Advancing World Class Prospect in Prolific Gold Fields

A Description of the Geology and Mineralization of the El Colmillo Mine

The El Colmillo vein-hosted gold deposit is located in a river basin which contains La Tinta Gorge. More specifically, it resides in the sub river basin of the gorge La Blanquita, a tributary of the Nechí River. This is located in the area associated with the municipality of Cáceres, in the eastern part of the province of Antioquia, state of Colombia. The concession covers an area of 296 hectares.

Bedrock consists of metamorphic rocks of sericite and graphitic aluminous schists. Alteration includes sericitization and chloritization, as well as silicification in the form of quartz. The dominant regional structures are the North Otú and North Bagre faults, with general directions N˚1-14˚W. Locally two faults which trend north-south and dip 60ºE have been observed. These two faults are concordant with the existing mineralization. Evidence indicates that they are part of the North Bagre fault system.

At least three veins are recognized in the El Colmillo mineralized zone. These include the El Colmillo Vein, the La Muela Vein and a third un-named subparallel vein. The first two show their moderate continuity by the presence of old mine workings. Some of these old workings are collapsed. In the un-named vein the continuity is recognized by old workings for about 5 meters.

The El Colmillo Vein has a strike direction that varies from N/75ºE to N30º-N40ºE with a thickness of between 0.20 meters and 3.2 meters. It is recognized along its course by small mining tunnels for a distance of about 300 meters. Those faults associated with the mineralized veins are regional in extent, suggesting that there is a considerable potential for the mineralization to extend along those faults for an additional 1.2 kilometers within the concession area.

The mineralization in El Colmillo is vein-hosted. The veins are composed of milky white quartz, with interleaves and interfingerings of schistose host rock. There are only minor amounts of sulfides in the examined levels. Galena is found locally.

This mineralization is cut by faults. Locally there are zones of Fe oxides, carbonate and chlorite alteration. The wallrock contains disseminated sulfides (pyrite) and veinlets of short length and millimeter thickness. The thickness of this disseminated zone is unknown although it is assumed that is not greater than 0.2 meter into the wallrock on either side of the vein.

The La Muela Vein is located about 600 m to the west of the El Colmillo Vein. It has a direction NS/80E to N10˚E/80˚ with a thickness that varies between 0.1 meter and 0.5 meter, locally widening to 1.2 meters. It is composed of milky quartz with interfingerings of host rock characterized by Fe oxide and gouge in the fractures.

The un-named subparallel vein is recognized for a distance of about 5 meters, with a direction N20˚E. The vein, composed of quartz, has a thicknesses between 0.1 and 0.4 meter.

Historically, production ore grades at El Colmillo (head grades) have varied between 10 and 50 grams/ton gold, with zones of enrichment of up to 250 grams/ton gold.

If only the two main veins, El Colmilla and La Muela are considered, with both having regional continuity and assuming a grade average of 10 grams/ton gold and a down-dip continuation of mineralization for 300 meters, it is estimated that an economically quite significant amount of low extraction cost gold can be produced from El Colmillo.

Additionally, the gross amount of extractable gold could be increased significantly by the probability of the existence of additional sub parallel veins, as well as by continuity of all mineralized structures along the strike both to the north and south of the known workings. Subject to additional exploration to define the resource by additional trenching or, possibly, drilling, it is our expectation that the potential economic value of El Colmillo could well be impressive and exciting.