Canary Gold Corp. (CSE: BRAZ; OTCQB: CNYGF; Frankfurt: K5D) announced that independent laboratory Overburden Drilling Management Limited (ODM) identified visible gold grains in gravity concentrates from 29 of 30 consecutive one-metre reverse-circulation (RC) samples collected from hole RC-0032 at the Jaci Paraná target within the Madeira River Project in Rondônia, Brazil. The results, while not representing head grades or establishing grade continuity, support the company's transition from discovery to technical evaluation.
ODM reported a total of 190 visible gold grains, with 82.1% reshaped, indicating transport and alluvial reworking. The grain size distribution shows a dominance of fine gold: 87.4% of grains are 100 micrometres (µm) or less, with a median maximum length of 50 µm. However, a pronounced coarse-particle tail exists, as five grains larger than 150 µm accounted for approximately 44.1% of the calculated visible-gold mass in the concentrate. This dual nature—abundant fine gold and rare coarse particles—creates significant sampling and recovery challenges, known as the nugget effect.
Mark Tommasi, President of Canary Gold, emphasized the significance of the repeated recovery of visible gold grains rather than any single calculated value. “The results provide additional vertical information at that location and support continued evaluation, but they are not representative head grades or metallurgical recovery results and do not establish grade continuity beyond the sampled hole,” he said. The company's next phase is designed to generate representative and auditable volumetric data.
To address these challenges, Canary is planning an intermediate quantitative test program involving approximately 40 selected one-metre RC samples, each expected to weigh about 25 kilograms. The proposed work would include controlled gravity concentration, analysis of the gravity product and tails, and mass-balance, volume, and density controls. This program aims to provide a more quantitative estimate of gold recovery from complete submitted samples and to identify losses associated with current discovery-stage procedures.
Additionally, the company has received an indication of potential sonic-drill availability in September 2026 and is evaluating contracting, site access, permitting, program design, and budget requirements. Focused sonic sampling would be designed to assess representative recovered volumetric gold grades, expressed in milligrams per cubic metre (mg/m³), while preserving both fine gold and the important coarser-gold fraction. This approach is critical because the current RC drilling may lose fine gold during sample handling and gravity concentration.
The exploration program has established a broad paleochannel interpretation at the Jaci Paraná target, encompassing approximately 6,700 hectares beneath 15 to 25 metres of overburden, with prospective alluvial packages locally up to 10 to 30 metres thick. However, these dimensions remain conceptual and are not mineral resource or volume estimates. The company's 2026 program includes 45 RC holes totalling 2,851 metres, 14 PQ (dry diamond drilling) holes totalling approximately 902 metres, and 63 screw auger holes totalling approximately 1,297 metres, for a combined 5,050 metres.
Andrew Lee Smith, P.Geo., the Qualified Person for the project, has reviewed and approved the technical information. He noted that the results are geologically meaningful but semi-quantitative, as ODM's calculated visible-gold values are based partly on an assumed concentrate mass. The company stressed that reported ppb values relate to visible gold in a heavy-mineral concentrate and are not sample head grades, metallurgical recovery results, or mineral resource estimates.
The company's decision-gated pathway requires that only if representative sampling produces sufficiently encouraging and reproducible grade, recovery, continuity, density, and volume data would Canary consider a larger sonic drilling campaign, potentially exceeding 15,000 metres, to support resource delineation work. This cautious approach reflects the technical complexities of alluvial gold deposits and the need for rigorous sampling to avoid overestimating economic potential.
