NI 43-101 Technical Report and Mineral Resource Estimate for the Handeni Property centered at 37.97°E, 5.744°S, Tanga Province, Handeni District, Tanzania Dr. Sandy M. Archibald, P.Geo., Aurum Exploration Services Ian J. Farrelly, P.Geo., Aurum Exploration Services James N. Gray, P.Geo., Advantage Geoservices Ltd Dr. James A. King, P.Eng., Jim King Consulting Inc June 28, 2012 H ANDENI PROJECT NI 43-101 REPORT TABLE OF CONTENTS 1 SUMMARY............................................................................................................................. 11 2 INTRODUCTION ................................................................................................................... 17 2.1 Terms of Reference, Scope & Purpose of Report ...................................................... 17 2.2 Sources of Information & Data ................................................................................... 18 2.3 Visits to the Property by Qualified Persons ................................................................ 19 3 RELIANCE ON OTHER EXPERTS ....................................................................................... 20 4 PROPERTY DESCRIPTION & LOCATION .......................................................................... 21 4.1 Size & Location ........................................................................................................... 21 4.2 Mineral Tenure ............................................................................................................ 22 5 ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE & PHYSIOGRAPHY .................................................................................................................. 27 5.1 Accessibility ................................................................................................................ 27 5.2 Climate ........................................................................................................................ 28 5.3 Local Resources ......................................................................................................... 30 5.4 Infrastructure ............................................................................................................... 32 5.5 Physiography .............................................................................................................. 35 6 HISTORY ............................................................................................................................... 36 7 GEOLOGICAL SETTING & MINERALISATION ................................................................... 41 7.1 Regional Geology ....................................................................................................... 41 7.2 Property Geology ........................................................................................................ 43 7.3 Mineralisation .............................................................................................................. 50 8 DEPOSIT TYPES .................................................................................................................. 55 9 EXPLORATION ..................................................................................................................... 57 9.1 Historical ..................................................................................................................... 57 9.2 Soil Sampling .............................................................................................................. 58 10 DRILLING .............................................................................................................................. 60 10.1 General ....................................................................................................................... 60 10.2 Reverse Circulation Drilling ........................................................................................ 60 10.3 Rotary Air Blast Drilling ............................................................................................... 63 10.4 Diamond Drilling ......................................................................................................... 63 10.5 Magambazi ................................................................................................................. 67 11 SAMPLE PREPARATION, ANALYSES & SECURITY ......................................................... 72 11.1 Sampling Method & Approach .................................................................................... 72 11.2 Laboratory Procedures ............................................................................................... 76 11.3 Sample Security & Chain of Custody Procedures ...................................................... 78 11.4 Drill Program QA/QC .................................................................................................. 78 11.5 Discussion of QA/QC Results ................................................................................... 109 June 2012 Page 2 of 200 H ANDENI PROJECT NI 43-101 REPORT 12 DATA VERIFICATION ......................................................................................................... 115 12.1 Electronic Database .................................................................................................. 115 12.2 Drill Hole Collar Checks ............................................................................................ 115 12.3 Independent Verification of Mineralisation ............................................................... 115 13 MINERAL PROCESSING & METALLURGICAL TESTING ................................................ 118 13.1 Sample Description & Preparation ........................................................................... 118 13.2 Summary ................................................................................................................... 123 13.3 Testwork Results & Discussion ................................................................................ 126 14 MINERAL RESOURCE ESTIMATES .................................................................................. 163 14.1 Available Data ........................................................................................................... 163 14.2 Sample Compositing ................................................................................................. 164 14.3 Geologic Model ......................................................................................................... 164 14.4 Grade Domain Modeling ........................................................................................... 166 14.5 Grade Capping ......................................................................................................... 170 14.6 Grade Interpolation ................................................................................................... 170 14.7 Density Assignment .................................................................................................. 171 14.8 Model Validation ....................................................................................................... 172 14.9 Mineral Resource Classification & Tabulation .......................................................... 174 15 MINERAL RESERVE ESTIMATES ..................................................................................... 176 16 MINING METHODS ............................................................................................................. 177 17 RECOVERY METHODS ..................................................................................................... 178 18 PROJECT INFRASTRUCTURE .......................................................................................... 179 19 MARKET STUDIES & CONTRACTS .................................................................................. 180 20 ENVIRONMENTAL STUDIES, PERMITTING AND SOCIAL OR COMMUNITY IMPACT . 181 20.1 Environmental Studies .............................................................................................. 181 20.2 Waste & Tailings Impoundment & Water Management ........................................... 182 20.3 Project Permitting ..................................................................................................... 182 20.4 Social & Community Requirements .......................................................................... 182 20.5 Mine Closure ............................................................................................................. 183 21 CAPITAL & OPERATING COSTS ...................................................................................... 184 22 ECONOMIC ANALYSIS ...................................................................................................... 185 23 ADJACENT PROPERTIES ................................................................................................. 186 24 OTHER RELEVANT DATA & INFORMATION ................................................................... 187 25 INTERPRETATIONS & CONCLUSIONS ............................................................................ 188 25.1 Interpretations & Conclusions ................................................................................... 188 25.2 Risks & Opportunities ............................................................................................... 192 26 RECOMMENDATIONS ......................................................................................................