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PROJECT PIPELINE – Project Evaluation Stage Projects
   

El Quevar

Title and Ownership Rights
Argentina is one of relatively few countries in which mineral rights are owned by the provinces, not by the central (federal) government. The Federal Constitution vests mineral rights with the provinces, which administer claims and assess royalties, although increasingly in line with Federal policies. Under the Federal Mining Code, which is adhered to by all provinces, minerals are divided into several categories including metal ores and construction materials.

The types of mineral concessions relevant to the El Quevar project are cateos (claims) for exploration and minas (mines) for exploitation. These are granted by a judge of the Salta Mining Court and are entered into a public register.

The El Quevar project includes 23 exploitation concessions and six exploration concessions ("cateos"), for a total of approximately 67,000 hectares. Three of the concessions near the primary Yaxtché target are subject to options to purchase from the existing third party concession owners. One option agreement covers the El Quevar II concession and one-half of the Castor concession, and another option agreement covers the Nevado I concession. Our remaining payments on the El Quevar II/Castor and Nevado I option agreements total $1,100,000 and $1,050,000, respectively. Assuming funding is available and the results of our additional drilling and planned economic study work are promising, we intend to make all remaining option payments by June 22, 2012.

In addition, under the terms of the option agreements, we are required to pay a 1% net smelter return royalty on the value of all metals extracted from the El Quevar II or Nevado I concessions and one-half of the minerals extracted from the Castor concession. We are also required to pay a 3% royalty to the Salta province based on the mine mouth value of minerals. To maintain all of the El Quevar concessions, we make yearly aggregate rental payments to the Argentine government of approximately $32,000.

Mineral Concessions at El Quevar - Data as of May 2011
PROPERTY No. of HECTARES Type of CONCESSION OWNER APPROX. ANNUAL PAYMENT
EL QUEVAR II 330 Mine SESA (Option Silex) $800
NEVADO I 2,161 Mine Saravia C. A. - Rodriguez S.R. $4,200
QUIRINCOLO I 3,500 Mine Silex Arg. S.A. $7,000
QUIRINCOLO II 3,500 Mine Silex Arg. S.A. $7,000
CASTOR 384 Mine

Silex Arg. S.A. (50%) - SESA (50% - Option Silex)

$800
VINCE 44 Mine Silex Argentina S.A. $100
ARMONIA 17 Mine Silex Argentina S.A. $40
QUESPEJAHUAR 18 Mine Silex Argentina S.A. $60
TORO I 436 Mine Silex Argentina S.A. $1,000
QUEVAR I 0 Cateo Silex Argentina S.A. 0
QUEVAR PRIMERA 2,626 Claim Silex Argentina S.A. 0
QUEVAR NOVENA 1,313 Claim Silex Argentina S.A. 0
QUEVAR DECIMO TERCERA 3,313 Claim Silex Argentina S.A. 0
QUEVAR III 3,997 Cateo Silex Argentina S.A. 0
QUEVAR TERCERA 3,995 Claim Silex Argentina S.A. 0
QUEVAR DECIMA 1,997 Claim Silex Argentina S.A. 0
QUEVAR IV 3,988 Cateo Silex Argentina S.A, 0
QUEVAR CUARTA 3,977 Claim Silex Argentina S.A. 0
QUEVAR DECIMO PRIMERA 1,988 Claim Silex Argentina S.A. 0
QUEVAR V 0.00 Cateo Silex Argentina S.A. 0
QUEVAR QUINTA 2,242 Claim Silex Argentina S.A. 0
QUEVAR DECIMO SEGUNDA 1,121 Claim Silex Argentina S.A. 0
QUEVAR DECIMO QUINTA 3,121.48 Claim Silex Argentina S.A. 0
QUEVAR VI 4,493 Cateo Silex Argentina S.A. 0
QUEVAR SEXTA 2,493 Claim Silex Argentina S.A. 0
QUEVAR VII 6,641 Cateo Silex Argentina S.A. 0
QUEVAR SEPTIMA 2,301 Claim Silex Argentina S.A. 0
MARIANA 25 Mine Silex Argentina S.A. $15
ARJONA II 2,786 Mine Silex Argentina S.A. $5,600
TOTAL 62,819 TOTAL $26,615
Source: El Quevar NI 43-10, May 2011

 

   
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