STATUS REPORT

TECOLOTE PORPHYRY COPPER PROJECT

SONORA - MEXICO

JUNE 2010

INDEX

INDEX 1
1.0 INTRODUCTION 2
1.1 LOCATION & TENURE 3
1.2 PORPHYRY DEPOSITS IN NORTHERN SONORA 4
2.0 GEOLOGY 8
2.1 REGIONAL GEOLOGY 8
2.2 REGIONAL AIRBORNE MAGNETIC SURVEY 13
2.3 LOCAL GEOLOGY 17
3.0 WORK COMPLETED 21
3.1 RANDOM ROCK-CHIP & STREAM SEDIMENT GEOCHEM 21
3.2 HISTORICAL MINING, DUMPS AND TAILINGS 24
3.3 ASTER IMAGERY 28
4.0 CONCLUSIONS & RECOMMENDATIONS 30

FIGURES

Figure 1 Tecolote Project Location

Figure 2 Azure Minerals’ ground position within the Tecolote District.
Figure 3 Regional Geology – Sonora
Figure 4 Regional Geology – NW Sonora showing Major Porphyry Copper Deposits.
Figure 5 Simplified Structural Interpretation of the “Fortuna-Tecolote-Caridad ENE-WSW
Porphyry Trend” over Regional Geologic Map.
 Figure 6 Simplified Structural Interpretation of the “Fortuna-Tecolote-Caridad ENE-WSW
Porphyry Trend” over Regional (CRM’s) Airborne Magnetic Map.
Figure 7 Regional Airborne Magnetics; First Vertical Derivate from Reduced to the Pole Total
Magnetic Field showing selected Mag-Low Anomalies of interest.
Figure 8 RTP Regional Airborne Magnetic Map showing Mag-Low Anomalies.
Figure 9 Satellite (Google Earth) showing Mag-Low Anomalies and Mineral Occurrences.
Figure 10 Tecolote Local Geology from Regional Government Maps.
Figure 11 Picture.
Figure 12 Picture.
Figure 13 Picture.
Figure 14 Picture.
Figure 15 Tecolote Porphyry; Satellite Imagery showing random rock-chip and stream
sediment geochem sampling results (Copper values in ppm).
Figure 16 Tecolote Porphyry; Satellite Imagery showing random rock-chip and stream
sediment geochem sampling results (Zn values in ppm).
Figure 17 Satellite Imagery of Tecolote’s Old Mining Site.
Figure 18 Picture.
Figure 19 Satellite Imagery, Tecolote Tailings Dam and sample locations (Cu values in ppm).
Figure 20 Satellite Imagery, Tecolote Tailings Dam and sample locations (Zn values in %).
Figure 21 Satellite Imagery, Tecolote Tailings Dam and sample locations (W values in ppm).
Figure 22 Satellite Imagery, Tecolote Tailings Dam and sample locations (Ag values in ppm).
Figure 23 Tecolote ASTER composite image with spectral processing;

TABLES

Table 1 Tecolote Concession Details

Table 2 Tecolote – Significant Geochemistry.
Table 3 Tecolote – Tailings Preliminary Sampling Program Results.

DATE LAST UPDATED June 29TH, 2010.

1.0 INTRODUCTION.

The Tecolote project is held 100% by Azure Minerals Limited*. The property covers 13,808 hectares
or 138-km2 with three different Mining Concessions. Acquisition of access permits from surface
owners (Ranchers and Ejido) has been completed. The project is subject to a 2% NSR royalty in
favor of Rio Tinto without back-in rights.

The Tecolote claim block, holds “first-class” ground to explore for a bulk minable porphyry copper
deposit. Shortly after putting together a land package (through acquisition and staking) which
sufficiently protects and holds all of the Tecolote District; Azure Minerals’ exploration team,
successfully identified an outcropping strongly-altered mineralized porphyry occurrence of sizable
dimensions within the Tecolote claim block, which was missed or unrecognized by previous explorers
(untested). According to this paper author, the Tecolote project ground offers a unique, obvious and
well supported bulk minable porphyry copper drilling target(s). Major companies focused on porphyry
copper exploration in México, although holding a strong interest in the
Tecolote District, were (historically) unable to put together a favorable land package (as Azure’s).
The altered-mineralized Tecolote porphyry copper occurrence (2.5X2-km) shows a transitional zone
between argillic and phyllic (porphyry related) alteration and mineralized pattern, hosting abundant
sheeted QSP veining (“D” type veinlets) and patchy stockwork zones. Mineralized stockwork veinlets
intensity and copper content appears to increase towards the north and northeast before
encountering a post-mineral extensional fault related to Tertiary Basin & Range tectonics. A first stage
geologic recon program and random chip-rock sampling program returned very encouraging
geochem results and the recognition of abundant peripheral Skarn, CRD and Epithermal type of
mineralization.

The Tecolote Porphyry occurrence is located approximately 3.5-km southeast of the historical
Tecolote skarn (mined) deposit which contained (1974): 943,000 Tons at 54.3 g/T Ag, 1.84% Cu,
6.98% Zn and 0.5% WO3 categorized as a distal type of skarn. From 1978 to 1984 Grupo México
(IMMSA) extracted >1,000,000 Tons. Due to low metal prices at the time and poor recovery, IMMSA
took the decision to close down operations in August of 1984.

To the peripheries of the Tecolote porphyry, there are numerous skarn and/or carbonate replacement
base metal mineral occurrences and some structurally control precious metal ones within the
peripheries porphyry district. Type of mineral occurrences and metal zonation appear to indicate that
the Tecolote porphyry system could be the source of such intrusive related mineralization (including
the Tecolote old mined skarn deposit).

The Tecolote Project offers exceptional potential to explore for a bulk minable porphyry copper deposit
and an evident opportunity to develop economic high-grade skarn and/or carbonate replacement
deposits located to the peripheries of the Tecolote altered-mineralized porphyry occurrence. A
significant amount of the Tecolote claim block exploration potential lies under cover (post-mineral
cover units cover approximately 2/3 of the area of interest).

1.1 LOCATION & TENURE .

The Tecolote project consists of two titled exploration concessions and a third one in the progress of
being titled; totaling 13,808 hectares or 138-km2, located approximately 95-km NW of Hermosillo,
Sonora State. Excellent infrastructure: dirt road all the way to main mineralized occurrences within
project site; 50-km to railroad tracks which lead to Guaymas port.

There is one small excision within the Tecolote claim block held by an individual who has indicated
willingness to sell or option his property (Tizoc). This in-holding protects a small distal skarnoid
occurrence, which shows artisanal underground workings. The Tizoc excision does not jeopardize
the interest of the property and is not necessary to test Tecolote’s porphyry exploration potential or
any other of the numerous skarn and/or carbonate replacement occurrences.

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Details of concessions are shown in Table 1 (below); project location is shown on Figure 1 and Claim
perimeter in Figure 2.

Table 1 – Tecolote Concession Details

Concession Title Application Date

Expiry Date Hectares
Name Number Number Granted
Tecolote 230771 82/31812 Oct 12, 2007 Oct 11, 2057 11,334.0000
Tecolote 3 234586 82/32921 Jul 14, 2009 Jul 12, 2059 74.0000
Tecolote 2 82/33729 2,400.0000
13,808.0000

1.2 PORPHYRY DEPOSITS IN NORTHERN SONORA.

• Cananea (Porphyry) – 7.1 Bt @ 0.42% Cu. 0.008% Mo, 0.58 g/t Ag, 0.012 g/t Au.

• Caridad (Porphyry) – 1.8 Bt @ 0.45% Cu, 0.025% Mo,

• Milpillas (Porphyry) – 230 Mt @ 0.85% Cu (leachable).

• Mariquita (Porphyry) – 100 Mt @ 0.48% Cu (leachable).

• Pilares (Porphyry related Breccia Pipe) – 147 Mt @ 1.04% Cu.

• Cumobabi (Porphyry related Breccia Pipe) – 45 Mt @ 0.1% Mo

• Crestón (Porphyry) – 147 Mt @ 0.077% Mo and 0.049% Cu.

• Fortuna de Cobre (Porphyry) – Major Porphyry Copper occurrence (Undeveloped).

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TECOLOTE PORPHYRY COPPER OUTCROP.

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Figure 1 – Tecolote Project Location

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Figure 2 – Azure Minerals’ ground position within the Tecolote District.

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2.0 GEOLOGY

2.1 REGIONAL GEOLOGY

Tecolote lies in the Sonoran costal porphyry belt within the western Basin and Range
province as defined by Sedlock et al. (1993). The character of the Basin and Range
province is controlled by extensional faulting, where pre mid-Tertiary basement rocks are
exposed in ranges and are generally separated by valleys filled with poorly consolidated
Late Tertiary conglomerates and basalt flows. The ranges typically trend northwest and are
generally separated from the valleys along normal faults.

Paleozoic and Mesozoic clastic and carbonate sedimentary rocks unconformably overlie the
Proterozoic basement. Volcanic rocks (andesitic and rhyolitic) were deposited in the late
Mesozoic to early Cenozoic, as part of the magmatic arc that developed during the Laramide
Orogeny. Laramide-age (50-70 Ma) granodiorites and related porphyritic phases intrude all
older rock types, including coeval volcanics. Mid-Tertiary volcanic rocks, predominately
rhyolite-rhyodacite, form the Sierra Madre Occidental (SMO) volcanic province are
persistently developed and preserved throughout the western Basin and Range province.
The SMO is a northwest-striking slightly domed volcanic plateau.

The Basin and Range Province is structurally complex, with several phases of compression
and extension recognized during the Mesozoic and Cenozoic. Dominant structural trends
are northwest-southeast, northeast-southwest and north-south. The SMO volcanic province
is relatively undeformed. Some of the northwest trending regional faults that cut the
volcanic province are thought to be reactivated basement structures that originally formed
to compensate for movement along the Sonora-Mojave Mega-shear in the Jurassic (e.g.
Aranda-Gómez et al., 2005). The Mega-shear developed as a sinistral transform fault
during arc magmatism in the Jurassic (Anderson & Silver, 1979) and separates 1.8-1.7 Ga
rocks of the Caborca Block in western Sonora from 1.7-1.6 Ga schists of the Pinal Province
in northeast Sonora (Anderson & Silver, 2005). The Jurassic rocks which occupy the zone
are strongly deformed along low-angle thrust faults and the associated sedimentary rocks
are tightly folded. The south-western boundary of the Megashear appears to be a major
fault that juxtaposes Precambrian basement rocks against the Jurassic magmatic terrain
(Anderson and Silver, 1979). Up to 800 km of left lateral movement has been proposed for
this shear after the Middle Jurassic period.

The main porphyry mineralization (and related deposit styles) events in Sonora date from
70 Ma to 50 Ma (e.g. Cananea at 59.3 Ma – Barra et al, 2005) and relate to phases of the
Laramide batholithic belt. The Laramide tectonic regime involved grossly east-west to
northeast-southwest shortening with probable lateral escape of the developing orogen
(synchronous, mild north-south to northwest-southeast extension). This is indicated by
grossly east-west trends in Laramide dilational features (fractures, dykes, normal faults,
breccias and alteration zones) and mineralized systems.

Epithermal deposits formed in the mid-Tertiary SMO, associated with widespread extension
following the Laramide Orogeny (Staude & Barton, 2001). Northwest trending faults are
recognized as having been important in localizing epithermal mineralization.

The regional geology of Sonora is illustrated in Figure 3.

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 Figure 3 – Regional Geology – Sonora

Figure 4 – Regional Geology – NW Sonora showing Major Porphyry Copper Deposits.

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 Figure 5 – Simplified Structural Interpretation of the “Fortuna-Tecolote-Caridad ENE-WSW
Porphyry Trend” over Regional Geologic Map.

NOTE: Interpreted NW-SE Structures coincide with Paleozoic, Mesozoic, and Tertiary basin margins
(growth-faults), interpreted as Crustal Structures which have been reactivated through time.

(Mexican Government Regional Airborne Magnetic Data compiled by Kennecott).

Figure 6 – Simplified Structural Interpretation of the “Fortuna-Tecolote-Caridad ENE-WSW

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 Porphyry Trend” over Regional (CRM’s) Airborne Magnetic Map.

NOTE: Interpreted ENE-WSW and NW-SE Structures coincide with major magnetic bakes (lineaments);
concentration of mineral occurrences coincides within intersections zones.

2.2 REGIONAL AIRBORNE MAGNETIC SURVEY.

Within Tecolote claim block several magnetic-low anomalies possibly related to porphyry related destructive
alteration systems have been selected to be followed up from Government’s (CRM) Regional airborne
magnetic survey (averaging 1-km line separation at 300-meter altitude). Within northwestern México;
porphyry copper deposits and main porphyry copper occurrences are outlined by magnetic-low anomalies;
including Cananea, Caridad, Pilares, Cumobabi, Crestón, Fortuna de Cobre, etc.

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 Figure 7 – Regional Airborne Magnetics; First Vertical Derivate from Reduced to the Pole Total
Magnetic Field showing selected Mag-Low Anomalies of interest.
The altered-mineralized Tecolote porphyry copper occurrence (2.5X2-km) is outlined by a magnetic low
anomaly reflecting a strong destructive alteration pattern (argillic / phyllic porphyry related alteration).

Within claim block, besides the one outlining the Tecolote porphyry, another 6 semi-circular magnetic-low
anomalies have been selected and categorized as of interest to be followed up which potentially could be

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outlining buried porphyry occurrences (“blind” type of targets). Preliminary Mag-Low Related Porphyry
Targets (Mag Targets) are illustrated in Figures 7 and 8.

(Mexican Government Regional Airborne Magnetic Data compiled by Kennecott).

Figure 8 – Reduced To The Pole Regional Airborne Magnetic Map showing Mag-Low Anomalies.

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 Figure 9 – Satellite (Google Earth) showing Mag-Low Anomalies and Mineral Occurrences.

2.3 LOCAL GEOLOGY.

Area of interest is underlined by following geology (from older to younger):

1. Low Proterozoic; Schists, Quartzites, Amphibolites, Gneisses (green schist and amphibolite
metamorphic degree) Bámori Metamorphic Complex (Longoria, 1978).

2. Early Paleozoic; Limestones and Sandstones of Early Paleozoic age; deposited in platform
environment.

3. Low Jurassic; Andesites, Calcareous Shales and Conglomerates; Santa Rosa Fm. (Hardy 1973);
platform environment.

4. Upper Cretaceous (Lower Laramide); Granitic, Granodioritic, Quartz-Monzonitic intrusives;

including porphyry copper host and source rocks.

5. Tertiary Oligocene Andesitic Volcanics.

6. Tertiary Oligocene-Early Miocene; Rhyolitic Volcanics (Rhyolites, Rhyolitic Tuffs, Ignimbrites,

Agglomerates.

7. Tertiary Early Miocene; Poligmitic Conglomerates, Sandstones, Basaltic Volcanic; Baucarit Fm.
(Dumble 1900, King 1939).

8. Quaternary Pleistocene; Gravels, Conglomerates, Sand.

2.3.1. ALTERATION / MINERALIZATION.

Within the property claim block lays the historical Tecolote Mine skarn deposit which contained (1974):
943,000 Tons at 54.3 g/T Ag, 1.84% Cu, 6.98% Zn and 0.5% WO3. Hosting calcareous units were subject
to metamorphic and metasomatic effects; alteration consists of silicification and tactite development
(skarn). Alteration minerals garnet, wollastonite, zoisite, epidote, diopside and scapolite have been
identified. The Tecolote deposit can be categorized as distal skarn mineralization type.

The Tecolote mineral deposit consists of several strata bound lens-shape massive sulfide ore bodies
composed of zinc and copper sulfide mineralization. Mineralization is composed of sphalerite, chalcopyrite,
pyrite, and silver sulfur-salts with random galena, molybdenite and sheelite contents. Sulfide mineralization
is observed throughout tactite development but historical exploration has only been focused on the high-
grade massive sulfide zones

A number of mineralized skarn and/or carbonate replacement type of mineral occurrences have been
identified within the Tecolote claim block, which individually show small to medium size mining development
potential and have not been developed other than some historical artisanal mining attempts. Precious
metals (gold) increase within distal skarnoid and vein type occurrences.

The recently discovered outcropping portion of the altered-mineralized Tecolote Porphyry system, surfacing
within a 2.5X2-km area, shows a transitional zone between argillic and phyllic (porphyry related) alteration
and mineralized pattern, hosting abundant sheeted QSP veining (“D” type veinlets) and patchy stockwork
zones. Intensity of (phyllic) alteration and abundance of stockwork increase towards the north and
northeastern most part of the porphyry outcrop before encountering a post-mineral extensional fault related
to Tertiary Basin & Range tectonics. It is interpreted that such post-mineral fault is displacing and “down-
dropping” the rest of the Tecolote untested altered-mineralized porphyry system.

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Scattered copper oxide occurrences have been located within the Tecolote Porphyry which apparently
subject to a topographic / oxidation level.

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 Figure 10 – Tecolote Local Geology from Regional Government Maps.

Map Geology Legend. pTiE-Gn=Pre-Cambrian metamorphics (gneiss, schists, quartzites) in purple,

PCzAr=Paleozoic sediments (limestones, sandstones) in gray, JiA-Ar=Jurassic volcano-sediments (andesites,
sandstones, siltstones) in brown, KsTpaGr-Gd=Laramide granodioritic intrusives in pink, ToA and ToTR-R=Tertiary
(post-mineral) andesitic and rhyolitic volcanics in light orange, Qhoal and QptCgp=Quaternary (post-mineral)
conglomerates, gravels and sand.

Figure 11 – Picture of Quartz Porphyry showing strong Phyllic alteration hosting abundant
Copper Oxide mineralization within stockwork fracturing.

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Figure 12 – Picture of Quartz Porphyry showing strong Phyllic alteration hosting abundant
sheeted Quartz-Sericite-Pyrite veining.

Figure 13 – Picture of Quartz Porphyry showing strong Phyllic alteration hosting strong
Quartz-Sericite-Pyrite stockwork veining.

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 Figure 14 – Picture of Quartz Porphyry showing strong Phyllic alteration hosting abundant
Copper Oxide mineralization within stockwork fracturing.

3.0 WORK COMPLETED

3.1 RANDOM ROCK-CHIP & STREAM SEDIMENT GEOCHEM.

First stage geochem sampling program within the Tecolote claim block was carried out within and
around the recently discovered Tecolote Porphyry Copper occurrence, returning very encouraging
results from random rock-chip and stream sediment geochem sampling as best values coincide with
increasing phyllic alteration intensity towards the north and northeast portion of the outcropping portion
of the Tecolote Porphyry system.

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 Figure 15 – Tecolote Porphyry; Satellite (Google Earth) Imagery showing random rock-chip and
stream sediment geochem sampling results (Copper values in ppm).

Outstanding copper values include: 2.4% Cu from copper oxide occurrence leaking from strong phyllic
altered zones. Zinc and Molybdenum anomalous values appear to be coincident to copper ones and
coincide with the appreciation of considering such porphyry outcrop a peripheral portion of a major
porphyry copper system.

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Figure 16 – Tecolote Porphyry; Satellite (Google Earth) Imagery showing random rock-chip and
stream sediment geochem sampling results (Zn values in ppm).

Table 2 – Tecolote – Significant Geochemistry

SAMPLE_ID Sample_Type Easting Northing Au_ppm Ag_ppm Cu_ppm Mo_ppm Pb_ppm Zn_ppm

839102 Rock-Chip 449106 3305364 <0.005 1.7 2110 7 44 340

839103 Rock-Chip 449099 3305055 0.008 4.9 3130 24 416 9700

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 839108 Rock-Chip 449357 3304308 0.014 5.5 36800 1 164 15650
839133 Rock-Chip 449375 3302723 <0.005 2.9 24100 1 174 202
839137 Rock-Chip 449853 3302323 0.016 14.7 497 9 172 595
839141 Rock-Chip 450146 3303556 0.018 0.6 9830 3 11 324
839142 Rock-Chip 450099 3303540 0.006 0.8 4390 4 16 121
839145 Rock-Chip 449962 3303260 0.845 5.8 35 4 401 143
839147 Rock-Chip 450931 3299620 7.11 80.3 1660 827 8820 71200
839148 Dump 450919 3300349 0.02 35.2 115 31 8740 428
839151 Rock-Chip 450224 3302136 <0.005 1.5 328 1 299 1190
839152 Dump 448429 3308561 0.055 24.9 23 3 30400 19
839154 Dump 447619 3309425 2.51 43.6 2690 1 4970 11500
839221 Rock-Chip 449345 3304410 <0.005 1 1185 2 25 324
839251 Dump 450930 3299618 <0.005 15 61 6 2010 7460

3.2 HISTORICAL MINING; DUMPS AND TAILINGS.

According to Grupo México (IMMSA) records; from 1978 to 1984; 1,171,374 Tons were mined with a head-
grade of 38.78 gr/T Ag, 1.54% Cu and 6.08% Zn.

A resource of 100,000 Tons of Oxide Mineralization was left behind (not mined).

Due to poor recoveries (0.564 for Ag, 0.659 for Cu and 0.677 for Zn); the tailings dam contains: 19,805.7Kg
of Silver, 6,151.4-Tons of Copper and 23,003.9-Tons of Zinc.

Table 3 – Tecolote – Tailings Preliminary Sampling Program Results.

SAMPLE_ID Sample_Type Height_Mts. Easting Northing RL Ag_ppm Cu_ppm W_ppm In_ppm Zn_%

838554 Channel 1.00 448407 3306809 801 13.4 1515 510 9.03 1.85

838555 Channel 1.20 448440 3306804 801 12.95 1540 395 8.59 1.365

838556 Channel 1.25 448476 3306810 800 12.35 1010 460 5.12 0.849

838557 Channel 2.00 448488 3306777 801 20.8 2480 490 6.48 1.07

838558 Channel 1.60 448491 3306780 797 20.5 3130 540 6.32 1.35

838559 Channel 3.20 448516 3306768 793 28.7 6400 780 16.9 3

838560 Channel 3.20 448523 3306746 794 21.2 4930 393 13.85 2.77

838561 Channel 2.40 448535 3306725 793 17.65 3940 359 10.8 2.03

838562 Channel 1.90 448554 3306705 793 16.85 4170 306 10.1 2.08

838563 Channel 1.20 448577 3306688 794 14.35 3270 327 10.75 2.14

838564 Channel 1.20 448615 3306672 792 15.55 3010 334 9.99 1.835

838565 Channel 1.05 448650 3306676 794 16.1 3110 373 11.65 2.01

838566 Channel 1.15 448677 3306698 795 14.2 2450 395 10.5 1.785

838567 Channel 0.90 448423 3306669 797 14.5 2810 351 7.9 1.525

838568 Channel 1.50 448470 3306691 795 19.5 4100 610 10.4 1.91

838569 Channel 2.35 448499 3306708 792 20.1 4370 395 13.2 2.34

838570 Channel 2.00 448517 3306712 793 14.4 4200 267 9.94 2.2

838571 Channel 2.10 448536 3306709 792 16.1 3670 268 10.35 2.02

838572 Channel 1.40 448976 3306627 789 24.3 4430 316 24.4 3.26

838573 Channel 1.50 448909 3306765 798 20.4 4060 358 12.85 2.48

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838574 Channel 2.15 448867 3306762 789 18 5630 403 16.8 2.81

838575 Channel 1.30 448319 3306659 798 31.4 8000 274 63 7.64

838576 Channel 0.90 448328 3306675 802 25.7 4790 620 11.3 1.84

Figure 17 – Satellite (Google Earth) Imagery of Tecolote’s Old Mining Site.

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 Figure 18 – Picture showing Tailing’s Channel Sample.

Figure 19 – Satellite (Google Earth) Imagery showing Tecolote Tailings Dam and sample
locations (Cu values in ppm).

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Figure 20 – Satellite (Google Earth) Imagery showing Tecolote Tailings Dam and sample
locations (Zn values in %).

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 Figure 21 – Satellite (Google Earth) Imagery showing Tecolote Tailings Dam and sample
locations (W values in ppm).

Figure 22 – Satellite (Google Earth) Imagery showing Tecolote Tailings Dam and sample
locations (Ag values in ppm).

3.3.1 ASTER IMAGERY.

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ASTER Imagery was acquired and spectral processing to highlight alteration assemblages completed by
Southern Geoscience Consultants in Western Australia. A color composite image of the ASTER, overlain
by the spectral processing is shown as Figure ---. Note that strong clay development due to hydrothermal
alteration is coincident with the Tortuga Porphyry location.

Figure 23 – Tecolote ASTER composite image with spectral processing; colored pixels on the
image represent the highest 1 percent concentrations of Kaolinite (green), Alunite-Pyrophyllite
(red), Sericite (cyan) and Propylitic alteration (blue) respectively.

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4.0 CONCLUSIONS & RECOMMENDATIONS.

• The Tecolote claim block holds first-class ground to explore for a bulk minable porphyry copper
deposit; hard evidences includes the (2.5X2-km) strongly altered and mineralized Tecolote Porphyry
occurrence which is interpreted to be a peripheral portion of a larger porphyry system.

• Besides the Tecolote Porphyry occurrence; sub-cropping altered and mineralized porphyry
evidences have been observed elsewhere within the property suggesting the potential to develop
multiple porphyry copper targets.

• “Brown-Field” type of exploration around and within Tecolote old mining site.

• Obvious potential to develop significant high-grade Skarn and Carbonate Replacement Deposit type
of Targets

• Exploration Targets at site; including large oxide-alteration zones coincident with favorable geology,
airborne magnetic signatures and clay-alteration footprints.

• Potential to develop a small mining operation in the short term (tailings dam, oxide resource, etc.).

A porphyry copper exploration effort should include:

• Geologic reconnaissance work within already selected areas of interest.

• District scale Geologic Mapping (1:20,000) and Stream Sediment Geochem sampling program.

• Detailed airborne magnetic and radiometric survey (Lines every 200-m @ 60 to 80-m altitude).

• Detailed geological mapping and geochemical sampling over selected targets.

• IP Survey over selected targets.

• Drilling.

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