SUMMARY OF EXPLORATION RESULTS

*Exploration results are summarized from a NI43-101 technical report prepared by Mr. Bob Lunceford, CPG, MSc and independent qualified person under NI43-101 (the QP). The report, titled “Geological Report And Summary Of Field Examinations, Ana Paula Project, Municipalities Of Cuetzala Del Progreso, Apaxtla Del Castregon, Guerrero State, México “ is available for viewing on this website or on the relevant company page on Sedar. The report was compiled from Goldcorp’s Mexican subsidiary, Desarrollos Mineros de San Luis S.A. de C.V. (DMSL), technical database created during the course of exploration between 2004 and 2008. This database was obtained as part of the Ana Paula acquisition agreement and was reviewed and verified by the QP during a field visit performed on March 22-23rd, 2010 and during the preparation of the technical report. This summary relates to current thinking based on the existing database and on the current state of knowledge of the GGB mineralizing environment and may vary and evolve as exploration progresses.

On consolidation of their district land position in 2004, Goldcorp conducted exploration programs between 2004 and 2008 through its 100% Mexican subsidiary, Desarrollos Mineros de San Luis S.A. de C.V. (DMSL). Among other studies, exploration programs included prospecting, regional and detailed geologic mapping (1:1000, 1:5000, 1:10000) including extensive grid sampling, road building, stream sediment sampling, trench and road cut sampling, intrusion age-dating, geophysical surveys (airborne – multispectral, magnetic; ground – pole-dipole IP3D), PIMA alteration mapping, structural interpretation, petrologic and microprobe studies, a 3,689.25 metres, 11 diamond drill hole program in 2005 and preliminary metallurgical testing.

Geological mapping has defined a host sedimentary stratigraphy of limestone overlain by lutite underlies the focus area for exploration. This is a stratigraphic boundary that is considered a favourable locus for mineral deposition throughout the GGB. The sediments are intruded by a series of Granodiorite sills emplaced along a north south trending axis of complexly folded and faulted sediments that was then intruded by a quartz monzonite stock at the intercept of a series of NE trending faults. Age dating and geochemistry completed on the granodiorite and quartz monzonite determined the intrusions vary in age from 66.0 to 66.7 (+ 0.7 to 1.8) million years and are geochemically similar to other intrusions of the GGB.

Surface geochemistry included collecting 275 regional outcrop litho-geochemical samples, 5,965 channel chips of road cuts and trenches, 690 grid geochemical samples of intrusive rocks, 511 grid geochemical samples from the Tembo Dos claim, and 109 stream sediment samples for a total of 7,550 samples collected for assay. 7,225 of those samples are located within the exploration focus area. All samples were collected using in house QA-QC protocols and assayed using ALS Chemex standard sample preparation and assay procedures. A plot of significant gold assays was found from this work to strike north-easterly over a 2 km by 1 km wide area that and remains open along strike and at depth. Significant gold values used to create the plot included all assays in excess of 200 ppb Au (equivalent to 0.2 gm/tonne gold).

Gold Distribution Map, Ana Paula Project. Over a geology base map with drill hole locations. Shows gold distribution at surface from outcrop, road cut and grid sample chip and channel samples.

Outcrop Sample Location Map. Shows the area of exploration focus for surveys completed between 2004 and 2008.

PIMA (portable infrared mineral analyzer) alteration studies on 883 intrusive and wall rock samples have determined a pattern of alteration that includes two distinct alteration events. Current thinking on the formation of observed alteration patterns is that during emplacement, the older granodiorite intrusions altered the country rocks to hornfels in the lutite units, and to marble in the limestone units. Later, the quartz monzonite altered the granodiorite and country rock generating a zoned alteration assemblage that includes moderate to selective quartz – sericite, argillic alteration, and potassic alteration assemblages among others. Alteration to smectite’s and iron oxides occur locally, as does an apparent epithermal overprint that produces banded and chalcedonic textures and which may be associated with observed arsenic and antimony mineralization.

Alteration Map, Ana Paula Project. Shows drill hole locations and gold distribution at surface from outcrop, road cut and grid sample chip and channel samples.

Geophysical surveys included a constant elevation high-resolution multispectral helicopter survey flown on an E-W grid with 100 metre line spacing. The magnetic signature determined a large anomaly underlying the area that correlates well with a subsequent ground – pole-dipole IP3D completed in a portion of the survey area. Results from these surveys, in combination with results from geological mapping and surface geochemistry were used to plan the first stage of exploratory drilling.

Geophysical Composite Map, Ana Paula Project. The base map is a reduced to the pole (RTP) magnetic signature that is overlain with the grid used for the ground pole-dipole IP3D survey and a composite image of a chargeability anomaly that is the result of that survey. The chargeability anomaly is co-incident with the magnetic high and is interpreted due to disseminated sulphides.

Drilling completed in 2005 was a first stage exploratory program designed to test the results of mapping and surface geochemistry as it related to geophysical targets. DMSL contracted a Longyear 44 drill rig, from Major Drilling S.A de C.V. of Hermosillo, Sonora to commence drill operations on the Ana Paula project using HQ diameter drill rods, reducing to NQ diameter if difficult down hole conditions were encountered. Drill operations started on the February 28, 2005, terminating on May 2nd, 2005. The drill operated on a single 12-hour shift/day with an average production of 61.5 metres of core per shift. A total of 3,689.25 metres were drilled in eleven (11) inclined drillhole’s varying from 184.25 metres to 520.25 metres in depth (Table 2). Drill collars were located using hand held GPS and Brunton compass using the NAD27 geoid. A total of 2,854 core samples were submitted for analysis.

Drill holes were focused on an area underlain by co-incident magnetic and induced polarization (IP) anomalies near the intersection of regional north south, northwest and northeast structures that occurs within an interpreted tectonic boundary. The structural intercept is the locus for emplacement for at least two phases of intrusion. DMSL located all drill holes to test the continuity of anomalous gold mineralization obtained from road cut and outcrop sample geochemistry at the intrusive-sedimentary contacts. All drill holes intercepted a frequently tightly folded thick sedimentary sequence invaded by at least two intrusive phases. Drill core axes angles, vary from high angled to parallel to core axis, indicating a high degree of deformation.

The timing and controls on epithermal mineralization within or proximal to skarn alteration zones and their genetic relationship, if any, are still being determined. The March 22-23, 2010 review of the drill core from diamond drill holes AP-05-05 and AP-06-05 indicated the dominant style of mineralization was epithermal in character. Gold mineralization in these drill holes is often associated with banded chalcedonic or very fine-grained (aphanitic) quartz typically brecciated at contact zones. Other textures suggest massive sulphide (pyrite, arsenopyrite?) as a replacement at a marble front. Other reviewed samples suggest both early replacements as calcite cemented breccia and coarse-grained calcite veins surrounding aphanitic, banded quartz on a road cut within the San Jerónimo area.

Alteration observed in core predominantly includes silicification, argillization and propylitization.  Pervasive moderate to strong silicification is most common. Argillic alteration has affected feldspar phenocrysts but is also sometimes found in the matrix associated with fine pyrite, especially in more fractured or stockwork altered zones in the intrusive units. Limited potassic and quartz- sericite alteration is found in some of the drill holes. Propylitic alteration commonly is found with fine chlorite and disseminated pyrite.

Gold mineralization occurs within veinlets, stockwork, and silicified breccias at intrusive contacts and also with disseminated sulphide away from contacts. Gold is commonly found with arsenopyrite, chalcopyrite, pyrite and lesser amounts of sphalerite, galena, stibnite and bornite. Gangue constituents include calcite, quartz, adularia, scorodite, and chlorite. Drill hole AP-05-05 was the most mineralized drill hole of the first exploratory stage program, grading 0.504 gm/tonne gold over 412.25 m from a depth of 1.05 m to 413.30 m (length of hole). Other notably mineralized drill holes included AP-01-05, AP-02-05, AP-03-05, and AP-09-05.

Drill Collar data, 2005 diamond drill program.

Summary of significant drill intercepts that assayed
greater than 1.0 g/t Au over  greater than 5.0 metre core intervals

2005 Ana Paula diamond drill results. This summary includes all values greater than 25 ppb Au over downhole intervals greater than 8.2 m. Rock types are summarized for each interval.

2005 Diamond Drill holes Location Map. Base map is a 1:1000 scale geology. See inset map for location detail.

Brecciated and banded, chalcedonic quartz from interval 43.2 – 44.75 m drill hole AP-05-05 that returned 2.0 g/t Au and 4460 ppm As.

Massive pyrite-arsenopyrite along banded and brecciated marble from AP-05-05 at 69.05 – 70.5 m within lutite. Reported values are 10.1 g/t Au and >10,000 ppm As.

Coarse grained calcite and banded chalcedony within limestone calcite-cemented breccia at San Jerónimo. Note pen for scale.

Preliminary metallurgical work in 2005-2006 was completed on composite samples collected from core from the diamond drill holes with encouraging results. A bottle roll test performed by Sol y Adobe achieved maximum gold extraction, greater than 70% while an in house preliminary floatation test resulted in a concentrate with indicated gold and silver recoveries of 77.34% and 74.45% respectively. Several composite samples were subsequently sent to SGS de Mexico, S.A. de C.V.  Four floatation tests were conducted, three of which included only primary and depleted flotation, while the fourth held a clean composite of the two concentrates: primary and depleted. At a grind size of 150 mesh the highest recoveries with flotation rates were 95.28% Au and 90.82% for Ag. To improve concentrate grades and improve arsenic suppression SGS recommended that primary floatation tests be carried out followed by cyanide concentration tests with optimization tests.

*Exploration results are summarized from a NI43-101 technical report prepared by Mr. Bob Lunceford, CPG, MSc and independent qualified person under NI43-101 (the QP). The report, titled “Geological Report And Summary Of Field Examinations, Ana Paula Project, Municipalities Of Cuetzala Del Progreso, Apaxtla Del Castregon, Guerrero State, México “ is available for viewing on this website or on the relevant company page on Sedar. The report was compiled from Goldcorp’s Mexican subsidiary, Desarrollos Mineros de San Luis S.A. de C.V. (DMSL), technical database created during the course of exploration between 2004 and 2008. This database was obtained as part of the Ana Paula acquisition agreement and was reviewed and verified by the QP during a field visit performed on March 22-23rd, 2010 and during the preparation of the technical report. This summary relates to current thinking based on the existing database and on the current state of knowledge of the GGB mineralizing environment and may vary and evolve as exploration progresses.

November 15th, 2010
Categories: Uncategorized . Author: caliche