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Notforreproductionordistribution.Theinformationcontainedinthisdocumentisconfidential.

Giacomo Deposit General Report July2009

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Table of Contents 1. TheProject 31.1 History 31.2 TheConcession 41.3 Location 41.4 Accessibility 41.5 ZOFRATACNA 52. Minerals 62.1 Giacomo’sexceptionalcharacteristics 62.2 Mineralsamples 62.3 CertificateofAnalysis 82.4 ElectronMicrographsScanning 93. GiacomoProducts 103.1. ProspectiveGiacomoMineralStreamsandRespectiveMarketCategories 114. GiacomoinFigures 125. Investmentsandfieldadvancements 126. Peru:GeneralInformation 136.1 Surfacearea 136.2 Mineralandenergyresources 136.3 Politicalandlegalsystem 137. Conclusion 14

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1. The Project IntheSouthernPeruvianAndes,auniquemineraloccurrenceofSiliconDioxide(SiO2)andTitaniumDioxide(TiO2)existsnearthecityofTacna.ThisoccurrenceisknownastheGiacomoProject.Giacomoiscurrentlyestimatedtocontainaresourceofatleast100millionmetrictonnesofhigh‐gradeSiO2andTiO2mineralizationofextremelysmallparticlesize.Giacomoisreallymoreaptlydescribedasan“Occurrence”ratherthanaDeposit.Thewhiteoutcroppingsseenbelowareactuallythemineralsofinterest.Thefollowingpicturesrevealthepurityoftheunderlyingmaterial.

GiacomoDeposit

OutcroppingsdetailstakenfromdifferentpartsofGiacomo 10‐metrelongtunnel

1.1 History

Theminewasdiscovered10yearsagoandisownedbyasingleindividual.Theprojectstartedatthetimeofitsdiscovery,howeverbecauseoftheowner’sillhealthitwaspauseduntilnow.Theprojectislookingforcommercialdevelopmentagreements,toassigntherightsfortheexploitation,commercializationanddirectionoftheproject.Currentlythereisnoagreementwithanyutilitycompanyoraspecificcustomer.Thedeposithasneverbeenexploitedandhasbeenpreservedinthestateoriginallyfound,exceptforanalysis‐orientedexcavations.However,duetothedeposit’scharacteristicsaswellasmadeinvestments;itiscurrentlyreadytogeneratecashflow.

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1.2 The Concession

GiacomoandGiacomoAbuelominingconcessionsarebothpartoftheGiacomoProjectandhaveatotalareaof900hectares(2,223acres).Themapbelowshowshowthedepositlaidout.

GiacomoConcession

1.3 Location

TheGiacomoDepositislocatedintheSouthofPeru,inthedistrictofEstiqueintheprovinceofTarata,intheTacnaregion.Estiqueisapproximately60kilometresnortheastoftheCityofTacna.TheconcessionisonthewesternfoothillsoftheBarroso’sMountainChainatanaveragealtitudeof4,500MASL.

1.4 Accessibility

Animprovedasphalthighwayspansabout70%ofthedistancefromtheCityofTacnatoGiacomo,whileanunpavedroadcoverstheremaining30%ofthedistance.

LENGTH ROAD TYPE DISTANCE

Tacna–EstiquePampa WideAsphaltedroad 72kmEstiquePampa–Talabaya WideUnpavedroad 15km(aprox.)Talabaya‐Concession Gravelroad 15km(aprox.)

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FromTacna,GiacomoMaterialcanbeshippedworldwide:• A56kmrailheadexistsbetweenTacnaandthedeepwaterAricaSeaport(Chile).• PeruvianPan‐AmericanHighwayrunsdirectlyfromTacnatoIloandArica’sSeaports.

ItisimportanttonotethatPeruvianfreightoriginatinginTacnaisnotrequiredtopassthroughChileanCustomstoaccessthePortofAricaasthecityofTacnaresidesina“free‐tradezone”withAricaset‐upbythePeruvianandChileangovernmentsaspartofapreviousborderdisputesettlement.

1.5 ZOFRATACNA

Law27688publishedinMarch2002createdZOFRATACNA(TacnaFreeandCommercialZone),whichsupersedetheCETICOSregime,grantingsimilarbenefitsasthelatter.Exportation,Transformation,Industry,TradeandServiceCentres(CETICOS)aregeographicalareas,dulydelineated,whicharedestinedtogenerateeconomicdevelopmentpolesinsouthernandnorthernPeru.Theactivitiesthatmaybeperformedwithinthosecentresinclude:repairservices,merchandisereconditioning,modification,mixing,packing,transformation,distribution,andstorage,amongothers.EnterprisesestablishedwithintheZOFRATACNAandexportingatleast92%oftheirproductionwillbeexemptuntilDecember31,2012fromincometax,VAT,excisetax,MunicipalPromotionTax,ExtraordinarySolidarityTax,customduties,andanyothertaxrequiringanexpressexemption.

AricaSeaport

IloSeaport

Giacomodeposit

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2. Minerals ThemineralsfoundareSiliconDioxideandTitaniumDioxidewhichareinunusualconcentrationsthatvaryincontentandareapproximatelyupto93%SiO2andupto6%TiO2insmallanduniformnaturalparticlesizesthatrangebetween1to3microns.ThesematerialsareperfectforHighTechapplicationslikesemiconductorschips,solarpanelsandmedicalapplicationsandfurtherthat;bothareessentialproductsusedworldwideinpaint,plasticaswellasseveralotherproducts.

2.1 Giacomo’s exceptional characteristics

Giacomoisavirginsite,suigenerisintheminingworlddueto4unusualfeaturesthathelpreducethecostsofextractionandconsequentlytheamountofinvestmenttostartupinasignificantway:1. Theminerals,intheirnaturalstate,arefoundonthesurface;thusreducingextractioncostasthe

collectionfromthesoildoesnotrequireexcavationsorcomplextunnels.2. Theconcentrationofusefulmineralisonaverageof95%,whichtranslatesintolowercostsfor

primarypurification.3. TheSiO2andTiO2arefoundasfineparticles(powderinsteadofquartz),makingmicronization

andmillingprocesses,whichareparticularlycostly,unnecessary.4. TheSiO2andTiO2areheldtogetheronlybycohesion(mixedbutnotfused,eachparticleis

independent),allowingtoavoidrefiningcosts.

Thesefeaturesreduceoperatingcostsandthereforeincreasingprofits.

2.2 Mineral samples

AnindependentpreliminarygeologistsurveywasconductedoftheGiacomoConcessionin2001.Randommineralsamplesweretakenat29pointsovertheGiacomoConcession.

DepositNortheastFace

M‐3

M‐5 M‐2M‐1Tunnel

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ThepreliminaryGeologistreportindicatedthatGiacomocontainstwoprincipalmineralsofsignificantcommercialvalue.Theresultswerethefollowing:

SAMPLING AND CHEMICAL ANALYSIS

Laboratory Analysis Sample

Number Sample Location

SiO2% TiO2% FEO3%

M‐1A CZZone‐Tunnel 84.28 10.88 0.22

M‐1B CZZone‐Tunnel 53.91 35.81 0.13

M‐1C CZZone‐Tunnel 82.62 13.10 0.14

M‐1D CZZone‐Tunnel 86.07 9.67 0.20

M‐1E CZZone‐Tunnel 87.67 7.47 0.22

M‐1F CZZone‐Tunnel 83.57 11.61 0.09

M‐1G CZZone‐Tunnel 66.05 25.46 0.13

M‐1H CZZone‐Tunnel 88.06 7.90 0.19

M‐1I CZZone‐Tunnel 85.54 10.29 0.12

DepositSouthwestFace

M‐7 M‐9

M‐10 M‐11 M‐12

M‐8 M‐17

M‐16 M‐15

M‐13 M‐17

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M‐1J CZZone‐Tunnel 89.58 3.14 0.20

M‐1K CZZone‐Tunnel 90.11 5.71 0.20

M‐2 CZZone 94.83 3.40 1.18

M‐3 CZZone 85.11 2.81 2.25

M‐4 CZZone 97.82 1.18 2.93

M‐5 CZZone 93.98 5.60 2.20

M‐6 CZZone 91.78 1.51 6.05

M‐7 CAMPZone 62.11 1.12 6.69

M‐8 CAMPZone 77.66 2.08 4.38

M‐9 CAMPZone 79.53 2.67 3.08

M‐10 CAMPZone 99.49 0.70 2.16

M‐11 CAMPZone 98.70 2.39 0.33

M‐12 CAMPZone 93.46 3.18 4.40

M‐13 CAMPZone 95.03 3.58 1.81

M‐14 CAMPZone 91.28 4.28 1.70

M‐15 CAMPZone 89.02 3.85 1.98

M‐16 CAMPZone 96.76 4.07 0.84

M‐17 CAMPZone 90.40 3.28 0.95

M‐18 CAMPZone 87.20 2.73 0.88

M‐19 CAMPZone 80.64 2.59 0.82

Mean(Avg.) 86.63 6.63 1.60

SOURCE:PreliminaryGeologicStudyandReserveComputationforResourcesandPotentialsintheMiningLeasesGiacomoandGiacomoAbuelo,January2001

2.3 Certificate of Analysis

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2.4 Electron Micrographs Scanning

ThelargercrystalsareallTiO2,andthefinematerialaroundthecrystalismostlySiO2.TheTiO2crystalsareupto10micrometresinsize,buttheSiO2isaveryfinepowder.

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3. Giacomo Products TiO2andSiO2arebothveryvaluablemineralsandbothusedextensivelyworldwideinabroadvarietyofconsumerproducts.WhilemostpeoplethinkofTitaniumasastrong,lightweightmetal,closeto97%ofTiO2isactuallyusedaspigmentinpaints,plasticsandpaper.Titaniummetalhasanumberofusefulphysicalpropertiesandveryresistanttocorrosion.Itisfirm,hasahighmeltingtemperatureandislightweight.Itsstrengthissimilartosteel,butitis45%lighter.Titaniumalloyscanbetwiceasstrongasaluminiumalloys.Itiscompatiblewiththehumanbodyandisoftenusedinsurgicalinstrumentsandmedicalimplants.Titaniumistheonlyelementthatwillburninapurenitrogenatmosphere.SiO2isusedinthemanufactureofspecialsteelsaswellascastiron,aluminiumalloys,glassandrefractorymaterials,ceramics,abrasives,waterfiltration,hydrauliccementcomponent,fillerincosmetics,pharmaceuticals,paper,insecticides,rubberreinforcingagent‐especiallyforhighadhesiontotextiles,anti‐cakingagentinfoods,flattingagentinpaintsandasathermalinsulator.Fusedsilicaisusedasanablativematerialinrocketengines,spacecraft;finally,silicafibresareoftenusedinreinforcedplastics.PricesofbothTiO2andSiO2historicallyaveragearound$1perpound,withmorevariationbeingexperiencedwithSiO2,duetoitsmanyformsandgreaternumberofapplicationsinendproducts.• MicrocrystallineSilicaforPaintsWithonlyaminimalamountofWetSeparationProcessing,GiacomoSiO2canbemarketedasaPigmentExtenderforExteriorGradePaintsforaround$500pertonne.Paintmakerstypicallyuseabout1pound(0.45kg)ofMicrocrystallineSilicaineachcanofexteriorpaint.Furthermore,companieswhosellMicrocrystallineSilicamustengageinacostlyandlowyieldmillingandgrindingphasetoobtainparticlesizesofaround5microns(e.g.5millionthsofameter)whereas,Giacomomaterialexhibitsthissmallparticlesizeinitsnaturalstate.ThisleadsustobelievethatapositionofCostLeaderforthismarketiscompletelyattainable.• HighPuritySilicaDuetoitsinherentsmallparticlesizeandpurity,GiacomoSiO2maybesuitableasaFeedstockforHighTechOpticsthatcansellforashighas$5,000pertonne.Whilethisisasmallermarketfromausageperspective,itisveryattractivesinceGiacomoSiO2canbemadesuitableforthisthroughtheuseofhighpurityrinsing.• SpecialtySilicaChemicalsAgreatdealofSiO2isusedtomake“AmorphousSilica”butthisSiO2mustfirstundergosomechemicalprocessingtocreatecompoundscalled“precursors”.TheseprecursorcompoundscanbemadefromGiacomo’sSiO2withanincreasedlevelofprocessing,andmayallowenteringintotheAmorphousSilicamarketinashortterm,intermediatefashion.Thesematerialscommandpricesfrom$2,000to$5,000pertonne.• TitaniumDioxidePigmentsMoreresearchneedstobemadeonthistopictoconfirmthatalow‐cost,efficientAdvancedSeparationtechniquecanbeperfectedtoremovetheTiO2fromtheSiO2,andthentheTitaniumDioxidemaybesalableasapigmentand/oropacifier.TitaniumDioxidepigmentiswortharound$2,000pertonne.

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3.1. Prospective Giacomo Mineral Streams and Respective Market Categories

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4. Giacomo in Figures ThecommercialvalueoftheSiO2andTiO2isaround$300to$500permetrictonsasrawmaterial;therefinedproductcanbeworth4to5timesthatamount.Assumingaconservativevolumeof20millionmetrictons,Giacomocouldshowapotentialvalueofabout10BB.Whilereservesarestillbeingestablished,thereisevidencetosaythatthereservoircontainsatleast100millionmetrictons.Theampledepositreservescanbeusedfordifferentpurposeseitherbysellingcrude,refinedorprocessedinmanywayssincetheSiliconandTitaniumareusedasfeedstockforavastvarietyofindustries.Asforpre‐operativeinvestment,theinitialfigureadvisedisof$5,000,000tobeginadailyextractionbetween100and300tonsore.Thesewouldbeinvestedmainlytoimprovethe15kmofgravelroadfromTalabayatotheConcession,sinceitisanemergencyroad.Additionalinvestmentof$15,000,000wouldbeneededtobuildacomplementaryroadinordertoincreasethecapacityofextractionnumeroustimes.Currently,Giacomohaslicensetoextract365.000tonsperyearwithinalegalframeworkasitisdefinedasaSmallProducerMiner.Ifnecessary,arequestfortheincreaseofthisamountcanbemade,evenforanindefinitequantity.Studiesofprocessingandrefiningformineralsareatthismomentpending.Nevertheless,thefirststepshavealreadybeenmadeandtheseindicatethatSiO2andTiO2arenotbondedtogetherandthatitispossibletouseasimplecyclonictechniquetoextractsignificantquantitiesofverypureSiO2.

5. Investments and field advancements Theownerandhisfamilyhavefundedtheproject;sofarthetotalinvestmentamountisnearly$10,000,000.Themainadvancementsistheprojectarethefollowing:a. AspecificCustomsClearanceNumber2508.40.00.00fortheMineralswascreatedin1998.Itis

importanttohighlightthatthematerialisregisteredasauniqueproduct,whichdoesnothaveaspecificnameinPeruasithasnoprecedentsinthecountry.

b. ResourceswereinvestedandboostedatCentralaswellasRegionalgovernmentstobuildtheNationalHighwayTacna‐Tarata,partlyusedatthismoment,toaccessthesite.Inthesameway,theculminationofnegotiationswasboostedsothatthefreePeruvianPortoperationsinArica(Chile)andtherailwaylinkingthecitiesofAricaandTacnacameintoforce.

c. Anemergencyroadof15km(approx)oflengthhasbeenbuilttoreachthedepositinoff‐roadvehicles.

d. In2003,thePeruvianDepartmentofTransportandCommunicationsapprovedaprojectinordertodevelopanexclusiveroadfordeDeposit.

e. Anapplicationforelectricitysupplyhasbeenapproved;thiswillsupportinitialoperationsofthereservoir.

f. AninitialenvironmentalimpactstudywaspresentedtotheDepartmentofEnergyandMining;neverthelessitwasdecidedtoendthisprocessinordertoapplyatDIA(EnvironmentalImpactDeclaration)torecoursemorebenefits.

g. Theownerpossessland,withmorethanthree(3)hectareslocatedonthesouthernsideofthecityofTacnaneartheraillineTacna‐Arica,thatcomesdirectlytothePeruvianportintheChileanterritory.Thislandcanserveasafuturedeposit.

h. Thedeposithasundergoneexcavation,thesameasgeologicalandlaboratoryteststhatprovetheclaimdescribedintheinitialPDFdocumentandthispresentation.

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6. Peru: General Information1

6.1 Surface area

Withanareaof1,285,215squarekm(496,222sqmi),Peruisthethird‐largestcountryinSouthAmericaafterBrazilandArgentina,rankingamongsttheworld’s20largestnations.Itholdsswayovertheseaupto200milesfromthePeruviancoastandhasterritorialrightstoanareaof60millionhectaresintheAntarctic.LimaisthecapitalofPeru.Peruisdividedintothreemajorregions;itsgeographyvariesfromthearidplainsofthePacificcoasttothepeaksoftheAndesMountainsandthetropicalforestsoftheAmazonBasin.6.2 Mineral and energy resources

Peruisthe1stproducerofgold,silver,zinc,tin,andleadinLatinAmericaand2ndproducerofcopperandmolybdenum.Almostallthelargetransnationalminingcompaniesoperateinthecountry.Severalcompanies,belongingtodifferenteconomicalgroups,provideelectricalsupply.ThelargestisEdegel(Endesa),followedbyElectroperú(state‐ownedcompany).ThemainvarietyofelectricalgenerationinPeruishydroelectric,althoughnaturalgasisbeingusedinanincreasingmannerinrecentyears.Thisisbecausesince2004,naturalgasfromCamiseaisavailableinLima.6.3 Political and legal system

PeruisademocraticrepublicdividedintoLegislative,ExecutiveandJudicialpowers.ThepresidentandmembersofCongressareelectedeveryfiveyearsbyuniversalsuffrage.ThecurrentconstitutionalpresidentofPeruisAlanGarciaPerez(2006‐2011).Peruoffersafavourablelegalframeworkforforeigninvestment• Non‐discriminatorytreatment.• Unrestrictiveaccesstomosteconomicsectors.• Noperformancerequirements.• Freetransferofcapital.• Freecompetition.• Guaranteeforprivateproperty.• Freedomtopurchasestocksfromlocals.• Freedomtoaccessinternalandexternalcredit.• Freedomtopayroyalties.• NetworkofinvestmentagreementsandmemberofICSIDandMIGA.

1Source:PriceWaterhouseCooper

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7. Conclusion TheGiacomoProjectrepresentsanexcellent“ground‐floor”investmentopportunitythatisuniqueintheworldofIndustrialMineralsasitentailstwomineralsofsignificantvalue.AtGiacomo,TiO2andSiO2existtogetherinanaturalstate,onethatisverydesirableforinclusionintoconsumerproducts.Insomeinstances,thesemineralsareappropriateforinclusionintointermediatechemicalsthatareusedtomakeconsumerproducts.Inotherinstances,thesemineralsaresuitablefordirectinclusionintoconsumerendproductswithaminimalamountofprocessingrelativetothatrequiredbycompetitorstoachievealevelofpurityandparticlesizeonparwiththatfoundnaturallyatGiacomo.Inthesecases,GiacomomaterialmaybeabletoenterthemarketasaPriceLeader,whichshouldenhanceearlyCashFlowasthecompanygoesforth.

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Thanks