 0 mrl
elevation or 200 metres below the bottom of the
existing main shaft these results provide confidence
that the palito gold mine has the potential to grow
into a longlife lowcost gold producer for serabi
the resource remains open in all directions
an important economic measure for an underground
gold mine is the number of ounces per vertical metre
it is therefore noteworthy that the new resource
estimate has added approximately 50 more gold
equivalent ounces per vertical metre on the palito
table 2 palito main zone resources
1 2
december 2005
cutoff gold grade copper contained au contained cu contained
grade gt category tonnes gt grade  ozs tonnes aueq ozs
00 indicated 3857000 527 025 653100 9560 739200
inferred 779000 320 008 81000 620 86700
total 4636000 493 022 734100 10180 825900
20 indicated 2081000 908 039 607300 8200 681200
inferred 187000 1200 016 72300 290 74900
total 2268000 932 037 679600 8490 756100
50 indicated 1089000 1441 059 504700 6400 562400
inferred 108000 1850 016 64300 170 65900
total 1197000 1479 055 569000 6570 628300
1
gold equivalent ounces are based on us550 per ounce gold and us225 per pound copper figures have been rounded
2
resource has been depleted for mining activity from commencement comprising 81053 tonnes for 21843 ounces of gold 
and 693600 pounds of copper
palito crushing circuit concentrate being loaded for shipping 3
serabi mining plc annual report and accounts 2005 7
main zone to an average of 5500 gold equivalent
ounces the potential economic impact of such an
increase is significant as more gold can be accessible
from each level of mine development 
our objective for 2006 is to continue to expand the
resource at the palito main zone along strike and at
depth we also expect to increase further the quality
of this resource as an increased rate of underground
drilling will enhance our understanding of the ore body 
2006 outlook for palito gold mine
with the shift to mechanised mining techniques
at palito serabi is forecasting an increase in gold
equivalent production for 2006 to 45000 ounces total
cash costs are targeted to reach approximately us200
per ounce by the year end based on the new resource
the geological potential and further drilling of the
palito main zone we also intend to complete a revised
longterm mine plan during the year in order to assess
the full potential of the mine and conclude upon the
optimal production rate for the operation
jardim do ouro district exploration
overview
the jardim do ouro district concessions include eight
identified targets that lie within five kilometres of the
palito gold mine serabi’s objective for the jardim do
ouro projects is to establish resource ounces and to
assess the potential to develop these resources into
satellite orebodies that could be processed at the
nearby palito plant
initial work during 2005 focused on the palito west
and bill’s pipe targets in the jardim do ouro district
palito west 
located approximately 250 metres to the southwest 
of the palito main zone palito west is interpreted as a
system of highgrade vein structures a small exploration
adit was driven into the palito west structure and
extensive channel samples were taken which yielded
encouraging results late in 2005 a preliminary drill
programme of four shallow diamond drill holes was
completed at palito west with results of 08 metres
grading 203 gt gold and 06 metres at 795 gt gold
mineralisation at palito west remains open to the south
and at depth we plan to test further the extent of
mineralisation at this prospect during 2006
bill’s pipe 
the bill’s pipe target lies approximately 1000 metres 
to the north of the palito gold mine and is the location
of a large goldinsoil geochemical anomaly a series 
of trenches were completed at bill’s pipe during the
year yielding promising results of 20 metres grading
176 gt gold 15 metres at 108 gt gold and 10 metre
at 25 gt gold the trenching programme was
table 3 jardim do ouro district exploration targets
property description
palito west high grade vein open to the south and at depth
chico do santo good drill results over 200m and soil geochemistry along strike
bill’s pipe good drill results with extensive anomalous soil geochemistry and coincident
ip anomaly
ruari’s ridge major geochemical geophysical anomaly
copper hill magnetic high anomaly with extensive sulphides and magnetite
pele and buriti strong soil geochemistry correlated with a major regional structure
tatu extensive garimpeiro workings similar to palito
rio novo south coincident strong gold geochemistry and associated magnetic anomaly
mineralisation on 200 mrl serabi mining plc annual report and accounts 2005 8
chief executive’s statement continued
followed up with a diamond drilling programme
which intersected highgrade mineralisation contained
within structures similar to those found on the palito
main zone and coincident with the goldinsoil
geochemical anomaly drill results included 05 metres
at 270 gt gold and 10 metre at 207 gt gold
further drilling on the bill’s pipe prospect is planned
for 2006
work programme for 2006
serabi’s objective for 2006 is to establish a resource 
on at least one of the jardim do ouro district projects
keeping this goal in mind drilling will continue to
follow up the encouraging results from palito west
and bill’s pipe in addition to other areas 
tapajos regional exploration
serabi has built an extensive exploration portfolio
throughout the tapajos region of brazil our
concessions total approximately 100000 hectares 
and we are only just beginning to evaluate these
prospective targets due to late delivery of new surface
drill rigs work in 2005 was limited to soil geochemistry
analysis geophysics and geology on a small number 
of projects however the groundwork laid in 2005
provides the foundation for serabi to advance these
projects during 2006 and initiate drilling
pombo gold project
in october 2005 serabi announced that it had
purchased an option to acquire 100 of the pombo
gold project coppergold mineralisation is found
within a major northeastsouthwest trending fracture
zone structure this structure has been mapped in
detail along a strike length of 39 kilometres and
mineralisation has so far been identified along
700 metres of strike length
channel sampling from old garimpeiro workings
returned six metres at 12 gt two metres at 37 gt
two metres at 22 gt two metres at 15 gt and three
metres at 15 gt geophysical analysis suggests that the
mineralisation at pombo may actually expand at depth 
the similarities between serabi’s palito gold mine and
the pombo gold project are striking both have similar
types of mineralisation namely gold associated with
pyrite and chalcopyrite 
work programme for 2006
a high priority for serabi during the first half of 2006 
is to drill on the pombo and sucuba projects in the
tapajos the company’s goal is to develop an initial
resource on at least one tapajos regional project and 
if warranted to begin work on a scoping study to
assess the possibility of bringing at least one of these
projects into production
conclusions
these are exciting times for serabi 2005 was an
important transitional year as we moved from a
private to public company and increased output at the
palito gold mine towards full commercial production
2006 is expected to be a year of continued growth for
the company as we expand production further at the
palito gold mine and advance our exploration projects
in the jardim do ouro district and the tapajos region 
bill clough
chief executive
30 march 2006
table 4 tapajos region exploration targets
property description
jutai large tonnage lowgrade gold system with mineralisation identified over 
1600 metres of strike length
castanheira located 150 kilometres southwest of palito with extensive garimpeiro workings 
but no systematic exploration to date
sao chico narrow highgrade gold vein mineralisation with extensive garimpeiro workings
sucuba similar to sao chico narrow highgrade vein system hosted within granite
pizon gold stockwork system with drill intercepts including 32 metres at 53gt
igarape salustiano located directly along strike of the palito mine
ornifel sucuba land package also located directly along strike of the palito mine
modelo significant garimpeiro workings but no modern systematic exploration to date