NI 43-101 Technical Report RIO CRISTAL RESOURCES CORP

i: COVER PAGE

NI 43-101 Technical Report RIO CRISTAL RESOURCES CORP. Bongará Zinc Project

Prepared for: Rio Cristal Resources Corp.

Prepared by: John Adrien Brophy, P. Geol.

Effective Date: January 31, 2012

January 9, 2013

ii: SIGNATURE PAGE

The effective date of this report entitled “Rio Cristal Resources Corp., Bongará Zinc Project”, is January 31, 2012

Signed by John A. Brophy, P. Geol., member in good standing of the Northwest Territories and Nunavut Association of Professional Engineers and Geoscientists (NAPEG), member number 1276.

(signed) “John A. Brophy” ______

2 iii: CERTIFICATE OF QUALIFIED PERSON

Name: John A. Brophy

Address: #226 Calle 31, Corpac, San Isidro, Lima, Peru, S.A.

Occupation: Independent consulting geologist

Qualifications:  Graduate of McGill University, Montreal, Quebec, Canada (BSc honours, geology, 1972)  Thirty-nine years of continuous exploration experience on four continents exploring for a variety of commodities including gold, copper, zinc, lead, uranium and silver. Experience includes evaluation of MVT deposits in Canada (Pine Point, Nanisivik, Polaris) and probable MVT deposits in Peru (Accha, Condorini).  Seventeen years of continuous exploration experience in Peru.

Professional Associations:  Member #1276 of NAPEG (Northwest Territories and Nunavut Association of Professional Engineers and Geoscientists) 

Qualified Person: The author is an “independent qualified person” in accordance with definitions stipulated in National Instrument 43-101

Property Inspection: The Bongará Project, which is the subject of this report, was visited by the author twice, once on January 26-27, 2011 and once on June 9-11, 2011.

Responsibility: The author is responsible for a 43-101 technical report entitled “Rio Cristal Resources Corp., Bongará Zinc Project”, with an effective date of January 31, 2012.

Independence:  The author is not an officer, director, or employee of Rio Cristal Resources or of any company that is affiliated with Rio Cristal Resources.  The author has neither received nor expects to receive shares, benefits, or any other consideration besides fair remuneration for the preparation of this report.  The author has not earned the majority of his income during the preceding three years from Rio Cristal Resources or from any company that is affiliated with Rio Cristal Resources.

Technical Information: The author certifies that, to the best of his knowledge, this technical report includes all the required scientific and technical information necessary to ensure that the report is not misleading.

Compliance: The author has read National Instrument 43-101 and confirms that this technical report has been prepared in compliance with that Instrument.

(signed) “John A. Brophy” ______John A. Brophy NAPEG member 1276 Dated: January 9, 2013

TABLE OF CONTENTS i: COVER PAGE ...... 1 ii: SIGNATURE PAGE ...... 2 iii: CERTIFICATE OF QUALIFIED PERSON ...... 3 TABLE OF CONTENTS...... 4 SECTION 1: SUMMARY ...... 8 1.1 Introduction ...... 8 1.2 RCR’s 2011 Exploration Program at Bongará ...... 8 1.3 Conclusions ...... 9 1.4 Recommendations ...... 10 1.4.1 Rio Cristal Estimated Exploration Budget - 24 Months: ...... 12 SECTION 2: INTRODUCTION ...... 13 SECTION 3: RELIANCE ON OTHER EXPERTS ...... 15 SECTION 4: PROPERTY DESCRIPTION AND LOCATION ...... 16 4-1: LOCATION ...... 16 4-2: PROPERTY AND TITLE IN PERU ...... 16 4-3: ENVIRONMENTAL REGULATIONS ...... 17 4-4: TENURE ...... 18 4-4-1: MINERAL CLAIMS ...... 18 4-4-2:AGREEMENTS ...... 20 4-4-3: ROYALTIES AND OTHER TAXES ...... 20 4-4-4: HOLDING COSTS ...... 21 4-4-5: SURVEY ...... 21 4-4-6: SURFACE RIGHTS ...... 21 4-5: ENVIRONMENTAL ...... 21 4-6: SOCIOECONOMICS ...... 22 SECTION 5: ACCESSIBILITY, CLIMATE, LOCAL INFRASTUCTURE AND PHYSIOGRAPHY ...... 23 5-1: ACCESSIBILITY ...... 23 5-2: CLIMATE ...... 23 5-3: LOCAL RESOURCES AND INFRASTRUCTURE ...... 23 5-4: PHYSIOGRAPHY, FAUNA AND FLORA ...... 24 SECTION 6: HISTORY ...... 25 SECTION 7: GEOLOGICAL SETTING AND MINERALIZATION ...... 27

7-1: REGIONAL GEOLOGY ...... 27 7-2: PROPERTY GEOLOGY ...... 28 7-2-1: LITHOLOGIES ...... 28 7-2-2: STRUCTURE ...... 30 7-2-3 ALTERATION ...... 35 7-3: PROSPECTS AND OCCURRENCES...... 37 7-4: MINERALIZATION ...... 50 7-4-1: PARAGENESIS AND ZONING ...... 50 SECTION 8: DEPOSIT TYPES ...... 52 SECTION 9: EXPLORATION ...... 54 9-1: SOIL SAMPLING ...... 54 9-2: ROCK SAMPLING ...... 58 9-3: STREAM SEDIMENT SAMPLING ...... 62 SECTION 10: DRILLING...... 65 10-1: DRILLING, CRISTAL AND CHARLITA PROJECTS ...... 65 10-2: DRILLING, SAN JOSE PROJECT ...... 69 SECTION 11: SAMPLE PREPARATION, ANALYSES AND SECURITY ...... 71 SECTION 12: DATA VERIFICATION ...... 72 SECTION 13: MINERAL PROCESSING AND METALLURGICAL TESTING ...... 73 SECTION 14: MINERAL RESOURCE ESTIMATES ...... 74 SECTION 15: MINERAL RESERVE ESTIMATES ...... 75 SECTION 16: MINING METHODS...... 76 SECTION 17: RECOVERY METHODS ...... 77 SECTION 18: PROJECT INFRASTRUCTURE ...... 78 SECTION 19: MARKET STUDIES AND CONTRACTS ...... 79 SECTION 20: ENVIROMENTAL STUDIES, PERMITTING, SOCIAL IMPACT ...... 80 SECTION 21: CAPITAL AND OPERATING COSTS ...... 81 SECTION 22: ECONOMIC ANALYSIS...... 82 SECTION 23: ADJACENT PROPERTIES ...... 83 SECTION 24: OTHER RELEVANT DATA AND INFORMATION ...... 86 SECTION 25: INTERPRETATION AND CONCLUSIONS ...... 87 SECTION 26: RECOMMENDATIONS: ...... 89 SECTION 27: REFERENCES ...... 91 APPENDICES ...... 93

APPENDIX 1: DRILL DETAILS, 2008 DRILLING CAMPAIGN ...... 93 APPENDIX 2 - DRILL DETAILS, 2011 DRILLING CAMPAIGN ...... 94 APPENDIX 3: QUALITY ASSURANCE, QUALITY CONTROL, ROCK SAMPLES ...... 96 APPENDIX 4: QUALITY ASSURANCE, QUALITY CONTROL, SOIL SAMPLES ...... 97 APPENDIX 5: QUALITY ASSURANCE, QUALITY CONTROL, DRILL CORE ...... 99 TABLES Table 4-1: Land Tenure Details and Payments for Mining Concessions 18 Table 4-3: Payment Schedule (Based on Third Amendment) 20 Table 9-1: Soil Sampling Summary and Statistics, 2008, N-389 58 Table 9-2: Soil Sampling Summary and Statistics, 2011, N-482 58 Table 9-3: Rock Sampling Summary and Statistics, 2008, N=445 61 Table 9-4: Rock Sampling Summary and Statistics, 2011, N=328 ………….... 61 Table 9-5: Sediment Sampling Summary and Statistics, 2008, N=79 …………...... 64 Table 9-6: Sediment Sampling Summary and Statistics, 2011, N=260 …..……...... 64 Table 10-1: Significant Intercepts, 2008 Drilling ...... …..……...... 66 Table 10-2: Significant (>2% Zn) Intercepts, 2011 Drilling ...... ……...... 68 Table 10-3: Basic Statistics, 2008 Drill Program, N=1,010 ...... ……...... 69 Table 10-4: Basic Statistics, 2011 Drill Program, N=1,584 ...... …..……...... 69

FIGURES

Figure 2-1: Location Map …………………...... 14 Figure 4-2: Claim Map, Bongará Property ……...... 19 Figure 7-1: Regional Geology (Wright 2010) ...... 28 Figure 7-2: Structural Geology...... ……...... 32 Figure 7-3: Geological Section – Bongará Area ...... 33 Figure 7-4: Cristal Prospects and Occurrences ……...... 37 Figure 7-5: Geological Section of the Esperanza Occurrence …...... 42 Figure 7-6: Geological Section, Nenita Occurrence ……...... 43 Figure 7-7: Geological Section, Yolanda Occurrence ……...... 44 Figure 7-11: Conceptual Model of Mineralization at the Cristal Project ……...... 51 Figure 9-1: Zinc in Soil Samples, 2008 and 2011 ……...... 55 Figure 9-2: Zinc in Soil Samples, Charlita and Cristal, 2008 and 2011 ...... 57 Figure 9-3: Zinc in Rock Samples, 2008 and 2011...... 59 Figure 9-4: Zinc in Rock Samples, Charlita and Cristal, 2008 and 2011 ...... 60 Figure 9-5: Stream Sediment Samples, 2008 and 2011 ...... 63

Figure 10-1: Drill Holes Cristal and Charlita 2008 and 2011 ...... 65 Figure 10-2: Location of Platform, San Jose Drill Holes ...... 70 Figure 23-1: Adjacent Properties ...... 83

SECTION 1: SUMMARY

1.1 Introduction

Rio Cristal Resources Corporation (the Company or RCR) retained the services of John A. Brophy to prepare a Technical Report (the Report) covering the Bongará Zinc Property (the Property) located in the Amazonas Department in northern Peru. The Report updates a Technical Report prepared by Amec (Peru) S.A. in 2009 with information from the Company’s 2011 exploration program.

The effective date of this report is January 31, 2012.

1.2 RCR’s 2011 Exploration Program at Bongará

In 2011, work done by Rio Cristal Resources Corp on their 18,413-hectare Bongará zinc property in northern Peru included multi-media sampling (328 rocks, 482 soils, 260 stream sediments) as well as the drilling of 57 HQ holes totaling 4,759 meters. This work expands the multi-media sampling (445 rocks, 389 soils, 79 stream sediments) and drilling of 40 HQ holes totaling 4,380 meters done by the Company in 2007-2008 as described in a 43-101 report by Wright (2010).

More than 80% of the soil and rock sampling done in 2008 and 2011 was confined to a ±3 square-km area encompassing the Cristal and Charlita Projects. Anomalies in rock (typically >5,000 ppm and up to 41.6% Zn) and soil (typically >1,000 ppm and up to 28.5% Zn) were used as the criteria for spotting drill holes. The Cristal Project and the Charlita Project are well defined by the 1,000 ppm zinc-in-soil contour, which encompasses 35 hectares in both zones.

With the exception of two scout holes drilled in 2011 from one platform at the San Jose Project, about 12 km southwest of Cristal, drilling was entirely confined to Cristal and Charlita, with about 75% drilled at Cristal. Both zones are underlain by dolomitized limestone of the Condorsinga Formation and are considered to be Mississippi-Valley- Type deposits. To date at the Cristal Project drilling identified significant mineralization (up to 26% Zn across 23 meters) in about half of the holes drilled. At the Charlita Project drilling also intersected zinc mineralization (2% to 6% zinc across intervals of up to 6.9 meters in 6 of 15 holes).

It is important to point out that, with the exception of four deep holes (500-720 m each) drilled mainly for stratigraphic information at Cristal-Charlita (2 holes) and San Jose (2 holes), most of the holes drilled in 2008 and 2011 are short (less than 60 meters true depth). However, there was one steep hole (-75%) at the Cristal Project that was comparatively long at 117.7 meters. This hole (CR-27-08) intersected about 25 meters with a weighted average grade of about 3% (maximum 19%) zinc between 75.2 and 100.4 meters.

This intercept suggests that there could be a vertical stacking of deposits at the Cristal Project, and possibly elsewhere on the property. This would not be unusual in a regional context inasmuch as the Florida Canyon zinc deposit of Solitario Exploration and Royalty, which is a few kilometers south of the south boundary of the property (and which is possibly one of the largest unexploited zinc deposits in the world), comprises stacked elliptoidal bodies similar in size to the three solids at the Cristal Project (Solitario, 2011). At Florida Canyon, zinc is in sulfides and is associated with a specific stratigraphic interval of dolomitized limestone of the Chambará Formation.

At the San Jose Project, two scout holes were drilled by the Company in 2011; a vertical hole that was 719.8 meters long, and an inclined hole (-70°, azimuth 020°) that was 697.25 meters long. It was hoped that these holes, which were spotted in the Aramachay Formation, would penetrate the underlying Chambará Formation deeply enough to intersect the same stratigraphic level where significant zinc mineralization is known at Florida Canyon on the adjacent property of Solitario.

Company geologists believe, based on known stratigraphic correlations, that the drill holes did not reach the target. However, extensive zinc anomalies were intersected. For example, the vertical hole intersected 95 meters with a weighted average grade of 0.17% zinc at and below the Aramachay - Chambará contact. Similar grades were found in the inclined hole, which bottomed in limestone grading 0.38% zinc; the highest assay of 254 assays taken from the two drill holes. Unfortunately the hole could not be pushed deeper due to mechanical limitations of the drill being used.

1.3 Conclusions

Mineralization on the Bongará property is of the Mississippi-Valley Type. The author suggests that mineralization is analogous to the Florida Canyon Deposit (adjacent to Rio Cristal’s Bongará Property), the San Vicente deposit in Central Peru and the Pine Point District of the Northwest Territories; although ore in these three deposits is in sulphides and not oxides. Similarities include:

1. Zn-Pb mineralization is associated with dolomitized limestones 2. Zinc content exceeds lead content 3. There are multiple separate deposits scattered over a large area 4. Mineralization appears to be open-space filling and/or manto replacement associated with karstification 5. Dimensions of individual mineralized bodies are similar.

At Pine Point, there are 100 drill-defined ore bodies scattered across an area measuring approximately 25 km by 3 km. Ore bodies are 40 to 2,000 m long, 15 to 1,000 m wide, and 0.5 to 100 m thick (Hannigan, 2007). The average grade is 10% combined Zn-Pb. As of mine closure in 1988, Pine Point produced 64.3 million tonnes of ore from about 50 open pits.

The author does not have equally detailed information for Florida Canyon, which is owned by Solitario and is being developed by Votorantim Metais. However, the “best- twelve drill intercepts” (from a Solitario news release dated January 12, 2012) range from 32.1 m grading 9.64% Zn, 1.76% Pb, and 18.8 ppm Ag (longest intercept) to 5.9 m grading 18.21% Zn, 5.89% Pb, and 40.42 ppm silver (highest-grade intercept).

The San Vicente Mine in central Peru comprises mantos of zinc-lead mineralization hosted in dolomitized limestone of the Pucará Group. Typically, a carbonate unit called the “Uncush Limestone” forms the roof above mineralized zones. Significantly, the Uncush Limestone is a black, bituminous carbonate that is considered to be equivalent to the Aramachay Formation (Davila et al, 2000). As mentioned earlier, Rio Cristal’s drilling at the San Jose Project on the Bongará Property intersected 95 meters grading 0.17% Zn at the Aramachay-Chambará contact. This strongly suggests that the geological setting for the San Vicente Mine is identical to that of the anomalous zinc concentrations at San Jose. As of June, 1999, San Vicente has produced 25 million tonnes grading 12% Zn and 1% Pb (Davila et al, 2010).

If the comparison with Pine Point, San Vicente and Florida Canyon is valid, there is considerable potential for discoveries on the Bongará property. For example, to date the Company has drilled only 97 holes totaling 9,139 meters on about 3% of the Bongará Property’s total area of 18,413 hectares. However, discoveries will be challenging to find because climate conditions, extensive overburden, and difficult topography make locating targets difficult.

Soil sampling appears to be the best technique for pinpointing specific targets, as can be seen by the coincidence of soil anomalies and rock anomalies at the Charlita Project and the Cristal Project. Stream-sediment sampling may be effective for locating broader targets.

1.4 Recommendations

The following is a suggested five-point plan to further aggressively explore the Bongará Property over the next 24 months, taking into account a three-month period of heavy rain each year when little work can be accomplished.

1. Additional and deeper drilling is recommended at the Cristal Project to test for “stacked” deposits below the near-surface mineralized zones already defined. At least 1,000 meters is suggested in 3 holes.

2. Additional drilling is recommended at the Charlita Project where low-grade zinc mineralization (2% to 6% across intervals of up to 8.9 m) has been intersected in 6 of 15 holes. Given that the Charlita soil anomaly is similar in size and grade to the Cristal soil anomaly, the presence of higher-grade zinc mineralization at Charlita cannot be discounted. With the exception of a deep hole drilled for stratigraphic

information, only 1,085.5 meters have been drilled at Charlita. An additional 3,000 meters of drilling is suggested.

3. Additional deep drilling (four 1,000-m holes) is recommended at San Jose, where one hole bottomed in limestone grading 0.38% zinc at a vertical depth of 650 meters. Drill sites should be chosen based on prior detailed soil sampling with preference given to sites that correspond to the deepest stratigraphic levels.

4. Deep drilling (at least four 1,000-m holes) is recommended at the Florida Project, where high-grade rock, soil, and stream-sediment anomalies identified in 2008 have not been followed up. The Florida Project is closer to Solitario’s “Florida Canyon” deposit than any other mineralized prospect on the Bongará property. Drill sites should be chosen based on prior detailed soil sampling with preference given to sites that correspond to the deepest stratigraphic levels.

5. Soil anomalies at the Cristal Project and the Charlita Project correspond to outcrop and drill-intersected mineralization. To date, almost 90% of the soil sampling has been concentrated in these two zones, which comprise less than 2% of the property. Additional regional soil sampling is recommended wherever dolomite has been mapped and at the sites of stream-sediment anomalies (Zona San Jose Central, Zona San Jose Sur, and Florida for example). Nominal 100-meter spacing is suggested for reconnaissance work, with follow-up sampling at a nominal spacing of 25 meters.

Table 1.5.1 details an estimated exploration budget for the three Bongará projects for the following 24 months.

1.4.1 Rio Cristal Estimated Exploration Budget - 24 Months: Item Cost Exploration Program Expenses (for 3 Projects, 24 months) Permitting (two areas) $ 80,000 Project Manager 180,000 Geologists (7) 365,000 Detailed Topographic Data (2 m contours) 50,000 Pick-up trucks (expense plus driver) 36,000 Helicopter Support (10 days/mo. 12 mos.) 120 days $7,000 840,000 Database & Quality Control 36,000 Geological Modeling & Resource Estimate 60,000 $1,647,000 Cristal Project (including Charlita) Drilling Costs, including assays 4,000 m $180/m $ 720,000 Local Labor (6 months) 40 empl. $22/day 158,000 Camp Expenses (6 months) 100,000 $ 978,000 San Jose Project Drilling Costs, including assays 4,000m $220/m $ 880,000 Local Labor (6 months) 40 empl. $22/day 158,000 Camp Expenses (6 months) 100,000 $1,138,000 Florida Project Cost Drilling Costs, including assays 4,000m $260/m $ 880,000 Local Labor (6 months) 40 empl. $22/day 158,000 Camp Expenses (6 months) 100,000 $1,138,000 Property Surface Exploration (6 months) Soil Sampling 2,000 $30 each 60,000 Local Labor (6 months) 20 empl. $22/day 79,000 $ 139,000

Contingency (10%) $ 200,000

Estimated Total $5,240,000

SECTION 2: INTRODUCTION

At the request of Thomas Findley, President and CEO of Rio Cristal Resources Corp. (Rio Cristal, the Company), the author was asked to write a 43-101 report on the Bongará Property (the Property, or, Bongará) in north-central Peru (Figure 2-1). The objective is to update two previous 43-101 reports (by AMEC Perú S.A. in 2007 and 2009) so as to include results of additional work (soil sampling, rock sampling, and drilling) done in 2011.

FIGURE 2-1 LOCATION MAP

The two previous AMEC reports are:

Cinits, R., 2007, Technical Report on the Bongará Zinc Property – Amazonas Department, Peru, In-house report prepared for Rio Cristal Zinc Corp, by AMEC (Perú) S.A., Effective date 20 September 2007.

Wright, Chris, 2010, Rio Cristal Resources Corp. - Bongará Zinc Project NI 43-101 Technical Report, Effective date November 2009.

The purpose of the author’s report is to expand the drilling section so as to include contributions to knowledge gained from the 2011 drill program. The author has also updated the report to incorporate results of soil-sampling and rock-sampling surveys completed in 2011.

The author, John Brophy, is an “independent qualified person” according to definitions established in National Instrument 43-101. The author has some experience evaluating Mississippi-Valley-Type (MVT) deposits (such as Bongará) having worked at Nanisivik, Polaris and Pine Point in northern Canada, and having visited several MVT prospects in Peru.

The author has had no involvement in the exploration programs reported herein, but has verified the information to the best of his ability, as described in Section 12 (Data Verification), during a 2-day visit to the property in January, 2011 and a 3-day visit to the property in June, 2011.

All measurements in this report are in metric units. All dollar amounts are American (US) dollars.

SECTION 3: RELIANCE ON OTHER EXPERTS

There is nothing to report in this section.

SECTION 4: PROPERTY DESCRIPTION AND LOCATION

Most of Section 4 of this report is taken verbatim from Wright, 2010, although some changes have been made to Table formats and some revisions have been made to Section 4-4-3 (Royalties) and Section 4-4-4 (Holding Costs) in order to address the current situation.

4-1: LOCATION

The Bongará Property is located approximately 740 km north of Lima and 245 km northeast of the coastal city of Chiclayo within the Eastern Cordillera of Amazonas Department in northeastern Peru. The Property straddles the boundary between Yambrasbamba District (within Bongará Province) and the Cajaruro District (within Utcubamba Province). The centre of the Property lies approximately 18 km north of the town of Florida and 15 km northwest of the village of Yambrasbamba (Figure 4-1).

The Property is at the junction of Instituto Geográfico Nacional (IGN) 1:100,000 scale topographic sheets 12-g (Bagua Grande) and 12-h (Jumbilla). The regional geology of these sheets was mapped by Sanchez (1995). The geographic UTM coordinates of the centre of the Property are approximately 826,200E and 9,375,000N (Zone 17, Datum WGS 84).

Elevations on the Property range from 1,600 m asl in the east to approximately 3,000 m asl in the west and south (near the headwaters of the Rio Cristal and Rio San Jose).

4-2: PROPERTY AND TITLE IN PERU

The General Mining Law of Peru defines and regulates different categories of mining activities, ranging from sampling and prospecting to development, exploitation, and processing (D.S.N No. 003-1994-EM, 19941). Mining concessions are granted using UTM coordinates to define areas ranging from 100 ha to 1,000 ha in size.

Mining titles are irrevocable and perpetual, as long as the titleholder maintains payment of the “Derecho Vigencia” fees up to date to the Ministry of Energy and Mines (Ministerio de Energia y Minas). A holder must pay a “vigencia” (annual maintenance fee) of US$3/ha (for metallic mineral concessions) for each Mining concession actually acquired, or for a pending application (petitorio), at the time of acquisition and then by 30 June of each subsequent year to maintain the concession.

The concession holder must sustain a minimum level of annual commercial production of greater than US$100/ha in gross sales before the end of the sixth year of the grant of the concession; or, if the concession has not been put into production within that period (by the first semester of the seventh year), the annual rental increases to US$9/ha (US$3 for vigencia plus a US$6 penalty) until the minimum production level is met. If by the start of the twelfth year the minimum production level has still not been achieved then the annual rental increases to US$23/ha thereafter (US$3 for vigencia plus a US$20 penalty).

The concession holder can be exonerated from paying the penalty if he can demonstrate that during the previous year he has “invested” an equivalent of no less than ten times the penalty for the total concession. This investment must be documented along with the copy of the “declaración jurada de impuesto a la renta” (annual tax statement) and the payment of the annual “Derecho Vigencia” fees. The concession will terminate if the annual rental is not paid for three years in total or for two consecutive years. The term of a concession is indefinite provided it is properly maintained by payment of rental fees.

The holder of a mining concession is entitled to all the protection available to all holders of private property rights under the Peruvian Constitution, the Civil Code, and other applicable laws. A Peruvian mining concession is a property-related right, distinct and independent from the ownership of land on which it is located, even when both belong to the same person. The rights granted by a mining concession are defensible against third parties, are transferable and chargeable, and, in general, may be the subject of any transaction or contract.

To be enforceable, any and all transactions and contracts pertaining to a mining concession must be entered into a public deed and registered with the Public Mining Registry (Registro Publico de Mineria). Conversely, the holder of a mining concession must develop and operate the concession in a progressive manner, in compliance with applicable safety and environmental regulations and with all necessary steps to avoid third-party damages. The concession holder must permit access to those mining authorities responsible for assessing that the concession holder is meeting all obligations.

4-3: ENVIRONMENTAL REGULATIONS

The General Mining Law of Peru is the primary body of law with regard to environmental regulation of exploration and mining activities. The General Mining Law is administered by the Ministry of Energy and Mines (MEM). A detailed description of Peru’s environmental regulations is found on the MEM website (http://www.minem.gob.pe).

Environmental regulations for mineral exploration programs (369821 R.S. Nº 018-2008- EM as modified) are divided into classes I and II. Class I permits allow drilling from 20 or less drill platforms which disturb 10 or less hectares. Three basic permits are required and a closure plan (Informe de Cierre) must be filed when an exploration program ends, either temporarily or permanently. The three permits are an environmental impact declaration (DIA), an archeological ruins report (CIRA) and a water use permit (ALA). The permits are filed with the MEM and, when there are no comments or objections, the permits are approved. Approval is automatic if the MEM does not respond with comments in 45 days.

A Class II permit is for more than 20 drills which disturb and area great than 10 hectares. The major difference in permitting is that a much more detailed environmental impact permit is required, along with a water and an archeological permit. A closure plan is also required when the exploration program ends.

4-4: TENURE

4-4-1: MINERAL CLAIMS

As shown on Figure 4-1 and Table 4-2 below, the Property covers a total of 18,413.06 ha and consists of 26 contiguous mining concessions. All claims are held in the name of Compañia Minera Pilar del Amazonas S.A. (Amazonas).

An option to purchase the mineral rights to all claims on the Bongará Property is held 100% by Rio Cristal through an agreement with Amazonas.

Registration Area Application Date Payment Penalty Name Code (ha) Date Granted US$ U US$ Mina 1 10331903 600.00 15/10/2003 10/03/2004 1,800.00 3,600.00 Mina 2 10337504 600.00 18/10/2004 02/08/2005 1,800.00 Bongará 20A 10752495A 100.00 23/05/1995 30/11/1995 300.00 2,000.00 Mina 3 10337404 600.00 18/10/2004 02/08/2005 1,800.00 San Jose 1 10337104 300.00 18/10/2004 02/10/2005 900.00 San Jose 2 10337204 700.00 18/10/2004 02/04/2005 2,100.00 Bongará 16 10752095 1,000.00 23/05/1995 27/12/1995 3,000.00 Nuevo Bongará 1 10279697 982.95 08/01/1997 29/12/1998 2,948.86 Bongará 58 10255096 390.33 29/08/1996 30/06/1998 1,170.98 Bongará 52 10102496 12.04 04/02/1996 29/12/1998 36.12 240.80 Bongará 53 10104896 730.10 04/10/1996 31/12/1998 2,190.29 Mina 4 10337304 300.00 18/10/2004 02/08/2005 900.00 San Josecito 10337004 1,000.00 18/10/2004 02/07/2005 3,000.00 Bongará 23 10783195 671.93 26/06/1995 25/11/1998 2,015.79 13,438.60 Bongará 22 10783095 1,000.00 26/06/1995 29/12/1995 3,000.00 Charlita 1 10112505 1,000.00 05/11/2005 27/09/2005 3,000.00 Bongará 60A 10257996A 700.00 09/04/1996 30/10/1998 2,100.00 14,000.00 Bongará 57 10249096 1000.00 23/08/1996 30/10/1996 3,000.00 Tia Violeta 10239107 998.96 19/04/2007 27/11/2007 2,996.88 Carolina 1 10239507 426.75 19/04/2007 30/10/2007 1,280.27 Charlita 3 10112805 1,000.00 05/11/2005 27/09/2005 3,000.00 Charlita 2 10112705 1,000.00 05/11/2005 09/06/2005 3,000.00 Charlita 4 10238907 800.00 19/04/2007 27/09/2007 2,400.00 Charlita 5 10238807 1,000.00 19/04/2007 09/12/2007 3,000.00 Violeta 1 10239007 1,000.00 19/04/2007 27/09/2007 3,000.00 Carolina 2 10239607 500.00 19/04/2007 25/09/2007 1,500.00 TOTAL: 18,413.06 Hectares $55,239.19 $33,279.40

TABLE 4-1: LAND TENURE DETAILS AND PAYMENTS FOR MINING CONCESSIONS

FIGURE 4-2: CLAIM MAP, BONGARÁ PROPERTY

4-4-2:AGREEMENTS

On December 4, 2008 Rio Cristal negotiated changes to a Mining Concession Transfer Agreement with Compañia Minera Pilar del Amazonas S.A. (Amazonas). The original agreement, signed on 16 April 2007, allowed Cerro La Mina, a wholly-owned subsidiary of Rio Cristal, to acquire 100% of the 26 mining concessions listed in Table 4-2 by making scheduled payments totalling US$6,040,000 over 11 years (Table 4-3).

The payment timetable was adjusted in an amendment to the Transfer Agreement in 2009 to allow payments due in the years 2009, 2010, 2011, 2012 and 2013 to be paid partially or completely in shares of the Company.

Payment Date Amount US$ Registration $40,000 15-Mar-08 100,000 01-Jun-09 25,000 (payable partially or all in shares) 15-Mar-10 50,000 (payable partially or all in shares) 15-Mar-11 125,000 (payable partially or all in shares) 15-Mar-12 300,000 (payable partially or all in shares) 15-Mar-13 500,000 (payable partially or all in shares) 15-Mar-14 600,000 15-Mar-15 600,000 15-Apr-16 600,000 15-Mar-17 600,000 15-Mar-18 2,500,000 Total $6,040,000

TABLE 4-3: PAYMENT SCHEDULE (Based on Third Amendment)

The agreement also contains a clause relating to a 5 km area of interest around the acquired concessions, whereby new concessions acquired by Rio Cristal are automatically incorporated into the agreement. As part of the agreement, Rio Cristal assumed payment of all concession fees on the properties from 30 June 2007, and any applicable penalties that may have been accrued on the concessions in years prior to the agreement.

4-4-3: ROYALTIES AND OTHER TAXES

There are no royalties or taxes on exploration activities in Peru except for concession fees described in Section 4-4-4.

If the Bongará Property begins production, income will be subject to income tax of 30%, a sliding scale royalty of 1% to 3% and a sliding scale mining tax of 2% to 8% based on income.

4-4-4: HOLDING COSTS

Annual concession fees and applicable penalties are paid annually to the Peruvian government and are described in Section 4-2. The author has verified that the claims are in good standing until June 30, 2012, when $55,238.74 in concession fees and an additional $33,279.26 in penalties are payable.

4-4-5: SURVEY

The mineral claims comprising the Property have not been surveyed or physically marked in the field as this is not a requirement of Peru’s mining code. Claim boundaries are defined by coordinates with the datum of UTM PSAD 56.

4-4-6: SURFACE RIGHTS

Rio Cristal has a legal agreement with the Communidad Campesina de Yambrasbamba allowing exploration on 15,550 hectares of community-owned lands comprising most of the Bongará property. The agreement was authorized by a favorable vote in the General Assembly on August 5, 2007 and registered Oct 23, 2007 in Moyobamba, Region of San Martin, Peru and prepared by Estudio Rodrigo, Elias, & Medrano (Ferrero Merino, 2007). The term of the agreement is seven years and includes an annual payment of $16,000 to the Community.

There are 2,145 hectares on the property that are within the jurisdiction of the Communidad Campesina de Shipasbamba. This area includes the highly prospective Florida Project, where the Company did surface sampling in 2008. Rio Cristal does not have an agreement with the community of Shipasbamba, but is currently in the process of negotiating one.

There are 718 hectares on the property that are within the jurisdiction of the Communidad Campesina de Pomacochas. The Company does not believe that the area warrants exploration at this time and there is no exploration agreement with the community.

4-5: ENVIRONMENTAL

Exploration programs to date have been conducted under appropriate authorization, license, or equivalent control document, which were obtained from the appropriate regulatory authority.

For its 2008 exploration program, the Company filed the required DIA, ALA and CIRA permit applications which were approved. SGS del Peru SAC (SGS) was hired to conduct a DIA study and an independent consultant prepared the CIRA. Soil and water samples for the DIA were collected and assayed by Inspectorate Services Peru S.A.C. The Company prepared and submitted the ALA.

In 2010, a closure report was prepared by the Company after all drill platforms, trenches and trails at Cristal and Charlita were reclaimed as required by the 2008 drilling permit.

In 2011, the Company hired Geades S.A. to prepare a new DIA study in support of an application for a Class I permit for the 2011 drilling campaign at Cristal and Charlita, and

21 another DIA study in support of an application for a Class I permit for drilling at the San Jose Project. The CIRA application was prepared by ALEPH Asociados. The Company prepared and submitted the ALA.

At Cristal and Charlita, all drill platforms, trails and trenches constructed in 2011 have been rehabilitated and a closure report is currently being prepared. At the San Jose Project, the current drill permit will remain in effect for the 2012 drilling campaign because only 1 of the 20 allowable drill platforms was utilized.

4-6: SOCIOECONOMICS

With the exception of a few clusters of small homes inhabited by local farmers there are no towns or other populated areas within the boundaries of the Property. In November 2008, Rio Cristal reached an agreement with the local community of Yambrasbamba for a plan for long-term sustainable development in the district.

The Company maintains an office in Yambrasbamba and employs two full-time community relations workers, as well as consultants from time to time. In 2011, the principal benefits that the community received from the Company was employment for 160 workers on a rotating basis, purchases of local goods and services, voluntary donations for 17 specific community projects, and a payment (contrato de usofructo) to the community of $16,000.

SECTION 5: ACCESSIBILITY, CLIMATE, LOCAL INFRASTUCTURE AND PHYSIOGRAPHY

Most of section 5 is taken verbatim from Wright (2010) and only three changes were made in the text. In Section 5-1, accessibility now includes information about accessing both the Cristal and San Jose Projects. In Section 5-3 (Local Resources and Infrastructure), the author has added that harvesting of cedar lumber is an economic activity in the property and that the Company has constructed a permanent camp at the San Jose Project.

5-1: ACCESSIBILITY

There are two primary routes from Lima to Yambrasbamba, one by road and one by a combination of air and road. The road route is Lima to Chiclayo to Yambrasbamba and takes approximately 20 hours. The air/road route is Lima to Tarapoto by air and then to Yambrasbamba via road. It takes approximately 6.5 hours. From Yambrasbamba to the Cristal Project or to the San Jose Project takes approximately 4.5 hours traveling mostly by horseback.

5-2: CLIMATE

The climate in the region is regarded as typical of a humid tropical upland, and has both a dry and rainy season. Generally the winter months (or the ‘dry season’) are April to November and have low amounts of precipitation, while the summer months (or the ‘wet season’) are December to March and have consistent tropical rains. The annual average rainfall generally exceeds 1,000 mm, with up to 1,800 mm at higher elevations (Anglo Peruana, 2005).

The annual temperature at elevations between 1,000 masl and 2,000 masl averages around 23°C to 25°C.

Although exploration can continue year-round in this part of Peru, it is common to avoid conducting field programs during the rainy season as the rains can hamper access and productivity.

5-3: LOCAL RESOURCES AND INFRASTRUCTURE

The local economy is very poor, and most of the local work force is untrained. Farming and harvesting of timber are the main means of subsistence for communities surrounding the Property, such as Pedro Ruiz, Florida, Buenos Aires, Esperanza, and Yambrasbamba, where the main crops are coffee, cocoa, rocoto, yucca, fruit and vegetables. No significant agricultural activity is carried out on the Property although people from the local communities use some of the slopes for crops or grazing their livestock, and cedar trees are also harvested.

The Bongará Property contains very little developed infrastructure. Although the condition of the access road between Yambrasbamba and the main highway is reasonable, short blockages may occur during the rainy season.

A permanent camp exists at the Cristal Prospect and consists of wooden buildings that were constructed by Solitario in 1996 during their exploration on the Property. Significant improvements were made to the camp during the 2008 field program, including the addition of waste-treatment facilities. The Company has also constructed a permanent camp at San Jose to house workers and store material. Both camps have telephone and internet connectivity.

There are several watercourses with year-round flow on the Property, which would be sufficient to support a mining operation. However, the appropriate hydrogeological and environmental studies would be required to determine their suitability for process and potable needs.

Although the towns along the access highway, including Yambrasbamba have electrical service, this would only be sufficient to support local usage. The Olmos Hydroelectric Project located 250 km west of the Property in the Lambayeque Region of Peru is almost complete. When operational, the project will supply 100 MW of power through the Bagua/Jaen power stations. This will eventually be upgraded to 650 MW. On completion, a high tension power line will parallel the highway and pass within 12 km of the Property.

The towns of Chachapoyas, Tarapoto and Chiclayo are the closest major centers and can provide all goods, services and accommodations for early stages of project development. More advanced projects would generally have to be serviced from Lima. Local towns, such as Pedro Ruiz, Pomacochas, Shipasbamba and Yambrasbamba may provide limited resources such as horses for transportation, fuel, lumber for camp construction, and fresh vegetable for the exploration camp kitchen.

The closest deep water port facility is at Salaverry, which is located approximately just south of the city of Trujillo and is 670 km by road to the southwest of the Property. Alternatively, the port of Eten is located southwest of the city of Chiclayo, approximately 465 km from the Property. A third port exists at Paita, which is about 150 km north of Chiclayo and roughly 550 km by road from the Property.

5-4: PHYSIOGRAPHY, FAUNA AND FLORA

The Bongará Property is located in the mountainous terrain along the eastern flanks of the Andean Cordillera. In general, the topography of the Property is mountainous and is characterized by a combination of steep and abrupt scarp slopes over limestone dominated geology and by more gently rolling terrain over pre-Mesozoic strata. In the limestone units, and particularly the Chambará Formation exposed in the west part of the Property, the rivers have carved steep-sided gorges and ravines, which can be difficult to negotiate. Karst-style topography in these areas is common and drainages are sometimes underground.

The area is densely forested by tropical jungle, characterized by a great variety of tree and plant specimens. Some parts of the Property have been clear-cut by forestry activities or cultivated by local farmers for agriculture or grazing.

Local animals include a variety of indigenous jungle fauna as well as domestic livestock such as horses and cattle.

SECTION 6: HISTORY

In 1973 Canadian geologist William Menges collected several oxidized surface samples from an area now known as the Mina Grande, which is adjacent to the Company’s current Bongará Property. The samples contained significant zinc values (Michaud, 1999). Mr. Menges then staked the initial Bongará concessions, which covered 10,000 ha and were roughly centered on the Mina Grande prospect.

From 1974 to 1984, the property was optioned to, and explored by, a subsidiary of Noranda, a Canadian mining company. Exploration consisted of topographical surveys, soil and stream sediment sampling, geological mapping, pitting and trenching, geophysical surveys and, in 1978, limited amounts of diamond drilling. Noranda dropped their interest in the property in 1984 when the decision was made to close their exploration office in Peru (Michaud, 1999), and ownership of the property was transferred to Maria del Pilar Sarmiento.

In 1985 Compañia Minera Pilar del Amazonas (Amazonas) was formed to explore and develop the zinc-oxide mineralization at Mina Grande. In addition Compañia Minera del Amazonas S.A., was formed as a holding company for the claims. An option to purchase agreement was made between Amazonas and a Canadian-based exploration company, Canper Resources, who then retained the services of Toronto-based consultants Watts, Griffith, and McOuat (WGM) to complete an independent study of the property. In 1987, after additional exploration work, Canper terminated its plans for additional exploration at the property due to a number of political events in Peru. The property then reverted to Amazonas.

In 1993, Amazonas re-named the project Bongará and an option on the property was secured by a subsidiary of Solitario Resources Corporation (Solitario). Between 1994 and 1996 Solitario completed a program consisting of soil sampling and geological mapping in the areas of Mina Grande and Mina Chica.

In 1997 Solitario sub-optioned the Bongará property to Cominco Ltd. (Cominco) and over the next three years Cominco completed a program of geological mapping, geochemical and geophysical surveys and five diamond drill holes totalling 592 m (mainly on the Cristal Project) In early 1999, Cominco and Solitario relinquished their interest in the Bongará claims, and the properties reverted to Amazonas.

In 2003 Amazonas optioned the Mina Grande concessions (approximately 10,000 hectares) to Mauricio Hochschild & Cia which later transferred the concessions to Compañia Minera Corianta S.A.C (Corianta), a subsidiary of Cementos Pacasmayo. Corianta mined high-grade zinc oxides at Mina Grande and processed them using a kiln in Pacasmayo, Peru to produce zinc calcines from 2006 until 2008, when the operation was shut down, apparently due to a low world zinc price.

Evaluation of the Bongará property continued intermittently during the years 2001 through 2004, when a detailed study of the Property was undertaken by Anglo Peruana on behalf of Amazonas.

In late 2006 Rio Cristal Zinc Corporation was formed and signed an option agreement with Pilar de Amazonas to acquire the Bongará concessions (not including the Mina Grande concessions). In late 2007, the Company was listed on the TSX Venture Exchange in Toronto and Rio Cristal completed a placement of shares. In 2009 the name of the Company was changed to Rio Cristal Resources Corporation (“Rio Cristal” or “the Company”). In 2010, the Company’s shares were also listed on the Lima Bolsa de Valores (Lima stock exchange).

Between September 2006 and the end of 2008, Rio Cristal completed a program of geological mapping, geochemical surveys including rock chip, soil and soil gas sampling, geophysical surveys including magnetometer, pole-dipole induced polarization and self- potential, and forty diamond drill holes totalling 4,380.2 m concentrating on the Cristal and Charlita projects of the Bongará Property. The drill program intersected significant zinc oxide mineralization near surface and to depths of up to 50 m.

Detailed results of this work are reported in Wright (2010) and are not repeated in this report, although exploration highlights, including drill highlights, are recalled throughout section 7-3 (Prospects and Occurrences), section 9 (Exploration) and section 10 (Drilling).

No new exploration was conducted on the Property during 2009 and early 2010 due to Rio Cristal’s lack of funding caused by the international financial crisis. Funding was eventually raised in Peru and Europe in 2010 and the Company returned to doing surface exploration at the Cristal project in November. A second drilling program began at the Cristal project in April 2011 and a total of 3,342.25 meters was drilled in 55 holes (20 new platforms). Also in 2011, initial drilling at the San Jose Project began with one platform and two drill holes that totaled 1,417 meters. Details of the 2011 drilling programs at Cristal and San Jose may be found in Sections 9 and 10, Exploration and Drilling.

SECTION 7: GEOLOGICAL SETTING AND MINERALIZATION

(This section is taken verbatim from section 7 and section 9 of Wright 2010)

7-1: REGIONAL GEOLOGY

The general geology of Peru consists of a number of northwest-trending lithotectonic belts. The geological, structural, and metallogenic provinces that comprise these regional lithotectonic belts define the Peruvian portion of the Andes, which form a continuous line along the entire western edge of South America. These belts have long been recognized as hosts to base and precious metals.

The Cristal Property is located near the northern end of a belt of carbonate outcrops belonging to the Upper Triassic to Lower Jurassic Pucará Group. The belt reaches a width of 25 km and extends for 900 km down the eastern flank of the Andean Cordillera from Rio Santa Aguada (Ecuador border) in the north to Huancayo in the south. This belt is located on the western margin of the Sub-Andean Foreland Basin, and contains Permian to Neogene-aged sedimentary rocks which were deposited on the western margin of the Brazilian Shield.

The belt or district contains a number of Mississippi Valley-type (MVT) Pb–Zn deposits and occurrences along its length, including the operating San Vicente Mine, located about 100 km to the north of Huancayo. In the general Property area, two significant Pb-Zn deposits are known, at Florida Canyon (16 km south–southeast) and Mina Grande, (6 km east). These are shown in relation to the Property in Figure 7-1.

Quebrada Seca Prospect

Cristal Prospect

Alto Cristal Prospect

Mina Grande

(Adjacent Property)

San Jose Prospect

Florida Prospect

Florida Canyon

(Adjacent Property)

FIGURE 7-1: REGIONAL GEOLOGY (WRIGHT 2010)

7-2: PROPERTY GEOLOGY

7-2-1: LITHOLOGIES

The geological basement of the Property area comprises Precambrian rocks of the Marañon Complex, which form the Marañon Geoanticline, a structural high that runs north–northwest to south-southeast (locally deflected to north–south) down the length of the Eastern Cordillera of the Andes. The Complex consists of tightly-folded, grey to greenish-grey mica schists with minor quartzites.

Where exposed to the west and southwest of the Property area, the Precambrian is overlain with angular unconformity by Lower Triassic Mitu Group sandstones or younger strata, implying that intervening Palaeozoic strata either was not deposited in the area or

28 more likely was eroded prior to Mitu Group sedimentation. However, the eastern margin of the Marañon Geoanticline structural high may pass through the Property area, approximately along the 826,700E grid line, and if so, Palaeozoic strata may have been preserved, un-eroded, at depth, below the eastern half of the area.

During late Permian times, regional uplift and erosion removed Palaeozoic strata from many areas (in particular over the Marañon Geoanticline) and exposed the underlying Precambrian schists over structural highs. This was accompanied by the formation of north–south-trending rifts (grabens and half-grabens), along re-activated basement faults, forming discrete depocentres for later sedimentation.

In the Property area, a rift complex, the “Pomacochas Pull-Apart Basin”, is interpreted to have formed during this process. The basin may have been intermittently active from at least as early as the Permo–Triassic.

The rifts were infilled with Lower Triassic Mitu Group continental clastics including polymictic conglomerates and coarse to medium-grained red sandstones, mudstones and occasional pyroclastic volcanic rocks. The red-bed deposits overstepped the margins of the rifts onto the structural highs, and overlie Precambrian schists in places.

The Upper Triassic to Lower Jurassic Pucará Group carbonate sequence, which regionally comprises a westward-thickening wedge of predominantly carbonate sediments, began with restricted halite and anhydrite deposition (a locally thick and tectonically mobile layer which accommodated later thin-skin detachment to the east) and was followed by the widespread deposition of clean platform carbonates, argillaceous limestones, and shales.

The Pucará Group is divided into three formations: the Chambará, the Aramachay and the Condorsinga Formations.

The Chambará Formation comprises a progressively deepening carbonate depositional environment from sub-tidal to intertidal hypersaline algal micites (calite mudstones) with wavy bedding, passing up through higher-energy open marine skeletal (fossiliferous) wackestones, packstones, floatstones and rudstones (coarser-grained and wave processed platform carbonates including shoal deposits) into argillaceous and bituminous carbonate mudstones with minor amounts of black chert indicating deepening and relatively euxinic open marine conditions. Karstic events imply oscillating sea levels with emergent episodes. Chambará limestones are generally grey to dark-grey, thickly bedded (1–3 m thick in the lower part), resist weathering and form prominent outcrops. The coarser- grained members of the Chambará Formation host the fault-controlled and karst-aided replacement zinc sulphide mineralization at Florida Canyon (outside the Property area).

The Chambará Formation is overlain by the Aramachay Formation, which consists of thinly-bedded dark-grey limestones and silty shales, intercalated with dark-grey to black, bituminous and silty mudstones containing abundant ammonite fossils. These sediments were laid down in deeper-water under sea bed anoxic conditions. In general, they are less resistant to weathering, provide poor outcrop coverage, and support thicker vegetation cover.

The uppermost Pucará Group unit, the Condorsinga Formation, represents a return to shallow-water platform carbonate sedimentation characterized by thinly-bedded (10-30 cm) pale-medium grey micritic limestones with undulating bedding planes and thin clay horizons representing fossil soils over emergent surfaces. “Pseudobreccia” textures denote widespread burrowing and underline the very shallow marine environment in which these rocks were laid down. In terms of weathering characteristics, the Condorsinga limestones resemble the Chambará Formation carbonates. The higher beds of the Condorsinga Formation are extensively karstified, with re-worked carbonate material forming layered infill to fossil solution cavities and cave systems.

Condorsinga platform carbonate sedimentation ended during the Lower to Middle Jurassic due to minor uplift, erosion and karstification; the latter producing the karstic erosion surfaces and cave systems which mark the top of the Pucará Group.

The Middle to Upper Jurassic Sarayaquillo Formation overlies the Pucará Group, and consists of a sequence of red-bed (terrestrial), medium-bedded, intercalated mudstones, siltstones and sandstones with minor conglomeratic horizons and locally, gypsum beds, laid down in various colluvial, alluvial and lacustrine environments. The base of the Sarayaquillo Formation is often marked by a horizon of variable thickness, with coarse limestone boulder breccias and breccia-conglomerates hosted within a carbonate matrix derived from the underlying Condorsinga Formation. The coarse and immature nature of these breccias suggests that they are derived from screen and fan deposits shed off active fault scarps. The Sarayaquillo Formation sequence is generally soft, erodes easily, and is not often seen in outcrop, except in protected situations such as the southern flanks of the Rio Cristal Valley.

Overlying the Sarayaquillo Formation is the Lower Cretaceous Goyllarisquizga Group, which consists of a thick, cross bedded sequence of thickly-bedded white quartzitic sandstones, with minor intercalations of grey–green siltstones and silty mudstones, with abundant plant debris. These units were laid down in a deltaic to marginal marine setting and are a product of the first major marine transgression of the Cretaceous. Regionally thickening to the west, the sandstones are well exposed at higher elevations over the central and eastern parts of the Property, having been eroded further to the west over the Marañon Anticline structural high.

The youngest exposed rocks belong to the Lower Cretaceous Chonta Formation and consist of thinly bedded, pale beige–cream–grey-coloured limestones and argillaceous silty limestones (marls) intercalated with greenish-grey nodular silty mudstones. These rocks have poor resistance to weathering due to their high clay content.

Younger Cretaceous and subsequent Tertiary strata deposited over the region and partially preserved in the down-faulted southwestern corner of Figure 7-1, have been eroded from the greater part of Property following late-Andean uplift and erosion.

7-2-2: STRUCTURE

A regional structural interpretation of a Landsat 7 image by Anglo Peruano (Figure 7-2) identified a series of north–south and northwest–southeast-trending (~N120°E) lineaments, which are believed to reflect lines of basement weakness. In addition, an oval

30 structure, as defined by a series of almost concentric curved lineaments, covers the central part of the area (Anglo Peruana, 2005).

To the east of the same north–south dividing line, the preservation of younger stratigraphy, as high in the stratigraphic column as the Lower Cretaceous Chonta Formation, suggests the influence of a “structural low”. Within this eastern structural zone, thrust (or reverse) faults (Chiriaco Fault), normal faults (Farallón Fault) and fold axes (Las Minas Anticline) all trend approximately west–northwest-east–southeast (~N120ºE). Some of the faults and fold axes also tend to swing northwards at their western extremities and southwards at their eastern limits, producing open “S-shaped” structures, typical of those associated with strike-slip faults and/or shear zones. The most intense folding occurs in the vicinity of the oval structure occupying the central part of the study area (Anglo Peruana 2005).

The line of separation between these two distinct structural zones is believed to lie along a north-trending basement fault, which forms the eastern margin of the Marañon Geoanticline Structural High (hence basement at surface to the west) and the western margin of a north south rift (graben or half-graben) basin (Anglo Peruana 2005).

The interaction of north–south and 120°-trending basement faults under the influence of northeast–southwest extension allowed the formation of a north–south rift basin and the localized Pomacochas Pull-Apart Basin during Mitu Group and early Pucará Group sedimentation (Anglo Peruana 2005). Anglo Peruano (2005) interpreted the rift basins to contain thick evaporites, shaly facies in the Mitu Group, and basal parts of the Pucará Group, making them more ductile as a lithological package under compression. By contrast, the surrounding structural highs are covered by competent platform sequences above rigid (un-sheared) basement, which makes them more resistant to deformation.

Dolomitization and base-metal mineralization of Pucará carbonates in the Property area are probably related to the mass movement of basinal brines and meteoric waters caused by hydraulic gradient and compressive tectonics, and aided by sheared basement high- permeability aquifers (Anglo Peruano 2005).

Faults

Faults within the Property area fall into three main groups, striking north–northwest, west–northwest and north–northeast (Figure 7-2 and Figure 7-3).

Figure 7-2: Structural Geology

Figure 7-3: Geological Section – Bongará Area

North-Northwest-Trending Faults

The principal faults of this trend are the Tihuja Fault and the Oso Fault, both of which are situated in the western part of the Property.

The Tihuja Fault is a normal fault trending N30°W with a downthrown block to the west. On the western flank of Quebrada La Tihuja, and on the western flank of San Jose Anticline, it places Condorsinga against Chambará, whereas, to the north, where the fault is deflected to the west northwest (probably influenced by the 120° system of basement fractures), it drops Chambará against Mitu strata (Anglo Peruana, 2005).

The Oso Fault, which appears to terminate the Chiriaco Fault at its western end, is parallel to the Tihuja Fault. It is interpreted that this fault has a sinistral tear component in addition to a normal (or reverse), down-to-the east movement (the dip of the fault has not been adequately established). In the upper reaches of the Rio Cristal, the fault displaces

Chambará limestones next to Aramachay and Condorsinga carbonates in a zone of abrupt topography characterized by scarps, prominences (Cerro Oso) and ravines (Anglo Peruana, 2005).

Both the Tihuja and Oso faults are believed to be influenced by the structural grain within the Precambrian basement, and may be re-activated earlier faults. The Oso Fault crosses the margin of the Pomacocha Pull-Apart Basin and extends south-southeastwards for 10 km. It is possible that sinistral tear movement within the Pucará strata around Quebrada Cristal was caused by northeast–southwest shortening of the Pomacocha Pull- Apart Basin stratigraphic sequence taking advantage of the earlier structure.

It should be noted that there is an area of dolomitization flanking the Oso Fault to the south southeast within the Chambará and Condorsinga limestones for a distance of more than 2,000 m from the point where the Oso Fault cuts the Chiriaco Fault (Pomacocha basin margin). The interaction of two important faults at the edge of the Pomacocha Pull- Apart Basin would have provided ideal conditions for fluid movement and may explain the dolomitization in this trend. It also has positive implications for zinc mineralization (Anglo Peruana, 2001).

In addition to the major faults of this trend, there are a number of north-northwest-south– southeast to north–south-trending minor faults and fractures affecting the Condorsinga limestones between the Rio Oso and the Farallon faults. These faults and fractures are tensional and in addition to being mineralized, appear to have acted as feeders for the dolomitizing and mineralizing fluids on the Property. Even where faults of this trend are not visible, mineralized showings in the Cristal Prospect often occur along north northwest-trending lines (e.g, Marita–Esperanza–Yolanda and Charlita–Charlita North). These minor faults and fractures may be the expression at the top-Condorsinga level of basement fractures of the same trend or faults and fractures related to local tectonics within the confines of the Pomacocha Pull-Apart Basin (Anglo Peruana, 2005).

Faults of similar trend are also present in Quebrada Seca to the north, where they appear to control zones of dolomitization.

West-Northwest-Trending Faults

The Chiriaco Fault which crosses the entire width of the Pomacocha Pull-Apart Basin from west–northwest to east–southeast is the most prominent reverse fault in the Property area. At Campo Cielo, it juxtaposes Condorsinga limestones against Chonta Formation strata, implying a reverse movement locally of between 500 m and 800 m. However, the throw diminishes to the west and to the east towards the margins of the Pomacocha Pull- Apart Basin, suggesting that the central part of the Pomacocha Pull-Apart Basin was subject to asymmetrical uplift (dome-like inversion of the central part of the Pomacocha Pull-Apart Basin). Similarly, the strike direction varies from almost east–west at its western extremity to northwest–southeast close to Mina Grande. Dipping steeply to the south–southwest, it forms the footwall of the overturned Nestor’s House–Ramon’s House–Mina Grande Anticline, and the two are almost certainly genetically related (Anglo Peruana, 2005).

The North and South Farallon Faults are situated parallel to, and 1.5 km and 2.0 km respectively north of the Chiriaco Fault. Although they now display normal, down-to-

34 the-south displacement, it is possible that they originated as minor reverse faults associated with the Chiriaco Fault. They may alternatively represent the re-activation of a Pomacocha Pull-Apart Basin margin fault on the north side of the basin. In outcrop they form prominent fault scarps in the upper part of the Condorsinga dip slope which constitutes the Cristal prospect. Due to difficulty of access, Anglo Peruana have recommended additional reconnaissance mapping in this area (Anglo Peruana, 2005).

Two west–northwest-trending north-dipping normal faults with throws down to the north- northeast occur between the Oso and Tihuja faults close to the San Jose occurrences on the western margin of the Pomacocha Pull-Apart Basin. The westernmost fault passes through the San Jose occurrence, where it contains galena together with vein calcite and oxides of iron (Anglo Peruana, 2005).

North-Northeast-Trending Faults The north–northeast-trending faults occur only within the confines of the Pomacocha Pull-Apart Basin where they displace both the axis of the Nestor’s House Anticline and the Chiriaco Reverse Fault to the west of Campo Cielo, in addition to strata as high in the sequence as the Chonta Formation (Anglo Peruana, 2005).

Folds There are two principal fold-axis trends within the Property area, and these trends reflect two of the principal fault orientations.

The north–northwest-south–southeast fold axis trend occurs mainly in the western part of the Property area above a basement structural high and is believed to be associated with compressional reverse movement along north-northwest-south-southeast-trending faults. The best example is the north–northwest-trending San Jose Anticline, an open fold which brings Chambará strata to surface (Anglo Peruana, 2005).

The west–northwest-east–southeast fold axis trend dominates the structure in the central part of the Property area, corresponding to the Pomacocha Pull-Apart Basin, where open folded synclines and anticlines are present in the higher exposed strata (Sarayaquillo to Chonta Formations), giving way to tighter and sometimes overturned folds verging to the north-northeast, in the lower parts of the succession (Chambará to Condorsinga Formations). An example of an overturned fold is the Nestor’s House–Ramon’s House- Mina Grande Anticline on the hanging wall side of the Chiriaco Fault (Anglo Peruana, 2005).

Folds with axes trending west–northwest-east–southeast are also present in Pucará strata overlying a basement structural high in the southwest corner of the area. These folds may have been formed by detachment along a basal Pucará/Mitu evaporite horizon (Anglo Peruana, 2005).

7-2-3 ALTERATION

The principal alteration in the Bongará Property area is secondary dolomitization of the Pucará Group strata. Primary dolomites related to early diagenetic processes have not been observed in the area, although they may be present at depth associated with evaporites within the Pomacocha Pull-Apart Basin.

The fluids responsible for dolomitization appear to have entered the limestones along vertical of steeply dipping faults and fractures. The fluids then selectively moved outwards into the limestone sequence. Thin mudstone horizons within the platform carbonate sequence acted as aquacludes and these clay bands often separate dolomite beds from unaltered limestone beds (Anglo Peruana, 2005).

In general, the grain size of the dolomites depends on the original grain size of the host. Rudstones and packstones produced coarser dolomites than wackestones, and silty cave infill sediments produced saccharoidal dolomite. Flowstone that filled earlier solution cavities produced coarse sparry dolomite (Anglo Peruana, 2005).

The finer-grained dolomites are usually pale-grey in colour when fresh, but weather to beige or brown at outcrop and internally (depending on porosity and exposure time) due to the presence of fine-grained pyrite which is very common, if not ubiquitous, to the dolomitizing process. The acidity accompanying the oxidation of the pyrite probably increased the porosity of the dolomites and assisted in the oxidation of sphalerite to smithsonite and other oxides of zinc (Anglo Peruana, 2005).

The coarser-grained, sparry dolomite, which occurs in (and close to) feeder channels, breccia zones and replaced sparry calcite (or aragonite) of cave deposits, consists of white sparry dolomite and grey sparry dolomite, accompanied by lesser amounts of late white calcite, and occasional clear euhedral quartz crystals (Anglo Peruana, 2005).

Within the Property area, the greatest continuous development of dolomitization occurs in a belt up to 1.5 km wide between the Rio Cristal and the North Farallon Faults, extending 7 km westward from Cristal Camp to the contact of the Chambará Formation with the underlying Precambrian basement. This distribution of dolomitization corresponds approximately, for most of its length, to the dissected dip slope of the top of the Condorsinga Formation, and it is possible that end Condorsinga karstification had an important part to play in pre-conditioning this part of the sequence for dolomitization. It is also possible that the Chiriaco Reverse Fault played an important role in deflecting rising fluids northwards into the north–northwest-trending to north-trending fractures which acted as main feeders for the dolomitization and mineralization (Anglo Peruana, 2005).

In the upper part of the Rio Cristal valley, dolomitization affects the Aramachay and Chambará carbonates, in addition to the Condorsinga limestones, and continues south– southeastwards from the Chiriaco Reverse Fault along the line of the Oso Fault in a belt around 600 m wide, again including the three Pucará units. Dolomitization affects both flanks of the San José Anticline, including to the west of the main San Jose mineral occurrence, where the dolomitization appears on both sides of the Tihuja Fault (Anglo Peruana, 2005).

Dolomitization is also present in Quebrada Seca to the north of the Cristal prospect, where blocks of pale-grey dolomite belonging to the Condorsinga Formation contain iron- oxides and appear to be spatially associated with north–northwest-trending faults (Anglo Peruana, 2005).

The only known occurrence of dolomitization outside of the Pucará Group limestones is within the first few metres of the Sarayaquillo Formation at the Charlita Prospect, where the calcareous component of the sandstones and siltstones at the base has been dolomitized. It is likely that in some situations the limestone breccias at the base of the Sarayaquillo Formation (Corontochaca Formation) have also been dolomitized and mineralized, although nowhere has such an occurrence been seen at outcrop (Anglo Peruana, 2005).

7-3: PROSPECTS AND OCCURRENCES

This section is taken almost verbatim from Wright (2010), although some updates were added by the author. Prospects and occurrences at Cristal are shown in Figure 7-4. San Jose and Florida prospects and occurrences are shown in various figures in Section 9, Exploration.

FIGURE 7-4: CRISTAL PROSPECTS AND OCCURRENCES

The Cristal Project Mineralization at the Cristal prospect forms a sigmoidal zone approximately 1.5 km long by 0.5 km wide. The zinc oxide mineralization outcrops at the Gigi, Yolanda, Nenita, Esperanza, Lupita, Marita and Kenita occurrences and forms a nearly continuous zone of zinc enrichment in soil samples (>500 ppm) and rock samples (>2,500 ppm) and is probably the most extensive area of zinc mineralization encountered on the Property to date. Individual meter-long channel samples reach grades of 5% to 10% zinc. Diamond drilling has encountered both near-surface base metal mineralization, and oxidized base- metal mineralization at depths of over 50 m down-hole and with grades of up to 20 to 30% Zn. Mineralization forms several sub-horizontal manto-like bodies within the zone.

Drilling at the Cristal Project in 2008 amounted to almost 4,000 meters in 38 holes. In 2011, forty additional drill holes totaling 2,548.45 meters were added (as described more fully in Section 10 of this report).

Mineralization at the Anita occurrence occurs in dolomites in a N30°W-trending zone of around 100 m in length and 15 m in width. The zone appears to be terminated to the northeast by an abrupt contact with well-laminated and thinly bedded pale grey wackestones and calcite mudstones. On the east side of the Rio Cristal, the mineralization occurs in two distinct levels. The Upper Level, which is higher in the sequence, consists of thinly laminated, pale grey sparry dolomites, after grainstones, showing evidence of cross-stratification. These dolomites are porous and loosely cemented, and individual rock chip and channel chip samples have values ranging between 0.05% Zn to 2.0% Zn and 7.1% to 34.5% Fe, while soil samples have values ranging between 0.05% Zn to 0.75% Zn and 7.1% to 21.7% Fe.

The Lower Level, situated stratigraphically lower, but also on the eastern flank of the Rio Cristal, displays higher-grade stratiform mineralization consisting of dark brown sphalerite and pyrite, but also with ruby sphalerite associated with veinlets of white sparry dolomite, calcite, quartz and bitumen. Systematic channel samples by Anglo Peruana reported values up to 9.91% Zn over 0.60 m (sample 1725), and 3.90% Pb over 1.25 m (sample 1720). A weighted average over 14 m of strike length and with a thickness averaging 0.93 m gave a grade of 3.09% Zn, 1.11% Pb and 0.51 g/t Ag.

The lower parts of the Anita occurrence are interpreted to represent a palaeo-cavern elongated along a northwest–southeast direction, which formed within fine-grained, laminated, calcite mudstones (limestones) during the end-Condorsinga period of uplift and karstification. The calcareous sand- and silt-sized, weakly-bedded sediments, which subsequently infilled these cave passages were more porous than the surrounding limestones and easily dolomitized to a similarly porous medium-grained saccharoidal dolomite. This in turn, was receptive to fluids carrying Zn and Pb in solution, which precipitated disseminations of sphalerite and galena.

Laterally, the laminated calcite mudstones were relatively impermeable to the dolomitizing and mineralizing fluids and show only weak dolomitization and re crystallization up to centimetres, or at most a metre, from the palaeocaverns. However, coarser grained and more porous limestone beds within the sequence probably were affected by the karstification, with an enhancement of porosity, and these beds also lent themselves to dolomitization, providing host rocks for the zinc-lead occurrences in the Lower and Upper Levels (Anglo Peruana, 2005).

In 1998 Cominco drilled diamond drillhole CR-01 to intersect the mineralization at depth. The hole is located 25 m to the north of Anita Upper Level and intersected 47 m of sparry dolomites within which was a 2.0 m intersection of sulphide mineralization grading 0.02% Zn, 1.35% Pb and 0.20 g/t Ag. The intersection correlates with the Upper Level of mineralization mapped in outcrop. The hole continued to a final depth of 76.25 m in weakly-dolomitized calcite mudstones and possibly did not cross into the Lower Level (Anglo Peruana, 2005).

Erika Occurrence

Approximately 100 m west of Anita is the Erika occurrence, which consists of a steep and resistant outcrop of Condorsinga Formation dolomite with considerable soil and vegetation cover. The outcrop consists of a 1 m wide north-trending zone of dolomitization accompanied to the west by 2–2.5 m of earthy, reddish brown oxides (after pyrite?). The vertical structure is interpreted to be a feeder structure. Dolomitization continues into the adjacent carbonate strata (Anglo Peruana, 2005).

A 3 x 3 m composite chip sample (sample 243952) was collected by AMEC covering this structure and some of the adjacent wall rock. The sampled area included dolomitized limestone mineralized with 5 to 20% honey brown sphalerite, minor pyrite, limonite and irregular shaped blebs of bitumen. The AMEC sample yielded values of 5.68% Zn and 880 ppm Ba.

The mineralized area is approximately 15 m long x 7 m wide, and the host rocks comprise pale-gray sparry dolomites replacing packstones with disseminations of brown sphalerite and cubic pyrite along with strong iron-oxide staining and zinc carbonates (smithsonite), concordant with the bedding. Veins of white sparry dolomite, calcite, quartz and bitumen are common, and “zebra textures” are present within the dolomites (Anglo Peruana, 2005).

A 1.5 m channel sample collected by Anglo Peruana across the zone reported grades of 1.88% Zn, 0.07% Pb and 0.9 g/t Ag. The best grades at this occurrence were obtained from a composite rock chip sample collected by Anglo Peruana in the upper part of the outcrop over a 3 m area. The sample was collected from mineralized and extensively oxidized dolomites, and returned a grade of 9.82% Zn, 0.01% Pb and 6.6 g/t Ag.

In 2008 soil samples with values ranging between 0.05% Zn to 0.20% Zn and 7.1% to 21.7% Fe were taken at Erika occurrence. Based on the relatively poor results from the soil samples, no follow up work was completed.

Marita Occurrence

The Marita occurrence is located 900 m west of the Cristal Camp, on the eastern flank of a north-trending dry valley. Mineralization consists of a zone of collapsed loose blocks and in situ outcrop some 12 m long x 5 m wide. The in situ strata strike N20°E and dip 20° to the southeast, and consist of pale-medium gray, coarse-to-medium grained dolomites, after packstones, with sub-millimetre disseminated crystals of dark-brown sphalerite, fine grained pyrite, and bitumen. Loose, saccharoidal dolomite in bands 2 –

5 cm thick containing small euhedral crystals of sphalerite comprise approximately 25% of some exposures.

The blocks and outcrops are strongly oxidized and mottled brown with limonite staining, which gives moderate to strong reaction to “zinc-zap”. Thin and irregular veinlets, and small dissolution cavities, are infilled with white sparry dolomite and gray sparry dolomite, minor calcite and bitumen. A chip sample (1735) collected by Anglo Peruana reported grades of 6.07% Zn, 0.11% Pb and 12.9 g/t Ag.

To the west, the dolomites abruptly change to weakly recrystallized pale-gray limestones (calcite mudstones and wackestones) along a contact trending N30°W. This contact is possibly a fault, and the dolomitization and mineralization may have entered along a parallel feeder structure within the dolomitized zone. Some of the dolomitic textures, particularly the loose saccharoidal dolomites, are similar to those derived from karstic cave-infill deposits observed at Anita (Anglo Peruana, 2005).

The scattered Marita occurrences cover a total area of approximately 250 x 150 m; however, much of this area is covered by soil and valley infill material. The encouraging assay values make this a target area for follow-up with additional outcrop cleaning, mapping and soil sampling.

In 1998, Cominco collared diamond drillhole CR-05 105 m to the north of Marita. The hole was drilled due west at an inclination of -50° and, intersected 9.5 m of valley infill material, followed by calcite mudstones and limestones to a depth of 57 m. Below this, fine-grained dolomites with some reported “de-dolomitization” and fine-grained disseminated pyrite was logged and this continued to the end of the hole at 115.9 m. The assayed sections contain only geochemically anomalous values, and this sequence likely represents facies of limited receptivity to sulphide mineralization as a consequence of the host rocks fine grain size and poor permeability (Anglo Peruana, 2005).

In 2008, Rio Cristal drilled hole CR-40-08 20 m to the east of the inferred fault at the Marita occurrence. The hole was drilled due west at an inclination of -70° and, intersected two oxide horizons, the first at depths from surface to 7.10 m with grades below 4.1% Zn and 0.3% Pb, and the second horizon from 16.0 m to 21.8 m showed very weak zinc mineralization and was not sampled.

Both holes may be interpreted to have intersected the middle unit of the Condorsinga Formation, but the vertical displacement of the fault is unknown but should be investigated in order to understand the continuity of the west sector of the Marita occurrence.

Lupita Occurrence

The Lupita occurrence is situated 220 m west of Marita. The host rocks of the Lupita occurrence consist of pale-gray dolomites after wackestones and packstones of the Condorsinga Formation which have been weathered to a beige colour with limonite staining. The beds have an overall northeast–southwest strike similar to the dominant trend at Cristal, but dip to the northwest at angles of between 30° and 60°, indicating that the Lupita occurrence lies on the northwestern flank of a minor anticline.

Sulphides and zinc oxide mineralization appears to occur preferentially in a unit of dolomitic packstones which can be traced over a strike length of 60 m. The mineralization occurs in two forms: one which shows an irregular distribution of Zn and Pb sulphides within discontinuous veinlets (which often appear to form the boundaries of breccia fragments) associated with mineralized structures (faults), and the other, which is represented by disseminations within medium-grained textureless dolomites, is interpreted to be dolomitized karst-infill sediments occupying fossil solution cavities within the favourable horizon (Anglo Peruana, 2005).

Channel samples taken by Anglo Peruana across selected mineralized sections over the 30 m long outcrop of the textureless dolomites in the northern part of Lupita returned zinc values of between 2.58% and 22.24%, and lead values up to 5.68% over channel lengths of 1.6–3.8 m. A weighted average of the samples over this strike length returned values of 14.12% Zn, 1.27% Pb and 3.77 g/t Ag over 2.25 m.

In the southern part of Lupita, the dolomites are strongly fractured along a N25°W trend and contain oxidized mineral accumulations which react weakly on the application of “zinc-zap”. In places, veins and veinlets of calcite with galena are observed. One of Anglo Peruana’s samples returned values of 4.35% Zn, 4.30% Pb and 3.4 g/t Ag over a channel length (“vein” width) of 1.6 m.

In 2008, additional rock chip and soil sampling were taken by Rio Cristal at the Lupita occurrence. The highest zinc grade encountered was from rock chip sample 200710874 with 4.0% Zn and 0.2% Pb.

Esperanza Occurrence

The Esperanza occurrence (Figure 7-5) covers an area approximately 150 m in length by 90 m in width and is located approximately 350 m to the north of the Marita occurrence. It is exposed on both sides of the Quebrada Marita that hosts the Marita occurrence. The host rocks are similar to those described at Lupita.

The geochemistry campaign carried out in 2008 included rock chip and soil sampling. At the Esperanza occurrence, the maximum Zn grade returned was from rock chip sample 200710921 with 27.1% Zn (0.9 %Pb).

Rio Cristal collared 14 diamond drill holes at the Esperanza occurrence for a total of 1,073.15 m. The drill holes defined a mineralized area over approximately 1.12 ha. The best results obtained at the Esperanza occurrence are:

In the northern part of the occurrence CR-03-08 intersected 4 m of oxide mineralization grading 23.66% Zn and 0.01% Pb, starting at a depth of 56.1 m and hole CR-11-08 intersected 8.59 m of oxide mineralization grading 22.73% Zn, 0.33% Pb, starting at a depth of 9.63 m down-hole.

In the eastern part of the occurrence hole CR-14-08 intersected 12.45 m of oxide mineralization grading 26.06% Zn, 0.07% Pb, starting at a depth of 11 m down-hole.

In the western sector of the occurrence hole CR-20-08 intersected 15.55 m of oxide mineralization grading 29.54% Zn, 1.38% Pb, starting at a depth of 49.55 m below

41 surface; CR-24-08 intersected 8.15 m of oxide mineralization grading 23.57% Zn, 0.76% Pb, starting at a depth of 23.8 m below surface; CR-25-08 intersected 2.05 m of oxide mineralization grading 22.53% Zn, 1.62% Pb, starting at a depth of 36.3 m down- hole (Figure 7-5).

In the central portion of the occurrence hole CR-35-08 intersected 11.55 m of oxide mineralization grading 29.74% Zn, 0.21% Pb, starting at a depth of 9.5 m down-hole.

FIGURE 7-5: GEOLOGICAL SECTION OF THE ESPERANZA OCCURRENCE

Nenita Occurrence

The Nenita occurrence covers an area approximately 250 m long by 200 m wide and is located approximately 120 m to the southwest of the Esperanza occurrence. The host rocks are similar to those described at Lupita. Figure 7-6 presents a geological cross- section through Nenita.

FIGURE 7-6: GEOLOGICAL SECTION, NENITA OCCURRENCE

The 2008 geochemistry campaign included rock chip and soil sampling. At the Nenita occurrence the highest-grade rock chip sample returned a grade of 31.2% Zn with 0.23 % Pb maximum (sample 200710873).

Drilling at Nenita defined a mineralized area over 0.88 ha. Eight diamond drill holes totalling 823.25 m in length were completed. Two anomalous intersections were encountered; CR-28-08 having 3.90 m with an average grade of 15.12% Zn and 0.02% Pb, and CR-39-08, having a length of 15.75 m with an average grade of 11.84% Zn and 0.01% Pb.

Future drilling at Nenita should focus on extending the known mineralization to the south where mineralized outcrops have been found and soil and rock geochemistry return anomalous values for zinc and iron.

Yolanda Occurrence

Situated on the west flank of Quebrada Marita and approximately some 200 m north of the Esperanza occurrence, Yolanda consists of an outcrop of earthy oxides 50 m long by 10 m wide, trending N80°E (Figure 7-7). The outcrop consists of residual soils containing a large proportion of iron oxides including limonite and goethite displaying massive and botryoidal textures. The iron oxides are enriched in Zn-carbonates and silicates, including smithsonite, hydrozincite and hemimorphite. These secondary zinc minerals infill cavities within botryoidal iron oxides (Anglo Peruana).

Lower down the west flank, are outcrops of rotten (loosely aggregated due to weathering) pale-gray sparry dolomites replacing calcareous grainstones and containing disseminations of fine cubic pyrite and bitumen (Anglo Peruana, 2005).

FIGURE 7-7: GEOLOGICAL SECTION, YOLANDA OCCURRENCE

Anglo Peruana’s systematic sampling of channels and old pits excavated by Cominco (the pits reaching depths down to 3.5 m below surface), returned highly anomalous values for zinc and silver. On the basis of these pit results, Cominco had outlined a potentially mineralized area about 50 m long x 10 m wide and averaging 6 m in thickness with average grades of 18.53% Zn, 0.48% Pb and 17.92 g/t Ag. AMEC understands that all of these dimensions remain open.

Following the pitting, Cominco drilled core hole CR-03, located 20 m northwest of the Yolanda showing. This vertical borehole continued to a depth of 152.20 m and intersected 4 m of barren, probably transported, soil, followed by 14.4 m from 4.0 m to 18.4 m, of intensely weathered and oxidized, coarse-grained dolomites with weighted average grades of 18.45% Zn, 0.42% Pb and 17.6 g/t Ag. The hole continued in calcite mudstones (fine grained limestones) to 36.6 m, after which intercalations of fine- to-medium grained dolomites with only geochemically anomalous values of Zn and Pb persisted to the final depth of 152.2 m (Anglo Peruana, 2005).

Mapping and sampling by Anglo Peruana 30 m to the northeast of Yolanda uncovered outcrops of pale-gray to beige dolomites, replacing calcareous packstones, which are often brecciated and strongly oxidized. Sampling by Anglo Peruana from these rocks returned a value of 1.41% Zn.

In 2008, rock chip and soil sampling were taken by Rio Cristal in Yolanda occurrence. Maximum value for Zn corresponds to sample 200710832 with 28.5% Zn (0.45%Pb).

Rio Cristal collared 14 diamond drill holes covering a total area of 1.11 ha and a total of meters of 734.95 m. CR-19-08 intersected 4.45 m of oxide mineralization grading 17.82% Zn, 0.01% Pb, starting at a depth of 27.5 m; CR-22-08 intersected 7.55 m of

44 oxide mineralization grading 16.7% Zn, 0.01% Pb, starting at a depth of 18.15 m below surface.

Juanita Occurrence

The Juanita Occurrence is located 200 m to the northeast of Yolanda. Mineralization here consists of an outcrop 15 m long and 5 m wide with dolomitized breccias with angular chert clasts, bleached-white dolomites and de-calcified dolomites within a matrix of strongly oxidized (with limonite and goethite) sparry dolomites (Anglo Peruana, 2005).

A composite rock chip sample by Anglo Peruana (sample 1744) taken over this breccia returned a value of 0.52% Zn.

In the vicinity of this sample, Anglo Peruana observed orange-coloured earthy oxides giving a strong reaction to “zinc zap”. A composite sample of channels by Anglo Peruana, 0.5 m wide by 7.0 m long gave values of 6.44% Zn, 0.04% Pb and 4.7 g/t Ag. Mapping of subcrop rubble in the area consists of massive oxides and zinc carbonate (smithsonite) (Anglo Peruana, 2005). A chip sample taken for reference purposes by Anglo Peruana (sample number 1746) reported values of >30% Zn, 0.004% Pb and 34.5 g/t Ag (Note: overlimits were not re-analyzed by Anglo Peruana to determine the actual zinc value).

Also, in the vicinity of the mineralized zone, sparry dolomites after packstones show evidence of strong fluid flow, with white and gray sparry dolomite present in veins and breccias, accompanied by widespread and intense disseminations of cubic, crystalline pyrite. The strength of the dolomitization, the pyritization and the zinc mineralization at this location may have been influenced by the intersection of a north–south-trending inferred fault and the South Farallon Fault.

In 2008, additional rock chip and soil sampling was undertaken by Rio Cristal at the Juanita occurrence. The highest grade rock chip sample taken was 200711091 which returned a grade of 7.6% Zn (0.02 %Pb).

Gigi Occurrence

The Gigi occurrence is located 200 m to the west of Yolanda. Mineralization at Gigi consists of an outcrop with replacement dolomite alteration containing zinc oxides. A composite rock chip sample by Rio Cristal (sample 200711083) taken from this outcrop returned a value of 3.04% Zn and 0.92% Pb.

One drill hole, CR-01-08, was sited at Gigi. The drill hole was a deep hole collared to define local stratigraphy and test for deeper sulphide targets. The hole intersected significant dolomitization in the Condorsinga Formation but did not encounter mineralization of economic significance.

Charlita Project

The Charlita Occurrence is located along the south wall of the Cristal River approximately 2.15 km west of the Cristal Camp. Stratigraphically, the occurrence is at the discordant contact between the karstified top of the Condorsinga Formation and the basal beds of the overlying Sarayaquillo Formation. The east–west-trending mineralized zone covers an area approximately 50 m long x 10 m wide. The mineralization occurs within pale-gray sparry dolomite beds (originally limestone packstones and calcite mudstones) of the Condorsinga Formation and in greenish-grey dolomitic (originally calcareous) siltstones at the base of the Sarayaquillo Formation. The Condorsinga beds strike northwest–southeast to east-west, with gentle dips of around 20° to the south, and are cut by fractures trending both N70°W and east–west with dips which vary between 75° to the north, and vertical (Anglo Peruana, 2005).

The principal alteration is dolomitization, which has affected both the eroded and karstified upper surface of the Condorsinga Formation and the first few metres of the overlying Sarayaquillo siltstones.

The dolomitization extends upwards into thin bands of limestone conglomerates within the siltstones and overlying sandstones, mainly dolomitizing the carbonate matrix around the pebbles (Anglo Peruana, 2005).

Consistently anomalous mineralization occurs along the contact and within the siltstones immediately above the contact. The dolomites contain disseminated dark-brown sphalerite, galena, and cubic crystalline pyrite, with the sulphides contributing up to 10% of the rock by volume (Anglo Peruana, 2005). Channel samples collected by Anglo Peruana within the dolomites generally gave geochemically anomalous values of zinc as high as 600 ppm, although at one location where there has been secondary enrichment of zinc 2.68% Pb and 0.9 g/t Ag (sample 1869).

The eroded upper surface of the Condorsinga limestones displays karst-related irregular embayments and cavities infilled with calcareous siltstones and sub-rounded fragments of sparry dolomite (originally limestone) in a matrix of strongly pyritized calcareous siltstones with sporadic disseminations and coarse-grained crystals of dark brown sphalerite (Anglo Peruana). Analyses of Anglo Peruana a single meter-long channel sample 1824 reported grades of 3.04% Zn, 1.94% Pb and 0.6 g/t Ag.

The most intense mineralization occurs along the contact in lenticular shaped veins up to 0.4 m thick, containing massive, coarsely crystalline, dark brown sphalerite and galena, and fine-grained massive pyrite. This mineralization is associated with white sparry dolomite, calcite, euhedral transparent quartz crystals and bitumen. A later phase of mineralization is believed to have precipitated crystals of ruby sphalerite intergrown with quartz crystals in open cavities within the dolomites. Anglo Peruana channel sample 1821, reported grades of 6.8% Zn, 0.5% Pb and 2.1 g/t Ag. AMEC collected a 0.9 m vertical channel (sample 243957) in similar mineralized rock a few metres to the east of this sample, which returned values of 8.99% Zn and 9.43% Pb.

The basal Sarayaquillo Formation calcareous siltstones have been intensely dolomitized and pyritized (estimate >75% by volume), and are up to 5 m thick. These beds also contain irregular lenses and bands of dark-brown sphalerite and are cut by calcite veins containing coarse crystalline galena (Anglo Peruana, 2005). The combined channel samples taken by Anglo Peruana over the 25 m long x 3 m wide zone of pyritic mineralization give a weighted average grade of 4.76% Zn, 1.71% Pb and 1.31 g/t Ag.

In 2008, additional rock chip and soil sampling were carried out by Rio Cristal at the Charlita occurrence. The maximum Zn value from the rock chip sampling corresponds to sample 200711003 with 20.8% Zn (0.17 %Pb).

Charlita North

(Author’s note: The Charlita Occurrence and Charlita North Occurrence are grouped together in subsequent sections and are referred to as the Charlita Project)

The Charlita North occurrence is situated 400 m to the northeast of the Charlita Camp and on the western flank of Quebrada La Perdiz. It consists of outcrops of pale-gray sparry dolomites, mainly wackestones but with some interbedded packstones, which weather a yellowish-beige colour at surface. The medium-bedded dolomites strike northeast– southwest with gentle dips averaging 30° to the southeast. They are crossed by northeast– southwest-trending fractures, dipping 60º to the southeast, sometimes infilled with white sparry dolomite. The surfaces of the outcrops contain karstic cavities with deposits of stalactitic travertine (Anglo Peruana, 2005).

The mineralization mainly occurs in the form of iron oxides and carbonates of zinc, often as sub-millimetre films along joint faces, which give a strong reaction to “zinc-zap”. In remnant unoxidized patches, the primary mineralization is seen as dark-brown sphalerite accompanied by fine-grained cubic pyrite and associated with irregular veinlets of white and gray sparry dolomite. The dolomite often displays concentric banding, which suggests that it replaced calcite or aragonite in stalactitic flowstone (subterranean travertine) infilling karstic cavities and caves (Anglo Peruana, 2005).

Fourteen bedrock samples were taken in the Charlita North area, 11 of which were composite rock chip samples. A few of the samples reported very high values, such as composite rock chip sample 1879, which was collected over a diameter of 3.4 m in heavily fractured dolomites that contained oxide infill and films of zinc carbonate (smithsonite), and returned 13.5% Zn. Similarly, composite rock chip sample 1876 returned 9.09% Zn (Anglo Peruana, 2005). This sample was taken over a diameter of 6 m in dolomitic packstones with moderate amounts of iron oxides and films of smithsonite, and also with grains of dark-brown sphalerite associated with gray and white sparry dolomite in less-weathered strata.

Cominco’s 1998 diamond drill hole CR-04 was collared approximately 74 m north of sample 1879. The hole was drilled to a depth of 150 m and was drilled at a dip of 70°and an azimuth of 330°. Following 4.8 m of colluvium and soil, the hole intersected

11.2 m of iron oxide gossan with a grade of 1.20% Zn. Below this (16.0 m to 41.0 m), geochemically anomalous values up to 1,818 ppm Zn were recorded. The remainder of the borehole from 41.0 m to 150 m was drilled in fine-grained dolomites and “de-dolomitized rock”, with calcite pseudomorphs after gypsum or anhydrite.

The Charlita North occurrences are aligned to the northwest and cover an area of approximately 250 x 100 m. Charlita North is a zone which warrants additional follow-up exploration for zinc oxide and carbonate mineralization.

Drilling in the 2008 campaign consisted of hole CR-36-08, drilled 200 m south of the main Charlita North occurrence which intersected 1.7 m of zinc oxide mineralization grading 1.83% Zn from a depth of 1.35 m, and hole CR-06-08 drilled 50 m east of the Charlita North occurrence which did not intersect significant mineralization.

In 2011, fifteen additional drill holes totaling 793.8 meters were completed (as described more fully in Section 10 of this report).

El Aguila Occurrence

The El Aguila occurrence is situated some 100 m northeast of Charlita on the western flank of Quebrada El Aguila. The geology consists of beds of pale grey dolomitic packstones and wackestones separated by horizons containing pseudomorphs after gypsum. The dolomites are medium bedded and weather to a yellowish beige colour. The general strike is northeast–southwest, locally north–south, and the beds dip at around 25° to the southeast, although local variations in dip result from gentle anticlines and synclines. The rocks are fractured along N60°W and north–south directions, the former showing evidence of pre-dolomitization, karstification and infill by dolomitized carbonates and dolomitic breccias.

The principal alteration consists of dolomitization of the original limestone sequence of packstones and wackestones, with re-crystallization and/or precipitation of white and gray sparry dolomite and calcite and bitumen along certain stratabound horizons. In addition, irregular breccias were noted in strongly fractured and pre-karstified zones (including fossil caves with collapse structures; Anglo Peruana, 2005).

Field relationships suggest that the El Aguila occurrence may represent the more distal parts of a horizontal and vertical outward zoning of mineralization from a local centre (fluid access channel), possibly the Charlita occurrence (Anglo Peruana, 2005).

Anglo Peruana channel sample 1771, taken at El Aguila, is 2.0 m in length, and returned grades of 4.93% Zn, 0.06% Pb and 0.3 g/t Ag hosted in pale gray dolomitic wackestones containing veinlets of white sparry dolomite and disseminations of yellowish sphalerite. Around 55 m to the north of sample 1771, at a higher stratigraphic level, dolomitic packstones containing high amounts of iron oxides and zinc carbonates gave an assay value of 4.01% Zn (Sample 1853).

At a point 50 m to the southeast of El Aguila, grey dolomitic packstones with disseminations and veins of dark-brown sphalerite, galena and fine-grained and veinlets of white sparry dolomite. The mineralization is continuous in lenses up to 3 m long and 1.8 m in thickness. Anglo Peruana channel sample 1767, 1.8 m long, returned grades of 1.26% Zn, 0.36% Pb and 0.5 g/t Ag. Channel sample 1765, taken 6 m to the northwest of the previous sample, was collected over a 1.9 m length and gave an assay value of 2.49% Zn (Anglo Peruana, 2005).

An additional mineralized zone lies 70 m to the southeast of El Aguila, in the riverbank on the south side of the Cristal River. Medium-bedded grey dolomitic packstones, corresponding to a stratigraphic level lower than those previously described, contain a cross-cutting irregular vein with disseminations of dark-brown sphalerite associated with irregular veinlets of white sparry dolomite and the development in the host rock of “zebra textures”. The mineralization is irregular, but persists over a length of 15 m. Anglo Peruana channel sample 1780 gave an assay of 1.9% Zn. Anomalous zinc values in meter-long rock chip samples of up to 0.73% Zn (channel sample 1781) were also encountered in the vicinity (Anglo Peruana, 2005).

The El Aguila mineralized outcrops occur over an area approximately 250 m x 300 m, and this area represents a prospective Zn/Pb exploration target that warrants additional investigation.

Alto Cristal Occurrence

The 2008 prospecting and geochemical sampling program carried out at the Alto Cristal prospect did not identify significant zinc mineralization; however, the source of a major stream sediment anomaly, discovered during 2004–2005 (>940 ppm Zn) has not been found and additional prospecting, line cutting, and geochemical sampling is recommended for the area.

San Jose Project

The San Jose prospect consists of several individual occurrences, which are the only examples of mineralization hosted within the Chambará Formation within the Property. Hosted by limestones, the mineralization is restricted to the infill of N50°W-trending dilationary fractures (veins) with calcite containing disseminations of galena and pyrite. Upstream along the Rio San Jose, east of the Tihuja Fault, an outcrop of dolomite close to the top of the Chambará Formation contains superficial oxides of iron which give a weak but positive response to “zinc-zap” solution (Anglo Peruana, 2005).

A suite of soil and outcrop samples were taken from the San Jose prospect during the 2008 field program; however, no significant results were obtained.

Additional rock sampling in 2011 (129 samples) encountered highly anomalous zones with up to 23.9% zinc. Additional soil sampling in 2011 (57 samples) encountered anomalies of up to 3,207 ppm zinc. Forty-five stream sediment samples were collected in

2011, and these yielded spectacular anomalies (especially in the southern part of the Project area) of up to 1.17% zinc.

7-4: MINERALIZATION

The principal style of mineralization on the Property is typical of a MVT base metal (zinc ± lead) model overprinted by tropical supergene weathering.

Mineralization consists dominantly of masses of amorphous orange-brown and white zinc oxides including smithsonite (ZnCO3) and hydrozincite (Zn5(CO3)2-(OH)6), cerussite (PbCO3) and limonite and other iron oxides and hydroxides. In several deeper drill holes, primary sulphide minerals such as pyrite, sphalerite and coarse blebs of galena are also found. Widespread fine-grained disseminated pyrite often replaced by limonite is prevalent throughout the dolomites, and probably arrived early, associated with the dolomitizing process. Zinc and lead mineralization followed later, and has a more restricted distribution close to feeder structures. As a result, iron mineralization forms an extensive halo around the zinc/lead mineralization. Bitumen is present throughout the dolomites, but particularly in association with the zinc and lead mineralization.

7-4-1: PARAGENESIS AND ZONING

On the basis of observations made in the field by Anglo Peruana (2005), the following mineral paragenesis has been proposed from oldest to youngest:

 Fine-grained pyrite, with some larger cubic crystals, dolomite, white sparry dolomite  Dark-brown sphalerite, fine-grained pyrite, white sparry dolomite, gray sparry dolomite, quartz  Galena, white sparry dolomite, calcite  Ruby sphalerite, pale yellow sphalerite, calcite, quartz.

FIG. 7-11: CONCEPTUAL MODEL OF MINERALIZATION AT THE CRISTAL PROJECT

Widespread dolomitization of the Condorsinga Middle Unit, which comprised the earliest phase of the alteration/mineralization process was accompanied by depositionof disseminated, fine-grained pyrite. With the development of the mineralizing system, fine- grained pyrite was accompanied by dark-brown sphalerite in mineral accumulations moving outwards from the feeder structures.

SECTION 8: DEPOSIT TYPES

The zinc and lead mineralization on the Cristal Property is interpreted to be an example of Mississippi Valley-Type (MVT) mineralization, with a supergene tropical weathering overprint oxidizing the primary MVT sulphide mineralization. This class of mineral deposit does not represent a single style or a common genetic model due to the large range of geological and geochemical processes involved in mineralization, transportation, and deposition. According to Sangster (1983; in Leach and Sangster, 1993) there are only a few common parameters common to all MVT districts worldwide, which therefore preclude a single descriptive or genetic model for all MVT deposits.

The following description of MVT deposits is taken from Leach and Sangster, 1993:

MVT lead-zinc deposits are a varied family of epigenetic ores occurring predominantly in dolostone and in which lead and zinc are the major commodities. Although found throughout the world, major districts occur only in the United States, Canada and Poland; a potentially large new district is currently being developed in northwestern Australia. Deposits are generally small (most are <2 Mt) and zinc-dominant, and grades seldom exceed 10% Pb + Zn. Most are found in Cambro-Ordovician, Devono Carboniferous and Triassic rocks.

Undeformed orogenic foreland carbonate platforms are the favoured tectonic setting for MVT deposits; some occur in carbonate sequences in foreland thrust belts bordering foredeeps; and fewer still are associated with rift zones.

MVT deposits typically occur in districts covering hundreds, or even thousands, of square kilometres. Within each district, deposits display remarkable similarities in mineral assemblages, isotopic compositions and textures. Ore controls are also typically district specific; examples include shale edges (depositional margins of shale units), limestone- dolostone transitions, reef complexes, solution-collapse breccias, faults and basement topography.

The most common forms of alteration include dolomitization, brecciation and local recrystallization or dissolution of host rocks; silicification is normally minimal but is important in two districts. Organic matter associated with MVT deposits is usually altered to insoluble, hydrogen-poor material. Formation of authigenic clay and feldspar minerals has been recognized in some districts.

Deposits do not normally display internal mineralogical or chemical zoning, although there are exceptions. Ore textures are extremely varied and range from massive replacement to clusters of crystals partially filling primary pore spaces. Sulphide cement in collapse breccias, ranging in habit from extremely large crystals to aphanitic botryoidal, and geopetal textures, such as internal sediments and “snow-on-roof”, are diagnostic of MVT deposits.

Age of mineralization is important in modeling of MVT deposits. Recent studies have shown that in many districts mineralization was coeval with tectonic uplift of distant orogenic belts; in some instances, the mineralization took place >200 m.y. after deposition of the host rocks. Ore fluids are saline (typically 10-30 wt.%) and dominated by chlorine, sodium, calcium, potassium and magnesium. Temperatures of the ore fluids typically range between 75º and 200ºC. Lead-and sulphur-isotope geochemical studies indicate that the ultimate sources of these elements were likely basement rocks and seawater, respectively. The immediate sources of the ore and gangue minerals, however, were probably the sedimentary successions in which the deposits are found.

Gravity-driven fluid flow, resulting from uplift of margins of foreland basins, best explains the regional extent of MVT mineralization. By this process, groundwater, recharged in the orogenic flank of the basin, migrates through the deep portions of the basin, thereby acquiring heat and dissolved components. The fluids are then discharged through an enormous hydrothermal system affecting broad areas along the cratonic flank of the basin. Factors controlling subsequent sulphide deposition are poorly understood.

The mineralization within the Property is considered to be typical of MVT mineralization as it contains the following features:

 Occurs in dolostone, and lead and zinc are the primary metals  Hosted in carbonate platform sequence  Occurs as part of a district-wide cluster of Zn-Pb mineralization  Mineralization controls related to limestone-dolostone transitions, solution- collapse breccias, faults and basement topography  Alteration comprising dolomitization, brecciation and local recrystallization or dissolution of host rocks  Mineralization association with organic matter (bitumen).

SECTION 9: EXPLORATION

In addition to geological mapping, which has been described in Section 7, the following work was done in 2008 and 2011.

 2008 (and late 2007): Completion of a drill program comprising 40 holes (4,380 m of HQ coring) with an average length of about 100.0 meters per hole from 23 platforms at the Cristal and Charlita Projects. Collection of 445 rock-chip and channel samples from outcrops and subcrops, collection of 389 soil samples and collection of 79 stream-sediment samples. Completion of a gas-in-soil survey, a twelve-line 27.4 km magnetic survey and a thirteen-line 26.9 km Induced Polarization survey. (All of the programs reported above were described in Wright (2010), and the information will not be fully repeated in this section).

 2011: Completion of a drill program comprising 57 holes (3,300 m of HQ coring) with an average length of about 60.0 meters per hole from 21 platforms at Cristal and Charlita. Collection of 328 rock-chip and channel samples from outcrops and subcrops, collection of 482 soil samples, and collection of 260 stream sediment samples. Drilling results are discussed in Section 10-1. At the San Jose Project, two scout holes were drilled in 2011; a vertical hole that was 719.8 meters long, and an inclined hole (-70°, azimuth 020°) that was 697.25 meters long. Both holes intersected extensive zinc sulfide anomalies. A full description of drilling results is given in Section 10-2.

It is important to point out that most of the soil sampling and rock sampling (and almost all the drilling) completed on the claims to date are restricted to a 225-ha portion of the property comprising the Cristal-Charlita prospect in the northeast portion of the claim block. In fact, of 1,644 rock and soil samples collected on the property in 2008 and 2011, only 280 samples were taken outside of the Cristal-Charlita prospect. In other words, 83% of the rock-soil sampling is concentrated on 1.2% of the property. On page-size maps such as those that accompany this section, this fact might not be intuitively obvious because the map symbols, in order to be visible, actually occupy an inordinate amount of space, and so it appears that considerably more work has been done in other parts of the property. The author mentions this fact in order to emphasize that there are vast parts of the property that have not been adequately explored.

Stream-sediment samples, however, were collected exclusively outside of the Cristal- Charlita area; mainly in the southern half of the property (Zona Florida and Zona San Jose). These returned abundant anomalous zinc values, suggesting that there is considerable exploration potential in that part of the property. For example, of 260 stream-sediment samples collected from the south half of the property in 2011, half the samples carried >500 ppm zinc.

9-1: SOIL SAMPLING

Soil sampling results for the property in general and for the Cristal Project area in particular are depicted in Figures 9-1 and 9-2 respectively.

FIGURE 9-1 ZINC IN SOIL SAMPLES, 2008 AND 2011

Soil samples in 2008 and 2011 were collected using the following procedures. A square pit was excavated, generally measuring 1.0m X 1.0mX 1.0m in order to ensure complete

55 penetration of the organic horizon and extension into the B horizon. Only the B horizon was sampled, and this was done by collecting vertical 15-cm-wide channel samples from the four walls of the pit. The resulting sample generally weighed 2-3 kg. Samples were bagged in the field and taken back to the Cristal camp, where they were dried, screened, and quartered to obtain a final sample weight of about one kg. The samples were placed into rice sacks and transported by horse to Yambrasbamba. A Company driver transported the samples to the town of Pedro Ruiz, where they were transferred onto a bus for transportation to Rio Cristal in Lima and subsequent immediate delivery to the laboratory.

Basic statistical analyses for zinc and related anomalous elements are given in Tables 9-1 for 2008 sampling and Table 9-2 for 2011 sampling. Of the 871 soil samples collected in 2008 and 2011, 88.7% (772 samples) were collected from the Cristal-Charlita area within a zone measuring about 225 hectares. In 2008, soils were collected at nominal 100-m intervals along east-west lines separated by 100 meters. In 2011, parts of the Cristal- Charlita area were in-filled at nominal 25-m intervals along east-west lines separated by 25 meters.

Figure 9-2 is a detail showing results from the Cristal-Charlita area. A 1,000-ppm zinc-in- soil contour is shown over each of the two zones. In both cases, the contour encompasses an area of about 35 hectares. At Cristal, the contour encompasses 98 samples from the 2008 campaign and 89 samples from the 2011 campaign. The median (50%ile) zinc assay from the 2008 campaign is 3,080 ppm (0.31%), whereas the median zinc assay from the 2011 campaign is 1,945 ppm (0.19%).

At Charlita, the contour encompasses 61 samples from the 2008 campaign and 89 samples from the 2011 campaign. The median zinc assay from the 2008 campaign is 2,250 ppm (0.22%), whereas the median zinc assay from the 2011 campaign is 3,293 ppm (0.33%). In other words, The Cristal Project appears to be significantly more anomalous based on 2008 results (median 0.31% Zn) than 2011 results (median 0.19%), whereas the opposite is the case for the Charlita Project, which appears to be considerably more anomalous based on 2011 results (median 0.33% Zn) than on 2008 results (median 0.22% Zn). If the differences were consistently higher in both zones for either the 2008 and 2011 campaigns, this might signify a laboratory problem, since different laboratories were used for the two campaigns. But since this is not the case, the author believes that the differences are simply true reflections of variations of zinc in soils in these very anomalous zones.

FIGURE 9-2 ZINC IN SOIL SAMPLES, CHARLITA AND CRISTAL, 2008 AND 2011

Interesting soil anomalies were identified in the San Jose occurrences and in Zona Florida (Figure 9-1), situated seven to fifteen km to the southwest of the Cristal-Charlita area. At Zona San Jose, 16 of 57 soil samples collected assayed >500 ppm (max 3,207 ppm) zinc, and the median assay for all samples is 300 ppm Zn. At Zona Florida, 7 of 58 soil samples collected assayed >500 ppm (max 1,325 ppm) zinc, and the median assay for all samples is 190 ppm Zn.

At Quebrada Northeast, about three km northwest of the Cristal-Charlita area (Figure 9- 1), five reconnaissance-scale soil samples collected in 2008 from a 34-hectare area returned assays of 1,100 to 1,700 ppm Zn.

On the subject of elemental associations; in general there does not appear to be a consistent correlation between zinc, lead, iron, cadmium and silver assays, although it can be said that high zinc assays commonly correspond to elevated lead, cadmium and silver assays, and to depressed iron assays.

As will be seen in the next section, there is excellent spatial correspondence between zinc-in-soil anomalies and zinc-in-rock anomalies. Because outcrop exposure is so sparse

57 on the property (<1%), soil surveying is considered an excellent method for identifying targets warranting detailed follow-up.

Zinc ppm Lead ppm Iron % Cadmium Silver ppm ppm Maximum 285,000 (28.5%) 18,800 (1.8%) 49.2 N/S N/S 10%ile 6,200 1920 35.0 20%ile 2,600 789 27.0 50%ile 551 130 12.5 (median) average 4,480 743 15.7 TABLE 9-1: SOIL SAMPLING SUMMARY AND STATISTICS, 2008, N=389

Zinc ppm Lead ppm Iron % Cadmium Silver ppm ppm Maximum 40600 (4.06% 34000 (3.4%) 47.2 130 N/S 10%ile 5470 1997 30.9 7 20%ile 2410 781 25.6 3 50%ile 520 157 12.6 1 (median) average 1900 820.9 15.1 3.82 TABLE 9-2: SOIL SAMPLING SUMMARY AND STATISTICS, 2011, N=482

9-2: ROCK SAMPLING

Rock sampling results for the property in general and for the Cristal-Charlita area in particular are depicted in Figures 9-3 and 9-4 respectively. Basic statistical analyses for zinc and related anomalous elements are given in Table 9-3 (2008 sampling) and Table 9- 4 (2011 sampling). Of the 773 rock samples collected in 2008 and 2011, 76.7% (593 samples) were collected from the Cristal-Charlita area within a zone measuring about 225 hectares.

Figure 9-4 is a detail showing results from the Cristal-Charlita area. The 1,000-ppm zinc- in-soil contour (from Figure 9-2) is shown over each of the two zones in order to demonstrate that the soil sampling survey precisely identified the area of anomalous zinc in rock.

FIGURE 9-3, ZINC IN ROCK SAMPLES, 2008 AND 2011

FIGURE 9-4: ZINC IN ROCK SAMPLES, CHARLITA AND CHRISTAL, 2008 AND 2011

At the Cristal Project, 300 rock samples collected in 2008 gave a median (50%ile) zinc assay of 6,100 ppm (0.61%), whereas 80 rock samples collected in 2011 returned a meagre median assay of 110 ppm. The reason for this is that all the obvious mineralized outcrops were sampled in 2008, whereas all outcrops found on the expanded 2011 grid were sampled, whether mineralized or not.

At the Charlita Project, 108 rock samples collected in 2008 gave a median (50%ile) zinc assay of 4,390 ppm (0.44%), whereas 105 samples collected in 2011 returned a median assay of only 90 ppm. The reason for the dichotomy is the same as that explained for the Cristal Project.

At San Jose norte (Figure 9-3), 21 rock samples were collected in 2011, and all but one register assays of <500 ppm (the exception assayed 623 ppm Zn). In conclusion, no target has been identified for follow-up.

At San Jose central (Figure 9-3), 28 rock samples were collected in 2011 from an area measuring about 300 hectares. The rocks have a median zinc value of 251 ppm Zn, and there are five samples that assayed >1000 ppm Zn (maximum 2700 ppm Zn). Most of these higher-grade samples are described as “bituminous limestone” (no dolomitization

60 noted). Sample widths are narrow (10-20 cm). In conclusion, no specific target has been identified for follow-up, but there is zinc in the system.

At San Jose Sur (Figure 9-3), 80 rock samples were collected in 2011 from an area measuring about 450 hectares. The rocks have a median zinc value of 400 ppm, and there are 16 samples that assayed >1000 ppm Zn (1,096 to 8,544 ppm Zn, and two exceptionally anomalous values of 55,300 and 239,900 ppm). The highest-grade sample (23.9% Zn) is from a 1.5-m-long channel taken in what is described as “muddy limestone”. The second-highest-grade sample (5.53% Zn) is from a 0.7-m-long channel taken from what is described as “crackle breccia”. Most of the other anomalous samples are described as “bituminous limestone”. Dolomitization was not observed, however, the rock geochemistry is intriguing and is supported by stream-sediment anomalies draining the same general area. Additional work is recommended as this is considered to be the best prospect discovered in the 2011 reconnaissance.

At Florida (Figure 9-3), 21 rock samples were collected in 2008 from an area measuring about 260 hectares. The rocks have a median zinc value of 247 ppm, and there are 4 samples that assayed >1,000 ppm Zn (range, 2,170 to 2,930 ppm Zn). These four higher- grade samples are described as “black limestone”. Dolomitization was not observed, however, the rock geochemistry is intriguing and is supported by stream-sediment anomalies draining the same general area.

At Baguas (Figure 9-3), twelve rock samples were taken in 2008, but zinc values were low (all but one registered <50 ppm Zn), although dolomitization was observed and there are a few soil anomalies that are not explained.

Zinc ppm Lead ppm Iron % Cadmium Silver ppm ppm Maximum 416,000 (41.6%) 41,000 (4.1%) 50 1,000 84.3 10%ile 69,500 (6.95%) 4,760 39.8 299 9.4 20%ile 25,700 (2.57%) 2,360 33.1 69.3 1.9 50%ile (median) 4,900 350 9.3 8.6 0.2 average 30,400 (3.4%) 1,760 16.34 100 3.84 TABLE 9-3: ROCK SAMPLING SUMMARY AND STATISTICS, 2008, N=445

Zinc ppm Lead ppm Iron % Cadmium Silver ppm ppm Maximum 239,900 (24%) 1,040 50.79 410 N/S 10%ile 1,467 49 4.34 12 20%ile 589 32 3.25 3 50%ile (median) 151 16 2.19 1 average 1,900 33.8 2.77 8.7 TABLE 9-4: ROCK SAMPLING SUMMARY AND STATISTICS, 2011, N=328

9-3: STREAM SEDIMENT SAMPLING

Stream sediment samples were composed of active stream sediments, taken in the middle of the river/stream where it is believed natural traps produce a mature accumulation of finer sediment fractions. Each sample weighed approximately 500 g and consisted of a composite of smaller amounts of material taken from different sites, up to 10 m apart, to minimize the influence of spurious sampling points. Locations were marked in the field with the sample number written on orange fluorescent marking tape and tied to an adjacent tree. During the collection process the grid reference (measured with GPS) and a brief description of bedrock and boulder composition were noted in the field.

No additional sample preparation occurred in the field and samples were taken to the Cristal camp on a daily basis. At the camp they were stored in a secure shed until a sufficient number of samples were backlogged. The samples were placed in strong rice sacks and loaded onto a horse and transported to the town of Yambrasbamba. Here the samples were met by a representative of Rio Cristal who transported them to the town of Pedro Ruiz where they were sent via bus transport directly to Lima.

Sediment-assay results for the property are depicted in Figure 9-5. Basic statistical analyses for zinc and related anomalous elements are given in Tables 9-5 for 2008 sampling and Table 9-6 for 2011 sampling.

There are three main targets indicated by the results of stream-sediment sampling. These are indicated as “SED ANOMALY 1, SED ANOMALY 2, and SED ANOMALY 3 on Figure 9-5.

SED ANOMALY 1 corresponds to Zona San Jose (Sur), which has been identified as the best reconnaissance target based on rock-sampling surveys. In total, 31 stream-sediment samples were collected from an area measuring 151 hectares. The median zinc assay is 2,100 ppm (0.21%), and the maximum zinc assay is 1.17% Zn.

SED ANOMALY 2 corresponds to Zona Florida, which has been identified as the second-best reconnaissance target based on rock-sampling surveys. In total, 45 stream- sediment samples were collected from an area measuring 255 hectares. The median zinc assay is 1,030 ppm, and the maximum zinc assay is 5,170 ppm (0.51%). This area should be considered the second priority for detailed follow-up, particularly the easternmost part of the anomaly where 13 stream-sediment anomalies returned a median assay of 2,200 (0.22%) zinc (maximum 5,170 ppm ).

SED ANOMALY 3 corresponds to Zona San Jose (Central), which has been identified as the third-best reconnaissance target based on rock-sampling surveys. In total, 14 stream- sediment samples were collected from an area measuring 131 hectares. The medina zinc assay is 1,100 ppm (0.11%) and the maximum zinc assay is 2,164 ppm (0.22%).

Elsewhere on the property there are scattered anomalous zinc assays in stream sediments, but no anomalous groupings that suggest the presence of a sizeable target.

9-5 STREAM SEDIMENT SAMPLES, 2008 AND 2011

Zinc ppm Lead ppm Iron % Cadmium ppm Silver ppm Maximum 5,170 343 11.3 Not significant Not significant 10%ile 1,820 57 3.63 20%ile 1,335 40 3.23 50%ile 850 30 2.70 (median) average 1,046 40.3 2.98 TABLE 9-5: SEDIMENT SAMPLING SUMMARY AND STATISTICS, 2008, N=79

Zinc ppm Lead ppm Iron % Cadmium ppm Silver ppm 11,800 553 11.73 247 Not significant Maximum (1.18%) 10%ile 1,731 49 2.97 26 20%ile 851 32 2.61 15 50%ile 524 25 2.27 8 (median) average 923.5 35.3 2.35 13 TABLE 9-6: SEDIMENT SAMPLING SUMMARY AND STATISTICS, 2011, N=260

SECTION 10: DRILLING

10-1: DRILLING, CRISTAL AND CHARLITA PROJECTS

Drill holes for both the 2008 and 2011 campaigns at the Cristal and Charlita Projects are shown in Figure 10-1.

FIGURE 10-1 DRILL HOLES CRISTAL AND CHARLITA 2008 AND 2011

Drilling conducted in 2008 (40 holes totalling 4,380.2 meters) is described in Wright 2010 and his information is not fully reproduced here. Table 10-1, significant intercepts 2008, and Appendix #1, drill details 2008 drilling, are given below for the sake of completion.

From To Length Drill hole Target Zone Zn (%) Pb (%) Meters Meters Meters CR-02-08 Yolanda Centro (Cristal) 10.75 12.30 1.55 6.93 1.85 CR-03-08 Esperanza N (Cristal) 56.10 60.10 4.00 23.66 0.01 CR-05-08 Yolanda Centro (Cristal) 21.60 37.30 15.70 9.33 0.15 57.75 63.85 6.10 12.11 0.11

CR-07-08 Esperanza N (Cristal) 16.90 29.55 12.65 18.72 0.40 36.30 39.45 3.15 4.63 0.04

42.35 47.80 5.45 9.48 0.05

49.00 64.20 15.20 11.40 0.01

CR-08-08 Esperanza N (Cristal) 24.60 26.60 2.00 18.29 0.30 31.85 41.65 9.80 19.55 0.30

43.50 46.15 2.65 12.05 0.01

CR-09-08 Yolanda N (Cristal) 3.00 13.10 10.10 6.94 0.62 CR-11-08 Esperanza N (Cristal) 9.63 18.22 8.59 22.73 0.33 19.70 21.80 1.80 13.67 0.40

CR-12-08 Yolanda N (Cristal) 1.70 3.50 1.80 6.75 0.16 4.15 9.10 4.95 8.72 0.64

CR-13-08 Esperanza E (Cristal) 12.90 27.40 14.50 14.69 0.47 CR-14-08 Esperanza E (Cristal) 11.00 23.45 12.45 26.06 0.07 CR-17-08 Esperanza E (Cristal) 6.05 10.50 4.45 6.94 0.49 CR-18-08 Esperanza E (Cristal) 5.65 28.80 23.15 19.87 0.12 32.35 35.10 2.75 10.98 0.01

41.90 44.65 2.75 6.08 0.00

CR-19-08 Yolanda S (Cristal) 24.00 26.35 2.35 3.77 0.02 27.50 31.95 4.45 17.82 0.01

CR-20-08 Esperanza W (Cristal) 49.55 65.10 15.55 29.54 1.38 CR-22-08 Yolanda SS (Cristal) 10.10 14.30 4.20 9.02 0.03 18.15 25.70 7.55 16.70 0.01

CR-24-08 Esperanza W (Cristal) 23.80 31.95 8.15 23.57 0.76 68.00 72.30 4.30 13.07 0.00

CR-25-08 Esperanza W (Cristal) 36.30 38.35 2.05 22.53 1.62 42.20 44.30 2.10 4.05 0.36

CR-27-08 Yolanda SS (Cristal) 84.30 86.25 1.95 14.48 0.00

TABLE 10-1: SIGNIFICANT INTERCEPTS, 2008 DRILLING

Drilling in 2011 was done by Energold Drilling Peru SAC using a portable drill (Hydracore 255 Rig) weighing 11 tonnes with a power capacity of 84 horsepower delivered by two 4-cylinder motors. A total of 55 holes were completed on 21 platforms, and 3,342.25 meters of HQ core (diameter 6.35 cm) were retrieved. The average length of the drill holes was 60 meters. Most of the drilling (2,548.45 m) was concentrated at the

Cristal Project (40 holes on 15 platforms) with the objectives of expanding the mineralization drilled in 2008 and of securing enough information with infill drill holes to calculate tonnage and grade in the mineral resource category. Fifteen scout holes (793.8 m) on six platforms were drilled at the Charlita Project. Two scout holes (1,407.1 m) on two platforms were drilled at the San Jose Project.

In total, 1,584 core samples (excluding 175 blanks, standards and duplicates) were sent to Inspectorate Laboratory in Lima for analysis. The average sample interval was 1.94 meters, and the aggregate length of all the core samples was 3,077.65 meters. In general, core recovery was good (>95%), although occasionally open spaces were encountered (karsts) and the apparent recovery therefore was reduced, but rarely to less than 85%.

Table 10-2 is a compilation of all intercepts >2.0% zinc and Appendix #2 gives details of the 2011 drilling campaign. The relationship of mineralized intercepts to “true width” cannot be stated with certainty for this type of deposit because the mineralization is neither tabular nor vein-like, but rather comprises infill of open spaces (caves) that does not have a specific orientation.

Table 10-3 gives basic statistical information for Zn, Pb, Ag and Cd from the core samples. Cadmium anomalies (>1000 ppm) always correspond to high-grade zinc (>10%), whereas silver anomalies (>30 ppm) almost always correspond to lead anomalies (>2,000 ppm). There is no correlation between zinc and lead, zinc or silver. Concentrations of lead and silver are not economically important as can be appreciated from the percentile figures given in Table 10-5. In fact, there are only 27 lead assays of >1.0% (maximum 11.3%) compared to 280 zinc assay of >1.0% (maximum 42.25%. There are only 11 silver assays >30 ppm (maximum 72.5 ppm).

Table 10-4 gives basic statistical information for Zn, Pb, Ag and Cd for the 2008 drill campaign. As can be seen, the 2008 drill campaign intersected more high-grade segments than the 2011 campaign. This is largely attributable to the fifteen “scout” holes at the Charlita Project, where mineralization was successfully encountered in several holes, but the zinc grades were generally low compared to the Cristal Project. Also, whereas the infill drill holes at the Cristal Project generally succeeded in intersecting high-grade zinc, most of the holes spotted outboard of the Cristal Project in the hope of expanding the size of the deposit failed to intersect significant zinc

from px hole zone (m) to (m) int (m) Zn *includes *0.35m of 7.0%Zn (18.7 to 19.05 m) CR 53 Cristal 9.70 27.20 17.50 2.26% *1.5m of 6.36%Zn (25.7 to 27.2 m) CR 53 Cristal 54.65 58.70 4.05 6.97% *2.75m of 6.57%Zn (21.95 to 24.7 m) CR 59 Cristal 3.95 27.85 23.90 2.65% CR 60 Cristal 7.70 18.90 11.20 6.98% *3.2m of 12.36%Zn (15.7 to 18.9 m) *1.05m of 23.4%Zn (32.9 to 35.3 m, CR 60 Cristal 32.90 37.50 4.60 7.38% includes 1.35-m cavity) CR 61 Cristal 0.70 32.00 31.30 4.43% *12m of 6.21%Zn (8.5 to 20.7 m) *3.5m of 7.62%Zn (5.2 to 8.7 m) CR 62 Cristal 0.30 18.20 17.90 5.56% *1.5m of 27.22%Zn (16.7 to 18.2 m) CR 63 Cristal 1.70 12.70 11.00 26.46% CR 65 Cristal 30.20 30.70 0.50 5.40%

CR 65 Cristal 45.20 46.70 1.50 6.08% CR 65 Cristal 49.70 52.20 2.50 3.34% CR 70 Cristal 0.00 1.60 1.60 15.97% CR 70 Cristal 1.60 6.70 5.10 2.39% *1.85m of 16.7%Zn (26.85 to 28.7 m) CR 72 Cristal 25.85 39.50 13.65 8.08% *2.0m of 20.03%Zn (33.7 to 35.7 m) *2.0m of 11.4%Zn (19.7 to 21-7 m) CR 73 Cristal 2.00 29.50 27.50 3.52% *9.0m of 7.1%Zn (19.7 to 28.7 m) CR 74 Cristal 13.80 25.20 11.40 14.49% CR 75 Cristal 22.7 24.7 2.00 24.09% CR 76 Cristal 25.70 40.40 14.70 5.21% *7.0m of 7.77%Zn (25.7 to 32.7 m) CR 76 Cristal 62.80 68.30 5.50 5.90% *0.9m of 27.22%Zn (62.8 to 63.7) CR 77 Cristal 29.10 33.10 4.00 19.05% CR 78 Cristal 0.00 0.50 0.50 10.34% CR 80 Cristal 45.20 52.90 7.70 4.89% CR 80 Cristal 56.20 60.00 3.80 2.66% CR 81 Charlita 27.20 35.40 8.20 2.02% CR 89 Charlita 13.70 18.10 4.40 2.55% CR 90 Charlita 3.80 7.70 3.90 2.86% CR 91 Charlita 3.30 12.20 8.90 2.27% *1.0m of 6.08%Zn (6.2 to 7.2 m) CR 94 Charlita 4.00 6.20 2.20 2.99% CR 95 Charlita 13.70 19.70 6.00 2.84%

TABLE 10-2: SIGNIFICANT (>2% Zn) INTERCEPTS, 2011 DRILLING

Zn% Pb% Ag ppm Cd ppm maximum 50.5 10.6 72.6 >1000 10%ile 13.5 0.65 7.6 670 20%ile 5.3 0.23 3.2 273 50%ile (median) 0.88 0.01 0.4 27.5

TABLE 10-3: BASIC STATISTICS, 2008 DRILL PROGRAM, N=1,010

Zn% Pb% Ag ppm Cd ppm maximum 42.25 11.7% 72.5 2778 10%ile 2.3 0.085 1.4 104 20%ile 0.76 0.013 0.6 36 50%ile (median) 0.12 0.0016 <0.2 4

TABLE 10-4: BASIC STATISTICS, 2011 DRILL PROGRAM, N= 1,584

10-2: DRILLING, SAN JOSE PROJECT

At the San Jose Project, two scout holes were drilled by the Company in 2011; a vertical one that was 719.8 meters long, and an inclined hole (-70°, azimuth 020°) that was 697.25 meters long (Figure 10-2). It was hoped that these holes, which were spotted in the Aramachay Formation, would penetrate the underlying Chambará Formation deeply enough to intersect the same stratigraphic level where significant zinc mineralization is known at Florida Canyon on the adjacent property of Solitario. Company geologists believe, based on known stratigraphic correlations, that the holes did not reach the target. However, extensive zinc anomalies were intersected. For example, the vertical hole intersected 95 meters with a weighted average grade of 0.17% zinc. Similar grades were found in the inclined hole, which culminated in limestone grading 0.38% zinc, which is the highest of 254 assays taken from the drill holes. Unfortunately the hole could not be pushed deeper due to mechanical limitations of the drill being used.

From an academic point of view, these extensive zinc anomalies must be involved in the ore-grade mineralization process, and undoubtedly will be studied in the future. From a practical point of view, the anomalies underscore the fact that the Bongará region is a zinc metallotect.

FIGURE 10-2: ZN IN STREAM SEDIMENTS AND DRILL HOLE LOCATIONS

SECTION 11: SAMPLE PREPARATION, ANALYSES AND SECURITY

For the work done in 2008 (and the latter part of 2007), all samples were prepared and analyzed by ALS Laboratory Group in Lima, Peru (ALS). The preparation procedure at ALS comprised drying samples at 105°C followed by coarse crushing in a jaw crusher to 70% passing -2 mm, followed by pulverization of a 250 g split in a ring and puck mill to 85% passing 75 μm. The analytical procedure at ALS Chemex included use of atomic absorption spectroscopy to determine zinc and lead using the Zn-AA46 and Pb-AA46 packages, a 35-element ICP-AES analysis with aqua-regia digestion, and a trace mercury analysis from cold vapor with an atomic-absorption finish. ALS is registered in Peru as an ISO 9000-2008-certified Company. Rio Cristal Resources Corp does not have any special arrangement with the ALS Laboratory Group other than that of a client-provider relationship.

For the work done in 2011, all samples were prepared and analyzed by Inspectorate Services Peru SAC. The analytical procedures were similar to the ALS procedures. Inspectorate is registered in Peru as an ISO 9001-2000-certified Company. Rio Cristal Resources Corp does not have any special arrangement with Inspectorate other than that of a client-provider relationship.

Sample shipment procedures were discussed in Section 9 (Exploration) and were witnessed by the author in the field. The author is satisfied with laboratory and security procedures.

SECTION 12: DATA VERIFICATION

Mississippi-Valley-Type mineralization is typically coarse grained and assays can often be confirmed by visual estimates. During the author’s visit of January 26 and 27, 2011, the author carefully examined core from eight drill holes (CR 07, 08, 13, 14, 18, 22, 24 and 35) and verified that visual estimates of zinc grade matched laboratory measurements.

The author also examined a random selection of original laboratory certificates for rock, core, soil and stream-sediment samples and verified that assay values in the various databases, from which many maps in this report were generated, correspond to the values listed on the laboratory certificates.

During visits to the property on January 26-27 and June 9-11, 2011, the author witnessed procedures for collecting rock samples and soil samples, for splitting core, and for packaging and transporting samples by horse, truck, and bus to Lima for laboratory analysis. The author is satisfied with all procedures.

Data was also verified by the Company using inserts of standards, duplicates and blanks to ensure consistency, accuracy and precision of laboratory results. As can be appreciated in Quality Assurance and Control lists given in Appendices 3 (Rock Samples), 4 (Soil Samples) and 5 (Drill Core), results are very consistent for standards and blanks and reasonably consistent for duplicates.

SECTION 13: MINERAL PROCESSING AND METALLURGICAL TESTING

There is nothing to report in this section

SECTION 14: MINERAL RESOURCE ESTIMATES

There is nothing to report in this section.

SECTION 15: MINERAL RESERVE ESTIMATES

There is nothing to report in this section.

SECTION 16: MINING METHODS

There is nothing to report in this section.

SECTION 17: RECOVERY METHODS

There is nothing to report in this section.

SECTION 18: PROJECT INFRASTRUCTURE

There is nothing to report in this section.

SECTION 19: MARKET STUDIES AND CONTRACTS

There is nothing to report in this section.

SECTION 20: ENVIROMENTAL STUDIES, PERMITTING, SOCIAL IMPACT

There is nothing to report in this section.

SECTION 21: CAPITAL AND OPERATING COSTS

There is nothing to report in this section.

SECTION 22: ECONOMIC ANALYSIS

There is nothing to report in this section.

SECTION 23: ADJACENT PROPERTIES

Adjacent properties include Solitario’s Florida Canyon advanced zinc- exploration project to the south, which is managed by Votorantim Metais and Cemento Pacasmayo’s “Mina Grande” to the east, which is currently on standby (Figure 23-1).

FIGURE 23-1: ADJACENT PROPERTIES

Florida Canyon is about 3 km south of the southern boundary of the Company’s Bongará property. In September 2011, Solitario Exploration & Royalty, owner of Florida Canyon, discussed the property at the Denver Gold Forum during a company presentation. Key elements in the presentation include:

 Exploration is being funded and carried out by Votorantim Metais, who can earn a 70% interest in the property by bringing the property into production. Votorantim Metais is Brazil’s largest zinc producer.

 The Florida Canyon deposit (also called Bongará) is one of the world’s largest undeveloped zinc deposits.

 Production is anticipated in the first quarter of 2015 at an initial rate of 108,000 tonnes of zinc metal; 16,000 tonnes of lead; and 400,000 ozs. of silver in concentrate per year.

 The initial deposit has potential of +20 million tonnes of 9% Zn + Pb and 0.4 opt Ag with significant possibilites for defining resources.

 Capital costs are estimated at $140 million and costs are estimated to be in the second quartile of world zinc production costs.

 12,242 meters were drilled in 2010 and 10,000 meters were planned for 2011.

 Metallurgical testing showed positive results and is continuing.

 The deposit consists of multiple ellipsoid-shaped mineralized bodies which are stacked within a vertical interval of more than 100 meters.

Mineralization at Florida Canyon is thought by the author to be of the Mississippi- Valley-Type related to karst features in dolomitized carbonates of the Chambará Formation.

Mina Grande is 4 km from the eastern boundary of the Bongará property. Mineralization, dominantly as oxides (smithsonite, hemimorphite and hydrozincite), is hosted in dolomitized carbonates of the Condorsinga Formation. The mineralized body is 1,500 m long, 400 m wide, and extends below surface to depths of 20 to 60 meters (Wright, 2010).. The zinc oxides apparently form a residual cap along the crest of an anticlinal structure.

In 2007 and 2008, Cementos Pacasmayo operated a surface mining operation, trucking zinc oxide ore to a kiln in Pacasmayo for processing to produce calcines

84 which were then sold to zinc refineries. The grade and tonnage of the deposit are not known and the operation is thought to have closed due to low zinc prices.

SECTION 24: OTHER RELEVANT DATA AND INFORMATION

There is nothing to report in this section.

SECTION 25: INTERPRETATION AND CONCLUSIONS

Mineralization in the Bongará region is of the Mississippi-Valley Type. The author suggests that mineralization is analogous to the Florida Canyon Deposit and San Vicente Mine in Peru and to the Pine Point District of the Northwest Territories, Canada (albeit, ore is in sulphides and not oxides). Similarities include:

 Zn-Pb mineralization is associated with dolomitized limestones  Zinc content exceeds lead content  There are multiple separate deposits scattered over a large area  Mineralization appears to be open-space filling and/or manto replacement associated with karstification  Dimensions of individual mineralized bodies are similar.

At Pine Point, there are 100 drill-defined ore bodies scattered in an area measuring approximately 25 km by 3 km. Ore bodies are 40 to 2000 m long, 15 to 1000 m wide, and 0.5 to 100 m thick (Hannigan, 2007). The average grade is 10% combined Zn-Pb. As of mine closure in 1988, Pine Point produced 64.3 million tonnes of ore from about 50 open pits.

The author does not have equally detailed information for Florida Canyon, which is owned by Solitario and is being developed by Votorantim Metais. However, the “best- twelve drill intercepts” (from a news release dated January 12, 2012) range from 32.1 m grading 9.64% Zn, 1.76% Pb, and 18.8 ppm Ag (longest intercept) to 5.9 m grading 18.21% Zn, 5.89% Pb, and 40.42 ppm silver (highest-grade intercept).

The San Vicente Mine comprises mantos of zinc-lead mineralization hosted in dolomitized limestone of the Pucará Group. Typically, a carbonate unit called the “Uncush Limestone” forms the roof above mineralized zones. Significantly, the Uncush Limestone is a black, bituminous carbonate that is considered to be equivalent to the Aramachay Formation (Davila et al, 2000). As mentioned earlier, Rio Cristal’s drilling at the San Jose Project on the Bongará Property intersected 95 meters grading 0.17% Zn at the Aramachay-Chambará contact. This strongly suggests that the geological setting for the San Vicente Mine is identical to that of the anomalous zinc concentrations at San Jose. As of June, 1999, San Vicente has produced 25 million tonnes grading 12% Zn and 1% Pb (Davila et al, 2010).

If the comparison with Pine Point, Florida Canyon and San Vicente are valid, there is considerable potential for additional discoveries on the Bongará property. However, they will be more challenging to find because of climate conditions, extensive overburden and dense vegetation.

Soil sampling appears to be the best technique for pinpointing specific targets, as can be seen by the coincidence of soil anomalies and rock anomalies at the Charlita Project and

87 the Cristal Project. Stream-sediment sampling may be effective for locating broader targets.

SECTION 26: RECOMMENDATIONS:

2. Additional drilling is recommended at the Charlita Project where low-grade zinc mineralization (2% to 6% across intervals of up to 8.9 m) has been intersected in 6 of 15 holes. Given that the Charlita soil anomaly is similar in size and grade as the Cristal soil anomaly, the presence of higher-grade zinc mineralization at Charlita cannot be discounted. With the exception of a deep hole drilled for stratigraphic information, only 1,085.5 meters have been drilled at Charlita. An additional 3,000 meters of drilling is suggested.

3. Additional deep drilling (four 1000-m holes) is recommended at San Jose (Sur), where one hole bottomed in limestone grading 0.38% zinc at a vertical depth of 650 meters. Drill sites should be chosen based on prior detailed soil sampling and locations corresponding to the deepest stratigraphic levels.

4. Deep drilling (at least four 1000-m holes) is recommended at the Florida Project, where there are rock, soil, and stream-sediment anomalies that have not been followed up. The Florida Project is closer to Solitario’s “Florida Canyon” deposit than any other mineralized prospect on the Bongará property. Drill sites should be chosen based on prior detailed soil sampling and locations corresponding to the deepest stratigraphic levels.

RIO CRISTAL EXPLORATION BUDGET - 24 Months: Item Cost Exploration Program Expenses (for 3 Projects, 24 months) Permitting (two areas) $ 80,000 Project Manager 180,000 Geologists (7) 365,000 Detailed Topographic Data (2 m contours) 50,000 Pick-up trucks (expense plus driver) 36,000 Helicopter Support (10 days/mo. 12 mos.) 120 days $7,000 840,000 Database & Quality Control 36,000 Geological Modeling & Resource Estimate 60,000 $1,647,000 Cristal Project (including Charlita) Drilling Costs, including assays 4,000 m $180/m $ 720,000 Local Labor (6 months) 40 empl. $22/day 158,000 Camp Expenses (6 months) 100,000 $ 978,000 San Jose Project Cost Drilling Costs, including assays 4,000m $220/m $ 880,000 Local Labor (6 months) 40 empl. $22/day 158,000 Camp Expenses (6 months) 100,000 $1,138,000 Florida Project Drilling Costs, including assays 4,000m $260/m $ 880,000 Local Labor (6 months) 40 empl. $22/day 158,000 Camp Expenses (6 months) 100,000 $1,138,000 Property Surface Exploration (6 months) Soil Sampling 2,000 $30 each 60,000 Local Labor (6 months) 20 empl. $22/day 79,000 $ 139,000

Contingency (10%) $ 200,000

Estimated Total $5,240,000

SECTION 27: REFERENCES

Anglo Peruana, 2004, A Report on Field Observations Made During a Visit to the Cristal Project in April 2004, 9 May 2004

Anglo Peruana, 2005, A Re-Evaluation of the Geology and Mineralization of the Bongará Zinc Project, Amazonas, Northern Peru

Apoyo and Asociados, 2007: Fitch Ratings, Cementos Pacasmayo S.A.A.: unpublished report, posted to Apoyo and Associates website, May 2007, http://www.aai.com.pe/files/instituciones_no_financieras/cementos_ pacasmayo/ca/cementospacasmayo_ca.pdf

Arce Geofísicos, 2007: Levantamiento Geofísico Magnetometría Polarización Inducida, December 2007, Proyecto Cristal, Amazonas Department, Peru, http://www.geofisicos.com.pe

Castro, Eugenio, 2011. Informe Final Programa Perforacion Proyecto Cristal, Rio Cristal Resource Corp internal report.

Cinits, R., 2005:, Technical Report on the Bongará Zinc Property – Amazonas Department, Peru, In-house report prepared for Compania Minera Pilar del Amazonas SA, by AMEC (Peru) SA, Effective date 18 May 2005, AMEC Project 146240

Cinits, R., 2007:, Technical Report on the Bongará Zinc Property – Amazonas Department, Peru, In-house report prepared for Rio Cristal Zinc Corporation by AMEC (Peru) SA, Effective date 20 September 2007, AMEC Project 155991

Davila, D., Fontbote, L., Oldham, L., & Febres, O., 2000. Exploracion y Geologia de la Mina San Vicente; Instituto de Ingenieros de Minas del Peru,

Fontboté, L., et. al., 2000, The Mississippi Valley-Type Zinc-Lead Mine of San Vicente, Eastern Pucará Basin, Peru, Publication of the Instituto de Ingenieros de Minas del Peru (IIMP), Vol. Luis Hochshild Claut, Monografía Proexplo 1999.

Hannigan, Peter, 2007. Geological Survey of Canada, District Metallogeny, Metallogeny of the Pine Point Mississippi-Valley-Type Zn-Pb District, southern Northwest

Leach, D.L., and Sangster D.F., 1993, Mississippi Valley – Type Lead- Zinc Deposit in Mineral Deposit Modeling, GAC Special Paper 40, edited by Kirkham, R.V. et. al

Leibold, A., 2008:, Geochemical Survey of the Cristal Prospect, Bongará Claim Block, Northern Peru, GORETM Survey for Exploration, Surface Geochemical Exploration Method, Internal Report prepared for Rio Cristal Zinc Corporation, by Royal Exploration, 22 April 2008

Minconsult, 2005: Estudio de Impacto Ambiental, Proyecto “Bongará”: unpublished report posted to Minem website, September 2005, http://www.minem.gob.pe/archivos/dgaam/inicio/resumen/Bongará. pdf

Oldham, L., 2004, The Bongará Zinc Project, Amazonas, Northern Peru, Internal report prepared for Amazonas, 8 May 2004

Peterson, U., Vidal, Cesar E., and Noble, Donald C. 1990. A special issue devoted to the mineral deposits of Peru. Economic Geology, November, 1990; v. 85; no. 7; p. 1287-1295.

Sanchez, A.W., 1995. INGEMMET, Geology of the Bagua Grande (12g) and Jumbilla (12h) map sheets.

SGS, 2008. Declaracion Jurada Ambiental (Categoria B) Exploración Minera Del Proyecto Cristal. For Cerro La Mina S.A. by SGS Peru SA. Servicios Ambientales Marzo 2008.

Solitario, 1996, Solitario Resource Bongará Project. Solitario internal report, September, 1996

Solitario Exploration and Royalty, 2011. Bongará High-Grade Zinc Project, Peru. Information presented to the Denver Gold Forum, Colorado Springs, Colorado, September 19-20, 2011

Soto, G., 2003, Reconocimiento Geológico Área del Proyecto Cristal, Bongará - Amazonas, Internal report prepared for Cia. Minera Pilar del Amazonas, September 2003

Southern Peru Copper Corporation (SPCC), 2001, Informe – Bongará Amazonas Internal memo for Compañía Minera Amazonas S.A., August, 2001

SRK, 1999, Valuation of the Bongará Zinc Project, Peru. Prepared for Compañía Minera Amazonas S.A., November, 1999

Wright, Christopher, 2010. Rio Cristal Resources Corp., Bongará Zinc Project, NI 43-101 Technical Report.

Zulueta, Miguel, 2011. Recursos Minerales Proyecto Cristal

APPENDICES

APPENDIX 1: DRILL DETAILS, 2008 DRILLING CAMPAIGN Easting Northing Drill hole Target Zone Depth (m) Azimuth Dip (UTM) (UTM) CR-01-08 Gigi (Cristal) 529.85 0 -70 830,844 9,374,585 CR-02-08 Yolanda (Cristal) 22.90 90 -75 830,910 9,374,537 CR-03-08 Esperanza N (Cristal) 62.75 270 -60 830,998 9,374,403 CR-04-08 Yolanda (Cristal) 56.10 0 -60 830,906 9,374,541 CR-05-08 Yolanda (Cristal) 75.60 150 -60 830,906 9,374,536 CR-06-08 Charlita 872.60 10 -80 829,753 9,374,501 CR-07-08 Esperanza N (Cristal) 70.05 0 -60 831,001 9,374,405 CR-08-08 Esperanza N (Cristal) 50.10 180 -80 831,001 9,374,402 CR-09-08 Yolanda N (Cristal) 38.90 180 -70 830,932 9,374,584 CR-10-08 Yolanda N (Cristal) 39.85 0 -60 830,932 9,374,591 CR-11-08 Esperanza N (Cristal) 40.50 90 -60 831,008 9,374,403 CR-12-08 Yolanda N (Cristal) 25.90 270 -60 830,929 9,374,589 CR-13-08 Esperanza E (Cristal) 56.90 270 -60 831,040 9,374,356 CR-14-08 Esperanza E (Cristal) 42.30 180 -70 831,049 9,374,351 CR-15-08 Yolanda N (Cristal) 33.50 90 -60 830,951 9,374,586 CR-16-08 Esperanza E (Cristal) 34.50 90 -60 831,061 9,374,356 CR-17-08 Esperanza E (Cristal) 30.70 0 -60 831,046 9,374,370 CR-18-08 Esperanza E (Cristal) 56.20 270 -60 831,043 9,374,369 CR-19-08 Yolanda S (Cristal) 59.40 340 -60 830,894 9,374,482 CR-20-08 Esperanza W (Cristal) 67.90 90 -75 830,978 9,374,352 CR-21-08 Yolanda S (Cristal) 50.40 180 -60 830,896 9,374,477 CR-22-08 Yolanda S (Cristal) 51.10 270 -60 830,890 9,374,477 CR-23-08 Yolanda S (Cristal) 66.10 90 -60 830,899 9,374,479 CR-24-08 Esperanza W (Cristal) 73.90 0 -60 830,974 9,374,354 CR-25-08 Esperanza W (Cristal) 63.65 180 -60 830,974 9,374,349 CR-26-08 Yolanda SS (Cristal) 53.50 0 -60 830,898 9,374,428 CR-27-08 Yolanda SS (Cristal) 117.70 90 -75 830,902 9,374,426 CR-28-08 Nenita N (Cristal) 107.75 270 -60 830,904 9,374,321 CR-29-08 Nenita N (Cristal) 59.60 90 -60 830,911 9,374,321 CR-30-08 Nenita N (Cristal) 64.90 180 -70 830,907 9,374,320 CR-31-08 Nenita Centro (Cristal) 79.10 270 -70 830,860 9,374,293 CR-32-08 Yolanda SS (Cristal) 44.00 180 -60 830,899 9,374,407 CR-33-08 Nenita Centro (Cristal) 61.45 90 -60 830,865 9,374,293 CR-34-08 Esperanza (Cristal) 272.80 180 -75 830,996 9,374,478 CR-35-08 Esperanza (Cristal) 150.90 60 -80 831,008 9,374,365 CR-36-08 Charlita 291.70 325 -80 829,880 9,374,273 CR-37-08 Nenita Norte (Cristal) 114.65 0 -76 830,908 9,374,327 CR-38-08 Nenita Sur (Cristal) 263.60 0 -80 830,872 9,374,246 CR-39-08 Nenita W (Cristal) 72.20 90 -70 830,802 9,374,290 CR-40-08 Marita (Cristal) 54.70 270 -70 831,090 9,374,043 TOTAL 4380.20

APPENDIX 2 - DRILL DETAILS, 2011 DRILLING CAMPAIGN Depth Easting Northing Elevation Drill Hole Zone Pad Azimuth DIP meters (UTM) (UTM) meters CR-41-11 Cristal 6 61.70 N270 -60 830874 9374525 1990 CR-42-11 Cristal 6 77.75 N 90 -60 830874 9374525 1990 CR-43-11 Cristal 6 80.20 N180 -60 830874 9374525 1990 CR-44-11 Cristal 13 81.20 N 90 -60 831317 9374729 2102 CR-45-11 Cristal 13 80.00 N270 -60 831317 9374729 2102 CR-46-11 Cristal 3 70.00 N 00 -60 831150 9374600 2000 CR-47-11 Cristal 3 65.00 N200 -60 831150 9374600 2000 CR-48-11 Cristal 3 70.90 N270 -60 831150 9374600 2000 CR-49-11 Cristal 4 81.20 N 00 -45 830750 9374400 1952 CR-50-11 Cristal 4 60.00 N270 -60 830750 9374400 1952 CR-51-11 Cristal 4 67.70 N180 -50 830750 9374400 1952 CR-52-11 Cristal 1 60.20 N 00 -45 831053 9374399 1951 CR-53-11 Cristal 1 63.00 N230 -60 831053 9374399 1951 CR-54-11 Cristal 2 60.20 N 00 -45 831047 9374302 1931 CR-55-11 Cristal 2 60.20 N335 -60 831047 9374302 1931 CR-56-11 Cristal 5 60.20 N 00 -60 830897 9374249 1930 CR-57-11 Cristal 5 63.20 N180 -60 830897 9374249 1930 CR-58-11 Cristal 5 60.20 N40 -55 830897 9374249 1930 CR-59-11 Cristal 9 78.20 N 00 -50 830798 9374246 1926 CR-60-11 Cristal 9 75.20 N65 -60 830798 9374246 1926 CR-61-11 Cristal 21 63.20 N240 -45 830950 9374525 1975 CR-62-11 Cristal 21 54.20 N00 -90 830950 9374525 1975 CR-63-11 Cristal 21 75.20 N30 -45 830950 9374525 1975 CR-64-11 Cristal 1 48.20 N00 -90 831053 9374399 1951 CR-65-11 Cristal 8 70.70 N 90 -60 830850 9374150 1922 CR-66-11 Cristal 8 50.50 N00 -90 830850 9374150 1922 CR-67-11 Cristal 8 60.20 N180 -45 830850 9374150 1922 CR-68-11 reco 7 70.70 N360 -45 830950 9373850 1725 CR-69-11 reco 7 52.70 N00 -90 830950 9373850 1725 CR-70-11 Cristal 12 50.20 N 310 -45 830870 9374025 1854 CR-71-11 Cristal 12 31.70 N00 -90 830870 9374025 1854 CR-72-11 Cristal 10 57.20 N 260 -50 830800 9374290 1913 CR-73-11 Cristal 10 50.70 N00 -45 830800 9374290 1913 CR-74-11 Cristal 10 52.70 N00 -90 830800 9374290 1913 CR-75-11 Cristal 11 49.70 N 00 -90 830949 9374325 1930 CR-76-11 Cristal 11 74.40 N 270 -45 830949 9374325 1930 CR-77-11 Cristal 11 75.20 N340 -45 830949 9374325 1930 CR-78-11 Cristal 21 61.70 N315 -45 830950 9374525 1975 CR-79-11 Cristal 14 58.40 N155 -60 830850 9374200 1922 CR-80-11 Cristal 14 64.70 N320 -45 830850 9374200 1922 CR-81-11 Charlita 15 56.50 N240 -50 829978 9374387 1981 CR-82-11 Charlita 15 63.20 N00 -90 829978 9374387 1981

Depth Easting Northing Elevation Drill Hole Zone Pad Azimuth DIP meters (UTM) (UTM) meters CR-83-11 Charlita 20 60.20 N30 -45 829900 9374250 1960 CR-84-11 Charlita 20 64.70 N300 -60 829900 9374250 1960 CR-85-11 Charlita 16 61.70 N210 -55 829813 9374157 1854 CR-86-11 Charlita 16 64.70 N140 -55 829813 9374157 1854 CR-87-11 Charlita 16 43.70 N00 -90 829813 9374157 1854 CR-88-11 Charlita 18 64.70 N90 -50 829806 9374268 1920 CR-89-11 Charlita 18 42.20 N155 -55 829806 9374268 1920 CR-90-11 Charlita 18 54.20 N40 -45 829806 9374268 1920 CR-91-11 Charlita 17 49.70 N40 -55 829832 9374294 1925 CR-92-11 Charlita 17 54.20 N250 -45 829832 9374294 1925 CR-93-11 Charlita 17 27.20 N250 -45 829832 9374294 1925 CR-94-11 Charlita 19 40.20 N40 -60 829831 9374358 1932 CR-95-11 Charlita 19 46.70 N150 -60 829831 9374358 1932 55 HOLES 3,342.25

APPENDIX 3: QUALITY ASSURANCE, QUALITY CONTROL, ROCK SAMPLES SAMPLE_ID QAQC Ag_ppm Fe_pct Pb_ppm Zn_ppm 2887 blank 0.1 0.16 3 8 2943 blank 0.1 0.30 3 9 10026 blank 0.1 0.17 3 5 10036 blank 0.1 0.18 3 5 10066 blank 0.1 0.32 3 5 10096 blank 0.1 0.36 3 5 10426 blank 0.1 0.30 3 6

2807 standard 24.9 8.61 7182 30100 2926 standard 25.4 8.68 7250 29900 10020 standard 25.8 8.75 7213 30400 10046 standard 25.6 8.95 7196 30500 10076 standard 26.0 9.09 7235 30000 10406 standard 25.3 8.96 7241 30300 10436 standard 25.9 8.85 7352 30700

2889 2.19 47 449

2893 duplicate 2889 2.37 17 38

2968 2.04 33 41

2975 duplicate 2968 1.72 8 86

10055 3.75 12 870

10056 duplicate10055 4.22 16 991

10084 0.08 3 14

10086 duplicate10084 0.09 3 12

10407 3.44 123 169

10416 duplicate10407 2.22 34 114

APPENDIX 4: QUALITY ASSURANCE, QUALITY CONTROL, SOIL SAMPLES SAMPLE_ID QAQC Ag_ppm Fe_pct Pb_ppm Zn_ppm 2820 blank 0.1 0.24 3 10 2913 blank 0.1 0.16 3 8 2965 blank 0.1 0.29 3 8 3007 blank 0.1 0.25 3 8 3027 blank 0.1 0.19 3 8 3078 blank 0.1 0.18 3 8 10110 blank 0.1 0.22 3 5 10140 blank 0.1 0.32 3 3 10170 blank 0.1 0.22 3 3 10200 blank 0.1 0.51 6 11 10330 blank 0.1 0.26 3 6 10360 blank 0.1 0.42 3 3 10389 blank 0.1 0.34 3 6 10469 blank 0.1 0.31 3 5 10499 blank 0.1 0.31 3 6

2835 standard 25.2 8.27 7282 30200 2856 standard 25.3 8.50 7224 30300 2903 standard 25.2 8.49 7269 30400 2934 standard 25.4 8.62 7363 30500 3017 standard 25.6 8.67 7243 30800 3048 standard 25.7 8.62 7292 30400 3068 standard 25.7 8.55 7299 30400 10120 standard 26.4 9.03 7207 30300 10150 standard 25.9 8.94 7137 29800 10180 standard 26.7 9.14 7157 30400 10310 standard 25.0 8.96 7238 30100 10340 standard 25.1 8.90 7216 30900 10369 standard 24.9 8.99 7220 30200 10399 standard 26.1 9.01 7265 29900 10479 standard 25.8 9.14 7147 30500

2808 0.3 7.52 64 94

2810 duplicate 2808 0.1 9.60 68 85 2846 0.3 24.43 387 1179

2851 duplicate 2846 0.2 24.99 310 1221 2867 0.1 27.37 81 57

2872 duplicate 2867 0.1 0.24 3 12 2876 0.1 22.20 92 37

2882 duplicate 2876 0.1 22.13 143 116 2994 0.3 9.58 255 1197

2997 duplicate 2994 0.2 9.86 216 1062 3030 0.5 27.09 253 1677

SAMPLE_ID QAQC Ag_ppm Fe_pct Pb_ppm Zn_ppm 3038 duplicate 3030 0.8 27.16 222 1803 3037 0.1 22.62 73 1100

3088 duplicate 3037 0.6 14.11 700 111 3050 0.1 7.19 240 401

3058 duplicate 3050 0.4 6.81 146 487 10129 0.5 15.78 436 425

10130 duplicate 10129 0.4 16.06 450 483 10159 0.1 25.83 65 147

10160 duplicate 10159 0.1 25.97 61 85 10189 0.1 37.63 288 1630

10190 duplicate 10189 0.1 37.56 290 1673 10193 0.1 7.85 47 45

10320 duplicate 10193 0.1 9.92 62 44 10344 0.1 9.90 164 424

10350 duplicate 10344 0.1 9.61 150 427 10367 0.1 6.44 69 101

10379 duplicate 10367 0.1 6.35 54 125 10395 0.1 17.94 222 539

10459 duplicate 10395 0.7 15.08 7021 764 10484 0.1 25.69 1097 5322

10489 duplicate 10484 0.1 25.97 1144 5264

APPENDIX 5: QUALITY ASSURANCE, QUALITY CONTROL, DRILL CORE DDH SAMPLE QAQC Ag_ppm Fe_pct Pb_ppm Zn_ppm CR-41-11 10570 blank -0.2 0.21 -5 -5 CR-42-11 10600 blank -0.2 0.21 -5 -5 CR-42-11 10630 blank -0.2 0.19 -5 -5 CR-43-11 10660 blank -0.2 0.19 -5 -5 CR-44-11 10700 blank -0.2 0.56 -5 -5 CR-44-11 10720 blank -0.2 0.57 -5 6 CR-45-11 10750 blank -0.2 0.3 -5 6 CR-46-11 10790 blank -0.2 0.3 -5 -5 CR-46-11 10810 blank -0.2 0.34 -5 -5 CR-47-11 10840 blank -0.2 0.32 -5 -5 CR-48-11 10870 blank -0.2 0.39 -5 -5 CR-48-11 10900 blank -0.2 0.27 -5 -5 CR-49-11 10930 blank -0.2 0.29 -5 -5 CR-49-11 10960 blank -0.2 0.37 -5 -5 CR-50-11 11000 blank -0.2 0.25 -5 6 CR-51-11 11030 blank -0.2 0.22 -5 10 CR-52-11 11060 blank -0.2 0.27 -5 -5 CR-53-11 11080 blank -0.2 0.19 -5 12 CR-53-11 11110 blank -0.2 0.25 -5 10 CR-54-11 11130 blank -0.2 0.30 -5 -5 CR-55-11 11160 blank -0.2 0.22 -5 -5 CR-55-11 11190 blank -0.2 0.34 -5 -5 CR-56-11 11210 blank -0.2 0.23 -5 -5 CR-57-11 11250 blank -0.2 0.24 -5 9 CR-59-11 11280 blank -0.2 0.51 -5 8 CR-59-11 11310 blank -0.2 0.52 -5 9 CR-60-11 11330 blank -0.2 0.36 12 9 CR-61-11 11360 blank -0.2 0.29 -5 8 CR-61-11 11400 blank -0.2 0.51 10 10 CR-62-11 11420 blank -0.2 0.48 14 11 CR-63-11 11460 blank -0.2 0.47 -5 45 CR-63-11 11490 blank -0.2 0.61 -5 20 CR-64-11 11520 blank -0.2 0.42 -5 12 CR-65-11 11550 blank -0.2 0.47 -5 25 CR-67-11 11570 blank -0.2 0.30 -5 5 CR-69-11 11600 blank -0.2 0.27 -5 17 CR-70-11 11640 blank -0.2 0.25 -5 27 CR-72-11 11670 blank -0.2 0.45 -5 6 CR-73-11 11700 blank -0.2 0.37 -5 6 CR-74-11 11730 blank -0.2 0.29 -5 -5 CR-76-11 11770 blank -0.2 0.29 -5 -5 CR-76-11 11800 blank -0.2 0.43 -5 -5 CR-77-11 11830 blank -0.2 0.31 -5 9

DDH SAMPLE QAQC Ag_ppm Fe_pct Pb_ppm Zn_ppm CR-77-11 11860 blank -0.2 0.38 5 13 CR-78-11 11890 blank -0.2 0.31 -5 9 CR-80-11 11920 blank -0.2 0.57 -5 11 CR-81-11 11950 blank -0.2 0.30 -5 -5 CR-82-11 11980 blank -0.2 0.31 -5 6 CR-84-11 12010 blank -0.2 0.39 -5 5 CR-85-11 12040 blank -0.2 0.32 -5 5 CR-87-11 12070 blank -0.2 0.31 -5 -5 CR-88-11 12100 blank -0.2 0.35 -5 10 CR-88-11 12130 blank -0.2 0.37 -5 11 CR-90-11 12160 blank -0.2 0.33 27 10 CR-90-11 12180 blank -0.2 0.29 -5 10 CR-91-11 12210 blank -0.2 0.31 5 12 CR-93-11 12240 blank -0.2 0.47 -5 8 CR-94-11 12270 blank -0.2 0.32 -5 11 CR-95-11 12300 blank -0.2 0.48 -5 7 CR-95-11 12310 blank -0.2 0.35 -5 17

CR-41-11 10560 standard a 29.3 5.24 10000 1.000 CR-42-11 10590 standard a 29.1 5.19 10000 1.000 CR-42-11 10620 standard a 29.5 5.2 10000 1.000 CR-43-11 10650 standard a 29.8 5.24 10000 1.000 CR-44-11 10680 standard a 29.1 5.29 17400 2.780 CR-44-11 10710 standard a 28.9 5.23 17200 2.710 CR-45-11 10740 standard a 29.6 5.25 17400 2.730 CR-46-11 10770 standard a 29.2 5.31 17100 2.720 CR-46-11 10800 standard a 29.6 5.3 17100 2.740 CR-47-11 10830 standard a 29.8 5.2 17200 2.720 CR-47-11 10860 standard a 30.1 5.19 17200 2.750 CR-48-11 10890 standard a 29.2 5.23 17000 2.690 CR-48-11 10920 standard a 29.2 5.22 17300 2.740 CR-49-11 10950 standard a 28.8 5.24 17200 2.710 CR-50-11 10980 standard b 94.6 7.85 51500 10.220 CR-51-11 11010 standard a 29.1 5.23 17300 2.670 CR-52-11 11040 standard a 30 5.19 17700 2.690 CR-52-11 11070 standard a 29.7 5.22 17500 2.750 CR-53-11 11100 standard b 94.5 7.76 50100 10.360 CR-54-11 11140 standard a 29.0 5.30 17000 2.670 CR-55-11 11170 standard a 29.6 5.29 17300 2.720 CR-56-11 11200 standard b 98.6 7.90 4970 10.270 CR-57-11 11230 standard a 30.6 5.25 17300 2.700 CR-58-11 11260 standard b 97.0 7.84 49100 10.250 CR-59-11 11290 standard a 30.9 5.29 17100 2.670 CR-60-11 11320 standard b 97.7 7.71 50200 10.280

100

DDH SAMPLE QAQC Ag_ppm Fe_pct Pb_ppm Zn_ppm CR-60-11 11350 standard a 29.4 5.31 17200 2.730 CR-61-11 11380 standard b 98.5 7.75 49800 10.320 CR-61-11 11410 standard a 28.8 5.24 17300 2.740 CR-62-11 11440 standard a 29.2 5.18 17500 2.760 CR-63-11 11480 standard a 29.8 5.18 17200 2.72 CR-64-11 11510 standard a 30.0 5.10 16800 2.69 CR-65-11 11540 standard a 29.9 5.18 17400 2.67 CR-68-11 11580 standard a 29.3 5.10 16700 2.75 CR-69-11 11610 standard a 28.5 5.24 17500 2.680 CR-70-11 11630 standard b 99.9 7.78 49300 10.370 CR-72-11 11660 standard b 99.0 7.65 49600 10.320 CR-73-11 11690 standard a 28.6 5.39 17200 2.740 CR-74-11 11720 standard a 29.9 5.30 16800 2.73 CR-75-11 11750 standard a 28.8 5.32 17400 2.69 CR-76-11 11780 standard b 98.5 7.63 50200 10.35 CR-76-11 11810 standard a 29.3 5.28 16900 2.68 CR-77-11 11840 standard a 29.0 5.11 17300 2.700 CR-78-11 11870 standard a 29.6 5.14 16900 2.740 CR-79-11 11900 standard a 28.8 5.09 17200 2.680 CR-80-11 11930 standard a 30.5 5.21 17500 2.670 CR-81-11 11960 standard a 31.0 5.27 16800 2.750 CR-83-11 11990 standard b 99.9 7.80 49900 10.300 CR-84-11 12020 standard a 30.0 5.36 17400 2.690 CR-85-11 12050 standard a 30.7 5.37 17200 2.680 CR-87-11 12080 standard a 30.3 5.24 17000 2.670 CR-88-11 12110 standard b 97.9 7.67 49600 10.350 CR-89-11 12140 standard a 30.8 5.26 16800 2.760 CR-90-11 12170 standard b 99.0 7.72 48500 10.270 CR-91-11 12200 standard b 98.9 7.81 49800 10.330 CR-92-11 12230 standard b 98.9 7.71 49900 10.31 CR-94-11 12260 standard b 97.2 7.66 48900 10.40 CR-95-11 12290 standard b 98.3 7.76 48500 10.28

CR-41-11 10571 -0.2 4.67 16 0.099

CR-41-11 10580 duplicate10571 -0.2 4.86 16 0.106 CR-42-11 10601 -0.2 4.23 33 0.266

CR-42-11 10610 duplicate10601 -0.2 4.65 41 0.269 CR-43-11 10636 -0.2 0.45 30 0.016

CR-43-11 10640 duplicate10636 -0.2 0.48 101 0.020 CR-43-11 10667 -0.2 1.82 9 0.065

CR-43-11 10670 duplicate10667 -0.2 1.8 7 0.064 CR-44-11 10689 -0.2 2.07 11 0.005

CR-44-11 10690 duplicate10689 -0.2 1.96 8 0.005 CR-45-11 10727 6.5 1.32 6 0.001

101

DDH SAMPLE QAQC Ag_ppm Fe_pct Pb_ppm Zn_ppm CR-45-11 10730 duplicate10727 15.4 1.37 9 0.001 CR-45-11 10757 -0.2 5.43 21 0.002

CR-45-11 10760 duplicate10757 8.4 4.18 16 0.001 CR-46-11 10777 0.2 8.96 66 0.002

CR-46-11 10780 duplicate10777 -0.2 10.67 107 0.002 CR-47-11 10818 0.2 6.56 34 0.046

CR-47-11 10820 duplicate10818 0.5 6.19 33 0.039 CR-47-11 10841 -0.2 3.35 87 0.339

CR-47-11 10850 duplicate10841 -0.2 3.56 85 0.335 CR-48-11 10872 -0.2 3.58 28 0.227

CR-48-11 10880 duplicate10872 -0.2 3.47 24 0.224 CR-48-11 10902 -0.2 2.19 7 0.172

CR-48-11 10910 duplicate10902 0.2 2.23 68 0.201 CR-49-11 10934 1 19.97 57 0.553

CR-49-11 10940 duplicate10934 4.1 20.11 64 0.538 CR-49-11 10939 -0.2 3.36 10 0.003

CR-50-11 10990 duplicate10939 0.6 0.89 7 0.001 CR-49-11 10963 -0.2 2.77 21 0.009

CR-49-11 10970 duplicate10963 -0.2 2.87 19 0.011 CR-51-11 11019 -0.2 0.2 -5 0.012

CR-51-11 11020 duplicate11019 1 0.19 7 0.013 CR-52-11 11046 0.5 2.73 1170 1.180

CR-52-11 11050 duplicate11046 0.7 2.45 1024 0.905 CR-53-11 11086 0.9 18.85 3031 1.420

CR-53-11 11090 duplicate11086 0.7 16.69 2599 1.190 CR-53-11 11112 1.1 21.64 113 6.680

CR-54-11 11120 duplicate11112 0.6 20.8 108 7.650 CR-54-11 11146 -0.2 4.36 10 0.266

CR-54-11 11150 duplicate11146 0.3 4.49 7 0.297 CR-55-11 11179 -0.2 0.76 98 0.209

CR-55-11 11180 duplicate11179 -0.2 0.78 82 0.172 CR-56-11 11212 1.6 16.75 210 2.450

CR-56-11 11220 duplicate11212 1.7 15.57 180 2.030 CR-57-11 11233 1.2 58.01 1341 0.333

CR-57-11 11240 duplicate11233 1.3 57.46 1403 0.334 CR-58-11 11262 1.6 53.76 4271 3.410

CR-58-11 11270 duplicate11262 2.2 53.27 4006 3.310 CR-59-11 11299 -0.2 1.42 9 0.087

CR-59-11 11300 duplicate11299 -0.2 1.72 8 0.105 CR-60-11 11334 1.7 3.42 1064 7.030

CR-60-11 11340 duplicate11334 2.2 4.10 1221 11.650 CR-61-11 11364 2.9 6.62 221 1.560

CR-61-11 11370 duplicate11364 3.9 4.71 100 1.740 CR-61-11 11382 16.1 3.27 196 4.140

102

DDH SAMPLE QAQC Ag_ppm Fe_pct Pb_ppm Zn_ppm CR-61-11 11390 duplicate11382 9.4 2.87 157 3.350 CR-62-11 11425 10.5 5.33 2758 4.960

CR-62-11 11430 duplicate11425 7.1 5.41 2729 5.070 CR-62-11 11445 -0.2 2.53 27 0.168

CR-62-11 11450 duplicate11445 -0.2 2.62 23 0.167 CR-63-11 11467 1.0 6.17 35 0.391

CR-63-11 11470 duplicate11467 1.1 6.10 34 0.363 CR-63-11 11497 0.2 1.46 9 0.308

CR-63-11 11500 duplicate11497 -0.2 1.36 9 0.305 CR-65-11 11528 -0.2 3.78 12 0.410

CR-65-11 11530 duplicate11528 -0.2 4.35 13 0.425 CR-66-11 11557 -0.2 1.32 5 0.02

CR-66-11 11560 duplicate11557 -0.2 1.34 5 0.02 CR-68-11 11588 -0.2 0.76 -5 0.01

CR-68-11 11590 duplicate11588 -0.2 0.80 -5 0.00 CR-70-11 11619 1.5 3.71 25 6.410

CR-70-11 11620 duplicate11619 0.6 3.72 26 3.940 CR-71-11 11649 -0.2 7.73 42 3.830

CR-71-11 11650 duplicate11649 -0.2 5.53 18 1.920 CR-72-11 11678 0.3 38.12 2940 9.350

CR-72-11 11680 duplicate11678 0.6 36.58 2858 10.870 CR-73-11 11709 -0.2 37.14 111 11.37

CR-73-11 11710 duplicate11709 0.4 37.98 91 11.33 CR-74-11 11726 -0.2 3.65 13 0.126

CR-74-11 11740 duplicate11726 -0.2 3.55 7 0.138 CR-75-11 11759 -0.2 2.33 7 0.432

CR-75-11 11760 duplicate11759 -0.2 2.54 9 0.433 CR-76-11 11787 -0.2 10.20 -5 5.95

CR-76-11 11790 duplicate11787 -0.2 10.57 -5 7.56 CR-77-11 11819 0.2 28.06 1047 0.399

CR-77-11 11820 duplicate11819 0.8 27.37 914 0.394 CR-77-11 11844 -0.2 3.33 30 0.510

CR-77-11 11850 duplicate11844 -0.2 3.14 22 0.477 CR-78-11 11874 0.7 10.24 196 1.060

CR-78-11 11880 duplicate11874 0.6 10.21 141 1.040 CR-79-11 11909 0.7 34.77 688 4.200

CR-79-11 11910 duplicate11909 0.3 35.12 658 4.300 CR-80-11 11933 2.1 43.42 582 7.600

CR-80-11 11940 duplicate11933 1.2 35.19 417 8.150 CR-81-11 11969 -0.2 1.32 -5 0.021

CR-81-11 11970 duplicate11969 -0.2 1.34 -5 0.025 CR-83-11 11999 -0.2 2.13 -5 0.008

CR-83-11 12000 duplicate11999 -0.2 1.88 5 0.009 CR-84-11 12029 -0.2 1.99 -5 0.048

103

DDH SAMPLE QAQC Ag_ppm Fe_pct Pb_ppm Zn_ppm CR-84-11 12030 duplicate12029 -0.2 2.15 26 0.059 CR-86-11 12059 -0.2 1.53 -5 0.031

CR-86-11 12060 duplicate12059 -0.2 1.68 -5 0.031 CR-88-11 12088 -0.2 5.98 1178 1.940

CR-88-11 12090 duplicate12088 -0.2 2.65 29 0.165 CR-88-11 12118 -0.2 0.82 -5 0.225

CR-88-11 12120 duplicate12118 -0.2 0.88 -5 0.264 CR-90-11 12149 -0.2 5.63 55 1.050

CR-90-11 12150 duplicate12149 -0.2 5.33 60 0.976 CR-91-11 12191 -0.2 1.63 10 0.476

CR-91-11 12190 duplicate12191 -0.2 5.08 12 2.680 CR-92-11 12217 0.4 4.10 402 1.850

CR-92-11 12220 duplicate12217 1.4 5.28 629 1.780 CR-93-11 12248 -0.2 3.69 16 1.88

CR-93-11 12250 duplicate12248 -0.2 2.42 14 1.06 CR-95-11 12276 2.5 46.91 7603 1.80

CR-95-11 12280 duplicate12276 2.0 46.50 8724 1.71

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