EXHIBIT 10.2
 

SUMMARY REPORT ON THE

QUINCHIA PROPERTY

Department of Risaralda, Colombia

Mineral Contracts
Exploration License 18567  
Exploration License 22159  
Concession Contract No. 22270

Prepared by
Caribbean Copper & Gold Corporation
Cobre y Oro de Colombia SA

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February, 2008

 

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TABLE OF CONTENTS

1. SUMMARY

2. INTRODUCTION AND TERMS OF REFERENCE
2.1 TERMS OF REFERENCE
2.2 SOURCES OF INFORMATION AND RELIANCE ON OTHER EXPERTS

3. GEOGRAPHIC SETTING
3.1 PROPERTY LOCATION AND DESCRIPTION
3.2 MINERAL TENURE
3.3 ACCESS, INFRASTRUCTURE AND LOCAL RESOURCES
3.4 PHYSIOGRAPHY AND CLIMATE

4. HISTORY

5. GEOLOGICAL SETTING
5.1 REGIONAL GEOLOGY
5.2 PROPERTY GEOLOGY

6. DEPOSIT TYPE

7. MINERALIZATION

8. QUINCHIA EXPLORATION AND RESULTS: 2005 to 2007

9. DRILLING
9.1  DOS QUEBRADAS DRILL RESULTS
9.2  MANDEVAL DRILL RESULTS

10. SAMPLING METHOD AND APPROACH

11. SAMPLE PREPARATION, ANALYSES AND SECURITY

12. DATA VERIFICATION

13. ADJACENT PROPERTIES

14. MINERAL PROCESSING & METALLURGICAL TESTING

15. MINERAL RESOURCE AND MINERAL RESERVE ESTIMATES
15.1 PRELIMINARY MINERAL RESOURCE – DOS QUEBRADAS

16. OTHER RELEVANT DATA AND INFORMATION

17. INTERPRETATION AND CONCLUSIONS

18. RECOMMENDATIONS

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1. SUMMARY

This technical report on the Quinchia Property is intended to provide an
assessment of the economic potential of the Quinchia property through a
description of its geologic characteristics and prior exploration results.

The Quinchia Gold Project is located within the Municipality of Quinchia,
Department of Risaralda, Republic of Colombia, approximately 190 kilometers WNW
of the Colombian capital of Bogotá and 55 kilometers to the north of Pereira,
the regional capital of the Department of Risaralda

The Project is located in the southern edge of a newly identified Au (Cu)
porphyry sub-belt of the Middle Cauca.  The basement in the Middle Cauca region
is form by basaltic oceanic rocks; this basement is covered by Oligocene
continental basin sedimentary rocks of the Amaga Formation that in turn is
covered by the 6 to 9 My volcano-sedimentary Combia Formation.  Quartz diorite
stocks, interpreted as co-genetic with Combia are genetically associated with
the known mineralization that varies in style from Au (Cu) porphyries to Au
(Au-Cu-Zn) intermediate sulfidation systems.

The Quinchia project is composed by at least three mineralized centers
associated with quartz diorite complexes with possible ages varying between 6 to
9 My and represent typical Au (Cu) porphyry systems.  These quartz diorite
centers are part of the evolution of the volcano-sedimentary Combia Formation.

Between January and November 2006, AngloGold Ashanti’s Colombian
subsidiary,  Sociedad Kedahda SA (now AngloGold Ashanti de Colombia SA), drilled
4701.17m in 18 holes in the Quinchia District. The Drilling focused on three
porphyry gold targets named Dos Quebradas, Mandeval, and La Cumbre.

Eight core drill holes were drilled on the Dos Quebradas target and a
preliminary resources estimation was carried out using the information from the
drill holes.

Seven core drill holes were drilled on the La Cumbre porphyry target proving
that the porphyry style mineralization covers an area of at least 400 x 500 m,
with possible extensions of the porphyry target that remain untested. Average
gold grades from the surface samples and drill holes from La Cumbre target is
0.745 ppm.  More drilling is needed to have a good estimation of the mineral
potential of the La Cumbre target.

Three drill holes were drilled at the Mandeval target with gold grades varying
between 0.2 and 0.4 ppm, which is very similar to the results of outcrops
samples.  Kedahda concluded that there is no mineral potential in the Mandeval
target.

The Juan Tapado area is a known large gold stream sediment anomaly toward the
north of Dos Quebradas that have not been evaluated yet.
 
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Diamond drilling and initial economic evaluation was focused on Dos Quebradas,
La Cumbre. Anglo determined that the Dos Quebradas target has an overall
potential of 2 million ounces at 0.7 ppm Au cut off.  This target is located in
a somewhat incised valley. There are theoretically two sub-targets with >1 g
Au/t potential: a) Don Miguel Ladino sector and b) Don Albercio Ladino sector.
The Don Miguel Ladino sector is related to +3ppm Au surface sample results and
the open +1.4 ppm Au intersection at the bottom of borehole DQ-DD-3, plus
mineralized basalt blocks in borehole DQ-DD-2. The theoretical ore potential
would be a body of approximately 100m x 100m x 200m depth x 2.5 x 1.5 g Au/t or
approximately 200.000 oz at 1.5 ppm Au. The Don Albercio Ladino sector is more
difficult to envisage as the +1g Au/t intersection in DQ-DD-5 does not reach
surface. Any operation will suffer from increased stripping, internal waste and
the Mandeval creek.

The La Cumbre prospect has very favorable topography for open pit mining and
heap leach operation. High gold values in early diorite present good spatial
correlation with hydrothermal biotite and fine-grained chalcopyrite. Gold was
progressively leached by the overprinting of intermediate argillic alteration.
Though there are isolated assay results >1 ppm Au, the expected average gold
grade for large volumes of the mineralized system is around 0.7 ppm, and there
is potential for small areas with > 1 ppm Au. The identified target cover and
area of approximately 400m x 400m that is open to the south.

Drilling proved that the Mandeval target has gold grades < 0. 4 ppm and is no
consider an exploration target anymore.

A large stream sediment anomaly remain untested in the northern part of the
Quinchia project; Phase II follow up work in the district should be advanced
according to agreements with indigenous population, and the municipality of
Quinchia.
 
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2. INTRODUCTION AND TERMS OF REFERENCE

2.1 TERMS OF REFERENCE

This technical report on the Quinchia Property was prepared by Caribbean Copper
& Gold Corporation. It is intended to provide an assessment of the economic
potential of the Quinchia property through a description of its geologic
characteristics and prior exploration results.  This report was completed to
comply with the norms and standards set out in National Instrument 43-101 of the
Canadian Securities Administrators.

2.2 SOURCES OF INFORMATION AND RELIANCE ON OTHER EXPERTS

This technical report is based upon published and unpublished data, primarily
from geological reports as described in the sections herein entitled History and
References.  Some of these reports were written prior to the implementation of
the standards relating to National Instrument 43-101.

The authors relied upon mineral tenure representations by AngloGold Ashanti Ltd.
and its Colombian affiliates, and by Cobre y Oro de Colombia SA, who attest to
the validity of the mineral exploitation and exploration contracts.  This report
assumes good standing of the joint venture agreement between AngloGold Ashanti
Ltd.’s Colombian affiliate Sociedad Kedahda S.A. and Cobre y Oro de Colombia SA.

3. GEOGRAPHIC SETTING

3.1 PROPERTY LOCATION AND DESCRIPTION

The Quinchia property consists of 1,408 hectares of mineral exploitation
contracts granted by the Colombian Ministry of Mines to the individuals Silvia
Rios Estela Martinez and Juan Uribe David Hurtado.

Geographically, the mineral contracts are located within the Municipality of
Quinchia, Department of Risaralda, Republic of Colombia, some 190 kilometers WNW
of the Colombian capital of Bogotá or alternatively, some 55 kilometers to the
north of Pereira, the regional capital of the Department of Risaralda (FIGURE
3.1).
 
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3.2 MINERAL TENURE

The Quinchia property primarily consists of three granted mineral contracts (two
exploration licenses and one concession contract), totaling 1,408
hectares,  flanked by other mineral tenements controlled primarily by Cobre y
Oro and by B2Gold.  The entire area of the claims is located within an
approximate 10,000 hectare area of interest, which defines the Quinchia property
for the purposes of the Agreement between Kedahda and Cobre y Oro.

The main Quinchia project area, where recent exploration and drilling was
focused, is covered by three claim blocks totaling 1,408 hectares. The location
and details regarding the claim blocks are outlined in TABLE 3.1 and are shown
in FIGURE 3.2.

TABLE 3.1: MINERAL CONTRACTS, QUINCHIA PROPERTY

CONTRACT NUMBER
SIZE HECTARES
REGISTERED TITLE HOLDER
CONTRACT STATUS
       
18567
869.79
URIBE HURTADO JUAN DAVID; RIOS MARTINEZ SILVIA STELLA
Current
22159
250.60
URIBE HURTADO JUAN DAVID; RIOS MARTINEZ SILVIA STELLA
Current
22270
288.46
URIBE HURTADO JUAN DAVID; RIOS MARTINEZ SILVIA STELLA
Current

The tenement information outlined in TABLE 3.1 is confirmed with the Colombian
authorities as of February, 2008.  Claim status as presented herein however, may
evolve as applications are approved or as contracts are signed by the Colombian
government.  Updated tenement may be verified with the government, and
historical (not regularly updated) information can be seen online via the
Colombian government’s mineral tenement website at: www.ingeominas.gov.co. This
website is in Spanish. The procedure for mineral title verification is as
follows:

• Go to homepage: www.ingeominas.gov.co

• Go to: “Nuevo CMC”, located on the upper left of the homepage
• Go to: “Consultas de Expediente”
• Under “Clasificacion” enter “Titulo” or “Solicitud”
• Enter number from CONTRACT NUMBER in TABLE 3.1, where solicited in “Codigo de
Expediente”
• Press “Buscar” (Search) at bottom of page.
• In the case that “Titulo” does not produce a positive result, repeat search
using “Solicitud”.
 

 
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Figure 3-2   Claim Map – Quinchia Property

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The area of the three known porphyry systems of the Quinchia project is covered
by tenements owned by Kedahda/Cobre y Oro and by Juan David Uribe (optioned to
Kedahda/Cobre y Oro ).  The northern part of the project (Juan Tapado area) is
mainly covered by tenements of Cobre y Oro and by a Special Mining Reserve owned
by the municipality of Quinchia (Fig. 3-2).  The municipality has expressed
their interest to negotiate the area of the special mining reserve.

In the map above of the Quinchia project with Tenements:  3rd party type 1 are
tenements optioned to Cobre y Oro, 3rd party type 2 are tenements not optioned
to Cobre y Oro; and the Municipality Especial Area can be optioned for
exploration.

3.3 ACCESS, INFRASTRUCTURE AND LOCAL RESOURCES

Access and infrastructure surrounding the Quinchia project is good.  The area is
surrounded by gravel roads which connect a dense rural farm population to
various nearby 10,000+ person population centres, including the towns of
Quinchia, Riosucio and Anserma (FIGURE 3.3). Various mid-sized cities, including
Manizales, Pereira and Armenia are located within a two-hour drive of the
project area, and full services are available from any of these centers.
 
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Access to the Quinchia property is accomplished overland.  The project is
located about five kilometers (30 minutes) SSE, along gravel-topped roads, from
the town of Quinchia, Risaralda. Based upon a Colombian entry point, access to
the Quinchia project may be achieved along the following routes:

Travelling overland along well maintained paved highways from Medellin, via the
towns of Caldas, Versailles, Santa Barbara, La Pintada, Marmato,  and Riosucio
to the town of Quinchia (approximately 3 hours, depending upon traffic
conditions); or
 
Traveling by air from Bogota to Manizales, and then overland along well
maintained roads through the town of Anserma to the town of Quinchia
(approximately 2 hours, depending upon traffic conditions); and,

Traveling overland along maintained gravel roads from Quinchia to the Quinchia
project area (approximately 30 minutes).  The use of a four-wheel-drive vehicle
on the gravel road section is recommended but usually not essential.  Gravel
roads afford direct access to the exploration areas of Los Cumbres and Dos
Quebradas.
 
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Economically, the Municipality of Quinchia and the Quinchia area may be
characterized as rustic and rural.  Agricultural activities dominated by coffee
and mixed-crop farming are principal sources of sustenance and
income.  Small-scale, artisanal gold mining is important in various areas such
as Miraflores, El Chuscal and Quinchia.

Sociedad Kedahda S.A. secured a surface access agreement with the local property
owners in the areas of planned exploration and drilling.  Additional surface
rights may be necessary for the establishment of additional exploration and for
a potential commercial mining project.

Water, power and labour are readily available at the project site.  Local labour
is not trained in modern exploration and mining technique, indicating the need
to provide training and import qualified personnel.  All requirements
(personnel, equipment, contractors) for project exploration and development can
be acquired\contracted out of Quinchia, Anserma or Riosucio.  Heavy equipment
and diamond drills can be contracted out of Manizales, Medellín, or Bogotá.

3.4 PHYSIOGRAPHY AND CLIMATE

The Quinchia property is located overlooking the Cauca River valley, along the
eastern margin of Colombia’s physiographic Western Cordillera (FIGURE 3.1).  The
topographic expression of the region is steep and, characterized by high-relief,
vegetated mountains and steeply incised active drainages. Elevations are highly
variable ranging from ca. 800 metres above sea level along the Cauca River
valley to the east, to ca. 2,800 metres over some of the peaks surrounding the
Quinchia area.  The elevation at the Quinchia project area ranges from about
1,000 to 1,500 metres above sea level.  Topography is moderate to steep.

Climatically, the region is tropical to sub-tropical, with daytime temperatures
throughout the year averaging in the 20 to 24 degree Celsius range. The climate
is humid, being somewhat more so during punctuated rainy seasons (March to May;
September to December).  Rainfall ranges between 900 and 3,000 millimeters per
year.  Natural vegetation is dominated by lush, low-growth Andean forest, mostly
preserved along the course and headwaters of the natural drainages and over to
peaks of higher elevation hills.  Approximately 70% of the area including and
surrounding the Quinchia project has been cleared for agricultural purposes,
including primarily commercial coffee production and subsidence food crops such
as plantain, beans, bananas and manioc.

4. HISTORY

The Quinchia property forms part of a Pre-Colombian to modern-day artisanal gold
mining district which extends from Anserma in the south to Riosucio in the
north. (FIGURE 4.1). Production on an artisanal level has been more or less
continuous throughout the region through to modern times, but with respect to
the present property boundaries, it is not possible to quantify with any
certainty the amount of gold extracted from the mines surrounding Quinchia to
date.  According to Rodriguez et al. (2000),
 
 
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artisanal gold production was most significant in the general area in the
1950’s.  Interest was renewed in the area in the late 1970’s (likely due to the
increase in world gold price) and culminated in the 1980’s in the Miraflores
area with the formation of the artisanal mining cooperative “Asociacion de
Mineros de Miraflores”. Activity has been relatively consistent since this time,
ebbing and flowing with fluctuations in the gold price.

With respect to modern exploration and development in the vicinity of Quinchia,
the mines at Miraflores have drawn the attention of various foreign-financed
exploration companies since the mid 1990’s, when Canadian junior companies such
as Gran Colombia Resources Inc. and Sur American Gold Inc. reviewed the property
and staked claims in the surrounding area (TVX, 1997). Data from these reviews
are not available. The most serious foreign-company review of the prospect was
undertaken in 1997 by T.V.X. Mineria de Colombia, a subsidiary of the then
Canadian mid-tier gold producer T.V.X. Gold Inc (T.V.X).  The social situation
in the area during the 1990’s did not lend itself to a secure exploration
environment and no at-depth exploration was completed by T.V.X.  In 2000, the
Colombian government’s geological division, INGEOMINAS, recognizing the apparent
mineral potential of the prospect, with the permission of the Asociacion de
Mineros de Miraflores, undertook a series of technical studies in the vicinity
of Quinchia, which included geological mapping, geochemical and geophysical
studies, and  resource calculations not compliant with National Instrument
43-101.

In 2005, Sociedad Kedahda S.A. entered into an agreement with the holders of the
mineral concessions (Juan David Uribe Hurtado and Silvia Stella Rios Martinez),
and exploration by Sociedad Kedahda S.A. had been ongoing through 2006, when the
decision to farm-out the project was made.

In November 2007, Cobre y Oro de Colombia S.A. entered into an agreement with
Sociedad Kedahda S.A. to obtain all rights to the Quinchia Project.  Under the
agreement, Cobre y Oro assumed the obligations and rights contained underlying
Option Contract in place between Kedahda and the holders of three mineral
concessions (Juan David Uribe Hurtado and Silvia Stella Rios Martinez).

5. GEOLOGICAL SETTING
 
5.1 REGIONAL GEOLOGY

The Quinchia project is located in the southern edge of a newly identified Au
(Cu) porphyry sub-belt of the Middle Cauca.  The basement in the Middle Cauca
region is form by basaltic oceanic rocks; this basement is covered by Oligocene
continental basin sedimentary rocks of the Amaga Formation that in turn is
covered by the 6 to 9 My volcano-sedimentary Combia Formation.  Quartz diorite
stocks, interpreted as co-genetic with Combia are genetically associated with
the known mineralization that varies in style from Au (Cu) porphyries to Au
(Au-Cu-Zn) intermediate sulfidation systems.  The western and eastern limits of
the Middle Cauca sub-belt are marked by the regional faults of Cauca and Romeral
respectively.  The geology of the block located toward the west the Middle Cauca
is composed by a Precambrian gneiss, Paleozoic schist, Triassic clastic rocks,
and Cretaceous andesite.  The geology of the block located toward the west is
composed by volcano- sedimentary lithologies with oceanic floor affinity
intruded by middle Miocene intermediate stocks.
 
 
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The Quinchia property is located along the eastern margin of Colombia’s
physiographic Western Cordillera.  According to Cediel and Cáceres (2000) and
Cediel et al. (2003), the region is underlain by a highly complex basement known
as the Romeral terrane, which may be characterized as a tectonic mélange (FIGURE
5.1).  The basement took form as middle-upper Mesozoic-aged volcanic and
sedimentary oceanic rocks collided with and were accreted to the northern Andean
paleo-continental margin, beginning in the early Cretaceous.  The resulting
suture is known as the Romeral fault system and mélange can be traced for over
1,000 kilometers along the northern Andes.  The original Romeral fault system is
generally north-striking and dextral transcurrent in nature whilst the Romeral
melange contains mega-scale blocks and fragments of the oceanic allochthon and
crustal slivers of autochthonous Paleozoic metamorphic rocks which formed the
paleo-continental margin.  The structure of the Romeral system has been modified
by various post-Romeral tectonic events.  Following accretion, the Romeral
terrane and mélange was unconformably overlain in the late Oligocene – early
Miocene by autochthonous silici-clastic sedimentary sequences of the Amaga
Formation, including basal conglomerates, quartz sandstones, siltstones, shales
and coals. In the middle - late Miocene both the Romeral mélange and the Amaga
Formation were overlain by mafic and intermediate volcanic rocks (flows and
pyroclastics) of the Combia Formation, associated with at least one middle-late
Miocene volcanic arc emplaced into the Romeral terrane basement during this time
period. Also associated with late arc formation was the syntectonic emplacement
of a series intrusives, including poly-phase hypabyssal stocks, dykes and sills
of dioritic, granodioritic and monzonitic composition.  These intrusives cut all
of the above mentioned stratigraphic units. K-Ar whole rock dates for the
intrusive rocks range from 8 to 6 Ma (Cediel et al., 2003).  The Combia
Formation and accompanying hypabyssal intrusive rocks are well represented along
an ca. 100 kilometer by 20 kilometer N-S trending belt extending from Anserma in
the south to Jerico, Fredonia and Titiribi, located to the north of the Quinchia
project (FIGURE 5.2).

Following the early accretionary events, the region was compressionally deformed
in the early - middle Miocene and again in the middle – late Miocene, in both
cases by additional tectonic accretionary events taking place to the west along
the active Pacific margin. The structural architecture of the Romeral fault and
mélange system is essentially that of a 10+ kilometer wide series of N-S
striking, vertically dipping dextral transcurrent faults.  Virtually all
lithologic contacts within the Romeral basement are structural, characterized by
abundant shearing, mylonitization and the formation of clay-rich fault
gouge.  Structural reactivation during the Miocene resulted in orthogonal
compression accompanied by mostly west-directed (back) thrusting and high-angle
reverse fault development in the basement rocks.  The Amaga Formation was
deformed into generally open, upright folds with tilting and near isoclinal
folding being associated with generally localized west-vergent thrusting. The
Combia Formation records tilting and open folding and both the Amaga and Combia
Formations exhibit moderate to strong diapiric doming where affected by the
emplacement of the mid-late Miocene intrusive suite.  N-S, NE, NW and
E-W-striking conjugate shearing and dilational fracturing affects all of the
above geologic units.  Some of these elements can be observed as structural
lineaments traversing the region, visible on Digital Elevation Model (DEM)
images, such as form the base of Figure 5.2.
 
 
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5.2  PROPERTY GEOLOGY

The bedrock geology of the Quinchia property and surrounding area is shown in
Figure 5.4, and is discussed below under two headings: Lithology and
Structure.  It is important to note that the Quinchia property is essentially
100% vegetated by native Andean forest, dense secondary scrub growth,
agricultural crops and\or grassy cattle pastureland, making detailed geologic
mapping difficult.  Natural outcrop is sparse and is limited to road cuts and
road-side quarries, mule and walking paths and steeply incised active
drainages.  In addition, tropical to semi-tropical oxidation and weathering at
surface masks original bedrock texture and mineralogy in many outcrops.

LITHOLOGY:

The Quinchia property and surrounding area is underlain by four principal rock
units. These include 1) a basement complex consisting of mafic and ultramafic
oceanic volcanic rocks and granitoid intrusive
 
 
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rocks belonging to the Romeral terrane, 2) stratified clastic sedimentary rocks
of the Amaga Formation, 3) bas-andesitic through felsic volcanic and pyroclastic
rocks of the Combia Formation and 4) dioritic to monzonitic hypabyssal
porphyritic intrusive rocks. Each of these units is described in detail as
follows.

1)  Romeral Terrane: Romeral terrane rocks form a tectonically disrupted
basement complex at Quinchia, and the Quinchia breccia and mineralization is
entirely developed within Romeral terrane rocks. Fresh outcrops are relatively
rare.  Where observed, they form isolated fine-grained packages of mafic oceanic
igneous rocks, including basalt, diabase and micro-gabbro, locally
interstratified with fine-grained pelagic sediments.  The mafic igneous rocks
are dark grey altering to dark green in color.  They are macroscopically
aphanitic and mineralogically dominated by labradoritic plagioclase and
clinopyroxene (augite), both of which occasionally form isolated phenocrysts in
a compact groundmass. Bedding features are difficult to ascertain in outcrop due
to tectonic disruption, weathering and poor exposure, although pillow structures
and auto-brecciation are occasionally observed, as are amygdules containing
zeolites, epidote and chlorite.  In most instances the basalts, diabases and
micro-gabbros can only be distinguished in thin section, due to their
fine-grained to microcrystalline nature. In proximity to hypabyssal porphyritic
rocks, the basement mafic lithologies are variably exhibit hornfels, fractured,
veined and hydrothermally altered.

Development of hornfels results in a compact recrystallization of the mafic
wallrock. Intrusion-induced fracturing \ veining occurs in dense stockworks with
quartz and magnetite as the filling phases, accompanied by the formation of
secondary (hydrothermal) biotite, and resulting in a potassic alteration
assemblage (A- and M-veining + biotite) directly linked to porphyry-style
mineralization in the hypabyssal intrusions.  These assemblages are commonly
overprinted by late propylitic alteration, dominated by chlorite and epidote
which introduces a greenish coloration to the Romeral lithologies.  Chemical
analyses indicate that Romeral basement rocks are tholeiitic in composition and
appear to represent slivers of oceanic crust and aseismic oceanic ridges. The
Romeral assemblage has not been directly dated at Quinchia, but based upon
regional correlations is considered to be broadly lower Cretaceous in age, and
to have accreted to the continental margin in the Aptian – Albian.

Forming part of the Romeral basement and outcropping in the southern part of the
Quinchia district is the Irra stock.  This calc-alkaline, granodioritic to
monzonitic and locally syenitic intrusive has been mapped over an ca. 32 square
kilometer area.  It is coarse grained and holocrystalline, light grey to pink in
color and is dominated by andesine and orthoclase +\- quartz with augite and
biotite forming the mafic phases. It has been dated at ca. 97 +\- 10 Ma (K-Ar,
biotite). Contacts between the Irra stock and the Romeral basement are not well
exposed and where present are structurally modified. It is not clear whether the
Irra stock was emplaced in Romeral basement before, during or after Romeral
accretion to the continental margin.
 
2)  Amaga Formation: The conglomerates, sandstones and siltstones of the Amaga
Formation outcrop along road cuts to the SE.  The formation was unconformably
deposited upon Romeral terrane basement rocks. Based upon pollen analyses, it
ranges from upper Oligocene to lower Miocene in age. The Amaga Formation is
dominated by greyish-green to cream colored sandstones which form well
stratified thickly to moderately bedded packages containing intercalations of
conglomerate and
 
 
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siltstone. The sandstones occur in coarse- to medium-grained, moderately to
poorly sorted beds up to six metres thick. In composition they range from quartz
arenite to clay-rich wacke. The conglomerates form thin to moderate interbeds
within the sandstones.  They are generally matrix supported, with sub-rounded
quartz pebbles ranging from one to five centimeters in diameter.  The siltstones
form larger interbeds within the sandstones and may locally dominate on the
outcrop scale, forming laminated beds not exceeding ten metres thick.  Organic
partings are commonly observed. The Amaga Formation is considered to be of
continental origin, having been deposited in transtensional (pull-apart) basins
along the middle Cauca, in response to transpression and uplift generated by
post-Romeral tectonism along the Pacific margin to the west. Structurally –
morphologically, the Amaga Formation forms elongate NNE-SSW trending ridges, and
structural measurements on bedding indicate moderate to steep dips to the west,
suggesting east-vergent folding and possibly thrust fault imbrication. The
formation is locally intruded by the hypabyssal porphyry suite, in the vicinity
of which it is domed, highly fractured and contains abundant disseminated
hydrothermal pyrite and illite +\- sericite.

3)  Combia Formation: Widespread throughout the Quinchia district. In the
district, it is dominated by two main units 1) a lower sequence of massive,
compact magnetic flow rocks and agglomeratic pyroclastics of bas-andesitic
composition, and 2) an upper finer-to-medium grained, interbedded tuffaceous and
agglomeratic pyroclastic unit of more felsic (intermediate) composition.  The
true thickness and stratigraphic age relationships between these units have not
been clearly determined.  The lower unit is of dark gray-green in color and
contains primary mafic phases including hornblende and magnetite.  The upper
unit is volumetrically dominant and is composed of mixed coarse- to fine-grained
crystal, lithic, ash and lapilli tuffs.  Lithic fragments comprise up to 40% of
the coarse grained pyroclastic rocks, and include fragments of basalt,
bas-andesite and hypabyssal porphyry.  Geochemical whole rock analyses indicate
that the lower Combia unit is of tholeiitic, basaltic to bas-andesitic
composition and has been interpreted to have formed in a back-arc setting. The
upper unit is of calc-alkaline volcanic arc affinity.  As with the Romeral
suite, in proximity to hypabyssal porphyritic rocks, the Combia Formation is
variably fractured, veined and hydrothermally altered.  Intrusion-induced
fracturing \ veining occurs in dense stockworks with quartz and magnetite in a
potassic alteration assemblage (A- and M-veining + biotite) directly linked to
porphyry-style mineralization.  These assemblages are overprinted by late
propylitic alteration. The Combia Formation has not been accurately dated.  The
lower unit is considered to range from about 14 to 11 Ma in age.  Both lower and
upper units have clearly been intruded by the hypabyssal porphyry suite which
has been dated at ca. 8 to 6 Ma (see below).
4)  Hypabyssal Porphyry Suite:  The suite is both volumetrically and
metallogenetically significant in the Quinchia district. The porphyry suite
manifests in various sub-tabular intrusive centres in the Quinchia (Dos
Quebradas, La Cumbre, Mandeval) and Irra (Chuscal) areas. In detail it is
comprised of multiple phases of hypabyssal porphyry which range in composition
from diorite to quartz diorite.  The porphyries are light grey to greenish-grey
in color, and texturally range from sparsely populated to crowded.  Plagioclase
is a ubiquitous phenocryst, followed by biotite, hornblende and augite, with
quartz occurring as bipyramidal eyes up to 8 millimeters in section in the more
felsic porphyry pulses.  A fine grained biotite micro-diorite body is observed
within the suite and in some areas it appears
 
 
17

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transitional to sparsely populated plagioclase porphyry.  The Quinchia district
porphyry suite forms the southern extension of an arc of porphyritic rocks which
extends from Anserma – Quinchia to Titiribi in the north.  At various locations
these porphyries have been dated and generally return ages ranging from 9 to 6
Ma. An unpublished whole rock (K-Ar, biotite) date produced from the Dos
Quebradas porphyry by Sociedad Kedahda S.A. returned 8.1 +\- 1 Ma.

Coincident with the hypabyssal porphyry suite at Quinchia, a series of
porphyry-style Au-Cu occurrences are observed (Sillitoe, 2000; Sillitoe,
2006).  These mineralized alteration centres are hosted within a kilometer-scale
propylitic (chlorite-epidote-carbonate-quartz-pyrite) halo which intensifies
inwards to a series of Au (+\-Cu) mineralized centres with alteration types
which range from calcic-potassic (A-veining, calcic amphibole, disseminated
magnetite and magnetite veining, K-spar +\- biotite) to intensely fractured \
stockwork “phyllic” (or "D-type" with sericite-illite-pyrite) and “intermediate
argillic” (with sericite-chlorite-clay (illite-smectite)).  The emplacement of
the porphyry and the resulting concomitant hydrothermal alteration, affects all
of the lithologic units in the Quinchia district.  As outlined in section 6,
Deposit Type, below, the gold occurrences of the Quinchia district, including
those contained within the Quinchia property, are linked to the emplacement and
cooling history of the hypabyssal porphyry suite.

STRUCTURAL GEOLOGY:
At the regional scale the most prominent structural control in the Quinchia
district is the generally N-S striking, subvertical basement architecture of the
Romeral fault system, as reflected in DEM-observed structural lineaments and in
the N-S trend of the general Middle Cauca porphyry belt.  Structural
reactivation during various post-Romeral events is also recorded, and principal
and secondary faults at the Quinchia property scale strike WNW – ESE and NE-SW.

6.  DEPOSIT TYPE

The Dos Quebradas-Mandeval-La Cumbre porphyry gold targets are associated with
three Miocene intrusive centers in a NS trend that extends approximately 3km and
at elevations between 1600m and 1950m. (Figure 6-1)  The intrusive centers are
composed by dikes and stocks separated in three groups as early,
intra-mineral,  late intra-mineral and post-mineral dioritic phases emplaced in
intermediate to felsic volcanic rocks of the Miocene Combia Fm. and in
Cretaceous basalts. The highest gold and/or copper grades occur in the early
diorite phases characterized by potassic (mainly biotite with subordinated Kfds)
and potassic-calcic alteration that is characterized by the addition of traces
of amphibole and garnet to the potassic assemblage. Significant amount of A (B)
veinlets, and >3% hydrothermal magnetite is common in these early phases. Gold
grades are lower in the Intra-mineral phases; they still have potassic
alteration with lower density of A-B veins compared with the early intrusive
phases. Sulfide contents in early and intramineral phases are normally lower
than 1% but up to 3 % and include py, cpy, mo, and bn. Late intra-mineral
intrusive phases present moderate to strong
 
 
18

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intermediate argillic alteration with an average sulfide content of 3 to 5 %
composed mainly by pyrite and traces of molybdenite and chalcopyrite.  The late
intra-mineral phases are devoid of potassic alteration and A-B
veins.  Post-mineral dikes only present argillic alteration (kaolinite) with
subordinated chlorite and epidote.

[page19.jpg]

7. MINERALIZATION

The Dos Quebradas-Mandeval-La Cumbre porphyry gold targets are described as
follows:
 
The Dos Quebradas target covers an area of approximately 700 x 700m.  The
mineralized target occurs in the somewhat incised Dos Quebradas valley.

Mandeval is a small target of 300 x 300m.

La Cumbre target covers an area of 800m x >1km and is open to the south. Gold in
these targets occurs in altered dioritic intrusions and in the diorite-basalt
contact zones.

Gold and copper grades in basaltic wallrock follow potassic biotite and
potassic-calcic (biotite-actinolite) alteration.  A-veinlet density reaches up
to >50 veinlets per meter. All mining activity in the area follows
cm-fault-gauge-pyrite zones along faults in tuffaceous volcanic rocks with
strong intermediate argillic alteration. Gold occurs with the fault gouge that
contains fine grained pyrite. Examples of these small miners operations are the
Mandeval and the La Cumbre adits; there is no economic potential associated with
style of mineralization.
 
 
19

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GEOCHEMISTRY

The distribution of seven elements and correlation matrix of all drill holes is
presented in Tables 7-1 and 7-2.

Table 7-1. Quinchia project percentiles for seven elements, all data from the 18
holes.

 
Au(ppb)
Ag(ppm)
As(ppm)
Cu(ppm)
Mo(ppm)
Pb(ppm)
Zn(ppm)
Population
2,343
2,343
2,343
2,343
2,343
2,343
2,343
Max Value
3,930
23.90
576.0
4,020.0
377.00
2,300.0
6,490
Min Value
3
0.05
0.5
2.4
0.20
1.1
3
Percentile 98th
1,362
4.48
96.4
1,960.8
139.08
114.4
586
Percentile 95th
1,010
2.95
69.3
1,649.5
99.09
71.6
391
Percentile 90th
789
2.32
50.1
1,420.0
74.68
50.3
300
Percentile 85th
669
2.05
39.2
1,268.5
60.70
41.6
264
Percentile 80th
587
1.80
34.6
1,155.0
50.00
35.1
231
Percentile 70th
467
1.54
26.3
972.0
38.60
27.6
189
Percentile 60th
372
1.32
21.0
822.0
30.90
22.2
160
Percentile 50th
295
1.12
16.6
687.0
25.40
18.2
139
Median
295
1.12
16.6
687.0
25.40
18.2
139
Average
380
1.34
23.5
725.2
34.22
29.7
178
               
Table 7-2.    CORRELATION MATRIX
 
Au
Ag
As
Cu
Mo
Pb
Zn
Au
1
           
Ag
0.32
1
         
As
-0.11
0.30
1
       
Cu
0.72
0.47
-0.06
1
     
Mo
0.43
0.12
-0.13
0.39
1
   
Pb
-0.01
0.40
0.40
0.01
-0.02
1
 
Zn
-0.01
0.42
0.36
0.11
-0.02
0.82
1
               

 
20

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Porphyry gold targets of Quinchia display typical features described by Sillitoe
(2000) for Au-Cu porphyry systems and in particular similar to the porphyry
systems of the Maricunga sub-belt in Chile.  Ore zones of the Quinchia targets
(minimum 10m grading >500ppb Au, maximum 10m internal waste <300ppb Au) plot in
the “Au-Cu field” in Sillitoe’s Cu-Au diagram for gold-rich porphyry deposits
(Fig. 7-1)

[page21.jpg]

 
21

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8. QUINCHIA EXPLORATION AND RESULTS: 2005 to 2007

National Instrument 43-101 compliant exploration has been completed at Quinchia
by Sociedad Kedahda S.A..  These activities included target identification and
first round diamond drilling.

All recent exploration work at Quinchia to date has been carried out by Sociedad
Kedahda S.A. technical personnel.  All data was collected under the supervision
of professional senior-level geologists utilizing generally accepted
international exploration standards and the resulting information is believed to
be highly reliable.  The details of each work phase are outlined below.

[page22.jpg]

 
 
22

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The Quinchia Au-Cu porphyry district was conceptually identified within Sociedad
Kedahda S.A’s regional target generation program.  The well known Miraflores
mine area was considered part of the Quinchia district, but not necessarily a
priority target for Sociedad Kedahda S.A.
 
In March, 2005 Kedahda initiated a work program in two phases, 1) target
identification by surface and underground mapping and sampling; and 2) diamond
drill testing.
 
Pre-drilling target identification exercises completed by Sociedad Kedahda S.A.
around and at Quinchia included:
 
·  
stream sediment, 1:10,000 mapping and reconnaissance sampling between Dos
Quebradas – La Cumbre,

·  
1:1000 scale topography, soil sampling at Dos Quebradas and La Cumbre,

·  
1:2500 mapping at Dos Quebradas - La Cumbre – Manzanares - Matecaña,

·  
4701.17m of diamond drilling,

·  
conceptual metallurgical test work at SGS Lakefields in Chile, and

·  
preliminary resource estimation of the Dos Quebradas target.

[page23.jpg]

 
23

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Both Dos Quebradas and La Cumbre were covered by B-horizon soil sampling. The
grid at Dos Quebradas was 100m x 25m. The grid at La Cumbre was 200 x 50m. At
Dos Quebradas, samples with >100ppb Au values match with the overall outline of
the drill target. The outline of the mineralized zone at La Cumbre by the soil
sample is less clear with variable gold values within the anomalous area maybe
due to the effect of the intermediate argillic overprint.

[page24.jpg]

Dos Quebradas was originally indicated by surface channel sampling in saprolitic
diorite (>3g  Au/t over at least 50m); the results of these samples are
presented in Table8-1.
 
 
24

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Table 8-1.  Channel rock samples that originally indicated the presence of the
Dos Quebradas Target. West – East channel line; the last three samples are in
basaltic rocks.
 
Sample
 
AU50_PPB
 
AG_PPM
 
AS_PPM
 
CU_PPM
 
MO_PPM
 
PB_PPM
 
ZN_PPM
2019866
1355
0.3
10
295
102
19
22
2019865
1535
0.2
11
233
187
14
14
2019864
2020
0.4
9
384
79
23
12
2019863
5080
0.7
4
308
53
26
25
2019862
4880
0.5
11
363
19
40
13
2019861
3130
0.7
8
189
50
34
17
2019860
3930
0.4
11
275
114
60
21
2019858
4550
0.8
3
286
18
47
48
2019859
7760
0.9
3
218
19
49
33
2019857
5690
1.2
15
230
190
55
74
2019856
3410
1.8
10
156
62
46
96
2019855
5280
1.6
27
139
101
46
55
2019847
4210
1.0
10
180
204
60
63
2019848
2820
0.5
62
330
70
90
16
2019849
604
0.3
79
356
149
51
39
2019850
2130
0.8
7
522
293
37
69
2019851
340
1.7
56
1140
88
43
108
2019852
220
2.7
17
1195
28
32
135
2019854
259
1.5
19
1115
16
34
193

 
25

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9. DRILLING

Between January and November 2006 AGA drilled 4701.17m in 18 holes in the
Quinchia District. The Drilling focused on three porphyry gold targets named Dos
Quebradas, Mandeval, and La Cumbre. (Figure 9-1)

Eight core drill holes were drilled on the Dos Quebradas target and a
preliminary resources estimation was carried out using the information from the
drill holes indicating 937,905 ounces of Au with and average gold grade of 1.155
ppm at 0.75 ppm cut off.

Seven core drill holes were drilled on the La Cumbre porphyry target proving
that the porphyry style mineralization covers an area of at least 400 x 500 m,
with possible extensions of the porphyry target that remain untested. Average
gold grades from the surface samples and drill holes from La Cumbre target is
0.745 ppm.  More drilling is needed to have a good estimation of the mineral
potential of the La Cumbre target.

Three drill holes were drilled at the Mandeval target with gold grades varying
between 0.2 and 0.4 ppm, which is very similar to the results of outcrops
samples. There is no mineral potential in the Mandeval target.

The Juan Tapado area is a known large gold stream sediment anomaly toward the
north of Dos Quebradas that have not been evaluated yet.
 
[page26.jpg]

 
 
26

--------------------------------------------------------------------------------

 

 
DDH
 
Zone
 
EOH (m)
 
Summary of results
DQ-DD-1
Dos Quebr.
23.37
Lost Hole
DQ-DD-2
Dos Quebr.
318.00
110m @ 0.685 ppm Au - 831 ppm Cu
DQ-DD-3
Dos Quebr.
269.50
90m @ 0.628 ppm Au - 708 ppm Cu, 39.5m @ 1.67 ppm Au - 1746 ppm Cu
DQ-DD-4
Dos Quebr.
170.55
68m @ 0.521 ppm Au - 690 ppm Cu
DQ-DD-5
Dos Quebr.
261.60
48m @ 0.642 ppm Au - 1297 ppm Cu, 84m @ 0.765 ppm Au - 789 ppm Cu
DQ-DD-6
Dos Quebr.
250.75
76.8m @ 0.712 ppm Au - 1192 ppm Cu,  awaiting results
DQ-DD-7
La Cumbre
265.30
100m @ 0.568 ppm Au - 768 ppm Cu, 53m @ 0.606 ppm Au - 1286 ppm Cu
DQ-DD-8
La Cumbre
282.65
276.65m @ 0.746 ppm Au - 1425 ppm Cu
DQ-DD-9
La Cumbre
245.00
-
DQ-DD-10
La Cumbre
249.00
-
DQ-DD-11
Dos Quebr.
259.30
-
DQ-DD-12
Mandeval
250.00
-
DQ-DD-13
Mandeval
250.35
18m @ 0.522 ppm Au - 1726 ppm Cu
DQ-DD-14
Mandeval
261.50
-
DQ-DD-15
La Cumbre
108.50
102.5m @ 0.677 ppm Au - 1102 ppm Cu
DQ-DD-16
La Cumbre
193.10
42m @ 0.508 ppm Au - 580 ppm Cu
DQ-DD-17
Dos Quebr.
492.70
60m @ 0.627 ppm Au - 1077 ppm Cu, 72m @ 0.686 ppm Au - 1177 ppm Cu
DQ-DD-18
La Cumbre
550.00
126m @ 0.53ppm Au - 1217 ppm Cu, 112m @ 0.689 ppm Au - 1296 ppm Cu
TOTAL (m)
 
6114.27
 

____________________
Table 9-1:  summary of best intercepts in drill holes drilled in the Quinchia
project.

9.1  DOS QUEBRADAS DRILL RESULTS
 
The best mineralized area at Dos Quebradas occurs along the eastern contact of
the qz-diorite dike complex and the basaltic volcanic host rock. The highest
gold values are associated with high density of A-B veins, potassic (mainly
biotitic), and calcic-potassic altered basalts affecting igneous breccias,
qz-diorite, and basalts. The western contact of the diorite complex is only
weakly altered and mineralized with dominant intermediate argillic and
propylitic alteration.

The diorite-basalt contact zone on the eastern side is about 150m wide as shown
in section DQ-DD-4_5_6_17 (Fig.9-3). This contact zone has a high density of
quartz veins (A-veinlets, 50-100 veinlets per meter); alteration is dominantly
chloritic with minor patches of biotitic and calcic-potassic assemblages. The
contact zone is sub-vertical with narrow dykes, truncated quartz veinlets, and
contact-igneous breccias with fragments of diorite and basalt. The highest gold
grades occur in the narrower section at the end of borehole DQ-DD-3 with 1.6 ppm
gold over 40m. Mineralization is open to depth; the hole was abandoned in
mineralization due technical problems on the drill rig. The continuation and
limits of the eastern contact zone to the south is delineated by borehole
DQ-DD-11, the northern limit is open and interpreted at no more than 150 m from
borehole DQ-DD-05 and by the soil anomaly. The approximate north-south extent of
the eastern contact zone is 600m.
 
 
27

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A potassium k-feldspar altered core zone has only been intersected in borehole
DQ-DD-5, but in general biotite appears to dominate over K-feldspar on the
potassic zone. Zones with K-feldspar flooding coincides with a zone of amphibole
veining, with minor garnet and quartz-garnet, and A-veinlet density of about 50
veinlets/meter. Pyrite is low where potassic alteration dominates, chalcopyrite
and bornite are present in quartz veinlets, fractures and disseminated.

Table 9-2: Dos Quebradas Ore zones.
 
DDH
 
From (m)
 
To (m)
 
Orezone (m)
 
Comp Au (ppb)
 
Comp Cu (ppm)
13.03.DD2
158
226
68
621
748
13.03.DD2
232
268
36
895
1076
13.03.DD3
140
230
90
628
708
13.03.DD3
230
269.5
39.5
1670
1746
13.03.DD4
76
126
50
554
702
13.03.DD4
134
144
10
539
665
13.03.DD5
0
48
48
642
1297
13.03.DD5
120
130
10
664
771
13.03.DD5
140
156
16
540
663
13.03.DD5
156
204
48
972
936
13.03.DD6
0
226
226
728
1098
13.03.DD17
126
186
60
627
1077
13.03.DD17
198
224
26
532
1033
13.03.DD17
236
248
12
510
954
13.03.DD17
288
360
72
686
990
13.03.DD17
370
380
10
552
1177
           
Minimum 10m grading >500ppb Au
     
Maximum 10m internal waste (<300ppb Au)
   

 
28

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[page29.jpg]

 
29

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[page30.jpg]

9.2  MANDEVAL DRILL RESULTS

The Mandeval stock is composed of early medium grained qz-diorite. Exposures and
boulders of massive banded silica occur in the Mandeval creek. These are thought
to be form by the coalescence of A veins.  Basalts with intense quartz veins and
partially biotite-altered form the northern contact of the Mandeval qz-dioritic
stock; the southern contact is with rhyodacitic tuffs of the Miocene Combia
Formation. The Mandeval sector is dominated by a strong intermediate argillic
overprint, which affects significant portions of the early diorite and
rhyodacitic tuffs.  With minor sections of the intrusive characterized by
chlorite-overprint with subordinate hydrothermal biotite. There is a tunnel of
illegal miners in Mandeval that follows an illite-sericite altered fracture zone
in diorite that ends in illite-altered tuff.

The intensely quartz-veined contact zone with patchy biotite (amphibole, garnet)
alteration was cut in boreholes DQ-DD-12 and 14 without observing elevated gold
values. Gold values from outcrops and drill holes are mostly between 0.2 and 0.4
ppm and no more mineral potential is interpreted for the Mandeval target.
 
 
30

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[page31.jpg]

 
31

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[page32.jpg]           

9.2  LA CUMBRE DRILL RESULTS

La Cumbre is located on the highest ground of the prospect area; stripping
ratios theoretically are very low.

The qz-diorite stock in La Cumbre is about 700 m in diameter, and is mostly form
by an early diorite intrusive phase with fine grained porphyritic texture,
locally carrying clasts of an older porphyritic intrusive rock. About 75% of the
stock carries remnant hydrothermal biotite, locally hydrothermal garnet, and A-B
veinlets. The sulfide present is mainly pyrite with traces and up to 0.7 %
chalcopyrite.

Early gold-bearing hydrothermal biotite alteration was overprinted by
intermediate argillic alteration, which significantly affects more than 50% of
the stock. The illite-pyrite alteration clearly lower the gold values indicating
hypogene leaching of metals by this late alteration event. This advanced
argillic alteration also affects the felsic-intermediate tuffaceous volcanic
rocks, which is the dominant lithology on the high ground and partially
surrounds the La Cumbre stock.

The early biotite-altered diorite was intruded in the south by intramineral
diorite with weak to moderate chlorite-epidote-magnetite alteration and
significantly less (or no) quartz veining. The exposure has been mapped for
>0.5km and continues beyond the Manzanares – Matecaña mapping limit.  The La
Cumbre informal miner workings follow narrow N-S structures developed in
strongly intermediate argillic altered felsic-intermediate tuffaceous rocks.
 
 
32

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[page33.jpg]

 
33

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[page34.jpg]
 
 
34

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10. SAMPLING METHOD AND APPROACH

Based upon sampling method and target materials, two types of samples have been
collected within the property;

1) Chip and channel rock samples of in situ or near in situ materials, from
outcrop and within mine workings, across and peripheral to zones of observed
alteration \ mineralization.
 
2) Samples collected from diamond drill core.

Sampling method and approach are described for each of these sample types.

Chip and channel rock samples of in situ materials were collected with a
geological pick \ hammer and chisel or metal spatula.   Due to the fine
fracture-controlled and “disseminated” nature of mineralization many samples
were collected as “scatter-chips” or continuous panels over areas of generally
greater than one square metre. Various more selective chip and linear channel
samples were collected over isolated mineralized structures.

Grab samples were collected in areas of poorly exposed “rubble-crop”.  In the
case of in situ sampling (panels, channels), three to five kilograms of material
were generally allowed to fall upon a clean plastic sheet spread in front of the
outcrop.  The entire sample was described by a supervising geologist, and sealed
in numbered plastic bags containing laboratory sample tags.

Upon return to the camp, samples were inventoried, packed into sacks and shipped
to SGS Laboratories (Barranquilla) or ALS Chemex Laboratories (Bogotá) for
drying and preparation. Information regarding the location and nature of all
chip and channel samples collected by Sociedad Kedahda S.A. is available on
site.

Samples collected from diamond drill core were collected after the core was
boxed, measured, had the recovery per drilled interval calculated, and was
logged for geological, mineralogical and alteration features by a supervising
geologist.  Due to the disseminated nature of the mineralization, Sociedad
Kedahda. S.A. decided to sample core at consistent two meter intervals
throughout.  Core for individual holes was measured and two meter samples
intervals were laid out along its entire length.  The core was cut using a
diamond core saw and ca. 50% of the core for each interval was randomly selected
and sealed into number plastic sample bags. Samples were later inventoried and
shipped to ALS Chemex Laboratories (Bogotá) for drying and preparation and ALS
Chemex Laboratories in Lima, Peru, for analysis.

Based upon the observations regarding the strength and style of alteration \
mineralization at the Quinchia project and the QA \ QC procedures and check
sampling programs utilized by Sociedad Kedahda S.A., sample results obtained by
these companies appear to be reliable and accurate. Surface sampling procedures
are considered justified and adequate, and show good repeatability based upon
check sampling.
 

 
 
35

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11. SAMPLE PREPARATION, ANALYSES AND SECURITY

As part of its sample quality control system Sociedad Kedahda S.A.  applied the
same sample management that AngloGold Ashanti Ltd. utilizes on a global level in
all its early phase (“greenfields”) exploration programs.  This includes
recording each individual sample on a uniquely numbered sample card, and, upon
analysis of a sample series, inserting sample duplicates, sample standards and
sample blanks.
 
The general “rule-of-thumb” for all sampling, is that for every series of 25
samples of any type collected; one sample is duplicated, and one commercially
purchased standard and one proven blank, are inserted (thus a 25 sample batch
consists of 22 original samples, one duplicate, one standard and one blank).
Sample duplication is carried out by sampling as precisely as possible over a
previously sampled area, using the same technique for sample collection and
collecting a similar sample volume. Commercial sample standards used by Sociedad
Kedahda S.A. were purchased for the international standards companies Geostats
and Rock Labs.  Eight separate standards ranging from 10 to 3,000 ppb Au are
used, and are thought to be highly reliable in their advertised gold contents.
For blanks, Sociedad Kedahda S.A. uses a clean, fine-grained quartz-arenite
sandstone, available in large volume from rock quarries near Bogotá.  Thousands
of analyses of this sandstone have shown it to be completely barren of gold with
very low values other economic metals. Sample standards and blanks are bagged,
numbered and inserted in the field such that they arrive at the lab packaged
with the other original samples.

In addition to the above checks, two additional laboratory checks are
automatically completed by the ALS Chemex laboratory at the request of Sociedad
Kedahda S.A.  First, for every 20 to 25 samples prepared at the preparation lab,
one is automatically duplicated by taking a new cut from the stored coarse
reject material.  Second, at the analytical laboratory, again, for every 20 to
25 samples analyzed, one is automatically duplicated by taking a new aliquot
from the pulverized reject material.  All of the analyses from the sample
duplicates are reported to Sociedad Kedahda S.A.

We are of the opinion that an adequate methodology was maintained with respect
to sample collection, preparation, analyses and security.

12. DATA VERIFICATION

Upon receipt of assay information, review of analytical data and statistical
analysis of all duplicate, standard and blank information is carried out on a
per-batch (lab order) basis by Sociedad Kedahda S.A.’s in-house Geochemical
Database Administrator (a professional geologist) in Bogotá.  A linear
correlation control curve is plotted from duplicate data to observe natural
variability in gold contents.  A similar plot is used to compare standards
analyses to their published gold content value.  Blanks analyses are inspected
for any possible contamination. This information is then passed on to the
individual project geologists for review and verification.  We are of the
opinion that an adequate  methodology was maintained with respect to  data
verification, although no additional verification was performed by the authors.
 
 
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13. ADJACENT PROPERTIES

The Miraflores property is located within the Quinchia Au-Cu porphyry district,
which contains various known mineralized centres.  Sociedad Kedahda S.A. and
B2GOLD Corp.,  and other third party mineral title holders, hold mineral
concessions within the Quinchia district.  Technical information regarding
specific present exploration at Miraflores and results or mineralization styles
within the district, other than the historical presented herein, has not been
sought after, nor has it been utilized by the author during the writing of the
present report.

The author acknowledges that mineralization, if encountered on the adjacent
properties, is not necessarily indicative of, or physically associated with the
mineralization on the Quinchia property, and an attempt has been made to clearly
indicate that any mineralization styles discussed herein are site specific
within the confines of the Quinchia property.

14. MINERAL PROCESSING & METALLURGICAL TESTING

SGS LAKEFIELD METALLURGICAL STUDIES
Preliminary metallurgical data have been obtained from bottle roll test on 1kg
samples. These samples were composites of rejects of -2mm crushed diamond drill
core.
 
The metallurgical sample was ground to >75% -200 mesh.
 
At the time of submitting the samples only drill core from Dos Quebradas was
available.
 
DQ-DD-3: 256 – 258m: 1.80 ppm Au, 84% recovery after 24 hours
 
DQ-DD-2: 244 – 254m: 1.30 ppm Au, 72% recovery after 24 hours
 
DQ-DD-5: 162 – 172m: 1.56 ppm Au, 79% recovery after 24 hours

No metallurgical samples from La Cumbre are available.

 
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15. MINERAL RESOURCE AND MINERAL RESERVE ESTIMATES

Preliminary resource modeling was performed by Kedahda at Dos Quebradas and La
Cumbre utilizing Datamine software.  This modeling has not been reviewed in
detail by the authors, and as such is presented as background information but
not 43-101 reporting compliant, although there is reason to believe that the
resources at Dos Quebradas would be classified as inferred resource given the
level of support for the resource estimation.

15.1  PRELIMINARY MINERAL RESOURCE – DOS QUEBRADAS

Preliminary model results indicate 96.3 million tonnes of inferred resource
grading 0.69 grams per tonne, containing 2.136 million ounces of gold at a 0.30
gram per tonne cutoff.   These results have not been validated by the authors
and as such are not reportable under NI43-101.

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15.2 PRELIMINARY MINERAL RESOURCE – LA CUMBRE Preliminary model results for La
Cumbre indicate 118.3 million tonnes of mineralized material grading 0.58 grams
per tonne, containing 2.191million ounces of gold at a 0.30 gram per tonne
cutoff.   These results are based upon limited information and as such would
likely not be classified as a resource without further exploration.  Further,
the results have not been validated by the authors and as such are not
reportable under NI43-101.  Table 15-2. La Cumbre mineral resources preliminary
model (Datamine - Inverse distance to square):

[page40.jpg]

 
 
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16. OTHER RELEVANT DATA AND INFORMATION

The Quinchia property is located in Colombia, and therefore carries certain
political and country risk beyond that found in other South American
jurisdictions. Colombia is host to a disperse and long-running insurgency that
at times in the recent past has manifested itself in widespread civil conflicts.
Company management has warranted to the author that they employ a comprehensive
corporate security program to ensure the safety of all personnel and project
sites. This program includes the use of highly trained and experienced internal
security personnel working in cooperation with military and civil
organizations.  Independent international risk assessors provide external advice
and audit services on a regular basis.

17. INTERPRETATION AND CONCLUSIONS

The Quinchia property is located within the historically important and
present-day artisanal mining district of Quinchia, Risaralda,
Colombia.  District-scale mineralization at Quinchia is related to high-level
hypabyssal Au (Cu) porphyry bodies.  The district includes the Quinchia breccia,
a significant gold-silver rich, magmatic-hydrothermal breccia body whose genesis
is intimately related to the evolution of the porphyry mineralization occurring
in the Quinchia district.

In conclusion, limited diamond drilling and metallurgical test work at Quinchia
by Sociedad Kedahda S.A. has been successful at delineating a potentially
significant low-grade large-tonnage Au-Ag deposit at Quinchia which is
potentially amenable to bulk-tonnage mining and mineral extraction techniques.
Quinchia is considered a property of merit.

Past work completed to date indicates the property warrants further resource
definition via diamond drilling, and continued metallurgical test work, in order
to verify the feasibility of economically recovering gold from the important
low-grade (0.3 to 1 ppm Au) resource the property has to offer.  In the event
that both diamond drilling and metallurgical test work provide positive results,
additional drilling of the project can be recommended.  A program to carry out
additional drilling and metallurgical test work is outlined in section 18,
Recommendations

 
 
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18. RECOMMENDATIONS

Based on the favorable exploration and metallurgical results to date, the
Quinchia property is of sufficient merit to warrant further exploration.

Phase II work has been proposed to follow up -80# stream sediment anomalies
located toward the north of the Dos Quebradas area, the Juan Tapado-Alacranes
area.  In this sector a vein system was drilled by Minera Esperanza in 1995;
drill data is not available.  Most of the unexplored anomalies are on indigenous
ground. Negotiations should continue, and agreements signed.

In order to further evaluate the mineral and economic potential of the Quinchia
property, a stage-three exploration diamond drilling program totaling 7,500
metres and additional metallurgical tests is recommended.  This program will
follow-up on positive results obtained in the Sociedad Kedahda S.A. diamond
drill programs.

Upon favorable results from stage three, a stage-four program that involves
completing a feasibility study is recommended.

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