TECHNICAL REPORT ON THE AMAZON BASIN GOLD PROPERTY AMAZONAS, MATO GROSSO AND RONDÔNIA STATES, BRAZIL Apui Airport Coordinates Latitude: 07° 10' 27.3" South Longitude: 59° 50' 20.4" West For: Armadillo Resources Ltd 411 – 470 Granville Street Vancouver, BC Canada V6C 1V5 Prepared By: David F. Reid, B.Sc., M.Sc., MBA, P.Geo. W. R. Gilmour, B.Sc., P.Geo Discovery Consultants 201 – 2928 29th Street Vernon, BC, V1T 5A6 P.O. Box 933 Vernon, BC, V1T 6M8 Date: June 30, 2011 i TABLE OF CONTENTS 1. SUMMARY .................................................................................................................1 2. INTRODUCTION ........................................................................................................3 3. RELIANCE ON OTHER EXPERTS..................................................................................6 4. PROPERTY LOCATION AND DESCRIPTION 4.1 Location ................................................................................................................7 4.2 Property Description ...............................................................................................7 4.3 Brazilian Mining Code & Permitting.......................................................................... 16 4.3.1 Exploration and Mining Concessions...................................................................... 16 4.3.2 Maintenance of Mineral Tenure Rights................................................................... 17 4.3.3 Environmental Regulations .................................................................................. 17 4.3.4 Environmental Liabilities relating to the Amazonia Property...................................... 17 4.4 Surface Rights ..................................................................................................... 18 4.5 Royalties ............................................................................................................ 18 5. ACCESS, CLIMATE, PHYSIOGRAPHY, LOCAL RESOURCES AND INFRASTRUCTURE 5.1 Access ................................................................................................................ 18 5.2 Climate ............................................................................................................... 20 5.3 Physiography ....................................................................................................... 20 5.4 Local Resources and Infrastructure ......................................................................... 21 6. HISTORY................................................................................................................. 21 7. GEOLOGICAL SETTING 7.1 Regional Geology.................................................................................................. 22 7.2 Property Geology.................................................................................................. 25 7.2.1 Manicore Project ................................................................................................ 25 7.2.2 Aripuana Project - Block 1................................................................................... 27 ii 7.2.3 Aripuana Project - Block 2................................................................................... 27 7.2.4 Aripuana Project - Block 3................................................................................... 27 7.2.5 Aripuana Project - Block 4................................................................................... 28 7.2.6 Aripuana Project - Block 5................................................................................... 29 7.2.7 Curauai Project - Block 1 .................................................................................... 33 7.2.8 Curauai Project - Block 2 .................................................................................... 36 7.2.9 Madeirinha Project ............................................................................................. 38 7.2.10 Apiacus Project ................................................................................................ 40 7.2.11 Juruena Project................................................................................................ 42 7.2.12 Matupa Project - Block 1 ................................................................................... 44 7.2.13 Matupa Project - Block 2 ................................................................................... 44 7.2.14 Matupa Project - Block 3 ................................................................................... 44 7.2.15 Matupa Project - Block 4 ................................................................................... 48 7.2.16 Jatoba Project ................................................................................................. 50 7.2.17 Cacoal Project ................................................................................................. 52 7.2.18 Theobroma Project .......................................................................................... 54 7.3 Structure............................................................................................................. 56 8. DEPOSIT TYPES....................................................................................................... 56 9. MINERALIZATION ................................................................................................... 57 10. EXPLORATION....................................................................................................... 58 10.1 Soil and Saprolite Sampling.................................................................................. 58 10.2 Stream Sediment Geochemical Survey................................................................... 58 11. DRILLING.............................................................................................................. 59 12. SAMPLING METHOD AND APPROACH 12.1 Soil and Saprolite Sampling.................................................................................. 59 iii 13. SAMPLE PREPARATION, ANALYSES, AND SECURITY 13.1 Soil and Saprolite Sampling.................................................................................. 59 14. DATA VERIFICATION............................................................................................. 60 15. ADJACENT PROPERTIES ........................................................................................ 60 16. MINERAL PROCESSING AND METALLURGICAL TESTING......................................... 62 17. MINERAL RESOURCE AND MINERAL RESERVE ESTIMATES ..................................... 62 18. OTHER RELEVANT DATA and INFORMATION .......................................................... 63 19. INTERPRETATION AND CONCLUSIONS 19.1 Geology and Mineralization................................................................................... 63 19.2 Exploration Targets ............................................................................................. 63 19.2.1 Manicore Project .............................................................................................. 63 19.2.2 Aripuana Project – Block 1................................................................................. 64 19.2.3 Aripuana Project - Block 2 ................................................................................. 64 19.2.4 Aripuana Project - Block 3 ................................................................................. 64 19.2.5 Aripuana Project - Block 4 ................................................................................. 64 19.2.6 Aripuana Project - Block 5 ................................................................................. 64 19.2.7 Curauai Project - Block 1................................................................................... 64 19.2.8 Curauai Project - Block 2................................................................................... 65 19.2.9 Madeirinha Project ........................................................................................... 65 19.2.10 Apiacus Project .............................................................................................. 68 19.2.11 Juruena Project.............................................................................................. 68 19.2.12 Matupa Project............................................................................................... 68 19.2.13 Jatoba Project................................................................................................ 68 19.2.14 Cacoal Project................................................................................................ 68 19.2.15 Theobroma Project ......................................................................................... 68 iv 20. RECOMMENDATIONS ............................................................................................. 71 20.1 Recommended Phase One Exploration Program...................................................... 71 20.2 Recommended Phase Two Exploration Program ..................................................... 73 21. REFERENCES ......................................................................................................... 76 22. CERTIFICATES OF QUALIFICATIONS ..................................................................... 78 List of Tables, Figures and Photos Tables Table 1: Mineral Tenure - Amazônia Capital e Participações Ltda., Brazil ................................ 10 Table 2: Proposed Budget Phase One Exploration