2009 01 20 - TechReport

TECHNICAL REPORT
DECEMBER 8, 2008
MINERAL RESOURCE ESTIMATE
ANGOSTURA GOLD PROJECT
SANTANDER, COLOMBIA
FOR
GREYSTAR RESOURCES LTD
January 21, 2009
Marco Alfaro Sironvalle
Santiago, Chile
Metlica Consultores S.A.
Page i
Table of Contents
1.
SUMMARY .......................................................................................................... - 1 -
1.1
BACKGROUND ..............................................................................................................................- 1 -
1.2
PROPERTY LOCATION AND DESCRIPTION ..............................................................................- 2 -
1.1
PROJECT HISTORY ......................................................................................................................- 3 -
1.2
ANGOSTURA GEOLOGY AND MINERALIZATION ......................................................................- 3 -
1.3
DATABASE .....................................................................................................................................- 5 -
1.4
RESOURCE ESTIMATION.............................................................................................................- 6 -
1.5
FUTURE PROGRAM ......................................................................................................................- 8 -
2.
INTRODUCTION.................................................................................................. - 9 -
2.1
GENERAL AND TERMS OF REFERENCE ...................................................................................- 9 -
2.2
CONTRIBUTORS TO REPORT .................................................................................................. - 11 -
3.
RELIANCE ON OTHER EXPERTS ...................................................................... - 12 -
4.
PROPERTY DESCRIPTION AND LOCATION ..................................................... - 13 -
4.1
LOCATION ................................................................................................................................... - 13 -
4.2
PROPERTY AND TITLE IN COLOMBIA ..................................................................................... - 15 -
4.3
LAND TENURE ............................................................................................................................ - 19 -
4.4
ENVIRONMENTAL REGULATIONS ........................................................................................... - 19 -
4.5
OBSERVATIONS AND CONCLUSIONS .................................................................................... - 22 -
5.
ACCESSIBILITY, PHYSIOGRAPHY, CLIMATE, LOCAL RESOURCES AND

INFRASTRUCTURE ........................................................................................... - 22 -
6.
PROJECT HISTORY .......................................................................................... - 23 -
Page ii
6.1
GENERAL REMARKS ................................................................................................................. - 23 -
6.2
EXPLORATION HISTORY .......................................................................................................... - 24 -
6.3
PRIOR MINERAL RESOURCE ESTIMATES .............................................................................. - 26 -
6.4
HISTORICAL PRODUCTION ...................................................................................................... - 29 -
7.
GEOLOGICAL SETTING .................................................................................... - 30 -
8.
DEPOSIT TYPE ..................................................................................................... 33
9.
MINERALIZATION AND ALTERATION .................................................................. 33
9.1
GENERAL REMARKS ...................................................................................................................... 33
9.2
HIGH-GRADE ACCUMULATIONS .............................................................................................. - 40 -
9.3
BULK MINERALIZATION ............................................................................................................ - 42 -
9.4
DISSEMINATED MINERALIZATION ........................................................................................ - 42 -
9.5
ALTERATION AND ORE MINERALOGY .................................................................................... - 42 -
9.6
OXIDATION ................................................................................................................................. - 44 -
9.7
10.
EXPLORATION.................................................................................................. - 46 -
11.
DRILLING .......................................................................................................... - 46 -
12.
SAMPLING METHODS AND APPROACH ........................................................... - 47 -
12.1
GENERAL REMARKS ................................................................................................................. - 47 -
12.2
DIAMOND DRILLING .................................................................................................................. - 47 -
12.3
SURFACE SAMPLING ................................................................................................................ - 49 -
12.4
UNDERGROUND SAMPLING..................................................................................................... - 49 -
12.5
13.
SAMPLE PREPARATION, ANALYSIS AND SECURITY ...................................... - 51 -
13.1
EARLIER FIELD PROGRAMS (1995 TO 2000) .......................................................................... - 51 -
Page iii
13.2
2003 TO 2008 PROGRAMS ........................................................................................................ - 53 -
13.3
14.
DATA VERIFICATION ....................................................................................... - 56 -
14.1
DATABASE .................................................................................................................................. - 56 -
14.2
ASSAYS 1995 TO 1999............................................................................................................ - 56 -
14.3
ASSAYS 2003 TO 2008............................................................................................................ - 57 -
14.4
BULK DENSITY ........................................................................................................................... - 60 -
14.5
15.
ADJACENT PROPERTIES ................................................................................. - 63 -
16.
MINERAL PROCESSING AND METALLURGICAL TESTING .............................. - 64 -
16.1
GENERAL REMARKS ................................................................................................................. - 64 -
16.2
HISTORICAL TESTWORK .......................................................................................................... - 65 -
16.3
CURRENT TESTWORK .............................................................................................................. - 66 -
16.4
PROCESS SELECTION .............................................................................................................. - 68 -
16.5
COMMINUTION PARAMETERS ................................................................................................. - 69 -
16.6
HEAP LEACH PARAMETERS .................................................................................................... - 69 -
16.7
FLOTATION AND OXIDATION CIRCUIT .................................................................................... - 72 -
17.
MINERAL RESOURCE ESTIMATION ................................................................. - 73 -
17.1
INTRODUCTION ......................................................................................................................... - 73 -
17.2
GEOLOGICAL MODEL ................................................................................................................ - 73 -
17.3
LOW-GRADE AND HIGH-GRADE POPULATIONS AND THEIR STATISTICS ......................... - 74 -
17.4
HIGH-GRADE PROBABILITY INTERPOLATION ....................................................................... - 79 -
17.5
GOLD-GRADE VARIOGRAPHY ................................................................................................. - 81 -
17.6
GRADE INTERPOLATION .......................................................................................................... - 84 -
17.7
RESOURCE CLASSIFICATION .................................................................................................. - 87 -
Page iv
17.8
DECEMBER 2008 UNCONSTRAINED ANGOSTURA MINERAL RESOURCE

ESTIMATE ................................................................................................................................... - 88 -
17.9
RE-BLOCKING ............................................................................................................................ - 94 -
17.10
DECEMBER 2008 CONSTRAINED ANGOSTURA MINERAL RESOURCE ESTIMATE .......... - 97 -
17.11
DISCUSSION OF CHOICE OF CUT-OFF GRADES .................................................................. - 99 -
17.12
RESOURCE MODEL VALIDATION, 6.25 M. X 6.25 M. X 6.25 M. ........................................... - 102 17.12.1 GOLD GRADE REVIEW ............................................................................................ - 102 17.12.2 CLASSIFICATIONS REVIEW .................................................................................... - 105 17.12.3 ORE RESOURCES TONNAGE ................................................................................. - 107 -
17.13
RESOURCE MODEL VALIDATION, 8.75 M X 8.75 M. X 8.75 M. ............................................ - 107 17.13.1 GOLD GRADE REVIEW ............................................................................................ - 107 17.13.2 CLASSIFICATION REVIEW ....................................................................................... - 109 17.13.3 ORE RESOURCES TONNAGE ................................................................................. - 111 -
17.14
OBSERVATIONS AND CONCLUSIONS .................................................................................. - 112 -
18.
OTHER RELEVANT DATA AND INFORMATION .............................................. - 114 -
19.
INTERPRETATION AND CONCLUSIONS ........................................................ - 114 -
19.1
GEOLOGY AND RESOURCES................................................................................................. - 114 -
20.
RECOMMENDATIONS FOR FURTHER WORK ................................................. - 116 -
20.1
RESOURCES ............................................................................................................................ - 116 -
20.2
MINING AND PIT DESIGN ........................................................................................................ - 116 -
20.3
MINERAL PROCESSING AND METALLURGICAL TESTING ................................................. - 117 -
20.4
METALURGICAL PROCESING AND INFRASTRUCTURE ..................................................... - 118 -
20.5
HYDROLOGY , HYDROGEOLOGY AND ENVIRONMENTAL BASE LINE ............................. - 118 -
20.6
OTHER STUDIES ...................................................................................................................... - 119 -
20.7
COST ESTIMATE ...................................................................................................................... - 120 -
Page v
REFERENCES .............................................................................................................. - 121 DATE AND SIGNATURE PAGE .................................................................................... - 127 CERTIFICATE OF QUALIFICATION ............................................................................. - 128 -
Page vi
LIST OF FIGURES
Figure
Page
Figure 1. Location Map ..
14
Figure 2. Mineral Tenure
17
Figure 3. Angostura Site and Property Plan ...
21
Figure 4 Measured Plus Indicated and Inferred Contained Gold Ounces

in the Mineral Resource Estimate Studies...
27
Figure 5. Regional Geology ..
31
Figure 6. Property Geology and Alteration..
36
Figure 7. 2850 Level Interpreted Economic Geology
37
Figure 8. 3150 Level Interpreted Economic Geology ..
38
Figure 9. Cross Section 1 130 900 E Interpreted Economic Geology
39
Figure 10 Image of Block Model (6.25 m). Distribution of the Gold Grades
in a Vein in the Diamante Zone. View Looking to Northwest..
41
Figure 11 Drill-Core Density Observations and Assigned Bulk Densities..
61
Figure 12. Structural Domains and Structural Trend Surfaces, 2 850 Level
76
Figure 13 Example of High-Grade Probability Interpolation.
81
Figure 14. 2 850 Level Block Model
89
Figure 15. 3 150 Level Block Model.
90
Figure 16. Cross Section 1 130 900 E Block Model
91
Figure 17 Re-blocking Results. Gold Grade Comparison between

6.25 and 8.75 m Blocks..
95
Figure 18 Re-blocking Results. Resource Classification Comparison

between 6.25 and 8.75 m Blocks
96
Figure 19 Histogram of Gold Grade of the Oxidized Blocks

within Metalica Pit, Paying Heap Leach Process..
Page vii
100
Figure 20 Histogram of Gold Grade of the Blocks of Sulphides within

Metalica Pit, Paying Heap Leach Process.
100
Figure 21 Histogram of Gold Grade of the Waste Blocks of Sulphides

within Metalica Pit.
101
Figure 22 Example, Bench 2 634, model and composites.
103
Figure 23 Classification Example, Bench 2 634.
105
Figure 24 Classification Example, Bench 2 834
106
Figure 25 Classification Example, Section North-South; East 130 784.
106
Figure 26 Example, Bench 3 034, model 8.75 m.
108
Figure 27 Classification Example, Bench 2634, 8.75 m blocks..
110
Figure 28 Classification Example, Bench 2734, 8.75 m blocks..
110
Figure 29 Classification Example, Section North-South;

East 130,684, 8.75 m blocks
Figure 30. Gold Grade Comparison, block model versus composites
Page viii
111
113
LIST OF TABLES
Table
Page
Table 1. Mineral Holdings, Angostura Project ..
15
Table 2. Angostura Field Work by Period and Timing of Historical Resource Estimates 25
Table 3. Angostura Mineral Resource Estimates since 2004 .
29
Table 4. Summary of Standards Performances for Gold
59
Table 5. Supporting Reports for Flowsheet Selection ..
65
Table 6. Summary Gold Recovery Results, Angostura Ore Samples.
71
Table 7. Gold Assay Statistics of 1.25-metre Composites ..
77
Table 8. Silver and Copper Assay Statistics of 1.25-metre Composites ..
79
Table 9. Variography Results, High-Grade Probability Indicator ..
80
Table 10. Gold Grade Variography
82
Table 11 Test Box Resource Estimates at Different Drill-Hole Spacing
83
Table 12 Grade Interpolation Search Distances .
85
Table 13. Composite Utilization during Grade Interpolation ..
85
Table 14. Estimate of Unconstrained Mineral Resources
92
Table 15. Comparison with the Unconstrained December 2007 Estimate.
93
Table 16. Effect of Re-Blocking, Measured & Indicated Resources .
97
Table 17. Angostura Mineral Resource Estimate, December 8,

2008, 6.25 m Blocks and Constrained by preliminary Metalica Pit ..
99
Table 18. Gold Grade Review, Model 6.25 m ..
104
Table 19. Tonnage, Oxides, 6.25 m Blocks ...
107
Table 20. Tonnage, Sulphides, 6.25 m Blocks Blocks ....
107
Table 21 Gold grade review, model 8.75m vs 6.25 composites
109
Table 22. Tonnage, Oxides, 8.75 m Blocks
111
Table 23. Tonnage, Sulphides, 8.75 m Blocks ..
112
Page ix
Table 24. Angostura Evaluation and Exploration Program Budget for 2009
Page x
120
1.
1.1
SUMMARY
BACKGROUND
The Angostura gold-silver project has been explored by Greystar Resources Ltd.
(Greystar) since 1995, with a notable interruption due to security and economicissues from
2000 to 2003. A number of mineral resource estimates for the project have been
completed and reported in the past, reflecting the increasing amount of exploration
information. All of those resource estimates were without the benefit of a constraining open
pit.
Based on an estimate of the Angostura mineral resources undertaken in December 2006,
Hatch Ltd. (Hatch) completed a scoping study in July 2007 (The 2007 Scoping Study) on
the technical parameters and economic potential of the project. Items covered included pit
optimization and pit design leading to an estimate of potentially mineable mineral
resources, site investigations, flowsheet development based on the available metallurgical
testwork, and cash-flow projections. The study used a gold price of $550 per ounce in the
first production year, decreasing to $515 per ounce in later years, and resulted in a pre-tax
cash flow (excluding royalties, finance charges, working capital and closure costs) to yield
an internal rate of return of 14.2% for the base case. Greystar has finished the exploration
program and the additional infill drilling.
Since the 2007 Scoping Study until may 2008, Greystar has developed a intensive
exploration program that comprised 297 drillholes with 90 000 metres drilled, 486 metres
of exploration tunneling.
The first phase of the Feasibility Study will provide technical evaluations, conceptual
designs, capital and operating costs for the mine, mills, process plant and site
infrastructure, as well as the financial analysis of the project. The second phase will start
immediately following completion of the first phase and will include the basic engineering
of the project. Upon completion, expected by the third quarter of 2009, the study will be
bankable.
the company has requested Metalica Consultores S.A. to review and report (in accordance
with the requirements of National Instrument 43-101) on an updated estimate of the
Angostura mineral resources that takes into account the results of the additional
Page - 1 -
exploration. As in previous cases, Greystar staff have prepared the resource estimate
using the procedures used in the study of 2007, and it has been reviewed by Metalica.
The resource estimation from this study will be used by Metalica in the mine design an
planning, as part of the feasibility study phase 1. Once the phase 1 is completed, a
Technical Report will be published with the results of that study.
1.2
PROPERTY LOCATION AND DESCRIPTION
The Angostura gold-silver project is located in northeastern Colombia near the border with
Venezuela, some 370 kilometres to the north of the capital city of Bogot and
approximately 40 kilometres northeast of the city of Bucaramanga. The site is accessible
from Bucaramanga on mostly unpaved roads, with the trip taking approximately two and a
half hours. A number of drill roads and footpaths provide access in the area. The property
is located in steep, mountainous and relatively rugged terrain at elevations ranging from
2600 to 3500 metres above sea level. The average annual temperature is 9 to 11 C, with
little seasonal change. Average annual precipitation is 740 millimetres.
Vegetation in the area of the Angostura project is light alpine scrub on the slopes, while
there is significant growth of oak and eucalyptus trees along watercourses at lower
elevations. The local vegetation supports only a limited amount of agriculture and
livestock. The principal economic activity in the area is the small-scale exploitation of gold
from veins that are part of the overall Angostura mineralized system. The area is served by
the national electric power grid, which is described by Greystar as efficient and reliable.
The Angostura property consists of 13 individual licences wholly-owned by Greystar that
cover a very large area of more than 30 000 hectares and extends well beyond the
immediate deposit and resource area. According to information provided by Greystar, two
would expire in 2010, and the others are valid until at least 2026. The licences include the
new Angostura Block that integrated several small claims previously owned by Greystar.
Greystar have also acquired surface rights over parts of those areas that will be required
for mining and processing infrastructure for a mining operation, and the process of
acquiring the necessary additional surface rights is ongoing.
Page - 2 -
1.1
PROJECT HISTORY
Early gold mining activities are reported to have occurred in the general area of the
Angostura deposit since pre-colonial times and continued during Spanish rule with the
mining of high-grade veins and placers in the area. After independence and throughout the
last century, precious metals were mined on a small scale in the districts of Vetas and
California, until present.
Greystar became involved in the project in 1994 and conducted exploration until1999
consisting of surface mapping, sampling and diamond drilling. The drill hole database at
the end of 1999 consisted of 181 diamond drill holes totalling nearly 52 000 metres.
Because of security and economic considerations, little fieldwork was accomplished from
2000 until 2003, when Greystar re-commenced their surface and underground exploration
program. Since 2003, 518 surface and 157 underground drill holes and 2,915.4 metres of
drifting have been completed. Until May 2008 a total of 277 000 metres were completed
for this study.
Each of the historical resource estimates showed Angostura to be a large but relatively
low-grade deposit with potential economic merit and provided the justification for Greystar
to continue the exploration of the project, which has resulted in a gradual improvement of
the data density covering the deposit, and has also succeeded in expanding its overall
known size. .
1.2
ANGOSTURA GEOLOGY AND MINERALIZATION
The Angostura property is situated within the western branch of the Eastern Cordillera in
northeastern Colombia, and more specifically within the Santander Massif that consists of
Precambrian gneisses and schists of the Guyana Shield. Intermediate intrusives of the
Santander Plutonic Group were emplaced during a period of uplift in the Triassic/Jurassic.
Younger porphyries of Tertiary age are common in the immediate area and are likely
related to the mineralization. Regional faulting parallels the topographic fabric. On a more
local scale, northeasterly faulting is considered to have guided the intrusive rocks and the
subsequent alteration and mineralization.
Angostura is part of the Angostura-California gold province, a belt of epithermal gold
occurrences of the high sulphidation type and characterized by the association of gold with
silver, copper, arsenic, bismuth, molybdenum and tellurium. The existence of a breccia
Page - 3 -
body hosting copper and molybdenum mineralization four kilometres from Angostura
indicates a connection with a (buried) porphyry system. Most of the gold is contained
within several sets of anastomosing veins and tabular breccia zones. Alteration within the
vein-like structures is dominated by silica, both in the form of free quartz and as
silicification, and sericite, and minor allunite while the host rocks are strongly argillized.
Several hydrothermal pulses are discernable and show a decrease of temperature with
time, from >300 C to about 250 C, based on fluid inclusion studies.
The Angostura gold-silver mineralization occurs in a swarm of veins and mineralized
structures that strike east-west, northeast-southwest and northwest-southeast and
generally dip steeply to the north. Recent structural studies have identified five stages of
mostly brittle deformation, four of which are mineralized. It is the continued history of
deformation and intrusive activity that provided the thermal impetus and structural
pathways for this large precious-metal deposit.
The mineralized structures may be single veins, but are more often made up of several,
closely spaced composite veins. Almost two hundred individual veins and composite
structures have been correlated to date on the basis of surface and underground mapping
and the interpretation of drill hole data. Vein widths vary from less than two metres for
individual veins to over 40 metres for composite structures. The overall deposit has now
been sub-divided into six structural domains, each reasonably homogenous, and many of
the resource estimation procedures were completed according to the distinctive geological
and structural features of each domain.
Mineralogical information indicates gold in the primary, non-oxidized mineralization at
Angostura is contained in the mineral calaverite, a gold telluride, often of exceedingly small
grain size as well as in the form of free gold associated with pyrite, forming rims on pyrite
and within fracturies in pyrite (See Vancouver Petrografics report on approximately 180
thin section studies, as well as the G&T 2 006 study on concentrates). While the small
grain size results in excellent repeatability (precision) during sample preparation and
assaying, it renders the primary mineralization partly refractory with respect to the recovery
of the gold.
The gold mineralization has two grade populations. The majority of values (92%) are less
than two grams per tonne (g/t) and show good continuity within the veins. A small, highgrade population represents high-grade shoots and vein segments located in structurally
favourable locations such as at the junction of two veins of different direction. Mapping and
Page - 4 -
sampling of underground openings has confirmed the general grade character of the
broader, low-grade veins and of a few of the high-grade shoots. The current drill hole
density, however, is generally not capable of providing reliable data on the size and shape
of the shoots, which have an influence on the overall resource grade much larger than
their small volume. The realistic modelling of the volume and of the grade of the shoots is
thus a prerequisite for any reliable resource estimate. (The over 60,000 metre of in-fill
drilling information from 2 007 and 2 008 provides significant amount of information to that
end, as mentioned in the following section)
Surface oxidation has affected the rocks at Angostura to depths of up to 170 metres along
specific structures, but is more generally in the range of 10 to 30 metres at the edge of the
deposit, and attains depths that vary from 40 to 100 metres in the central parts. The
oxidation is irregular in shape and is of partial character, i.e., fine-grained sulphides in
dense quartz often remain fresh even near surface, while the coarser sulphides are often
completely oxidized.
1.3
DATABASE
The project database now includes 710 surface drill holes with an aggregate length of
243,039 metres, 1464 muck samples from 2400 metres of underground drifting and
crosscutting on the 2850 level, and 160 underground drill holes with an aggregate length
of 33,962 metres. For much of the resource volume, the drill density is now on a nominal
50-metre spacing, with in-fill drilling on a 25-metre pattern completed in the area of the
underground drilling on the 2850-metre level. From surface a in-fill drilling program on a
25 metres spacing between the 50 metres pattern were completed in areas with presence
of high grade shoots, in late 2 007 and 2 008. The total assay information from all sources
used for the current resource estimate comprises about 225,434 1.25-metre composite
samples.
The past and ongoing sampling and assaying protocols employed by Greystar were and
are comparable with industry standards. A detailed review of the assay database and the
results of the quality control measures undertaken since 2003 confirms the assay
database to be reliable, with individual assays having a high degree of precision due to the
fine-grained nature of the gold mineralization in the Angostura deposit. The project
exploration database was set up and is being maintained by Greystar personnel and is in
good order, after a number of earlier clerical errors and shortcomings had been corrected.
Page - 5 -
For the unoxidized mineralization, the large number of drill-core density determinations
now available show a general increase of the density with the pyrite content which in turn
is positively correlated with the gold grade. Due to the partial weathering of the pyrite, the
correlation between density and gold grade is subdued in the oxide zone.
1.4
RESOURCE ESTIMATION
As in the past, Greystar geological staff has undertaken a detailed interpretation of the
veins system at Angostura which has provided the geological framework for the current
resource estimate. However, in the 2 007 resource estimation the concept of wireframing
the veins was discontinued, allowing the grade interpolation to see low-grade assays
outside of the interpreted veins. The function of the five metre minimum mining width
applied previously to the vein wireframes has been assumed by the regular five-metre size
of the blocks in the block model of 2 007 resource estimation study; now for this study, a
block size of 6.25 x 6.25 x 6.25 metres was used . The size of 6.25 metres was selected
as the block size to get the selectivity required for the Angostura deposit type, and
because is an acceptable equipment size to move huge tonnages. A Re-blocking to 8.75
meters was done as the second option, to evaluate the impact in the selectivity. Metalica
will use this two block models to make a Trade Off between the two block sizes.
The assay database was again divided into low-grade and high-grade populations which
were evaluated and treated separately. A distinction was also made between the six
structural domains, each of them reasonably homogenous structurally, but different from
adjacent domains. The assay data was evaluated separately for each domain, and
separately for the two grade populations. Very little capping of outlier values was required
for the low-grade assay populations, while two of the three high-grade populations
required capping, most severely for the Veta de Barro East area. After capping, the
coefficients of variation for nearly all of the different gold grade populations are now at or
below 1.3, a reasonable level for gold deposits.
The current estimate continues the approach of estimating the probability of each block in
the block model to contain high-grade mineralization. A number of trial runs were
undertaken until a set of interpolation parameters was found that produced realistic
probability indicator results. This is a critical issue since the high-grade assay population of
the deposit constitutes only about 2% of the total assay population used for resource
estimation, but contributes 26% of the gold to the overall mineral resource at a cut-off
Page - 6 -
grade of 3 g/t gold (the 2 007 Scoping Study reflects this to some extent by projecting that
five percent of the tonnage mined is of sufficiently high grade to be processed in the plant).
The interpolated probabilities were used to calculate high-grade and low-grade tonnages
for each block.
The available drill-hole density has given reasonable variography results for both assay
populations in the six structural domains, and this information was used to determine
search distances for the grade interpolation. The influence of the high-grade assay
intervals was further restricted by limiting their projection distances.
The grade interpolation was completed in two passes. The initial pass used a shorter set
of search radii, approximating one-half of the variography ranges. The blocks estimated
during this pass were placed in the measured or indicated category. If a block was
informed during the first pass from three (high-grade) or four (low-grade) different drill
holes, it was placed in the measured class, otherwise in the indicated class. Doubling of
the original search distances resulted in blocks being assigned to the inferred category.
Those blocks of the block model that did not receive a grade estimate during the second
pass were not assigned any grade, or mineral resource status. From this resulted an
estimate of unconstrained mineral resources that is summarized below.
Estimate of Unconstrained Mineral Resources

Measured Mineral Resources
Indicated Mineral Resources
Au
Tonnes
Cut off
grade (g/t)
Au
(g/t)
(1,000)
Measured & Indicated Mineral

Resources
Au
Ag
Tonnes
Au
(g/t)
(oz,
(g/t)
(1,000)
1,000)
Au
Ag
Tonnes
(oz,
(g/t)
(1,000)
Au
(g/t)
1,000)
Ag
(oz,
(g/t)
1,000)
Oxides
0.3
49,620
0.63
1,007
37,246
1.05
1,258
86,867
0.81
2,265
Sulfides
0.45
99,280
0.86
2,729
144,760
1.41
6,555
244,040
1.18
9,284
148,900
0.78
3,736
182,006
1.34
7,813
330,907
1.09
11,549
TOTAL
Inferred Mineral Resources

Au
Ag
(oz,1000)
(g/t)
1.33
266
84,539
1.18
3,205
90,779
1.19
3,472
Cut off
grade (g/t)
Tonnes
(1,000)
Au (g/t)
Oxides
0.3
6,241
Sulfides
0.45
TOTAL
Page - 7 -
The gold cut-off grades applied were 0.3 g/t for the oxidized and 0.45 g/t for the fresh
mineralization, different to those used in the previous studies. The choice of cut-off grades
is explained in Section 17.11.
The resources were also constrained by the open-pit generated by Metalica during the first
phase of the feasibility study to get an idea of the resources inside the pit that has been
constructed with some basic mining engineering parameters. Different cut-off grades are
used to report the constrained resources. The following table summarizes the December
09, 2008, constrained mineral resource estimate for the Angostura deposit.
Angostura Mineral Resource Estimate, December 1, 2008, Constrained by Metalica

Pit.
thousands of tonnes and ounces
Sulfides
Cut off
grades Au
(g/t)
Oxides
Total
Tonnes
(1000)
Au
(g/t)
Ag
(g/t)
Tonnes
(1000)
Tonnes
(1000)
Au
(g/t)
Ag
(g/t)
Au (oz,
1000)
Tonnes
(1000)
Au
(g/t)
Ag
(g/t)
Au (oz,
1000)
133,863
1.48
7.41
6,365
61,391
1.09
6.88
2,160
195,254
1.36
7.24
8,525
156,984
1.33
6.79
6,717
88,263
0.87
5.87
2,460
245,247
1.16
6.46
9,177
185,005
1.19
6.20
7,100
127,070
0.68
4.94
2,768
312,075
0.98
5.69
9,868
Oxides 0.4
Sulfides 0.5
Oxides 0.3
Sulfides 0.45
Oxides 0.2
Sulfides 0.4
The mineral resources estimated for the Angostura deposit disclosed in this
technical report are not mineral reserve.
Silver values at Angostura are low and average 6 g/t for the measured, indicated and
inferred tonnage.
1.5
FUTURE PROGRAM
Greystar is embarking on the phase 1 of the feasibility study.
This study will develop
some of the following activities until get a bankeable feasibility study.
Other mining-related studies include the continuation of geotechnical and hydro-
geological investigations with respect to pit design and pit slopes.
Page - 8 -
Program of metallurgical testwork on course.

Site investigations will include geotechnical, hydro-geological and hydrological
investigations of the Angostura site in general, and of the specific sites chosen for waste
disposal, heap leaching and other mining-related infrastructure, including condemnation
drilling to disprove the existence of potentially mineable mineralization.
Environmental studies will be conducted in preparation for the application for the permits
and licenses necessary to start project construction.
The program of surface rights acquisition over the Angostura site will be continued.
Greystar has another mining titles that have to be explored, and a exploration program will
be developed to evaluate new targets close to the project.
2.
2.1
INTRODUCTION
GENERAL AND TERMS OF REFERENCE
Metalica Consultores S.A.(Metalica) has been retained by Greystar Resources Ltd.

(Greystar), to prepare an independent technical report compliant with the requirements of
National Instrument 43-101 (NI 43-101) on the newest estimate of the mineral resources of
the Angostura gold-silver project situated in northeastern Colombia.
The resource
estimate being reported here is based on information that was available in May, 2 008. An
updated resource estimate, which will form the basis for the ongoing feasibility study
phase 2 of the Angostura project and which will take into account additional information
that has become available after May 2 008, is expected to be completed during the second
quarter of 2 009. The current estimate has been prepared in-house by Greystar personnel
between June and November 2,008, with the methodology used in the last Technical
Report authored by Strathcona Mineral Services Limited of Toronto (Strathcona 2 008).
Greystar has explored the property since 1995, with a hiatus forced by security and
economic considerations from 2000 to 2003.
As part of the documentation required for funding by private placement in May of 2002,
Greystar asked Strathcona to update an original unpublished report of June 2000 to make
it compliant with the reporting requirements of NI 43-101 that had come into effect in the
interim. Following that request, Strathcona produced a report in May 2002 (Strathcona
Page - 9 -
2002) that was substantively similar to the earlier version but included information on some
of the project aspects notinitially covered. The May 2002 report was subsequently updated
to deal with certain shortcomings in September 2003 (Strathcona, 2003).
Since mid-2003, Greystar has undertaken a continuing program of surface diamond
drilling, underground development and underground drilling at Angostura. During this time,
five resource update reports have been prepared documenting the progress with respect
to the mineral resources of the project, the first one was made by Strathcona in 2004, two
others by Snowden Mining Industry Consultants in 2005 (Snowden, 2005a, Snowden
2005b), another by Strathcona in 2006 and the last one by Strathcona in 2008.
Greystar has also engaged Hatch Ltd. of Vancouver (Hatch) to undertake a scoping-level
study on the Angostura project from a technical, practical and economical point of view,
and the Hatch report was issued in July 2007 (Hatch 2007). Hatch used an updated
resource estimate that was undertaken by Greystar in December 2006 with the same
estimation procedures as those described for the estimate of one-half year earlier, but that
took into account additional exploration information that had been accumulated in the
subsequent period. Henrik Thalenhorst of Strathcona was a co-author of the Hatch 2007
report with respect to the resource estimate.
As part of the feasibility study, Mr. Marco Alfaro from Metalica Consultores, visited the
Angostura site and the Greystar field office in Bucaramanga from August 25 to 28, 2008 to
review the procedures of the total exploration activities carried on the Angostura project.
Mr. Giovanny Ortiz from Greystar visited the offices of Metalica in Santiago, Chile, from
September 1 to 17, to review the process of resources estimation developed by Greystar
with the specialists of Metalica.
The present report will utilize, or quote from the earlier technical reports on Angostura
project made by Strathcona where appropriate. In particular, sections of this report have
been copied completely or nearly completely from the latest Strathcona report (Strathcona,
2008).
The coordinate system used for the project is based upon the Universal Transverse
Mercator (UTM) projection (datum Bogota Zone: 18N). All units used in the resource
estimate are metric (except for contained ounces), and all references in this report to
currency are to the United States dollar, unless otherwise indicated.
Page - 10 -
2.2
CONTRIBUTORS TO REPORT
The resource estimate reported herein relies on a very large project database assembled
by Greystar since 1998, as described in more detail in Section 6.2 below. A listing of more
general references and earlier reports is provided at the end of this report.
Greystar has been and continues to be the operator of the Angostura project, and
company personnel have collected all data for the current and previous mineral resource
estimates. From 1995 to 1998, the exploration conducted at Angostura was directed and
supervised by Attilio Spat, P. Eng. Mr. Spat has an MSc degree in mineral exploration from
McGill University (1959), has practised as a consulting geologist since 1957 and was a
director of Greystar from 1997 to 2006. Since April 1999 the field programs at Angostura
have been directed and supervised by Frederick Felder, P. Geo. (MSc geology, University
of New Brunswick 1972), a practising geologist since 1967 and executive vice-president of
Greystar, with considerable international experience. Under the supervision and guidance
of initially Attilio Spat and later Frederick Felder, the actual fieldwork in Colombia was
conducted by a group of local geologists all of whom have from two to thirteen years of
professional experience, most if not all of it at Angostura.
The project database is similarly maintained by Greystar personnel in Bucaramanga. The
geological interpretation was undertaken by Mr. Giovanny Ortiz under the supervision and
guidance of Mr. Felder, and in consultation with the author of this report. Mr. Ortiz is the
Superintendent of Geology and Exploration, having worked for the company since 1997.
Mr. Ortiz obtained a geology degree from the Universidad Industrial de Santander,
Bucaramanga in 1994 and is a resource and Datamine specialist having received
geostatistical training with the University of Alberta of Canada, in Via del Mar, Chile 2007,
and Datamine training in Lima, Peru, in 2004, 2005 and 2006.
The author has relied on the available data to prepare this report. While we have visited
the project site in august 2008, we have not conducted independent sampling, or sample
analysis, or surveys to verify the validity of the assay data, the location of drill holes and
underground openings, or the location or the validity of mining claims. Based on the
observations during our field visits, and on subsequent data review, it is our opinion,
however, that the staff and supervising geologists of Greystar have taken a sufficient
amount of care in the collection and documentation of the data that forms the basis for the
current mineral resource estimate. During our visit and from the information provided by
Page - 11 -
Greystar, we reviewed the primary and derived data of the Angostura project. Based on
our review, we believe that the data used are reasonable and reliable, so that the results of
the December 09, 2008 resource estimate, within the resource classification assigned, are
similarly reasonable.
The Hatch (2007) report was issued in July 2007 and is in the public domain. It has
examined and reported upon, at a scoping study level, mining, metallurgical and other
technical and economic aspects of the Angostura project. The Hatch report is still relevant
for many of the items discussed, and we have consulted with the Hatch study in
preparation for this report.
3.
RELIANCE ON OTHER EXPERTS
In the past outside technical specialists involved in the process of mineral resource
estimation for the Angostura project included Elmer Ildefonso of Lima, Peru who has been
retained by Greystar repeatedly since 2004 to assist with the resource modelling process
with the Datamine software. Mr. Ildefonso is a consulting mining engineer who attended
the Centre Geostatistique de lEcole de Mines de Paris at Fontainebleau, France in
1989/90 and specializes in computer applications relating to resource and reserve
estimation, mine design and mine planning using the Datamine software. Mr. Ildefonso has
not been involved in this study, but his inputs have been maintained.
The mineral
resource estimate that is the subject of this report has been undertaken and completed by
Greystar staff.
We have relied on the representations made by Greystar with respect to the Angostura
mineral tenure described in Section 4.2, since we are not in a position to verify the
information supplied on the mineral tenements held by Greystar in Colombia.
Strathcona Mineral Services from Toronto provides continued advice and assistance to the
project team on various aspects of resource and regulatory matters.
Page - 12 -
4.
4.1
PROPERTY DESCRIPTION AND LOCATION

LOCATION
The Angostura project is located in northeastern Colombia near the border with
Venezuela, some 370 kilometres to the north of the capital city of Bogot, and
approximately 40 kilometres northeast of the city of Bucaramanga (population 700 000), at
7 23 North and 72 54 West (Figure 1). The property is located near the boundary
between two political entities referred to as departamentos, Santander and Norte de
Santander, and thus has to deal with two district administrations. For the Angostura
project, the mining would take place in Santander, a province that is familiar with the
existing small mining operations in the area, while a heap-leach facility would be in Norte
de Santander, whose administration has had little exposure to such activities.
Page - 13 -
Page - 14 -
4.2
PROPERTY AND TITLE IN COLOMBIA
Over the course of their involvement in the project, Greystar have acquired, by purchase
and by application to the governmental agencies, a total of 13 concessions covering 30
000 hectares in the Angostura area, as shown in Figure 2 and summarized in Table 1.
Table 1 Mineral Holdings, Angostura Project
Licence
Designation
Area (hectares)
Expiry Date
Notes
CC 3452
Concession
5,244.9
August 8, 2027
1, 2
L 101-68
Mining Licence
5.7
April 19, 2010
L 127-68
Mining Licence
3.5
April 19, 2010
CC 6979
Concession
40.0
July 09, 2026
L 300-68
Exploration Licence
9.2
October 13, 2008
L 22346
Mining Licence
1,184.1
June 17, 2026
CC AJ5-142
Concession
4,061.1
Novem ber 14, 2034
CC AJ5-143
Concession
3,890.5
June 21, 2037
CC AJ5-144
Concession
4,336.0
February 11, 2037
CC EJ1-159
Concession
814.9
March 8, 2037
CC EJ1-163
Concession
8,424.7
March 15, 2037
CC EJ1-164
Concession
1,439.3
May 23, 2037
CC 343
Concession
600.0
February 9, 2037
Totals
30,053.9
Notes: (1) Angostura Block.

(2) Two of the original claim s incorporated into the Angostura Block are subject to a net profits
royalty (NPI). These are the original Permit 3452 (7.5% NPI on 230 hectares) and concession 47-68
(10% NPI on 53.9 hectares).
(3) Change to concession contract in process.
(4) Application for reduction of area and the addition of limestone as new mineral for exploration, in
process.
Mineral property rights are governed by the Colombian Mining Code, which has been
subject to changes and amendments. The oldest version relevant to the Angostura
property is Law 20 promulgated in 1969. Law 20 was superseded by decree 2685 in 1998,
which in turn was amended by Law 685 in 2001, which continues in effect to the present
time.
Page - 15 -
Until 1998, the Colombian Ministry of Mines and Energy was directly responsible for the
administration of the mining law as it relates to mining title. In 1998, these duties were
devolved to a separate agency Minercol. On January 27, 2004, with resolution 180074,
these responsibilities were transferred to the mining department of INGEOMINAS (the
Colombian Geological Survey Instituto Colombiano de Geologa y Minera).
An exploration licence (Licencia de Exploracion) as defined by the 1988 Mining Code and
continued unchanged in the 2001 revision, grants the holder the exclusive right to conduct
exploration activities. The exploration licences formerly held by Greystar at the Angostura
site have now been consolidated and incorporated into the Angostura Block (Concession
3452).
An exploration licence can be converted into a mining licence (Licencia de Explotacion
designated L in Table 1 and Figures 2) with a term of 10 years under the 1998 rules, or
into a Concession Contract (Contrato de Concesion CC) with a term of 30 years,
renewable for a further 30 years under the 2001 law. The concept of mining licences has
been abandoned as part of the 2001 Mining Code revision, but the three Greystar mining
licences continue under this designation until their expiry date.
Prior to their expiry as exploration licences and in order to qualify for the designation as a
Concession Contract, a production plan and an environmental impact study must be
submitted. In order to comply with this requirement, Greystar has advised that it has
presented production proposals under the 1988 law so as not to be in default of this
particular provision. It is the practice in Colombia to submit a minimum mining proposal to
comply with the law. Since the requirement is minimal, such production objectives can be
met by a small-scale operation and have more recently been met by the tunnelling
activities described in Section 6.2.
On December 11, 2002, Greystar filed a petition with the Colombian authorities to
integrate (group) the central, key part of their claim holdings that had consisted of a
number of individual concessions, including several interspersed fractions not owned by
Greystar, into one concession contract in accordance with provisions of Articles 101 and
349 of the 2001 Mining Code. This process was delayed because of the existence of the
fractions. On April 17, 2006 Greystar submitted an application to INGEOMINAS to
combine the titles in the original group application into a new concession, including the
claim fractions.
Page - 16 -
Page - 17 -
This new, larger concession known as the Angostura Block (Concession 3452) was
granted in February 2007. It encompasses an area of some 5245 hectares, with most of
the fractions now incorporated. Excluded from the block, but enclosed within it, are two of
the original Greystar Mining Licences L101-68 and L127-68. The new Angostura Block
expires in 2027 and gives Greystar a total of five years for further exploration (three years)
and the construction of a mine (two years, extendable by a further two years) from the date
of registry on August 9, 2007. This means that the exploration phase of the Angostura
Block has to be completed by August 2010.
The basic annual renewal fee is $7.70 per hectare for concessions with an area of less
than 2000 hectares, and is twice that amount for licences with an area from 2000 to 5000
hectares. The annual fees are payable in advance within 30 days of the anniversary date
for each licence. Greystar have advised that they are in full compliance with the
corresponding payment schedule for the claims on which the Angostura mineral resources
are located.
Greystar has acquired, through purchase and direct acquisition, a 100% interest in all of
the mineral licenses and permits itemized in Table 1, subject to a the NPI royalty interests
noted above. Upon production, there is a government royalty of 4% on the gross value of
gold production on all mineral holdings, calculated on 80% of the London gold price fixing,
or an effective rate of 3.2%.
The L. 300-68 title that had an expiry date in October 13 2008, is now in process to obtain
a new Concession Contract with a minimum of 20 years of validity.
Ventana Minerals Corp. (Ventana) holds two small parcels of concession 328-68 which are
located immediately to the east of the Angostura deposit, and one of these partly underlies
one of the waste dump areas selected as an option by the feasibility study phase 1. Parts
of other concessions as 73-68, 3451, 145-68 and 13625 will be affected by the planned
mining infrastructure, mainly by the internal roads.
The actual mining code provides the needed legal framework that promotes mining, with
such legal tools as mining servitude for the use of the land and/or mining titles of others to
enable development of a mineral deposit or for building the required mining infrastructure.
Greystar may also take the approach of initiate a process of negotiation with the land or
mining titles owners to obtain right of ways or to purchase the properties outright.
Page - 18 -
A number of modifications to the 2001 Mining Code are currently under discussion in the
Colombian Congress, and it can be expected that some regulations are going to change.
4.3
LAND TENURE
Over the past ten years, Greystar has acquired outright certain surface rights in the area of
the Angostura project in anticipation of a decision to build a mine and related
infrastructure. The surface rights, together with the mineral rights and the mine
infrastructure proposed by Hatch (2007) are shown in Figure 3. The surface parcels are
irregular-shaped since they were mainly held for agricultural use.
4.4
ENVIRONMENTAL REGULATIONS
For the area in which the Angostura project is located, the Colombian Ministry of the
Environment has delegated the environmental oversight for projects such as Angostura to
the autonomous Corporacion de Defensa de la Meseta de Bucaramanga (CDMB
corporation for the protection of the Bucaramanga plateau) for the Department of
Santander. Field exploration activities including trenching, road building, and diamond
drilling can proceed subject to the prescribed Environmental Mining Guidelines under an
Environmental Management Plan or plano de manejo amiental (PMA) according to Article
199 of Law 685/2001. The PMA is set up for the duration of the planned exploration
activities with CDMB and has been updated for the expanded mineral holdings.
Under the guidelines of conduct prescribed by the PMA, existing surface disturbances
caused mainly by the previous drill programs have largely been remedied by replanting,
and drill moves since 1999, 2003 and 2004 have used smaller equipment, or moves have
been done manually. To further minimize ground disturbances, Greystar is now using
wooden scaffolding to reduce the size of the drill set-up excavations. The environmental
liabilities with respect to the surface disturbances on the property constitute an
environmental liability for Greystar currently estimated to be $163 000 until December 31
2008.
Greystar has submitted the required environmental action plans to the CDMB. This
includes an environmental plan on January 20, 2004 for the underground development on
the 2850 level at Perezosa, and an environmental plan on November 2, 2007 for the new
adit in the Veta de Barro area. Greystar has been granted all necessary permits for the
field activities to proceed.
Page - 19 -
For exploration work in the adjacent department of Norte de Santander, Greystar have
advised that they will submit a separate management plan to CORPONOR , the equivalent
of the CDMB. As work in the department of Norte de Santander is still early-stage
prospecting work, a PMA is currently not required.
Page - 20 -
Page - 21 -
4.5
OBSERVATIONS AND CONCLUSIONS
The consolidation of the various Greystar mining claims, and fractions not originally owned
by Greystar, into the Angostura Block has now simplified and clarified the mineral tenure
status in the immediate Angostura deposit area. However, several small parcels of claims
held by others would be affected by any future mining infrastructure, and Greystar will
have to address this question as part of the feasibility study. The exploration phase for the
block, on which all of the current mineral resources are located, expires in 2010, and this
should give enough time to complete the additional work and the necessary studies
planned as described in Section 19.
Given the as yet partial coverage of the future mining infrastructure areas by surface
rights, ownership of all surface rights required for the future mine infrastructure is
mandatory given the limited choice for such infrastructure in the mountainous area of
Angostura.
5.
ACCESSIBILITY, PHYSIOGRAPHY, CLIMATE, LOCAL RESOURCES
AND INFRASTRUCTURE
There are several jet or turboprop flights per day from Bogot and from Medellin to
Bucaramanga, and a new daily flight from Panama City. The Angostura site is accessible
from Bucaramanga on partially-paved roads via the small towns of Mantanza, Surat and
California, a road distance of 50 kilometres, and from there on a secondary road, an
additional 11 kilometres (Figure 4). The entire trip from Bucaramanga takes from two to
three hours for the relatively short distance, depending on the weather. Alternatively, the
property is a 15-minute helicopter ride from the Bucaramanga airport. A number of drill
roads provide access in the area of the concessions being worked by Greystar. Local
traffic uses foot paths and horse trails that provide access throughout the area.
The property is located in steep, mountainous and relatively rugged terrain at elevations
ranging from 2600 to 3400 metres. Based on data from a number of nearby weather
stations at comparable altitudes, the average annual temperature is 9 to 11 C, with little
seasonal change. The average annual precipitation is 740 millimetres (mm), while the
average annual evaporation is approximately 1300 mm, which identifies the site as a net
evaporation area. Without significant changes in temperature, the seasons are defined by
Page - 22 -
variations in precipitation. In the two wet seasons, from April to June and from September
to November, about two-thirds of the annual precipitation is recorded.
The Angostura project is situated at the upper end of the Quebrada La Baja drainage
basin, a catchment area of approximately 124 square kilometres above the town of
California. The local catchment area of the Quebrada Angostura drains and area of
approximately ten square kilometres.
Vegetation in the area of the Angostura Project can be described as light alpine scrub
consisting of grasses and shrubs such as "Fraillejon" (espeletia humbolt), typical for the
high elevations of the northern Andes mountains of Venezuela, Colombia and Ecuador.
There is significant growth of oak and eucalyptus trees along the watercourses in the lower
elevations on the property. The local vegetation supports only a limited level of agriculture
and livestock pasture. The principal economic activity in the area is the small-scale
exploitation of gold, while agriculture, cattle raising and basic commercial activities are of
lesser significance. Agriculture is carried out using traditional methods with low yields and
soil deterioration over time. Cattle are raised primarily for meat production.
The area is served by the national electric power grid, which is described by Greystar staff
as efficient and in a good state of repair. Land telephone service is essentially restricted to
the municipality of California, but cellular telephone service is now available throughout the
area. The exploration camp communicates via a microwave system directly with the
Bucaramanga office, providing voice and data communication with a band width of two
megabytes.
6.
6.1
PROJECT HISTORY
GENERAL REMARKS
Early gold mining activities exploiting placer deposits and high-grade veins in the general
area of the Angostura deposit are reported to have occurred around the present village of
Surat, located some ten kilometres to the west (Figure 2), where mining was conducted
from Pre-Columbian times until 1644. In 1824, the Colombian Mining Association
Company became involved in gold mining in the California district in which Angostura is
located and continued until 1900. Starting in 1906, a French mining company conducted
mining and produced a matte (gold-silver-copper) that was sent to Europe for processing
Page - 23 -
until the beginning of World War I. More modern activities included an investigation by the
Anaconda Company in the 1940's and a study of the gold potential of the area by Placer
Development in the 1970's. In the 1980's, INGEOMINAS carried out geochemical surveys
for the occurrence of copper mineralization and a Japanese entity investigated the La Baja
area for possible uranium occurrences.
Greystar first became involved in the Angostura area in 1994 and has continued to acquire
additional concessions, as indicated in Table 1. A small underground operation of perhaps
25 or 30 tonnes per day (tpd) is conducted on the neighbouring Bodega concession.
Downstream, a number of operators and cooperatives recover gold from small, high-grade
veins.
6.2
EXPLORATION HISTORY
The considerable exploratory work completed by Greystar is summarized in Table 2 by

period, with the period-ends coinciding with historical resource estimates as detailed in the
next section. The estimate of the Angostura mineral resources described in this report is
based on the sampling and drilling summarized in the Total line in Table 2.
From 1994 to 1999, exploration of the Angostura property by Greystar had consisted
mainly of surface work which included geologic mapping, surficial rock sampling, and
diamond drilling aggregating 52 000 metres in 181 diamond drill holes. A small part of the
underground openings created by artisan miners was also mapped and sampled. The
database based on these activities underlies the 1999 KTS resource estimate described in
the next section.
Because of the security situation in the area, and the general economic problems faced by
junior mining companies, no substantive field work was conducted by Greystar at
Angostura from late 1999 until mid-2003 except for the sampling and mapping of the
existing and accessible underground openings that took place in late 1999 and early 2000.
In June 2003, after the improvement of the security situation, a surface drilling program
commenced that has since added 687 diamond drill holes with a total length of more than
224 909 metres to the project database. Much of this additional drilling was designed as
in-fill drilling in the main areas of mineralization.
.
Page - 24 -
Table 2 Angostura Field Work by Period and Timing of Historical Resource Estimates
Surface Sampling
Surface Diamond Drilling
Tunnelling
Underground Diamond Drilling
Period
1995 to late 1998
Metres Sampled
Assays
Holes
Metres Drilled
Assays
Metres
398
131
139
38 836
27 399
198
Muck Samples
Channel Samples
Holes
Metres Drilled
Assays
356
12
2 463
1 556
169
14
2 817
1 681
374
42
11 497
7 059
140
348
24
5 658
3 249
295
718
23
6 118
3498
42
5 409
3 014
157
33 962
20 057
116
Mineral Resource Estimate MDA 1999 (KD Engineering Company, Inc., et al, 1999)
Late 1998 and 1999
7 336
2 014
44
15 255
11 809
432
KTS Mineral Resource Estimate 1999 (Strathcona 2003 and predecessor reports)
2000 to June 2003
756
275
June 2003 to May 2004
343
61
19 032
12 495
32
145
Greystar/Strathcona Mineral Resource Estimate May 2004 (Strathcona 2004)

June 2004 to March 2005
1 272
738
61
23 041
13 763
476
322
Greystar/Snowden Mineral Resource Estimate March 2005 (Snowden 2005a)

April to September 2005
38
13 353
7 000
369
214
Greystar/Snowden Mineral Resource Estimate November 2005 (Snowden 2005b)

Sept. 2005 to June 2006
100
39 616
21 969
923
439
Greystar/Strathcona Mineral Resource Estimate June 2006 (Strathcona 2006)

June 2006 to Dec. 2006
38
16 334
9 833
274
Hatch Scoping Study (Hatch Ltd., 2007)

Dec. 2006 to Dec. 2007
87
Dec. 2007 to May. 2008
167
Totals
10 016
42
121
50 423
27 353
228
Greystar/Strathcona Mineral Resource Estimate Dec 2007 (Strathcona 2007)

76
111
27 148
15 015
458
54
150
Greystar/Metalica Mineral Resource Estimate Dec 2008 (This report)
713
243 038
146 636
3 276
2 958
1 464
3 151
Page - 25 -
An underground development program was started in early April 2004 on the 2850-metre
elevation consisting of two parallel east-west drives some 350 metres apart, with a
connecting cross-cut in the Perezosa Area. These excavations serve as a base for
detailed underground diamond drilling. The openings have also provided access to some
of the known mineralized structures for detailed underground drifting and sampling. A new
adit 415.3 metres long has recently been completed in the Veta de Barro area on elevation
3 095 metres.
In the past three years, at program of geochemical soil sampling has been undertaken in
the project area and in some of the nearby exploration concessions. More than 4,000
samples have been taken on a grid with an initial spacing at 100 or 200 metres with later
infill sampling. Samples were taken at an average depth of 0.8 m. The samples were
analysed for 37 elements using ICP mass spectroscopy analysis of 15-gram aliquots after
agua regia digestion. As a result of this work, gold anomalies were identified in such areas
as Cristo Rey, La Alta Este, Los Laches (shown on Figure 5) and Violetal and Animas
(outside of Figure 5). Subsequent diamond drilling has found extensions to the Angostura
gold deposit in all of these cases. A new drilling program in the Animas, Mongora and
Violetal areas, is investigating strong soil and rock geochemical anomalies.
Condemnation sampling and drilling is ongoing to confirm the absence of economically
interesting mineralization in areas such as Angostura, Paez, Mongora, Romeral and
Crucecitas creeks. These areas have been identified as alternatives for mining
infrastructure.
6.3
PRIOR MINERAL RESOURCE ESTIMATES
As indicated in Table 2, eight mineral resource estimates have been conducted at

Angostura during the tenure of Greystar prior to the current estimate. Two of these
estimates were concluded prior to NI 43-101 and would today be referred to as
preliminary economic assessments as defined by NI 43-101 because they were
essentially based on inferred or unclassified mineral resources. They were done to aid
management to gauge the advisability of further exploration efforts to put the resource
base on a more complete footing.
The Figure 4 indicate the evolution of the Angostura
resources since 1999 until December 2008.
Page - 26 -
Figure 4 Measured Plus Indicated and Inferred Contained Gold Ounces in the
Mineral Resource Estimate Studies.
On the basis of information available at the end of 1998 (137 diamond drill holes with a
total length of nearly 37 000 metres), KD Engineering Company of Tucson, Arizona
undertook a preliminary feasibility study in early 1999. Mine Development Associates of
Reno, Nevada (MDA), provided an estimate of the total mineral resources in all classes
which amounted to 254 million tonnes with average grades of 0.84 g/t gold and 3.8 g/t
silver at a cut-off grade of 0.3 g/t gold. Only 19% of this tonnage was in the indicated
category, the remainder being in the inferred category, reflecting the preliminary nature of
the data base at that time. Assuming a combination of heap leaching and milling, a gold
price of $300 per ounce, and preliminary but reasonable (for the time) operating cost and
metallurgical recovery expectations, a pit optimization process based on the MDA
resource estimate arrived at a seven-year production schedule which mined a total of 27
million tonnes at a gold grade of 2.0 g/t and with a strip ratio of 4.4. The option of a heapleach only operation for both oxides and sulphides was also investigated in a preliminary
way.
Based on an expanded data set, Kinross prepared a new resource estimate in the autumn
of 1999 that investigated the deposit for both underground and open-pit mining. While this
estimate predated NI 43-101 and is therefore a Historical Estimate in the context of NI
43-101, it was prepared to satisfy the standards of the Australian JORC code promulgated
earlier in 1999 (Australasian Institute of Mining and Metallurgy, Australian Institute of
Page - 27 -
Geoscientists and Mineral Council of Australia (JORC), 1999). The 1999 resources by
KTS are now completely out of date, and the concept of underground mining is no longer
considered valid for Angostura.
The generally positive findings of the KTS studies provided the justification for Greystar to
continue the exploration of the project starting in mid-2003, after the security situation had
normalized. In line with the increase in information as shown in Table 2, additional
resource estimates were prepared in the following years, culminating in the potentially
mineable mineral resource estimate of the Hatch (2007) report that for the first time
constrained the resources within an open pit. The resource estimates from 2007, 2008
and the potentially mineable mineral resource are summarized in Table 3.
There is a general increase over time in the total (unconstrained) deposit resource (mostly
in the sulphide zone), as well as of the ratio between indicated and inferred resources,
reflecting the success of the ongoing exploration activities.
Page - 28 -
Table 3 Angostura Mineral Resource Estimates since 2007

millions of tonnes and contained ounces of gold
Au
Au
Tonnes
(g/t)
(ounces)
Ag
(g/t)
Tonnes

Au
Au
(g/t)
(ounces)
Oxide
Sulfide
Total
Greystar/Strathcona Dec 2007 (1)

Measured + Indicated
57.9
1.07
2.0
6
6.7
176.4
1.44
8.2
7
71.0
234.3
1.4
10.2
7
77.7
1.6
1.4
1.4
Oxide
Sulfide
Total
Greystar/Metalica Dec 2008 (2)

Measured + Indicated
86.9
0.81
2.3
6
6.2
244.0
1.18
9.3
6
84.5
330.9
1.09
11.6
6
90.7
1.3
1.18
1.19
Ag
(g/t)
Inferred
0.3
3.1
3.4
10
7
7
0.3
3.2
3.5
9
6
6
Inferred
Hatch Potentially Mineable Mineral Resource, July 2007 (3)

Tonnes
Au (g/t)
Au (oz)
Ag (g/t)
Waste tonnes
Oxide
46.6
1.2
1.8
7
Sulfide
120.4
1.3
5.0
5
Total
167.0
1.3
6.8
6
740.3
Strip Ratio
4.4
Notes:
(1) Cut offs: Oxides 0.4 g/t Au; Sulfides: 0.55 g/t Au
(2) Cut offs: Oxides 0.3 g/t Au; Sulfides: 0.45 g/t Au
(3) Cut offs: Oxides and Sulfides: 0.5 g/t Au
The original notion of two different assay populations contributing to the overall Angostura
deposit grade, initially reflected in the KTS 1999 estimate by the use of two different cut-off
grades respecting two different mining approaches, has not lost its validity. However, the
concept of perhaps mining only the small, higher-grade part of the deposit by underground
methods has not endured, given the large, low-grade tonnage that requires high capacity
open-pit mining.
6.4
HISTORICAL PRODUCTION
Small-scale operators have driven a number of adits on the Greystar concessions, but
those (illegal) activities, which carried out intermittently until early 2003, have now ceased.
No systematic underground mining has been carried out, but the local miners have
followed and exploited high-grade veins and shoots, generally by raising and shortdistance sub-drifting, using haphazard and unsafe mining methods. The tonnage removed
by drifting is estimated to amount to some 8700 tonnes with an average grade of 4.6 g/t
gold, based on the Greystar surveys and sample results of the various drifts and tunnels
on the Angostura property. High-grading above and below the tunnels is estimated to have
removed one-half as much again, with a gold grade of perhaps 15 g/t, an estimate that is
Page - 29 -
not supported by any data because these openings are off-limit because of safety reasons,
but is not unreasonable. The total removed would then amount to perhaps 13 000 tonnes
with an average gold grade of 8 g/t. Given the size of the overall resource, subtraction of
this tonnage from the resource estimate is not relevant.
7.
GEOLOGICAL SETTING
The plate-tectonic setting of the northern part of South America is characterized by the
interaction of several plates. The Caribbean plate to the north is currently moving to the
ESE, the Cocos and Nazca plates to the west are moving to the NE and E, respectively,
and the South American plate itself moves to the S and SE. The interaction of the tectonic
plates has caused docking of some of the plates, subduction with associated magmatism,
thrusting and local extension with the formation of intra-continental basins (Horner, 2005).
Similar plate-tectonic movements in the geological past are responsible for the
structural/tectonic setting of the Angostura area.
The Angostura Property is situated within the Eastern Cordillera in Northeastern Colombia.
The Eastern Cordillera bifurcates at a point south of the Maracaibo Basin. The western
branch swings to the northwest, while the eastern branch maintains the northeast trend
and continues as the Sierra de Merida in Venezuela, to the east of the Maracaibo Basin
(Figure 4).
Page - 30 -
Page 31
The western splay of the Cordillera includes the Santander Massif within which the
Angostura deposit is located. The oldest rocks within the Santander Massif consist of
Precambrian gneisses and schists that were part of the Guyana Shield. These rocks were
regionally
metamorphosed
to
upper
amphibolite
grade
during
dynamo-thermal
metamorphism. Younger rocks of Paleozoic age occur in the region, but not in the
immediate area of the deposit. Diorite to granite composition intrusive rocks in the district
belong to the Triassic-Jurassic Santander Plutonic group. Emplacement of these intrusives
occurred during a period of uplift in the Triassic-Jurassic. Younger porphyries are very
common in the immediate area of mineralization, and these may be as young as Tertiary1
1
.(Felder et al., 2000).
The structural/intrusive history of the area is summarized by Horner (2005). The

Precambrian rocks were deformed sometime in the Paleozoic. During the Mesozoic,
granitic to dioritic rocks intruded into the deformed Precambrian basement, and felsic to
andesitic volcanic rocks were extruded. At that time, part of the Eastern Cordillera wasin a
back-arc setting, andlocal basins formed and filled with marine-transgressive sediments.
During Late Cretaceous to Paleocene/Eocene, folding and thrusting of the Eastern
Cordillera resulted in basin inversion and uplift. The porphyry stock hosting part of the
Angostura mineralization was intruded at this time. Uplift and erosion of the Eastern
Cordillera, in particular the Santander Massif, occurred during Late Eocene to Early
Oligocene time, with reactivation of older structures and continued uplift during the Middle
to Late Miocene.
Finally, starting in the Late Miocene and continuing to the present, a major Andean
deformation event is taking place with increased strike-slip faulting, extrusion and escape
of the triangle-shaped Maracaibo block to the North along the left-lateral Bucaramanga
Fault(to its west) and the Bocon Fault system (to its south and southwest). Basin
inversion and rapid uplift are continuing.
This supposition was subsequently confirmed by dating of such a rock from the Angostura area
that yielded an age of 59 million years.
Page 32
8.
DEPOSIT TYPE
The Angostura gold-silver project is part of the Angostura-California gold province of the
Eastern Cordillera in northeastern Colombia, a belt of epithermal gold occurrences
developed along the Rio La Baja regional fault that trends in a northeasterly direction from
the town of California (Felder et al., 2000). The fault transects pre-Devonian granitoid
bodies, high-rank metamorphic rocks and overlying Lower Cretaceous sediments
quartzite, limestone and argillite. Intense hydrothermal activity related to Cretaceous and
early Tertiary quartz porphyry intrusions gives rise to the goldsilver mineralization.
The Angostura mineralization is of the high sulphidation type and is characterized by the
association of gold with silver, copper, arsenic, bismuth, molybdenum and tellurium, a
classic porphyry-related epithermal metal association. Most of the gold is contained within
several sets of anastomosing veins and tabular breccia zones as described in more detail
in Section 9. Alteration within the vein-like structures is dominated by sericite and silica,
the latter occurring both in the form of free quartz and as silicification, while the host rocks
are strongly argillized. Several hydrothermal pulses are discernable and show a decrease
of temperature of formation with time, from >300 C to about 250 C, according to fluid
inclusion studies reported in Felder et al., 2000. Locally, disseminated gold in the altered
host rocks gives rise to low-grade mineralization in the strongly altered host rocks,
particularly in the southern, deeper part of the project area.
The discovery of copper-molybdenum mineralization in an intrusive breccia some four
kilometres to the south of Angostura suggests that the gold mineralization at Angostura
may be associated with a porphyry system at depth.
The exploratory works in this area
have showed evidence of hydrothermal alteration, and contents of pyrite that suggest a
potential that have to be properly investigated.
9.
9.1
MINERALIZATION AND ALTERATION

GENERAL REMARKS
The gold-silver mineralization at Angostura is contained in a deposit that is nearly two

kilometres long in a north-easterly direction and up to one kilometre wide (Figure 5). The
drill results indicate that the deposit is delimited to the northwest by the Angostura Fault
and to the southeast by the Mongora Fault. Mineralization continues southward across the
Page 33
Paez Fault, but the very steep topography across the creek presents a limit for a pit
extending in this direction. To the north, the deposit appears to terminate fairly abruptly
against an unnamed fault in the Cristo Rey area, beyond which only narrow, isolated veins
have been encountered.
Mineralization within the deposit is largely controlled by a swarm of generally eastnortheast trending, steeply north-dipping structures. The structures cut a suite of
porphyritic diorite to quartz monzonite bodies and dike swarms of Triassic age that are
intruded into the amphibolite facies Bucaramanga Gneiss, a series of meta-sediments of
Proterozoic age. In the upper parts of the mineralized system, alteration and mineralization
are stronger in the intrusive host rocks, and the meta-sediments appear to make a poorer
host for the gold-silver mineralization. However, within the main part of the mineralized
system in which the vast majority of the current mineral resources reside, metamorphic
rock inclusions not only become rather less frequent, but do not exert any noticeable
control on the strength and distribution of the mineralization.
The overall Angostura deposit is sub-divided geographically into a number of areas or
sections that, from south to north, are referred to such as El Vivito, El Silencio, Nueva Alta,
La Perezosa, El Diamante, La Alta and its eastern neighbour La Alta Este, El Pozo, Veta
de Barro, Veta de Barro Este, and the recently-identified Cristo Rey, as shown in Figure 6.
The mineralized structures have been correlated either as single veins or as composites,
the latter consisting of a number of closely-spaced veins. More than one hundred and
ninety individual veins and composite veins have been identified to date by means of
surface mapping, mapping of underground workings and interpretation of drill hole data.
Widths vary from less than two metres for individual veins to over 40 metres for composite
structures, and identified strike lengths range from less than 100 metres to over one
kilometre. Figures 7 and 8 depict the interpreted economic geology of the deposit on the
2850 and 3150-metre levels, respectively.
The distance between veins or composite veins varies from nil (where two veins of
different direction cross) to 50 metres. The vein system has generally been tested by
diamond drilling to a depth of 200 to 300 metres below surface, with scattered intercepts
obtained to depths of up to 400 metres. Figure 9 is a typical cross section through the
deposit.
Page 34
Underground observations indicate that the gold mineralization within the veins is to a
large extent contained in a set of fractures that have a porphyry-style distribution, rather
than following the vein direction.
The structural history of the veins and faults at Angostura has been studied by Horner
(2005), who has identified five stages of mostly brittle deformation. As in many similar
cases, it is this continued history of deformation and intrusive activity that provided the
thermal impetus and structural pathways for a major precious-metal deposit. Specifically:
Stage 1
Stage 2
Stage 3
Stage 4
Stage 5
NE-SW striking faults with steep to moderate dips to the northwest and southeast
are generally unmineralized or only weakly mineralized, and occasionally show
alteration.
NW-SE striking mineralized veins, veinlets and breccia structures are created,
partly
developed as faults, with dips that range from sub-vertical to about 60/ to the
northeast and southwest.
This stage is represented by E-W to ENE-WSW striking mineralized veins, veinlets
and breccia structures. Dips range from steep to moderate (85/ - 65/) to the north
and south.
Approximately north-south and east-west striking veins, veinlets, and faults and
low
angle (20/ - 50/) structures that dip to the west and north or south.
NW-SE, N-S and NE-SW striking veins, veinlets and faults, predominantly dipping
steeply to moderately to the W. E-W striking veinlets dipping steeply to the north
and south. These structures display minor mineralization, and alteration is
common.
Page 35
Page 36
Page 38
Page 38
Page 39
Cross cutting relationships indicate that most of the brittle structures formed in a short
period of time almost contemporaneously. This is supported by the fact that the majority of
brittle structures exhibit hydrothermal alteration and/or mineralization (sulphides, oxides).
(Horner 2005, page 16).
As a result of the multiple stages of structural ground preparation, alteration and
mineralization, the different vein families have a different geochemical character, with the
northeasterly trending veins being relatively enriched in copper and partly also in
molybdenum. Moreover, there is silver enrichment in two wide northwesterly trending
bands, not necessarily attributable to any individual vein. The silver enrichment is
accompanied by increased values in bismuth (Bi), arsenic (As), antimony (Sb),
molybdenum (Mo), zinc (Zn) and lead (Pb). In contrast, the areas with a high gold to silver
ratio are largely devoid of these more volatile metals. The gold-rich structures frequently
also have elevated phosphorus (P) levels, probably in the form of alumino phosphates.
The geochemical character of each vein is important in the context of the overall
geological understanding of the Angostura deposit, and with respect to the presence or
absence of potential cyanicides. The successful geochemical characterization of each vein
requires thirty-element geochemical data that are now available for the majority of the
Angostura database. This data has guided the interpretation and correlation of the various
veins and provided direction for the selection of representative samples for metallurgical
testwork.
Following the events of mineralization and vein formation there was a phase of formation
of open faults and fractures. These often contain rubble fill and are the conduits for
oxidizing ground water in the zone of oxidation.
9.2
HIGH-GRADE ACCUMULATIONS
Local and generally narrow accumulations of higher-grade mineralization make an

important contribution to the economic prospects of the Angostura deposit. They were in
previous reports referred to as shoots, reflecting their interpreted shape. The difficulty
has been, and continues to be, to model the high-grade accumulations in such a way that
they do not over-contribute (nor under-contribute) to the overall resource grade of the
deposit.
Page - 40 -
Detailed mapping by Greystar personnel of the existing underground openings, developed

by informal operators on high-grade mineralization, has documented the internal
complexity of these occurrences. As a general rule, high-grade gold mineralization has
been preferentially deposited in more than one directions, of which one is usually
dominant. For the 2004 and 2005 resource estimates, separate shoots had therefore been
modelled by Greystar staff around high-grade drill intersections creating, as best as
possible, shoot outlines for separate resource estimation. The primary purpose was to
geometrically constrain the influence of high-grade intersections.
For the more recent resource estimates, this approach has been abandoned as being
impractical, since drilling alone cannot possibly determine the structural setting and the
geometry of a high-grade intersection that would allow a realistic body to be created, and
its volume to be estimated with some accuracy. Instead, with the additional drill data
available, a probability approach has been chosen to create a non-geometrical constraint
to the high-grade assay population as described in Section 17.4.
Figure 10 shows the
image of a longitudinal section of one vein in the Diamante area (Western area), and the
distribution of the gold grades along the structure.
Figure 10 Image of Block Model (6.25 m). Distribution of the Gold Grades in a Vein
in the Diamante Zone. View Looking to Northwest.
Gold Legend (g/t)
Page - 41 -
9.3
BULK MINERALIZATION
The bulk zone concept was introduced for the 2006 resource estimate to account for
relatively continuous mineralization that is difficult to resolve into individual veins. These
large bulk structures are typically 100 to 200 metres across and are elongated in plan and
in section along structurally preferred directions. In keeping with their nature, the modelling
of these zones has incorporated a reasonable amount of internal dilution. There are now
three such bulk zones in the Veta de Barro, Veta de Barre Este and in the Nueva Alta-Alta
Este area, two of which are shown in Figure 8.
9.4
DISSEMINATED MINERALIZATION
For previous resource estimates, the term disseminated mineralization had been used for
areas within the Angostura deposit where elevated gold values occur between identified
veins and was carried as a separate line item in previous resource estimates. The
character of these intersections indicated them to be vein segments not large and
continuous enough to be traceable to neighboring drill holes.
With the abolition of the vein wireframes for resource estimation, the disseminated material
is now taken into account during grade interpolation of the veins, and mineral resources for
this material are no longer separately reported.
9.5
ALTERATION AND ORE MINERALOGY
Petrographic work (Harris, 1998 and more recently Thompson, 2004, Thompson 2005a, b,
c & d) has demonstrated the details of the alteration sequence at Angostura. The entire
rock mass in which the various veins and mineralized structures occur has been affected
by argillization. In the process, the plagioclase and minor mafic components of the original
quartz diorite or gneiss have been replaced by sericite and kaolinite, with the primary
quartz unaffected and surviving as remnants. The alteration within the main part of the
Angostura deposit is so strong and pervasive that the determination of the original host
rock (gneiss or felsic intrusive) is difficult and often impossible.
The process of vein formation is associated with partial silicification that is superimposed
on the original argillized rocks with patches of microgranular quartz forming in the
sericitized matrix between the remnants of primary quartz. As the intensity of silicification
increases, the original sericitized matrix is almost totally converted to fine-grained, cherty
Page - 42 -
quartz, in which the primary quartz remnants survive as "islands". The most intense stage
shows complete silicification of the rock, assimilating the primary quartz remnants. The
final product of this process is granular, sometimes vuggy, crustified quartz.
More specialized alteration types on a more local scale ...include opalization of feldspars
(instead of, or superimposed upon, sericitization); alunitization (partially, though not
exclusively associated with advanced silicification); and development of an Al phosphate
mineral of uncertain identity. In addition, minor tourmaline occurs in a couple of samples.
(Harris, 1998, pp. 2/3). However, tourmaline was an important constituent in two of the
three samples investigated by Thompson (2005c).
At least two stages of pyrite formation have been recognized. The older is represented by
relatively large crystals and does not appear to be associated with gold, or is so only
moderately, while a younger, fine-grained pyrite/marcasite phase is intimately correlated
with the intense stages of silicification and with gold deposition. Accessory sulphide
minerals include chalcopyrite (CuFeS2) and tetrahedrite ((Cu,Fe)
12Sb4
S13 ), commonly
replaced by digenite (Cu9 S5 ), covellite (Cu2S) or chalcocite (Cu2S) as well as arsenopyrite

(FeAsS) and bismuthinite (Bi2S3). The distribution of the chalcopyrite replacement
throughout the deposit is of obvious interest for the metallurgical behaviour of the
Angostura mineralization since its replacement minerals are cyanicides. In addition, small
amounts of sphalerite (ZnS), enargite (Cu3 AsS4) and tellurides have been noted, among
them bismuth telluride, gold-silver telluride, and native tellurium. It has already been
remarked on the distinct geochemical character of some of the different vein directions in
Section 9.2 above.
Very fine-grained electrum and gold-silver tellurides occluded in pyrite are described by
Thompson (2005b). Similarly SGS Lakefield Research Africa Pty (Lakefield Africa) have
reported on the deportment of gold in the flotation concentrate from a composite sample of
wide distribution within the Angostura deposit. Gold was only found as gold-telluride
(probably calaverite AuTe2) and as gold-silver telluride (probably petzite Ag3 AuTe2).
No native gold or electrum was seen (SGS Lakefield Africa 2007, page 6). Silver
minerals identified included hessite (Ag2Te) and pearceite, a complex silver-copperarsenic sulphosalt. At a grind of 80% passing 106 microns, about 30% of the observed
gold-silver tellurides were still completely locked in sulphides (mainly pyrite). The finegrained character, and the frequent occurrence of gold in tellurides together explain the
partly refractory nature of the primary mineralization at Angostura.
Page - 43 -
The metallics screen assay data of nearly 1000 samples averaged 9.6 g/t gold, a part of
the high-grade gold population described in Section 17.4 and substantially higher than the
average deposit grade. Seventy-seven percent of these assays have less than 5% of the
total gold in the plus 150-mesh fraction (no coarse-gold problem), three percent have
between 25 and 50% (a moderate problem with coarse gold) in the coarse fraction, and
only one percent of the samples have more than 50% (a serious problem) of the total in
the oversize fraction. Overall, there is not a large problem with coarse gold or with the
nugget effect in the Angostura deposit.
Alunite (a hydrous sodium sulphate) replacing original feldspar occurs in some parts of the
deposit, and significant gold values are at least locally associated with relatively broad
areas of alunitization. Non-systematic petrographic investigations (Thompson, 2004)
indicate that much of the alunite may be supergene in nature. However, one sample
contains thin-tabular alunite (B133660), leaving the possibility of advanced argillic
alteration overprint on potassic to sericitic alteration. (Thompson 2004, page 1). New field
observations has shown that the alunite is usually related to the hydrothermal alteration
and not only to supergene processes, as Thompson concluded..
9.6
OXIDATION
Surface oxidation has affected the rocks at Angostura to a depth of 10 to 30 metres at the
edge of the deposit, and attains depths that vary from 40 to 100 metres in its central parts.
The oxidation is irregular in shape, following the increased permeability along the
mineralized structures and later faults and fractures sometimes exceeding 170 metres in
depth along specific structures.
It is important to note that the term oxidized zone, at Angostura, does not imply complete
oxidation. Rather, even immediately below the surface as can be observed in the tunnels,
the oxidation is partial and patch, affecting more the coarse rather than the fine pyrite, and
is governed by local permeability changes. Thus it is possible to observe completely
oxidized sulphides in close proximity to entirely fresh sulphides, together with areas in
which oxidation is incomplete where sulphides are mantled by limonite. This mixed zone is
referred to as the transition zone, and typically has sulphide sulphur values from 1 to 2%,
compared to sulphide sulphur values in the range of 0.5% in the actual oxidation zone.
The results of metallurgical test work indicate that the process of oxidation has improved
the metallurgical response of the mineralization in comparison with its hypogene
Page - 44 -
precursor, and gold has obviously been liberated from the tellurides during oxidation.
There is also a reduction of the bulk density in the oxide zone as described in Section
14.4. Finally, silver is enriched at the redox boundary between oxides and sulphides, and
continues enriched for up to several tens of metres below. There is thus a zone of
supergene enrichment for the silver, with a concomitant zone of silver depletion above.
9.7
The understanding of the Angostura mineralized system has continued to improve since
2003. The deposit shows three different modes of grade continuity:
The volumetrically most prominent domain consists of the veins and composite
veins that form the framework of the deposit and host the low-grade gold assay
population described in Section 17.3.
The grade distribution within these is
moderately erratic, owing to a high-grade component of lesser continuity. The

current drill pattern of 50 metres is generally adequate to give a reasonable
impression of the vein shape, size and precious metal grades. Tighter drilling of the
high-grade component of the deposit (next point) provided additional information,
specially for the high grade areas.
The high-grade accumulations (formerly referred to as shoots) are thought to

have developed in structurally favorable locations such as at the intersection of two
veins of differing strike direction. The exact size and shape of this type of
mineralization is uncertain in most cases, and is not resolved by the current drill
density. At a cut-off grade of 3 g/t gold, the high-grade assay population amounts
to about two percent of the total assay population used for mineral resource
estimation but contributes 26% of the contained gold in the overall Angostura
mineral resource. The effect of the high-grade assay population was to elevate the
gold grade of about 5% of the total resource by volume in the Hatch (2007) scoping
study to a level that allowed it to be considered for selective mining and processing
by flotation in a sulphide flotation plant, with subsequent bio-oxidation, to maximize
gold recovery.
Page - 45 -
10.
EXPLORATION
The exploratory work completed by Greystar is summarized in Table 2 by periods.

Starting in 1994 the exploration had consisted of surface work which included geologic
mapping, surficial rock sampling, soil sampling, stream sediment sampling and diamond
drilling completing until May of 2008, of 277,000 metres in 870 diamond drill holes. More
than 3,140 m of drifting have been constructed in the tunnels Perezosa 2, Veta de Barro
and Fuego Verde.
All the underground openings created by artisan miners in the
Greystars claims were also mapped and sampled.

An underground development program was started in early 1997 with 198 metres in the
the Fuego Verde tunnel on 3056 metre elevation in the Silencio Area. In April 2004 on the
2850-metre elevation consisting of two parallel east-west drives some 350 metres apart,
with two connecting cross-cut in the Perezosa 2 tunnel. Recently 415.3 metres and one
cross cut has been completed in the Veta de Barro tunnel located in the northern part of
the deposit on 3 095 metre elevation.
In the past, the program of geochemical soil sampling has been undertaken in the project
and some surrounding areas, and more than 4,000 samples have been taken on a grid
with an initial spacing at 100 or 200 metres with later infill sampling. Samples were taken
at an average depth of 0.8 m. The samples were analysed for 37 elements using ICP
mass spectroscopy analysis of 15-gram aliquots after agua regia digestion. As a result of
this work, gold anomalies were identified in such areas as Cristo Rey, La Alta Este, Los
Laches (shown on Figure 6) and Violetal and Animas (outside of Figure 6). Subsequent
diamond drilling has found extensions to the Angostura gold deposit in all of these cases.
11.
DRILLING
The great majority of data used for the current resource estimate for the Angostura project
is from diamond core drilling and was completed in May 2008. Diamond drilling was
performed by the following contractors: 1995 -Norbert Reinhart; 1996 to 1998 Terramundo Drilling; 1999 -Major Drilling Inc; since June 2003 -Concorcio Geominas S.A.
- Perfotec Ltda. (a Colombian contractor from Medellin), all using a variety of drill rigs.
Core size varied from BQ (36.5 mm diameter) to NQ (47.6 mm) to HQ (63.5 mm). By far
the majority has been NQ (78% of the total), with HQ and BQ core making up 19%and 3%
Page - 46 -
of the total, respectively. Since November 2007, 1547 metres of PQ-size (85 mm) core has
been drilled to collect material for metallurgical testwork, mainly in the oxide zone. Table 2
shows the summary of drilling completed from 1994 by period.
12.
SAMPLING METHODS AND APPROACH
12.1
GENERAL REMARKS
Greystar has created a manual summarizing the prescribed sampling and activity
protocols for the various geological and sampling activities at the Angostura site. These
have been updated from time to time to reflect the increasing care required as the project
developed. The Strathcona observations during the visits in 2004, 2006 and 2007, and in
our visit in august 2008 have indicated that Greystar technical personnel take pride in their
work, which is being performed in a diligent and conscientious manner. The permanence
of many of the Colombian geologists on the project is of definite benefit in this respect.
12.2
DIAMOND DRILLING
Drill-hole collars in the field are clearly marked by wooden stakes bearing the information
of hole number, azimuth, inclination, and coordinates, and the collar locations have been
verified by survey.
The drill hole deviation was measured using the Tropari instrumentation through 1997,
with the Sperry Sun system introduced in 1997, and with the Swedish Reflex Easyshot
system since 2003. The original deviation measurement spacing of 50 metres starting at a
depth of 150 metres downhole has been tightened since 2003 to 25 metres down-hole
starting with an initial reading immediately below the casing, to give better control. In the
absence of magnetite in the rocks, these methods work well. The experience with the 25metre readings indicates a systematic steepening of the holes by about 1.5 in the first
hundred metres, and azimuth deviations are of a similar order of magnitude, but they can
be in either direction, right or left. The degree of steepening and change of azimuth at
greater depths is somewhat smaller, reducing to 1 for the dip and 0.3 for the azimuth per
hundred metres. These changes in drill hole attitude are small and reasonably predictable,
so that, despite the absence of deviation determinations above a depth of 150 metres in
the earlier drill holes, the actual location of these holes will not be far from where they are
plotted.
Page - 47 -
The average core recovery for the entire drill-hole database is nearly 94%, with 81% of the
intervals above a 90% recovery, and these figures include the initial, poorer near-surface
recoveries to a depth of typically eight to ten metres. The core recovery below a depth of
35 metres increases to 95%.
The scattergrams plotting core recovery vs. gold and sulphur (a proxy for pyrite) grades
are contradictory. No obvious relationship is observed for the high-grade assay population
for either gold or sulphur. For the low-grade assay population, the sulphur grades increase
with increasing recovery, indicating that sulphides are preferentially lost in poor-recovery
intervals. The gold grade vs. recovery plot shows the opposite behaviour, statistically
decreasing with increasing core recovery. The rate of increase of the sulphur values and
the rate of decrease for the gold values is similar. However, gold and sulphur are positively
correlated at Angostura, as shown by the bulk density data discussed in Section 14.4. The
data for the low-grade population is thus conflicting, and at this time no unequivocal
evidence that a gold grade bias has been introduced as a result of core loss.
All drill core has been photographed starting in 1997, on film until 1999, digitally since
June 2003. After photography, the Greystar geologists log the core in detail. Data recorded
include the major and minor lithologies, the type and intensity of alteration, the rock colour,
grain size, structural information such as brecciation and faulting, rock quality designation
(RQD) since November 1997, and the degree of oxidation and weathering. The data was
initially entered into paper log sheets and later into a computerized relational database. As
a result of unsatisfactory logging procedures in the earlier years, a major program of relogging to the improved standards was undertaken in early 1999.
With the exception of the initial, near-surface few metres of each hole in which core
recovery was poor, nearly all the drill core produced was sampled and submitted for
assay, resulting in a very large assay database of almost 167 000 assays from drilling
alone. Core sampling was, and continues to be by sawing. In 1995 to 1999, one-half core
for BQ and NQ and one-quarter core for HQ was collected as a sample, to make the
samples similar in mass. The samples are bagged and shipped for assay (in the past) or
transported to the site preparation facility (since March of 2004, see Section 13.2), while
the remainder is returned to the core box for reference.
Page - 48 -
The average sampled core length was 1.3 metres in the earlier drilling, and has increased
to the 1.7-metre range since 2003. The sample interval in the higher-grade sections was
noticeably shorter in the 1995 to 1999 drill holes, but has evened out starting in 2003. In all
cases, however, the longer samples were taken in areas believed to be of low-grade
character. Few samples are less than 0.5 metres long. Sampling observes obvious
lithologic, alteration, and mineralization breaks. All The drill core is stored in two
permanent facilities near the village of California. The older drill holes that were stored in
Bucaramanga were moved to the facilities in California in late 2 008.
12.3
SURFACE SAMPLING
Surface and trench sampling was conducted by channel sampling where the lithology did
not change in an outcrop. Discernable vein structures were sampled by panel sampling,
with individual panels measuring one to four square metres. Chip samples were collected
over pre-defined sections of outcrop showing no discernable difference in lithology or
alteration. The sample locations were determined by tape and compass, tying into
surveyed drill hole collars.
In 2004, many of the channel samples were still easily recognized. However, following the
recommendations of Strathcona, from 2 005 rock re-sampling using an electrical saw was
implemented to give a more representative sampling of the veins themselves. The surface
channel samples are used during resource estimation for geometrical purposes, but the
grade information is not included in the estimate.
12.4
UNDERGROUND SAMPLING
Samples in the near-surface tunnels and drifts created by artisan miners were taken by
Greystar personnel as continuous chips along the back of a drift, and along one of the
cross cut walls. In some cases, wall samples were also taken in drifts, but being along
strike, these were not considered during resource modelling. The sample length varied
from 0.5 to 1.5 metres, observing obvious lithologic and mineralization changes. The
distance between back samples was a nominal two metres.
The 2850-level development has been sampled in three ways.
Continuous chip sampling was originally done along the walls of the drifts and
cross-cuts, but is incomplete. Individual fractures with obvious mineralization were
Page - 49 -
sampled separately to pinpoint the location of the gold. The results of these
samples were not used for the current resource estimate.
The broken material of the majority of the rounds on the 2850 level in Perezosa II
tunnel and on the 3100 level in Veta de Barro tunnel, taken was systematically
sampled by shovel from each mine car, creating 1464 samples of typically 150 to
160 kilograms per round, a sample ratio of nearly one percent (a round was
generally 2.3 by 2.3 by 1.3 metres). For the first 1100 such samples, grab samples
were removed from the muck sample and submitted for assay, a less than
satisfactory method. In 2006t, re-sampling of the muck samples was instituted. The
entire sample was dried if necessary, then crushed to minus 2.5 cm and
homogenized in a cement mixer. A sub-sample of 5 to 10 kilograms was split out
using a fourtiered arrangement of riffle splitters and subjected to the normal
Greystar sample preparation and assaying protocols used for core from the surface
drill holes as described in Section 13.2.
Overall, there was no difference in the average gold values between the original
and the resampled 1100 assay results. However, there was a fair amount of scatter
between initial and duplicate samples for both gold and silver. Since the duplicate
assays represent a more accurate estimate of the grades of the individual samples
and are thus more reliable for local grade estimation, they have replaced the initial
assay data in the project database. For the resource estimate, dummy drill holes
were created along the drifts and cross-cuts with the muck sample assay
information and used in the same manner as all of the other drill holes.
A program of systematic channel sampling along both walls of the 2850 drifts and
cross-cuts was undertaken from 2007. Analysis of the comparative data (nearly
350 metres of drift length) for channel and muck sampling showed the muck
samples to be systematically higher for gold as well as other elements such as Ag,
S, and As, on average by 10 to 20%, indicating a systematic sampling bias
between the two types of samples. This information was not utilized for the
completion of the current resource estimate. Strathcona 2008 has suggested using
the channel samples rather than the muck samples for grade interpolation where
available, but in May 2008 that information was not completed. The overall effect of
this possible bias is limited, since the muck samples represent only 1.4% of the
overall sample length used for the current resource estimate. However, for the
Page - 50 -
resource estimate that will form the basis for the feasibility study, the channel
sample assays need to be used instead of the muck sample assays.
It should be clarified that the sawn channel samples were higher in grade than the chip
channel samples, and the mucks were even higher. Thus as the sample size increased, so
did the gold grade. This is may be due to the fact that as the volume of material increases
so does the actual degree of systematic sampling of the microfractures containing the
mineralization. Thus the smaller samples including drill core tend to under estimate grade.
12.5
While there are a few areas in which the sampling methods employed in the Angostura
project in the past and present may bear improvement, the past and ongoing sampling
approach by Greystar is judged to be on par with industry standards, and any existing
shortcomings are of an extent and magnitude that they do not represent an impediment to
the reliability of the current mineral resource estimate for the project.
13.
13.1
SAMPLE PREPARATION, ANALYSIS AND SECURITY

EARLIER FIELD PROGRAMS (1995 TO 2000)
The samples collected in the field, from surface or from drill holes, were initially placed in
heavy plastic bags, large enough to contain one individual sample, and marked on the
outside with the sample number, and a sample tag with the same information placed
inside. Several of the plastic bags containing individual samples were combined into larger
heavy plastic bags, and three of these in turn were packed into plastic fibre bags for
shipping.
After bagging, there was no more access to individual samples. The shipping bags were
sealed with lock and seal and brought by company truck to the DHL office in
Bucaramanga, who then shipped the samples by air freight directly to the analytical
laboratory.
Rossbacher Laboratories Ltd. of Vancouver was the principal laboratory used. All samples
were dried at 50 to 60 C and then crushed to minus 10 mesh (1.7 mm). A sub-sample of
250 to 350 grams was obtained from the crushed sample by Jones splitter and pulverized
to 90% passing 150 mesh (106 microns) in a ring pulverizer.
Page - 51 -
All samples were initially assayed for gold using a 10-gram aliquot, dissolution in aqua
regia, gold extraction by methyl isobutyl ketone organic solvent (MIBK) and gold
determination by atomic absorption spectroscopy (AAS). This is essentially a geochemical
method, suitable for low gold concentrations. Samples with gold values between 0.5 and
1.5 g/t as determined by the geochemical method were subjected to routine fire assaying
using a one assay-ton aliquot (one half assay ton until the end of 1996). The remainder of
the pulp of those samples yielding above 1.5 g/t gold from the initial geochemical method
was re-assayed using the pulp-and-metallics method, screening at 150 mesh.
For the incorporation of the Rossbacher gold assays into the database, an assay hierarchy
by quality of the result was established. If only a geochemical value was available, then
that value was used. If a geochemical and a fire assay were available, then the fire assay
result was used. If in addition to a fire assay, a metallics assay was also available, then
that figure was incorporated. There was no averaging of the results of different sample
variance.
Silver and copper were originally determined by AAS based on a 0.5-gram aliquot, with an
aqua regia digestion. Silver values equal to or greater than 15 g/t were later re-assayed
using the fire assay method.
A large number of samples from early drilling at Angostura (1996 to 1998) were also
assayed using the cyanide-leach method, for the purpose of comparing total gold (as
determined by fire assay or metallics assay) to cyanide-soluble gold. A 30-gram sample
that was shaken for three hours in 60 millilitres of a 0.5% NaCN solution, and the dissolved
gold determined by AAS. The gold content of the residue was not determined, and neither
was the cyanide concentration at the end of the dissolution time. For those samples from
the sulphide zone with significant copper values (>1000 ppm), there is an indication that
the amount of cyanide-soluble gold reported was negatively affected by increasing copper
grades.
The available 998 Rossbacher metallics screen assays demonstrate that for the large
majority of the samples tested, only a relatively small portion of the gold resides in the
coarse fraction retained on the 150-mesh screen. Below an assay of 50 g/t for the full
sample, there is virtually no difference between the gold grades of the plus 150-mesh and
the minus 150-mesh fractions. Only 34 of the 979 samples below 50 g/t contained more
than 25% of their total gold in the coarse fraction, and this proportion did not change with
the gold grade. Even among the 19 samples with assays >50 g/t, a high proportion of gold
Page - 52 -
in the plus 150-mesh fraction was found in just three samples, with the other 16 being no
different than the samples with assays below 50 g/t. These results characterize the
Angostura gold mineralization as generally well-behaved from a sampling and assaying
point of view.
13.2
2003 TO 2008 PROGRAMS
After resumption of field activities in June of 2003, a number of changes with respect to
sample preparation and analysis were implemented. The most important was the
construction of a preparation laboratory on site, to speed up the process and to reduce the
sample mass to be shipped for assay. The crusher components were sourced in the fall of
2003, and the laboratory was put in production in March of 2004. Design and construction
were under the supervision of a former laboratory manager at a commercial assay facility
in Canada.
Prior to the site sample preparation laboratory being operational, a local independent
sample preparation laboratory in Bucaramanga was employed in 2003 and early 2004 but
could not keep up with the volume. This resulted in those samples judged to be
mineralized being air freighted to ALS Chemex Laboratories in Vancouver (Chemex)
without crushing and splitting, and only the anticipated low grade samples being crushed
in Bucaramanga and shipped overseas. ALS Chemex is an accredited chemical laboratory
and registered with Quality Management Institute (QMI) under ISO 9001:2000 as well as
being accredited by the Standards Council of Canada.
The sample preparation in Colombia, at both the site since April 2004 and the
Bucaramanga facility before, is single-stage crushing to nominally 80% passing 1.7
millimetres (ten mesh). The site facility now employs one Rhino and one Terminator jaw
crusher manufactured by TM Engineering Ltd. of Burnaby, British Columbia. A charge of
barren limestone or granite is passed between samples. After crushing, the sample, of an
original mass of typically 1.5 to 3 kilograms, is blended and a sub-sample of nominally 250
grams obtained by riffle splitting. Quality control measures include the weighing and
screen analysis of one in ten samples. Actual crusher output is usually close to 95%
passing 1.7 millimetres. The capacity is now around 150 samples per shift, employing six
personnel.
All crushed and split samples are weighed before being sent for assay. Weighing at the
assay lab is repeated, and this provides a valuable tool for detecting and tracing any case
Page - 53 -
of sample misidentification. The crushed rejects are stored under cover at the site for
future reference.
Samples derived from what appear to be weakly mineralized drill hole intervals were sent
to ACME Analytical Laboratories Ltd. in Vancouver (ACME) for assay until March 2007. A
15-gram aliquot was assayed using a thirty-element geochemical ICP gold method after
aqua regia digestion2. Since March 2007, ALS Chemex is being used for anticipated lowgrade samples instead of ACME who did not provide sulphur assays.
Any samples returning more than 0.4 g/t gold are re-assayed at ALS Chemex, together
with the stream of samples submitted directly from Colombia, for gold determination by fire
assay with an atomic absorption spectrometer (FA/AAS) finish using a one assay-ton (29.2
grams) aliquot. Gold assays above 10 grams per tonne (g/t) and silver assays above 100
g/t are re-assayed by one assay-ton FA with a gravimetric finish.
Separate splits of these samples are subjected to a multi-element ICP assay including
silver and sulphur following a four-acid digestion. Sulphur assays >10%, the limit of the
reported as >10%. Given the importance of the sulphur assays for the metallurgical
characterization of the sample intervals at Angostura as discussed in Section 16, all the
samples with results >10% were and are been re-assayed using the Leco method with
an upper limit of 50% S.
The site preparation laboratory does not operate independently of Greystar and thus offers
the potential for sample tampering and salting, the process of adding gold-bearing,
extraneous materials to a sample to enhance its gold grade. There is no indication that
such tampering is taking place. Certain precautions are in place, such that only one of the
Greystar geologists has access to the facility, which is also kept locked when not in use.
Roughly four percent are duplicate samples dispatched with new sample numbers from
the site as part of the sample batch. This would make tampering difficult to commit, and
would aid in its discovery, if present.
From the ACME website glossary: ICP - Inductively Coupled Plasm a - Atomic Emission Spectrom eter: An
instrum ent capable of determining the concentrations of 40 to 70+ elem ents sim ultaneously by m easuring
the intensity of light given off by samples aspirated into an argon gas plasm a heated to >10,000/K. Capable of
very low detection limits (ppm to ppb) with wide linear ranges (5 orders of m agnitude).
Page - 54 -
In 2004, an initial set of 40 drill core intervals had been re-sampled and sent directly to an
assaying facility, without using the Greystar preparation facility. The mean gold and silver
grades were essentially identical to those reported originally. The recommendation of
Strathcona to resume the practice of re-splitting core were implemented starting in October
2007. These consisted of quarter HQ core, not at random, but with mainly mineralized
intervals (higher than 0.2 g/t Au). On average, the original core is 9% higher than the
duplicate core, the sampling of quarter core may contribute to this bias. The precision is
poor and indicates that the core does not represent the grade of mineralization within 50%
at 5 g/t. A good portion of this error can be alleviated with unbiased sampling and large
half core HQ duplicates.
Barry Smee (Smee Consultant) is the independent auditor of the preparation laboratory,
and has made two inspection visits from 2004
13.3
All of the sample preparation procedures are industry standard and should, with
satisfactory performance by the camp preparation facility and the chemical laboratory, give
reliable results subject only to sample errors. Security measures have been and are in
place to avoid sample tampering. While it is difficult to prevent a determined effort, the
procedures adopted by Greystar make such an act difficult to commit and relatively easy to
detect.
With respect to silver, the Angostura database contains the results of different digestion
methods. For the years 1995 to 1999, the initial Rossbacher dissolution was by aqua
regia, and for the high silver repeat samples it was by fire assay. For the low-grade
samples in 2003 to 2007 submitted to ACME, the silver was extracted from the sample by
aqua regia. Silver values below 100 g/t at Chemex in 2003/04 were obtained by ICP after
a four-acid digestion, while those higher than that value were repeated (and the results
accepted into the Angostura database) by fire assay. This means that the silver values in
the database are not strictly comparable. However, the Acme and Chemex silver values
compare well, and silver is not an element of great economic importance for the Angostura
project.
Page - 55 -
14.
14.1
DATA VERIFICATION
DATABASE
The Angostura database existing at the end of 1998, i.e. before the 1999 drilling, was
maintained and audited by Todd Lavens of Greystar in early 1999, with the results of the
audit being reported to MDA as part of the pre-feasibility study undertaken at the time
(Lavens 1999). This audit detected a number of clerical errors and shortcomings, and
addressed remnants of a problem that had been recognized earlier, namely the duplication
of sample numbers by Rossbacher, a problem that was subsequently resolved.
Greystar are currently using the Postgre SQL software, produced by the Bucaramanga
firm of Systemas Integrados de Informacion y Digitalizacion (SIID), to manage the
Angostura database. The system is installed in the Greystar Bucaramanga office and is
fully integrated with the data acquisition activities in the field that are entered into a Palm
daily and downloaded via the microwave communication system to Bucaramanga.
strict, controlled and structured set of fields and columns is used to manage the data flow,
and the software thus controls the integrity of the data and will alert the database manager
to any structural problems. As an example, the existence of duplicate sample numbers has
now become impossible. Similarly, assay results are posted by the laboratory on the
Internet and can be directly downloaded into the database, avoiding clerical errors during
data entry. The exchange of the Greystar database with the Datamine program did not
create any problems.
14.2
ASSAYS 1995 TO 1999
There was no Greystar-sponsored quality assurance/quality control (QA/QC) program in

place for the drilling campaigns from 1995 to 1999. However, a substantial program of
check assaying of pulp duplicates was undertaken at Bondar Clegg Laboratories during
those years, and in 2003/04 a number of high-grade core intervals originally assayed in
that earlier period were re-sampled and rejects submitted for check assaying at Chemex.
The results were summarized in Table 7 of the 2004 report (Strathcona, 2004), showing
that there was a tendency of the Rossbacher results for gold to be high by around 10% as
compared to Bondar Clegg and Chemex.
Greystar undertook a detailed analysis of the Rossbacher bias in 2004. This showed that
the differences between Rossbacher and Bondar Clegg were restricted to assays above
Page - 56 -
about 2 g/t and appeared to be traceable to certain groups of contiguous samples where
the Rossbacher results were consistently and obviously high (the bad set), while other
batches did not show this bias. The bad set, representing about 28% of the total, showed a
large difference with Rossbacher being 44% higher than Bondar Clegg. Subsequently, the
original sample batches corresponding to the bad set were identified, a total of 891
samples. From these, 344 of the original rejects could not be found, and another 20
mismatched samples and 7 samples with very high gold grades were eliminated from
further consideration.
The remaining 520 samples with a Rossbacher mean gold value of 6.6 g/t were reassayed at Chemex who reported a mean of 6.2 g/t. The lower Chemex values were
substituted into the project database, and the KTS 1999 mineral resource estimate
described in Section 6.3 was reestimated with the Chemex data. The effect on the
estimated resource grade was very small, the relatively largest consequence being a 1%
reduction of the gold grade of the indicated resources at the 3.0 g/t cut-off grade (Snider,
2004).
14.3
ASSAYS 2003 TO 2008
For the more recent drill programs that started in June of 2003, a QA/QC program external
to the assay laboratory was instituted. In August 2005, Smee and Associates Consulting
Ltd. of Sooke, British Columbia (Smee) were engaged by Greystar to guide and audit the
QA/QC procedures and results. Smee has produced several reports since then, the latest
in October 2008 covering the period November 2007 to August 2008.
From September 2003 to March 2004, a total of 117 drill-core blanks were inserted into the
sample stream from drill core that had previously been shown to be barren. Only one of
the samples was slightly high with a value 0.05 g/t gold, a very good outcome.
This practice was changed to using field blanks consisting of limestone or barren gneiss
which were inserted into the sample stream at the rate of one in 25 to 30 by the project
geologists. These field blanks are invisible to the assay laboratory. To the end of June
2006, the results of 431 such blanks are available (344 gneiss and 87 limestone), with a
failure rate (defined as >0.05 g/t) of 7%, which is above the acceptable level of 5%.
However, nearly one-half of the failures is attributable to one shipment when a laboratory
operator made an error in the aliquot preparation. The sample batches in question have
been reassayed and the corrected values entered into the database. Other blanks that
Page - 57 -
returned high values were re-assayed individually, with the initial values being confirmed. It
appears that the gneiss material used was slightly mineralized, leading to artificial
failures.
There were no blanks inserted by Greystar from July 2006 to August 2007, so that a
significant number of samples cannot be assessed with respect to any contamination that
may have occurred. The practice of adding core blanks was resumed in September of
2007, and 303 such samples had been added, with only three returning a high value of
0.05 g/t gold.
The insertion of reference materials (standards) into the sample stream did not start until
March 2004, when the site sample preparation facility became operational. Since then, a
total of 4568 samples from twelve different standards have been assayed. All of the
standards were prepared and certified by CDN Resource Laboratories Ltd. of Vancouver,
British Columbia. The standards fall into two gold grade ranges, 0.8 to 1.0 g/t and 4.7 to
5.2 g/t, and at least one standard of each range was being used at any given time since
March 2004. Following a recommendation by Smee (2007), Greystar have acquired
samples representing two high-grade standards, one of 14.8 g/t and another of 35.25 g/t.
Triggers for an individual standard to have failed were generally set at reference value plus
or minus three standard deviations (SD). If two adjacent standards were both more than
two SD values above or below the reference value, then both standards were failures as
well. The SD values were determined during the certification process. The results are
tabulated below:
Page - 58 -
Table 4 Summary of Standards Performances for Gold

Limits
Low Results
High Results
Standard
Reference
Value
(Au - g/t)
Achieved
Value
(Au - g/t)
Upper
(Au - g/t)
Lower
(Au - g/t)
Au
(g/t)
Au
(g/t)
CDN-GS 1A
218
0.78
0.77
0.9
0.66
0.65
0.91
CDN-GS-1B
898
1.02
1.00
1.11
0.91
20
0.86
18
1.13
CDN-GS-1C
489
0.99
1.00
1.11
0.87
0.83
1.14
CDN-GS-5A
686
5.1
4.96
5.62
4.48
38
4.23
5.92
CDN-GS-5B
666
4.83
4.75
5.4
4.26
4.08
5.44
CDN-GS-5C
574
4.74
4.62
5.16
4.32
21
3.64
5.63
CDN-GS-7
190
5.15
4.95
5.84
4.46
21
4.07
CDN-GS-7PA
521
0.77
0.77
0.86
0.68
13
0.47
23
0.89
CDN-GS-10
199
0.82
0.8
0.96
0.69
0.62
1.01
CDN-GS-5D
15
5.06
5.15
5.43
4.68
5.43
CDN-GS-30A
52
35.25
33.95
37.06
33.43
32.9
CDN-GS-15A
60
14.75
14.66
15.74
13.91
13.05
16.22
TOTAL
4568
3.36
3.28
138
3%
63
1.4%
N = number of assays
The mean gold grades of all standard samples assayed by the laboratory before the
correction of failures tend to be slightly below the reference values, indicating that the
laboratory may have a slight overall low bias for gold. This is also expressed by the
number of low results that exceeds the number of high results. The overall failure rate at
4.4% (low plus high) is acceptable. Among the failures was one run of 14 assays on
standard 5A that were consistently low in early June 2005, indicating a systematic
laboratory calibration problem. Greystar data indicate that samples impacting the resource
estimate were re-assayed from batches where a standard had failed, and the re-assay
value subsequently accepted into the database.
For the period June 2003 to December 2006, there are 433 samples that, having originally
been assayed at ACME, returned gold values above 0.4 g/t. These were re-assayed at
Chemex, using a new pulp sample split from the rejects. The mean grades of 1.52 g/t
(ACME) and 1.58 g/t (Chemex) with a mean pair variance of 14% confirm each other,
keeping in mind the different assay protocols used (see Section 13.2).
Page - 59 -
Starting in April 2004 and extending (with a three-month interruption at the end of 2005) to
March 2007, a total of 1829 sample pulps were re-assayed at a second accredited
laboratory (Assayers Canada Limited) as a program of checking assaying selecting at the
rate of one in 25 to 30 by batch, which represents 5% of all samples >0.4 g/t Au. The
results of this check assaying program available in May 2007 (1670 assay pairs) have
been evaluated by Smee (2007) who observed that The scatter chart does not show any
bias between the two laboratories when all the data is regressed. The Q-Q plot may exhibit
a bias in the grade range of 50 to 100 g/t favouring Assayers, but his is only made up of
three points. The overall Q-Q plot does not show a grade-based bias. (Smee 2007, page
13). It is demonstrated also since the mean grades of the 1829 achieved by ALS Chemex
(3.89 g/t gold) and by Assayers (3.85 g/t gold) are very close.
This program of checking assaying was continued with Acme Vancouver replacing
Assayers as the secondary laboratory. A total of 1479 samples have been assayed for the
period from April 2007 to June 2008. This group of samples had mean gold values of 4.66
g/t and 4.51 g/t for ALS Chemex and Acme respectively. The overall bias averages 3.4%
higher by ALS Chemex, again indicating, that the ALS Chemex laboratory may have slight
low bias. Above 40 g/t Au the bias is more pronounced, but up to 40 g/t the bias at 1.6 %.
As part of the ongoing metallurgical testwork, 30 samples were submitted to the SGS test
facility in South Africa for flotation testwork. The individual samples were re-assayed and,
together with the calculated head grade of the composite sample constituted from 29 of
the 30 individual samples, provides a further independent check on the original Greystar
assay results. The composite grades predicted by the individual drill-hole assays were 1.4
g/t Au and 6.8 g/t Ag, while the calculated head grades were 1.38 g/t Au and 8.6 g/t Ag, in
excellent agreement with the Chemex gold results.
As part of the quality control regime now installed by Greystar, duplicate samples have
been prepared at the site preparation laboratory at irregular intervals spanning the time
from early 2007 to August 2008. There are 1 111 assay pairs with mean gold values of
3.19 g/t and 3.20 g/t, which are practically equal.
14.4
BULK DENSITY
Greystar have undertaken more than 8 400 density measurements on drill core samples,
selected according the litology, alteration and mineralization. The method used is the wax
immersion method (ASTM C914-98) in most cases. The results are shown in summary
Page - 60 -
form in Figure 11, separately for data from the oxide/transition zone and from the sulphide
(fresh) zone.
Figure 11 Drill-Core Density Observations and Assigned Bulk Densities
There is still a fair degree of scatter in these density values above 7 g/t (for unweathered
rocks) and above 5 g/t (for oxidized rocks), and this explains the fairly large scatter of the
core density values in the upper gold grade range in Figure 11. However, the data permit
calculating a logarithmic trend curve for the two observed density populations. These were
subsequently adjusted downward to account for expected rock porosity that is not reflected
in the measurements, with the assigned bulk density figures (BD) being on average 3%
lower than the actual measurements.
The two formulae:
BD = 0.092 ln (Au [g/t]) + 2.63 for fresh rocks and
BD = 0.032 ln (Au [g/t]) + 2.45 for oxidized and transition rocks
Page - 61 -
were subsequently used in the block model to assign bulk density values to individual
blocks, based on their gold grade. The scientifically more accurate method would have
been to assign BD figures to the blocks using the sulphur assays, however, about 20% of
the drill hole data base from the years 1995 to 1999 do not have sulphur assays.
The sulphur data for the fresh rock drill core intervals, from which the observed drill-core
density data originate, show that the increase of the density values with the gold content is
a direct consequence of an increase in the pyrite content. However, the rate of increase
decreases quickly for gold values above about 4 g/t, an observation for which there is
currently no mineralogical or genetic explanation. That there is still a (much smaller) rise of
the observed density values with increasing gold grade in the oxidized rocks is due to the
only partial removal of pyrite during weathering particularly in the transition zone, as
described in Section 9.7. The lower density values for low-grade oxidized rocks compared
to the fresh rocks are attributed to additional porosity that was created during weathering
and oxidation.
14.5
The assay database underlying the current mineral resource estimate for the Angostura
deposit is probably biased high for a small part of the 1995 to 1999 Rossbacher assays.
However, this now constitutes less than one percent of the total assay database and is
therefore no longer an issue. While the QA/QC system as practiced since 2003 largely
conforms to industry standards, it could have been somewhat more systematic and
regular. The available check assay and standards assay data indicate that the assay
results for the years 2003 to 2008 collectively are reliable, that they are fairly precise
individually, and that any contamination was a short-lived problem.
The new bulk density data added since December 2007 has confirmed the analysis made
in 2007. The large data bank of core-density determinations, have allowed a positive
correlation between gold grade and bulk density to be expressed as a formula that can be
used to assign a bulk density figure to each block based on its gold assay. There is one
such formula each for the fresh and for the oxide/transition rocks. At very low gold grades,
the bulk densities of the two types of rock converge at about 2.4 t/m3 and increase to 3.0
t/m3 once a grade of 50 g/t is reached. The bulk density for the oxide mineralization
reaches only about 2.6 t/m3 for similarly high gold assays.
Page - 62 -
15.
ADJACENT PROPERTIES
There are a number of small-scale mining operations in the area of the Angostura project
run by Colombian nationals and cooperatives. The largest of these, located at the south
end of the Angostura concessions, exploits the Malvinas Vein at a reported rate of 25 or
30 tonnes per day of ore from a small underground operation.
Ventana Gold Corp. (Ventana) has an option to acquire the La Bodega property
(Ventana Gold Corp., 2007) which immediately adjoins the Angostura property (Licence
P3451, Figure 3). Following surface and underground sampling programs and
magnetometer and induced polarization surveys programs pursuant to a Phase-1
exploration program recommended by Reeves.
Ventana reported in a December 22
2008,press release to have completed 101 diamond drill holes with a total length of 25 100
metres. Two mineralized areas have been identified, La Bodega Area, as an southwest
extension of the mineralization of Angostura project, and La Mascota area, parallel to La
Baja creek.. On November 7 2008 Ventana Gold Corp. was listed in the Toronto Stock
Exchange (TSX:VEN).
Some of the mineralization at Angostura extends onto the La Bodega property, and the
vendor and artisanal miners continue to extract gold ore from narrow veins on that
property.
Ventana also holds the California-Vetas property most of which is located well to the south
of the Angostura deposit, to the west of the municipality of Vetas. However, two small
parcels of concession 328-68 are located immediately to the east of the Angostura
deposit, and one of these partly underlies one of the waste dump areas selected as an
option by the feasibility study phase 1. Some areas of the concessions as 73-68, 3451,
145-68 and 13625 would be affected by the mining infrastructure, mainly by the internal
roads.
Small-scale mines at El Silencio, Mina el Diamante, Veta de Barro and Los Laches were
located on the Angostura property. From 2000 to 2002, in the period of absence of
Greystar from the area, illegal miners invaded many of the workings. These operations
were shut down in May 2003, prior to the illegal miners being able to claim any rights of
occupancy, although some attempts have persisted of entering the workings and
extracting ore from them until Greystar secured the area with a fence.
Page - 63 -
Several small operations are currently active along La Baja Creek draining the area to the
southwest toward the town of California.
16.
16.1
MINERAL PROCESSING AND METALLURGICAL TESTING

GENERAL REMARKS
Metallurgical test work on Angostura samples has been conducted by different laboratories
in several campaigns since 2000, including a detailed metallurgical testing program in
progress at contract laboratories in the US. This very extensive work has been conducted
on drill core samples and composites. The following information summarizes the general
remarks about the testwork carried out until now:
2480 intervals have been used for all metallurgical testwork (including current
testwork) representing all types of the identified minerals (oxides, transitionals,
intermediate sulphides, high grade sulphides) and 26 tonnes of bulk samples
representing oxides and transitionals have been shipped to McClelland
Laboratories for ROM (Run of Mine) heap leach evaluation testwork.
A total of 146 metallurgical composites and samples have been tested.
267 bottle roll tests, 145 column leach tests, 78 flotation tests, 10 mineralogy
analysis (including MLA) and 8 bio-oxidation tests have been carried out until now.
Other test work carried out includes crusher work index, abrasion index, Bond ball
work index, gold deportment, gravity concentration and roasting testing.
Early metallurgical testing was quite varied in scope, and ranged from general amenability
testing to detailed heap leach and flotation testing.
Results from the previous metallurgical testing and a scoping study conducted by Hatch
were used to arrive at a proposed combination of processing that includes heap leaching
of oxide, transitional and low grade (or intermediate) sulphide ore types, and flotation of
higher grade sulphide ore types. The current metallurgical testing program is more
systematic, and is focused primarily on optimizing these processing alternatives, as well as
evaluation of alternative processing methods for the lower grade sulphide ore types.
Page - 64 -
16.2
HISTORICAL TESTWORK
Metallurgical testwork has been conducted by various different contract laboratories and
has concentrated on the treatment of the ore by heap-leaching, milling/agitated leaching,
flotation and processing of flotation products.
A list of reports concerning metallurgy of the Angostura Project is presented in Table 5.
Table 5. Supporting Reports for Flowsheet Selection
Laboratory
Date
Report
Testwork
Newmont Metalurgical Services
Jan-00
Exploratory metallurical Study on Angostura Composites Progress Report
Bottle Roll Test
METCON Research, Inc.
May-05
Scoping Cyanide Column Leach Testing
Bottle Roll Test

Column Leach Test
Instituto de Minerales CIMEX
Jul-06
Metallurgical Study for the Gold Recovery from an Auriferous

Mineral, from California, Santander
Diagnostic Leaching
Bottle Roll Test /Column Leach Test
Flotation
Little Bear Laboratories
Dic-06
Biooxidation of Angostura Ore Samples
Biooxidation testing
G&T Metallurgical services LTD.
Ene-07
A Preliminary Assesmet of Metallurgical Response KM1836
Flotation
Mineral Liberatation Analysis
METCON Research, Inc.
Ene-07
Leaching and beneficiation Characterisitics of Gold Bearing

Vein Materials
Bottle Roll Test / Column Leach Test

Diagnostic Leaching
Flotation / Cyanidation of Rougher Conc
Hatch
Jul-07
Angostura NI 43-101 Independent Technical
Conseptual Report
SGS Lakefield Research Africa (Pty) Ltd
Ago-07
Mineralogical Characterization of a Rougher Flotation

Concentrate Sample from Angostura Colobia
XRD
SGS Lakefield Research Africa (Pty) Ltd
Ago-07
Flotation Testwork on a Gold Ore Sample from Angostura in

Colombia
Flotation
Tetratech and Kappes Cassidy
Apr-08
Angostura Direccional Study Final Report
Direccional Report
McClelland Laboratories
Oct-08
Angostura Gold Recovery Estimates
Column & Bottle Leach Tests, Flotation,

Roasting, Biooxidation, Comminution,
Recovery Model & Consulting
GRD Minproc
Nov-08
Trade Off Study
Flowsheet Selection
Of particular interest is the Hatch Scoping Study report, which includes a detailed
summary of metallurgical testing conducted before July 2007. Processing methods
selected in this Scoping Study for processing the Angostura ores incorporated a dual
circuit for separate processing of oxide/transitional and lower grade sulphide ore types,
and higher grade refractory sulfide ore types. A valley fill heap leaching of tertiary crushed
(nominal 19mm) ore was proposed for the oxide/transitional and lower grade sulphide ore
types. A milling/flotation circuit (nominal 106m feed size), with stirred tank biooxidation,
Page - 65 -
followed by agitated cyanidation treatment of the flotation concentrate was proposed for
the higher grade sulfide ores. Mention was also made of the potential for whole ore heap
biooxidation treatment of the refractory lower grade sulfide/transitional ores, but that
processing alternative was not part of the economic analysis conducted in the Scoping
Study.
Metallurgical testing programs reviewed by Hatch and used for estimating process design
criteria in the Scoping Study included primarily a detailed column leach testing program
conducted at Metcon Research (Tucson, AZ) in 2005/2006, a flotation testing program
conducted by G&T Metallurgical (Kamloops, B.C.) in 2006, and a whole ore biooxidation
testing program conducted at Little Bear Laboratories (Golden, CO). Additional earlier
testing programs were reviewed by Hatch in the Scoping study, but were of limited use for
determining the process design criteria.
Metallurgical testing conducted since the Hatch study include a flotation testing program
conducted by SGS Lakefield (South Africa) reported August 2007, a cyanidation and
flotation testing program conducted by CIMEX (Columbia) reported May 2008, and an
ongoing metallurgical testing program in progress at McClelland Laboratories Inc. (USA).
16.3
CURRENT TESTWORK
A more detailed metallurgical testing program is currently in progress at multiple

metallurgical testing laboratories, including McClelland Laboratories Inc. Results from this
current testing program are not complete, and consequently are included in the discussion
here only where available. Any references to available results from the current testing
program are excerpted from updates and progress reports, as formal reports have not yet
been issued for this testing program.
The major groupings of drill core composites evaluated during the current testing program
include:
Oxide (3 composites)
Transitional (3 composites)
Intermediate* Sulphide (30 composites)
High Grade Sulphide Ore Zone (5 composites)
High Grade Sulphide Ore Variability (36 composites)
Page - 66 -
Low Grade (3 composites)
Los Laches Zone (2 composites)
Comminution Rock Type (4 composites)
Additionally, master composites for testing are being prepared as required.
*Intermediate sulphides: low grade gold sulphides minerals.

The current testing involves detailed evaluation of the following:
Heap Leach Cyanidation oxide, transitional and intermediate sulfide ore types:
including optimization of processing parameters (feed size, cyanide concentration,
etc.), and further evaluation of ore variability, as well as required geotechnical and
environmental testing.
Milling/Cyanidation intermediate and high grade sulfide ore types: including

optimization of processing parameters (grind size) and further evaluation of ore
variability.
Flotation and Flotation Product Processing high grade sulfide ore type: including
optimization of processing parameters (grind size, reagents, pull weight, etc.),
evaluation of concentrate processing (biooxidation, shipping to smelter, roasting,
etc.) and tailings processing (agitated leaching or heap leaching).
Heap Bio-oxidation/Cyanidation intermediate sulfide ore type
Comminution Characteristics rock type composites
Environmental Characterization process residue samples generated from select

metallurgical testing.
Available testing results from the current testing program have generally been consistent
with those generated during earlier testing programs. The oxide, transitional and low grade
ore types have been confirmed to be amenable to simulated heap leaching treatment at
19mm feed size. Preliminary data indicate that the oxide ore types have shown
comparable gold recoveries when the crush size was coarsened to 38mm. Follow-up
testing currently being initiated will include evaluation of run-of-mine (ROM) heap leaching.
Other ore types have not yet been evaluated at coarser (than 19mm) feed sizes. The
intermediate sulfide ore types were varied in their response to heap leach cyanidation
Page - 67 -
treatment at the 19mm feed size, and work is in progress to obtain a better understanding
of the parameters controlling response to heap leaching of these ore types.
Milling/cyanidation treatment generally resulted in incrementally higher gold and silver
recoveries than obtained by heap leach cyanidation. Results from the GRD-Minproc trade
off study probably indicate that this processing option will not merit further consideration.
The sulfide ore types evaluated responded well to conventional flotation processing. The
flotation rougher concentrate generated from a master composite responded well to
roasting, followed by cyanidation of the roasted calcine. Combined cyanidation gold
recovery (including cyanidation of the calcine and flotation tailings) was approximately
85%. Detailed work is currently in progress to optimize roasting conditions, and determine
the possibility of improving this recovery. Stirred tank biooxidation testing is in progress on
flotation concentrate generated from the same master composite to confirm amenability to
this processing alternative.
Testing to evaluate processing of lower grade refractory sulphide ore types using heap
biooxidation pretreatment followed by heap cyanidation treatment is in progress.
Preliminary results indicate that heap bio-oxidation pretreatment has been effective for
improving gold recovery from the intermediate sulfide ore types by approximately 20%,
after 105 days of pretreatment. These tests are ongoing, so the ultimate improvement in
gold recovery has yet to be determined.
16.4
PROCESS SELECTION
Based on results from the Hatch Scoping study and GRD Minproc Trade Off studies, both
incorporating available metallurgical results at the time of the study, a two circuit process
flowsheet is currently being considered:
1.
Oxide, transitional and low grade sulphide ore types would be processed
using conventional valley-fill heap leach operation with tertiary crushing
(nominal 19mm feed size) of ore. ROM leaching was also considered as
an alternative in the Minproc study. Metallurgical testing is planned to
evaluate ROM leaching, but data are not currently available to support
that alternative.
2.
Higher grade sulphide ore would be treated by milling (nominal 106um

feed size)/flotation treatment. In the Hatch study, stirred tank biooxidation
Page - 68 -
treatment of the flotation concentrate, followed by cyanidation of the biooxidized concentrate was considered. In the Minproc study, a number of
processing options, including POX, stirred tank biooxidation and roasting
of the flotation concentrate were considered, with cyanidation of the
oxidized residue.
The same two general processing circuits, along with the possible shipping and treatment
of flotation concentrate at a smelter are also currently being considered. Detailed
metallurgical testing currently being conducted is designed to generate data sufficient for
final selection of the optimum processing option for the Angostura flotation concentrate.
Ongoing economic evaluation of the possible processing options requires estimation of
commercial processing parameters for the various alternatives, which are described in the
following sections.
16.5
COMMINUTION PARAMETERS
Bond ball work index early determinations were made by CIMEX Colombia and the current
comminution testwork is carried out by Phillips Enterprises and reported by McClelland
Laboratories. Bond ball mill work indices ranged from 11.0 to 15.8 kW-hr/t. For design
criteria the average value 14.5 kW-hr/t was used.
Crushed work index and abrasion index were also determined by Phillips Enterprises and
reported by McClelland Laboratories. Crusher work indices ranged from 2.2 to 12.1 kWhr/t, and averaged 7.3 kW-hr/t. For design criteria the 85% of the maximum value, 10.3
kW-hr/t was used.
Abrasion indices ranged from 0.0478 to 0.3509, average 0.1823. For design criteria the
85% of the maximum value = 0.298 was used.
16.6
HEAP LEACH PARAMETERS
A heap leach recovery model was estimated from current and previous testwork
developments and analysed, compiled and agreed upon by McClelland Laboratories, GRD
Minproc and Greystar.
The recovery model was issued on October 22, 2008 in the report: October 2008
Angostura Gold Recovery Estimates - Angostura Project - MLI Job No. 3252. Revisions in
this model, as compared to the model used in the Hatch Scoping Study are based on the
Page - 69 -
use of total sulphur, rather than sulphide sulphur, for estimating gold recoveries, and the
inclusion of additional test results from the current McClelland Laboratories testing
program. The gold recovery model was switched from sulphide sulphur in previous
evaluations to total sulphur in order to be consistent with the sulphur analyses available in
the drill sample database (total sulphur only).
The expected metallurgical parameters for heap leaching the Angostura ore are shown
below. A detailed description of these estimates, as well as corresponding estimates for
whole ore milling cyanidation treatment are found in the Angostura Gold Recovery
Estimates Memo (McClelland Oct 2008).
Heap Leach at 80% -19 mm Feed Size

Reagents (Kg/t)
Ore
Au Recovery
Ag Recovery
Category
NaCN
CaO
S (Total) < 3%
Au Recovery = -25.415 x [S (total)] + 109.349

with Maximun Au Recovery = 90%
54%
0.7
1.3
S (Total) > 3%
Au Recovery = 31%
34%
1.4
1.9
Heap leach parameters were based on results from the available metallurgical tests on
composites evaluated by cyanidation treatment at a 19mm feed size. Those results are
presented in Table 6. Table 6 includes all available current testing, and all "standardized"
testing conducted earlier by Metcon at a 19mm feed size.
Page - 70 -
Table 6. - Summary Gold Recovery Results, Angostura Ore Samples

Composite
Head Analysis
Au Recovery, %
Ag Recovery, %
19mm
19mm
El Diamante Oxide Zone
% S (tot)
0.77
% S=
0.43
CLT
87.7
BRT
69.2
CLT
50.2
BRT
49.1
La Alta Oxide Zone
0.81
0.55
91.0
88.4
65.2
72.5
La Perezosa Oxide
0.43
0.30
95.0
88.7
63.4
65.7
Nueva Alta Oxide
0.67
0.41
93.9
85.2
64.5
55.5
Silencio EW Oxide
0.61
0.43
85.9
74.7
57.6
44.8
Silencio NE (Oxide)
0.86
0.59
95.8
89.1
55.6
43.0
Veta de Barro Oxide
0.88
0.49
82.8
74.0
61.7
63.4
La Alta Transition
2.11
1.77
63.8
64.8
68.6
46.4
Silencio EW Transition
1.19
0.74
77.9
66.8
63.0
47.2
Veta de Barro Transition
1.86
1.79
80.7
76.2
49.3
67.7
El Diamante Sulfide
3.23
2.88
30.3
51.5
El Diamante Sulfide 200
3.74
3.38
12.3
32.7
La Alta Sulfide 1
3.80
3.49
27.6
30.6
La Alta Sulfide 200
4.18
3.93
17.5
26.9
La Perezosa Sulfide
4.20
3.74
39.2
Silencio EW (Sulfide 1)
2.44
2.14
37.8
50.8
63.4
29.0
52.5
Silencio NE (Sulfide 1)
6.90
6.77
33.9
46.2
34.6
35.5
Vein 12
5.80
5.37
30.7
43.5
15.8
26.7
Vein 354
3.25
3.14
62.2
73.1
64.5
77.3
Vein 21 & 22
5.45
5.02
44.9
42.9
33.2
45.9
38.9
33.3
28.3
29.1
Veta de Barro Sulfide 1
2.43
2.35
Zona Veta de Barro
2.82
2.68
36.7
HIS-01
2.18
1.68
28.8
32.7
HIS-02
3.11
2.60
33.6
30.8
HIS-03
3.81
3.36
28.2
32.6
HIS-04
2.11
1.46
27.2
30.4
HIS-05
3.40
2.66
44.7
43.8
HIS-06
4.42
3.72
22.7
18.9
HIS-07
5.41
4.49
17.4
28.4
HIS-08
2.86
2.33
29.8
41.4
HIS-09
2.98
2.52
29.8
35.0
HIS-10
4.46
3.58
32.0
45.5
HIS-11
6.47
5.57
27.0
32.3
HIS-12
3.12
1.61
42.5
27.0
HIS-13
4.10
1.37
69.5
19.8
HIS-14
3.06
2.37
25.6
24.8
HIS-15
2.32
1.96
35.2
25.8
HIS-16
3.06
2.37
40.5
63.1
HIS-17
3.03
2.38
27.0
24.0
HIS-18
3.10
2.55
22.1
16.7
HIS-19
4.78
3.20
28.7
25.0
HIS-20
6.26
4.57
14.4
23.1
HIS-21
4.28
2.20
41.0
35.5
HIS-22
4.33
2.65
17.9
30.5
HIS-23
6.53
3.15
14.1
31.1
HIS-24
2.02
1.61
27.6
37.6
HIS-25
2.38
1.93
20.0
20.6
HIS-26
3.06
2.37
24.4
31.0
HIS-27
4.35
3.28
24.5
30.3
HIS-28
6.25
4.44
17.6
B-01
2.47
1.89
34.9
31.5
39.1
32.6
B-02
3.84
3.22
31.3
23.6
31.9
31.6
Page - 71 -
39.6
16.7
16.7
FLOTATION AND OXIDATION CIRCUIT
A test program was conducted at G&T Metallurgical Services Ltd. in 2006 to evaluate the
flotation response of the Angostura transition and sulphide materials. Three composite
samples (one transition and two sulphide) were evaluated that were composited according
to their response to earlier flotation testing at Metcon Research. Additional testwork was
performed in 2007 at SGS Lakefield Research Africa (Pty) Ltd. on a single refractory
sulphide composite sample, which included sample material from nine different areas at
Angostura.
Confirmatory flotation testing has been conducted at McClelland laboratories on three
sulphide ore composites to verify earlier flotation testing, and to generate concentrate
product samples for further testing. Preliminary regrind/cyanidation testing and
roast/calcine cyanidation testing has been conducted on flotation concentrates. Agitated
cyanidation testing has been conducted on flotation tailings. Bulk flotation rougher
concentrate has been generated for detailed process alternative testing (bio-oxidation and
roasting).
Conclusions drawn from this testing includes the following:
Flotation gold recoveries approaching 90% or higher were obtained, with rougher
concentrate weight pulls of from 13% to 17%.
Cyanidation gold recoveries obtained by flotation, roasting of the flotation rougher

concentrate, cyanidation of the resulting calcine, and cyanidation of the flotation
tailings totalled approximately 85% of gold values contained in the ore.
Cyanidation of the flotation rougher tailings resulted in a significant incremental

improvement in gold recovery, and will be continue to be considered as a
processing option going forward. These incremental cyanidation recoveries were
equivalent to approximately 50% of gold values contained in the flotation tailings, or
5% - 7% of gold values contained in the ore.
Detailed flotation optimization and ore variability testing is also in progress.

Detailed testing for evaluation of processing alternatives for the flotation rougher
concentrate is also in progress.
Page - 72 -
17.
17.1
MINERAL RESOURCE ESTIMATION

INTRODUCTION
The current mineral resource estimate for the Angostura project was developed with the
help of a block model using the Datamine software package and was prepared by a
technical group as noted in Section 2.2. All drill-hole data available at the end of May
2008 have been included. The block model uses a regular cell size of 6.25 x 6.25 x 6.25
metres. The size of 6.25 metres was selected as the block size to get the selectivity
required for the Angostura deposit type, and because is an acceptable equipment size to
move huge tonnages. A Re-blocking to 8.75 meters was done as the second option, to
evaluate the impact in the selectivity. Metalica will use this two block models to make a
Trade Off between the two block sizes.
The Datamine software automatically creates fields in the block model file that reflect the
volume above the surface and below it, and also to define the limits of the oxidation. The
oxidation limit was created as a surface (DTM: Digital Terrain Model), from the information
of the oxidation zone in the drillholes. The DTM of the oxidation limit was created from
lines manually modeled in North South vertical sections.
17.2
GEOLOGICAL MODEL
The geological model developed by Greystar staff builds directly on the interpreted
geology of the Angostura deposit as detailed in Section 9. Much of the interpretation
process was iterative, conducted in plan and sectional view, and in three-dimensional
space utilizing the projection capabilities of the Datamine software and continuing and
adjusting the interpretation that has been ongoing for a number of years. The process was
exhaustive and thorough and has resulted in the identification of more than 195 individual
vein structures. Given the complexity of the structural setting with veins striking in different
directions in the same area in many cases, the current model is the best that can be
expected.
In contrast to models created until 2007, where the interpreted veins or vein systems were
labeled individually and wire-framed, the January 2008 and the current models have used
the wireframes solely for the purpose of creating structural trend surfaces that follow the
interpreted veins and the bulk mineralization throughout the deposit. The trend surfaces
guide the direction of the three axes of the search ellipsoid used for grade interpolation on
Page - 73 -
a local scale and assure that the structural influence on the grade interpolation is
preserved. This more open concept of grade interpolation allows some of the grade
information surrounding the interpreted veins to be incorporated into the grade
interpolation. An example of the structural trend surfaces is in Figure 12.
As a result of this approach, the concept of disseminated mineralization outside of the
wireframes used in the 2007 and earlier resource models was also abandoned. This is
reasonable, given the generally good drill hole coverage and spacing.
Based on the structural trends observed in surface and underground mapping, and
interpreted from drill-hole information, the deposit was divided into six structural domains,
also shown on Figure 12. From north to south they are identified as the Cristo Rey, the
Veta de Barro and Veta de Barro East, the Central, the Perezosa and Silencio domains.
Each of these domains was considered as a separate entity for grade statistics and grade
interpolation, but some were later treated as collectives based on their structural, statistical
or variography similarities.
17.3
LOW-GRADE AND HIGH-GRADE POPULATIONS AND THEIR STATISTICS
One of the major challenges for a realistic resource grade estimate at Angostura has been
the treatment of a high-grade assay population that clearly has a much shorter range of
predictability than the low-grade population within which it occurs. To limit the influence of
higher-grade intersections at Angostura, shoots had been constructed in previous
resource estimates around each such intersection, projecting the high-grade mineralization
up to a maximum distance of 20 metres along the interpreted strike direction from the point
of information and up to 60 metres down-dip, with the dimensions chosen derived from the
relatively sparse and not necessarily representative vein variography. With the continued
addition of high-grade intersections due to the increased drill-hole coverage, this approach
had become impractical, and a different method had been developed for the 2007
estimate. This has proven to be workable and was continued for the current estimate.
In an initial step, all high-grade intersections are identified individually and given a unique
code that reflects the drill hole and the status of the intersection as high-grade. In
general, a threshold of 5 g/t gold over 1.25 metres or equivalent grade-thickness product if
shorter was used to identify high-grade intersections, but this was adjusted, up or down, to
suit local circumstances. In the central part of the deposit, where the overall grade is
higher, the threshold grade was increased, while in areas where the low grade
Page - 74 -
mineralization rarely reaches 1.5 or 2 g/t , the threshold grade was lowered to around 3 g/t
over 1.25 metres.
The remaining assay data not identified as high-grade forms the low-grade population.
Page - 75 -
Page - 76 -
For statistical purposes, the high-grade and low-grade populations were further subdivided into Veta de Barro East (which includes the Cristo Rey structural domain), Veta
Barro and Main areas, the latter including the Central, Perezosa and Silencio structural
domains.
Basic statistics were established using 1.25-metre down-hole composites for each of the
assay populations, with the results tabulated in Table 7.
Table 7 Gold Assay Statistics of 1.25-metre Composites
Main Area
Veta de Barro East
Veta de Barro West
Low Grade Composites

Number of
composites
182,727
25,157
14,149
Length (metres)
227,918
31,398
17,657
Cap (g/t)
3.8
4.1
3.7
Number of capped
(percentile)
342 (99.8%)
9 (99.9%)
23 (99.9%)
Gold Removed
0.7%
0.04%
0.3%
Mean
(g/t)
SD
(g/t)
CV
Mean
(g/t)
SD
(g/t)
CV
Mean
(g/t)
SD
(g/t)
CV
Uncaped
0.30
0.57
1.9
0.20
0.42
2.1
0.22
0.43
2.0
Capped
0.30
0.47
1.6
0.20
0.42
2.1
0.22
0.42
1.9
High Grade Composites

Number of
composites
2,874
304
223
Length (metres)
3,275
351
253
Cap (g/t)
65
90
NO CAP
Number of capped
(percentile)
28 (99%)
7(97.9%)
N/A
Gold Removed
4.1%
9.6%
N/A
Mean
(g/t)
SD
(g/t)
CV
Mean
(g/t)
SD
(g/t)
CV
Mean
(g/t)
SD
(g/t)
CV
Uncapped
10.7
13.9
1.3
14.81
23.5
1.6
12.4
24.4
2.0
Capped
10.3
9.8
1.0
13.51
15.5
1.1
N/A
N/A
N/A
Page - 77 -
During compositing, composites less than one-half the composite length were discarded.
To avoid the discard of a high-grade intersection, a minimum core length of 0.65 metres
was established during the high-grade interval selection process by adding adjacent lowgrade mineralization as required. Unused composite tails are not a problem for the much
more frequent low-grade mineralization.
Note that for the evaluation of the low-grade population, a lower cut-off grade of 0.05 g/t
was applied to exclude the very large number of waste composites from this population.
Compositing uses length-weighted grade averaging, and the changes in bulk density as a
function of gold grade (Section 14.4) are largely accounted for by the split into the two
grade populations.
To guard against any low-grade bias introduced by high core losses, core assays from
intervals with less than 70% core recovery had previously been factored by the actual core
recovery. Given the findings presented in Section 12.2, this has been discontinued
starting with the June 2006 resource estimate, but assays from sample intervals with a
core recovery of 10% or less have not been used for resource estimation (0.05% of the
total length).
Capping levels were determined for each population by evaluating frequency distribution
and logprobability diagrams, and the values chosen, and their effects, are also shown in
Table 7. The individual populations generally have a good statistical behaviour, with
reasonable to excellent CV values, and capping was limited.
In addition to the data summarized in Table 7, there are 637 muck samples that fall within
the various veins in the Main Area and were used for the resource estimate. Their mean
gold grade is 0.58 g/t with a SD of 0.78 g/t and a CV of 1.3. Capping of high-grade values
contained in this population was not required. Channel samples taken recently along both
walls of the some of the underground openings indicate that the muck samples may be
biased high, and future resource estimates should use the channel sample results as
discussed in Section 12.4. Surface channel sampling to replace the existing surface
samples is ongoing and will be incorporated into the next resource estimate.
The silver and copper values of the high-grade and low-grade composite populations were
similarly investigated, and capping levels determined as summarized in Table 8.
Page - 78 -
Table 8 Silver and Copper Assay Statistics of 1.25-metre Composites

Main Area
Ag (g/t)
Cu (%)
Veta de Barro East
Veta de Barro West
Ag (g/t)
Cu (%)
Ag (g/t)
Cu (%)
Low Grade Composites

Cap
260
2.25
100
0.55
115
0.15
Mean Grade Uncapped
2.3
0.02
1.4
0.01
1.5
0.01
Mean Grade Capped
2.3
0.02
1.4
0.01
1.4
0.01
High Grade Composites

Cap
340
3.40
300
1.1
300
No Cap
Mean Grade Uncapped
39.2
0.19
47
0.14
50
Mean Grade Capped
36.9
0.19
41
0.13
41
The capped 1.25-metre composites were used to calculate six and twenty five metre
composites employed for the interpolation of the low-grade mineralization, while the highgrade interpolation used the capped 1.25-metre composites to create vein composites with
a maximum length of ten metres.
17.4
HIGH-GRADE PROBABILITY INTERPOLATION
Instead of constructing physical shoots to model and constrain the high-grade assay
population as had been attempted in earlier resource estimate, a probability approach had
been introduced in 2006 and was continued, with some changes, for the current resource
estimate. For this purpose, each 1.25-metre composite assigned to the high-grade
population was given a value of one, i.e., the high-grade probability indicator is 100%,
while each low-grade sample interval was assigned a value of zero (0% high-grade
probability). Variography was undertaken on the probability data for each of the structural
domains described in Section 17.2. The results are summarized in Table 9.
Page - 79 -
Table 9 Variography Results, High-Grade Probability Indicator

Variogram Ranges (metres)
Structural Domain
Radii Used for Indicator

Interpolation (metres)
Along-Strike
Down-Dip
(75% range)
(75% range)
65
45
45
75
75
55
55
Veta de Barro West
60
60
45
45
Perezosa
80
80
60
60
Central
88
120
65
110
Silencio
70
70
50
50
Along-Strike
Down-Dip
Cristo Rey
65
Veta de Barro East
All of the domains had isotropic results except for the Silencio domain. The probability to
contain high-grade mineralization was then interpolated for each block. The actual radii
used for the indicator interpolation were generally set at 75% of the variography ranges to
guard against overprojection of the high-grade indicators. The long and intermediate axes
of the search ellipsoids were forced to follow the structural trend surfaces described in
Section 17.2 (a floating ellipsoid). Experimentation with the interpolation technique for
the probability indicator estimate resulted in the selection of inverse distance to the twelfth
power [ID12] for the probability indicator estimate. A typical example of the results of this
interpolation is shown in Figure 13.
The high-grade probability indicator estimated for each block is directly translated into a
volume percentage of high-grade mineralization within the block, with the remainder
occupied by low-grade mineralization.
Page - 80 -
Figure 13 Example of High-Grade Probability Interpolation
Figure 13 shows a vein in the Los Laches Area approximately on section 131 900 E
(Looking southwest). Blocks with zero indicator probability are not shown. Some deviation
on a local scale of the search ellipsoid and the structural trend surface from the actual
attitude of the high-grade mineralization is apparent.
17.5
GOLD-GRADE VARIOGRAPHY
Variography of the gold grade distribution was undertaken for each of the structural
domains described in Section 17.2. The main purpose was to quantify distances for the
two types of mineralization in each structural domain. For the high-grade and low-grade
populations, five-metre composites were used to perform the variography, reducing the
investigation to two dimensions (strike and dip). An angular tolerance of 15 (up to a
maximum distance of 30 metres) was introduced to assure enough data pairs. The results
are summarized in Table 9 separately for the low-grade and for the high-grade
populations.
Page - 81 -
Table 10 Gold Grade Variography

Variogram
Variogram
Structure
Model
Variogram
()
Strike and Dip

Range (metres)
Low Grade Population
Cristo Rey
Veta de Barro
West
Veta de Barro
East
Perezosa
Central
Silencio
First
Nugget
0.64
Second
Spherical
0.32
37.5
Third
Spherical
0.14
100
First
Nugget
0.54
Second
Spherical
0.24
35
Third
Spherical
0.13
125
First
Nugget
0.07
Second
Spherical
0.05
50
Third
Spherical
0.05
125
First
Nugget
0.07
Second
Spherical
0.06
30
Third
Spherical
0.02
125
First
Nugget
0.34
Second
Spherical
0.11
45
Third
Spherical
0.10
150
First
Nugget
0.07
Second
Spherical
0.03
40
Third
Spherical
0.04
100
High Grade Population

Poor and insufficient data
Cristo Rey
Veta de Barro
First
Nugget
0.32
Veta de Barro
First
Nugget
0.19
East
Second
Spherical
0.16
First
Nugget
0.16
Second
Spherical
0.13
First
Nugget
0.12
Second
Spherical
0.13
First
Nugget
0.22
West
Perezosa
Central
Silencio
Page - 82 -
30
30
40
The high-grade probability indicator estimated for each block is directly translated into a
volume percentage of high-grade mineralization within the block, with the remainder
occupied by low-grade mineralization.
The variography analysis shows that the gold-grade distribution isotropic, or the anisotropy
is not large. While this conclusion applies to both populations, it is more robust for the lowgrade population because of the larger quantity of data.
For the low-grade population, a shorter range is in the order of 35 to 50 metres, while a
larger range is from 100 to 150 metres, with the nugget effect ranging from 50% to 60% of
the data variance. The data available for the high-grade population gives ranges of around
30 metres or a pure nugget effect, depending on the structural domain.
A test was undertaken in the Perezosa II tunnel on the 2850 level, which was designed to
measure the impact of the drill density on the tonnage and the contained gold of the highgrade and low-grade populations. For this test, an area 315 by 230 metres was drilled on a
regular 12.5-metre pattern by 95 flat north-south totalling 13,752 metres collared from the
tunnel. The height of the test box was set at 20 metres, centred on the 2850 level.
Resources were estimated for the test box at decreasing drill spacing, and the results,
which are stated at a cut-off grade of 0.4 g/t and 0.55 g/t gold for oxides and sulphides
respectively, are shown in Table 11.
Table 11 Test Box Resource Estimates at Different Drill-Hole Spacing
Drill-Hole Spacing (metres)
Tonnes
Gold (g/t)
Gold (ounces)
50
4,060,916
1.12
146,385
25
4,027,140
1.32
170,637
12.5
4,101,650
1.31
173,282
Going from 50 metre spacing to 25 metre spacing, there is 17.5% increase in gold grade
and a 16.6% increase in contained ounces, while the tonnage increased slightly by 0.8%.
The almost identical results between the 12.5 and 25 metre spaced programs suggest that
there appears to be no significant benefit to drilling at a tighter separation than 25 metres.
The important conclusion from this test is that the higher-grade structures require drilling at
25 metres, and this distance confirms the variography results summarized in Table 10.
Page - 83 -
17.6
GRADE INTERPOLATION
The grade interpolation used the full vein composites for the high-grade assay population,
and the 6.25 metre composites for the low-grade assay population. Gold, silver and copper
grades were interpolated for each individual block by a simple inverse-distance squared
algorithm (ID2). A control interpolation using ordinary kriging gave similar overall results,
but a higher local estimation variance when compared to the actual composite grades.
The high-grade and the low-grade assay populations were estimated separately using
different interpolation parameters and search distances along strike and down-dip as
derived from the results of the variography described in Section 17.5 above. For each of
the two grade populations, only composites from the population being interpolated could
be used.
The first-pass interpolation for the high-grade population used search distances equal to
one-half of the distances shown in the two right columns in Table 8 for the two long axes,
and 6.25 metres for the short axis. During the second pass, the strike and dip search
distances were doubled (but the width was unchanged), and some of the other constraints
were also relaxed. For the grade interpolation of the low-grade population, the first pass
used a search ellipsoid of one-half of the third-structure ranges in Table 10, and again the
strike and dip distances were doubled for the second pass.
After several trial runs with different interpolation parameters, the mineral resources for
the Angostura deposit were estimated using the search parameters summarized in Tables
12 and 13. The evaluation of the trial interpolation parameters was mainly based on the
visual inspection of the resultant block grade patterns, the degree to which local grade
information was honored, and what projection distance of the high-grade mineralization
appeared defensible in light of the known geology and grade distribution within the deposit.
Page - 84 -
Table 12 Grade Interpolation Search Distances

First Pass Interpolation
Second Pass Interpolation
Search Radius (metres)
Search Radius (metres)
Along
Across
Down -
Along
Across
Down -
Strike
Strike
Dip
Strike
Strike
Dip
Low Grade
50
6.25
50
100
6.25
100
High Grade
22.5
6.25
22.5
45
6.25
45
Veta de Barro
Low Grade
62.5
6.25
52.5
125
6.25
125
West
High Grade
22.5
6.25
22.5
45
6.25
45
Veta de Barro
Low Grade
62.5
6.25
62.5
125
6.25
125
East
High Grade
27.5
6.25
27.5
55
6.25
55
Low Grade
62.5
6.25
62.5
125
6.25
125
High Grade
30
6.25
30
60
6.25
60
Low Grade
75
6.25
75
150
6.25
150
High Grade
32.5
6.25
55
65
6.25
110
Low Grade
50
6.25
50
100
6.25
100
High Grade
25
6.25
25
50
6.25
50
Cristo Rey
Perezosa
Central
Silencio
Table 13 Composite Utilization during Grade Interpolation

Composite
Length
(metres)
Low Grade
High Grade
6.25
Vein Composite
(max. 10 m)
First-Pass Interpolation
First-Pass Interpolation
Number of Composites
Number of Composites
(Drill holes) Used
(Drill holes) Used
Minimum
Maximum
Minimum
Maximum
(1)
NR
(NR)
(1)
NR
(NR)
(1)
(5)
(1)
(5)
NR = no restriction
Blocks that were not estimated after the second run remained without a grade estimate
and are thus not included in the current resource statement. The extent of the high-grade
interpolation was further constrained by the introduction of a thirty-metre limit around each
drill hole, beyond which the high-grade probability was set to one-fifth of its original value,
and to zero if the block was at the edge of the existing drill-hole coverage. This has the
Page - 85 -
purpose of restricting high-grade mineralization being extended too far beyond single highgrade intersections.
In general, silver, sulphur and copper grades were interpolated similar to gold for the lowgrade population, except that the search ellipsoid for calcium and sulphur was enlarged to
200 by 20 by 200 metres. Where this search proved insufficient for sulphur in the oxide
zone because of the lack of sulphur data in holes drilled in 1999 and earlier years, a 200metre spherical search was used.
Snowden (2005b) have demonstrated that the gold grades and their distribution in the
oxide and sulphide zones are quite similar. The boundary between the two zones was thus
left transparent during gold grade interpolation, as it was for silver, calcium and copper.
For sulphur, the boundary was opaque.
As a result of the two-stage interpolation, each original 6.25 m by 6.25 m by 6.25 m block
contains the following information:
1.
The location of the block in space.
2.
A designation of the structural domain in which the block resides.
3.
A designation of whether the block is located in the oxide or sulphide zone.
4.
Azimuth and dip of the floating ellipsoid (Section 17.2).
5.
The probabilities for high-grade and low-grade mineralization obtained during the
probability indicator interpolation described in Section 17.4.

6.
The volumes for each of the contained low-grade and high-grade mineralization
reflecting the results of the high-grade probability interpolation.

7.
A density value for each of the two volumes depending on the gold grade (Section
14.4).
8.
Interpolated gold grades for each of the low-grade population and the high-grade
population.
9.
Interpolated grades for silver, copper, sulphur.
10.
A calculated overall tonnage as well as grades for all elements.
11.
The classification of the total block in accordance with the procedures described in
Section 17. 7.
Page - 86 -
The near-surface grade information from the artisanal tunnels, biased high because the
drifts follow higher-grade mineralization, was not considered for the general grade
interpolation. The tonnage and grade supported by these tunnels was estimated
polygonally to a vertical distance of 50 metres above and below the tunnel elevation and
amounts to some 175 000 tonnes at an average grade of 5.9 g/t gold, a small proportion of
the total.
17.7
RESOURCE CLASSIFICATION
The two interpolation passes summarized in Tables 12 and 13 were used as a primary
tool to classify the individual blocks. If a block was estimated during the first pass, it was
classified as either measured or indicated, if it was estimated during the less constrained
second pass, it was classified as inferred. In addition to having been interpolated during
the first pass, the assignment to the measured class for the high-grade material required
estimation with data from three or more drill holes. For the low-grade material to be
assigned the measured class, information had to be used from four or more drill holes
during the first pass.
There are a number of instances where the low-grade tonnage of a block has a higher
classification than the high-grade tonnage in the same block. In these cases, the majority
of the contained ounces of gold in each tonnage determined the block classification
(Majority Rule). Since the high-grade population contributes a larger proportion of
contained gold than corresponds to its volume, and since the search distance of the highgrade is also more restricted (i.e., the high-grade ounces tend to have a lower resource
class), application of the majority rule favours a lower classification. This is also the case
during re-blocking (described in the next section) and was particularly obvious for the
measured category, which attained an overall lower grade as a result.
Variations in structural geology and grade continuity between the newly-introduced
structural domains have been taken into account, and the interpolation distances for the
measured and indicated classes of resources are based on variography results in each
domain (Section 15.5). The classification is in accordance with the requirements of NI 43101 as formulated by the latest CIM Definitions and Standards on Mineral Resources and
Mineral Reserves (adopted by CIM Council December 11, 2005), that read in part as
follows:
Page - 87 -
A Mineral Resource is a concentration or occurrence of ... base and precious metals ...
in or on the Earths crust in such form and quantity and of such a grade or quality that it
has reasonable prospects for economic extraction. The location, quantity, grade,
geological characteristics and continuity of a Mineral Resource are known, estimated or
interpreted from specific geological evidence and knowledge.
A Measured Mineral Resource is that part of a Mineral Resource for which quantity,
grade or quality, densities, shape, and physical characteristics are so well established that
they can be estimated with confidence sufficient to allow the appropriate application of
technical and economic parameters, to support production planning and evaluation of the
economic viability of the deposit.
An Indicated Mineral Resource is that part of a Mineral Resource for which quantity,
grade or quality, densities, shape, and physical characteristics can be estimated with a
level of confidence sufficient to allow the appropriate application of technical and economic
parameters, to support mine planning and evaluation of the economic viability of the
deposit.
An Inferred Mineral Resource is that part of a Mineral Resource for which quantity and
grade or quality can be estimated on the basis of geological evidence and limited sampling
and reasonably assumed, but not verified, geological and grade continuity.
The mineral resources estimated for the Angostura deposit and disclosed in this
technical report are not mineral reserves.
17.8
DECEMBER 2008 UNCONSTRAINED ANGOSTURA MINERAL RESOURCE
ESTIMATE
The results of the December 08, 2008 mineral resource estimate for the Angostura project
are shown in plan and section in Figures 14, 15 and 16 and are summarized in Table 14
for regular blocks of 6.25 m by 6.25 m by 6.25 m, and unconstrained by any pit shell. The
estimate of the mineral resources constrained by an open pit developed by Metalica as
part of the feasibility study phase 1, will be reported in Section 17.10.
Page - 88 -
Page - 89 -
Page - 90 -
Table 15 Comparison with the Unconstrained December 2007 Estimate

-millions of tones and contained ounces of goldTonnes
Au
Au
Ag
(g/t)
(oz)
(g/t)
Tonnes
Au
Au
Ag
(g/t)
(oz)
(g/t)
December 2007 Estimate

(block size: 5 m, and minimum subcell size 1.25m)
Measured & Indicated Mineral Resources
Oxide
57.9
1.1
2.0
8.7
1.6
0.3
10
Sulphide
176.4
1.4
8.2
71.0
1.4
3.1
Total
234.3
1.4
10.2
77.7
1.4
3.4

(block size: Regular, 6.25 m)
Oxide
60.0
1.0
2.0
4.7
1.6
0.2
11
Sulphide
177.9
1.4
8.2
62.7
1.4
2.9
Total
237.9
1.3
10.2
67.4
1.4
3.1
Note: Cut off grades of 0.4 g/t and 0.55 g/t gold for oxides and sulphides respectively
However, the current estimate uses a somewhat different approach as discussed in detail
in the preceding sections. The main differences are the change of the block size from 5
metres (minimum cells of 1.25 m) to regular 6.25 metre in the three dimensions. The
Table 15 compares the estimations of December 2007 and December 2008. The effect of
the new 6.25 metres block size is a small reduction in the gold grades, and in the ounces
at cut off grades of 0.4 g/t and 0.55 g/t gold, because the dilution obtained with the
increase of the block size.
There are several reasons for the differences of the two estimates. The drill and assay
database available for the current estimate has been augmented by additional information
compared to that available a year ago (Table 2). The cut off grades where changed from
0.4 g/t Au to 0.3 g/t Au for oxides and from 0.55 to 0.45 for sulfides.
Page - 93 -
Table 14 Estimate of Unconstrained Mineral Resources

Measured Mineral Resources
Au
Cut off
grade
(g/t)
Tonnes
Oxides
0.3
49,620
Sulfides
0.45
Tonnes
Ag
(oz,
1,000
)
(g/t)
0.63
1,007
37,246
1.05
99,280
0.86
2,729
144,760
148,900
0.78
3,736
182,006
(1,000)
TOTAL
Au
Ag
Au
(g/t)
Measured & Indicated Mineral

Resources
(1,000)
Au
(g/t)
(oz,
Tonnes
Au
(g/t)
Au
Ag
(oz,
1,000)
(g/t
)
(g/t
)
(1,000)
1,258
86,867
0.81
2,265
1.41
6,555
244,040
1.18
9,284
1.34
7,813
330,907
1.09
11,549
1,000
)

Au
Ag
(oz,1000)
(g/t)
1.33
266
84,539
1.18
3,205
90,779
1.19
3,472
Cut off
grade (g/t)
Tonnes
(1,000)
Au (g/t)
Oxides
0.3
6,241
Sulfides
0.45
TOTAL
The cut off grades used have been changed from 0.4 g/t for oxide resources and 0.55 g/t
for sulphide resources used in previous estimates. The lower cut-off grades reflect a
higher gold price of $ 650 per ounce than the $ 500 per ounce used previously, and a
more detailed discussion of the choice of cut-off grades is in Section 17.11.
Greystar published the last unconstrained mineral resource estimate for the Angostura
project one year ago in December 2007 (Greystar, 2007). This estimate constituted an
update of the resource estimate used for the Hatch 2007 Scoping Study and is described
in detail in a Technical Report of January 2008 (Strathcona 2008).
Page - 92 -
Table 15 Comparison with the Unconstrained December 2007 Estimate

-millions of tones and contained ounces of goldTonnes
Au
Au
Ag
(g/t)
(oz)
(g/t)
Tonnes
Au
Au
Ag
(g/t)
(oz)
(g/t)

(block size: 5 m, and minimum subcell size 1.25m)
Oxide
57.9
1.1
2.0
8.7
1.6
0.3
10
Sulphide
176.4
1.4
8.2
71.0
1.4
3.1
Total
234.3
1.4
10.2
77.7
1.4
3.4

(block size: Regular, 6.25 m)
Oxide
60.0
1.0
2.0
4.7
1.6
0.2
11
Sulphide
177.9
1.4
8.2
62.7
1.4
2.9
Total
237.9
1.3
10.2
67.4
1.4
3.1
Note: Cut off grades of 0.4 g/t and 0.55 g/t gold for oxides and sulphides respectively
However, the current estimate uses a somewhat different approach as discussed in detail
in the preceding sections. The main differences are the change of the block size from 5
metres (minimum cells of 1.25 m) to regular 6.25 metre in the three dimensions. The
Table 15 compares the estimations of December 2007 and December 2008. The effect of
the new 6.25 metres block size is a small reduction in the gold grades, and in the ounces
at cut off grades of 0.4 g/t and 0.55 g/t gold, because the dilution obtained with the
increase of the block size.
There are several reasons for the differences of the two estimates. The drill and assay
database available for the current estimate has been augmented by additional information
compared to that available a year ago (Table 2). The cut off grades where changed from
0.4 g/t Au to 0.3 g/t Au for oxides and from 0.55 to 0.45 for sulfides.
Page - 93 -
17.9
RE-BLOCKING
Re-blocking of the Angostura resource estimate from the original smaller block size to a
larger block size to incorporate dilution and mining losses into the block model had been
undertaken for the December 2007 estimate, increasing the block size from 125 cubic
metres to 1000 cubic metres (ten-metre blocks). At the cut-off grades used for the
December 2007 estimate, this had resulted in a gold grade reduction of about 10%, and a
reduction of the contained gold by about 7% (Strathcona 2008, page 78). Ten-metre
benches had also been used by the Hatch 2007 Scoping Study.
SRK Minproc have studied the question of the size of the smallest mining unit (SMU) for a
possible Angostura open-pit mining operation and have concluded that 8.75-metre blocks
are the maximum SMU possible. The evaluation of the mining equipment size was made
to obtain the SMU that could be used, obtaining that block sizes 6.25 metres and 8.75
metres can address the magnitude of work required to achieve good selectivity. Metalica
is currently conducting trade-off studies on two SMU sizes, 6.25 metres (the block size of
the current resource estimate), and 8.75 metres as proposed by SRK. Given these
ongoing studies, Table 16 compares the two estimates for the measured and indicated
resource categories, at cut-off grades of 0.3 g/t gold for oxides and 0.45 g/t gold for
sulphide material. Both estimates are constrained by the Metalica pit.
the majority of the contained ounces of gold in each tonnage determined the block
classification (Majority Rule). This majority rule is applied in the re-classification during
the re-blocking.
To illustrate the effects of the re-blocking in particular areas, Figure 17 compares the 6.25metre and 8.75-metre block models for one area at level 2 850 m, in the Perezosa area.
Figure 18 shows the change in classification as a result of re-blocking for one area to the
north of the area compared in the Figure 17, but at the same level 2 850.
Page - 94 -
Figure 17 Re-blocking Results. Gold Grade Comparison between 6.25 and 8.75 m
Blocks.
6.25 m block
8.75 m block
Page - 95 -
Figure 18 Re-blocking Results. Resource Classification Comparison between 6.25

and 8.75 m Blocks.
6.25 m block
8.75 m block
Page - 96 -
The re-blocking has induced a gold grade reduction as seen in the Figure 17. The reclassification with the re-blocking has caused small changes generating more
homogeneous areas.
Table 16 Effect of Re-Blocking, Measured & Indicated Resources
millions of tonnes and millions of ounces
6.25 m by 6.25 m by 6.25 m

Tonnes
(Mt)
(Au (g/t)
Au (Koz)
8.75 m by 8.75 m by 8.75 m

Tonnes
(Mt)
(Au (g/t)
Au (Koz)
Oxide
86.9
0.81
2.3
92.4
0.74
2.2
Sulphide
244.0
1.18
9.3
259.8
1.06
8.8
Total
330.9
1.09
11.6
352.1
0.98
11.0
Identical cut-off grades are used in Table 16 for both sets of resources (0.3 g/t gold for
oxide and 0.45 g/t gold for sulphide resources). The re-blocking results in a grade
reduction by about 10%, and a smaller increase in the diluted tonnage, since some lowgrade blocks have fallen below the cut-off grade due to added dilution during the reblocking process. As a result, there is an overall loss of contained gold of about 5%. Reblocking also results in a partial re-classification by the application of the majority rule
explained in Section 17.7.
17.10
DECEMBER 2008 CONSTRAINED ANGOSTURA MINERAL RESOURCE
ESTIMATE
To satisfy the requirement that mineral resources have reasonable prospects for
economic extraction, that portion of the unconstrained regular 6.25 metre resource
estimate as of December 1, 2008 that is enclosed in the open-pit designed by Metalica
(2008).
The resources using three different sets of cut off grades for oxides and for
sulfides is summarized in Table 17.

Metalica obtained the pit using the software Whittle as part of the feasibility study phase 1,
with the following parameters for the pit optimization; obtained from the information
provided by GRD Minproc, Metalica and McClelland laboratories, as part of the studies of
the feasibility study phase 1.
Page - 97 -
Block Model Size
6.25 m x 6.25 m x 6.25 m
Mining Cost
1.2
Heap Leaching Process Cost
2.39 US$/t (70,000 ktpd)
Milling Flotation Process Cost
20.73 US$/t (4.25 ktpd)
Gold Selling Price
650
Gold Selling Royalties(3.2% gold price)
20.8 US$/oz
Gold Selling Costs (1% gold price)
6.5
US$/oz
Silver Selling Price
9.0
US$/oz
Silver Selling Royalties(3.2% gold price)
0.29 US$/oz
Silver Selling Costs (1% gold price)
0.09 US$/oz
Pit Wall Slope
43
Heap Leach Metallurgical Recoveries: Gold (RAu_HL) and Silver (RAg_HL):
US$/t
US$/oz
Au
If S < 3%
RAu_HL = -25.415 x %S + 109.349;
mx. 90%
Au
If S>= 3%
RAu_HL = 31%
Ag
If S < 3% RAg-HL = 54%; If S 3% RAg_HL = 34%
Flotation + Concentrate Processing Metallurgical Recoveries: Au (RAu_F) and

Ag(RAg_F):
RAu_F = 81%
RAG_F=45%
Page - 98 -
Table 17 Angostura Mineral Resource Estimate, December 1, 2008, 6.25 metre

blocks and Constrained by Preliminary Metalica Pit.
Sulfides
Cut off
grades Au
(g/t)
Oxides
Total
Tonnes
(1000)
Au
(g/t)
Ag
(g/t)
Tonnes
(1000)
Tonnes
(1000)
Au
(g/t)
Ag
(g/t)
Au (oz,
1000)
Tonnes
(1000)
Au
(g/t)
Ag
(g/t)
Au (oz,
1000)
133,863
1.5
6,365
61,391
1.1
2,160
195,254
1.4
8,525
156,984
1.3
6,717
88,263
0.9
2,460
245,247
1.2
9,177
185,005
1.2
7,100
127,070
0.7
2,768
312,075
1.0
9,868
Oxides 0.4
Sulfides 0.5
Oxides 0.3
Sulfides 0.45
Oxides 0.2
Sulfides 0.4
17.11
DISCUSSION OF CHOICE OF CUT-OFF GRADES
Reviewing the operating costs presented by Hatch, and a gold price of $650 per gold
ounce, a reduction of the cut off grades from 0.4 to 0.3 g/t Au for oxides and from 0.55 to
0.45 g/t Au, is now considered appropriate, if is considered that the incremental cut-off
grades calculate to less than 0.2 g/t for oxide material and 0.4 g/t for sulphides,
respectively, below the figures of 0.3 g/t for oxide and 0.45 g/t for sulphide as used to
report the unconstrained resource(Table 14).
The pit optimization developed by Metalica using the parameters described above,
obtained the blocks within the pit that paid for either heap leach or the flotation processes.
The population of the blocks that paid the heap leach process was used to obtain a
histogram of the gold grades with positive economic return. This is necessary because the
metallurgical recovery depends of the gold grade, silver grade and the sulphur content.
The histograms of the gold values of the economic blocks for heap leach process for
oxides and sulphides are shown in the Figures 19 and 20. The histogram of the gold
grades of the waste blocks in the sulphides zone is showed in the Figure 21.
Page - 99 -
Figure 19 Histogram of Gold Grade of the Oxidized Blocks within Metalica Pit,
Paying Heap Leach Process.
Oxides Cut off

0.3 g/t gold
Figure 20 Histogram of Gold Grade of the Blocks of Sulphides within Metalica Pit,
Paying Heap Leach Process.
Sulphides Cut off

0.45 g/t gold
Page - 100 -
Figure 21 Histogram of Gold Grade of the Waste Blocks of Sulphides within

Metalica Pit
Sulphides Cut off

0.45 g/t gold
The cut off grades selected for the resources reporting in oxides and sulphides, 0.3 g/t and
0.45 g/t gold respectively, were based on the analysis of the histograms of gold grade for
the economic blocks. Many blocks are economic with gold contents bellow the cut off gold
grades defined, because the silver content and the low cost of the heap leaching process.
The histogram in the Figure 21 represents the population of the blocks gold grade bellow
the cut off grade selected for the sulphides zone. Again, some of blocks with gold grade
above cut off grade are not economic (Waste), because their high content of sulphur
affecting the metallurgical recovery.
The parameters that affect the economic cut off grades are:
1. The long term gold price of US$650 per ounce and silver price of US$ 9 per ounce.
2. The fact that the silver grade and the sulphur grade are playing an important role in
the economics of the block.
Page - 101 -
3. The new information obtained from the metallurgical tests and the advanced
investigation of the operation costs makes it acceptable to use lower cut-off grade
4. The mining and process costs affect the economics of the blocks depending of the
exploitation rates defined for the mine. In this case, 70 000 ore tonnes/day going
to heap leach were assumed and 4,250 ore tonnes/day going to milling + flotation +
concentrate process (bio-oxidation).
17.12
RESOURCE MODEL VALIDATION, 6.25 M. X 6.25 M. X 6.25 M.
In order to verify the consistency of the model resources to use in long term exercises, it
has been realized a grade model review including the estimation methodology and ore
classifications, like also a comparison of grade model available. It is possible to indicate
that the validation corresponds to standards methodologies to block model review.
17.12.1 GOLD GRADE REVIEW

Model grade review is a comparison of mean model gold grade to mean 6.25 metres
composite gold grade according 100 m intervals. The results are included below; bench
2634 is displayed in Figure 22 and Table 18 compares the gold grades of the block model
and of the composites that were used to interpolate the grade in to the block model at a
cut of grade of cero.
Page - 102 -
Figure 22 Example, Bench 2 634, model and composites.
Model Gold Grade:

N data:
0.42 g/t
17 279
308,500
308,400
Composite Gold Grade:

308,300
N data:
308,200
308,100
308,000
307,900
307,800
307,700
307,600
130,500 130,600 130,700 130,800 130,900 131,000 131,100
Page - 103 -
0.59 g/t
94
Table 18.- Gold grade review, model 6.25m.

Bench
Gold Mean Grade (g/t)
Difference
Block Model
Composite
2634
0.42
0.59
0.17
2734
0.40
0.70
0.30
2834
0.35
0.40
0.05
2934
0.30
0.42
0.12
3034
0.31
0.46
0.15
3134
0.28
0.33
0.05
3234
0.22
0.35
0.13
3334
0.10
0.14
0.04
According to selected bench, its shows a tendency to the model mean grade it is lower
than the composites. This give like result of a conservative model, with a average
difference of 0.1253 g/t.
Page - 104 -
17.12.2 CLASSIFICATIONS REVIEW

The resource classifications is shown graphically on a set of plans and north-south
sections spaced at 100 m.
The Figures 23, 24 and 25 are displaying the block
classification in plains and in a N-S section.

Blocks
Measured
Indicated
Drillhole Traces
Page - 105 -
Inferred
Figure 25 Classification Example, Section North-South; East 130 784
Blocks
Measured
Indicated
Drillhole Traces
Page - 106 -
Inferred
17.12.3 ORE RESOURCES TONNAGE

Based on gold cut off grade of 0.3 g/t for oxides and 0.45 g/t for sulphides, the ore
resource model estimate the following quantities of minerals.
Table 19.- Tonnage, Oxides, 6.25 m Blocks

Tonnage
Au (g/t)
Ag (g/t)
Cu (%)
S(%)
Measured
49,620,528
0.63
4.6
0.014
0.75
Indicated
37,246,139
1.05
6.8
0.018
0.83
6,240,636
1.33
9.1
0.022
0.80
Inferred
Table 20.- Tonnage, Sulphides, 6.25 m Blocks
Tonnage
Au (g/t)
Ag (g/t)
Cu (%)
S(%)
Measured
99,279,676
0.86
4.0
0.033
2.99
Indicated
144,760,412
1.41
7.1
0.038
2.97
84.538,614
1.18
5.8
0.032
2.72
Inferred
17.13
RESOURCE MODEL VALIDATION, 8.75 M X 8.75 M. X 8.75 M.
17.13.1 GOLD GRADE REVIEW

Similarly to the Model 6.25 m, the model for the gold grade review for 8.75 m. is based on
comparison of the gold grade mean to composite gold grade mean. The mean grade of the
composites is the same as the one used in the model gold grade review for 6.25 m. The
results are shown in an example of the bench 3 034 displayed in the Figure 26. Table 21
that summarizes the estimate and measured gold grade comparison.
Page - 107 -
Figure 26 Example, Bench 3 034, model 8.75 m

309,600
309,400
309,200
Model Gold Grade:
309,000
N data:
19 389
308,800
308,600
308,400
308,200
308,000
307,800
130,800 131,000 131,200 131,400 131,600 131,800 132,000
309,200
309,000
Composite Gold Grade:

N data:
308,800
308,600
308,400
308,200
308,000
307,800
130,800
131,000
131,200
131,400
131,600
Page - 108 -
0.30 g/t
0.46 g/t
469
Tabla 21.- Gold grade review, model 8.75m vs 6.25 composites.

Bench
Gold Mean Grade (g/t)
Difference
Block Model
Composite
2634
0.40
0.59
0.19
2734
0.38
0.70
0.32
2834
0.33
0.40
0.07
2934
0.28
0.42
0.14
3034
0.30
0.46
0.16
3134
0.27
0.33
0.06
3234
0.22
0.35
0.13
3334
0.09
0.14
0.04
Like in the model of 6.25 m, in selected benches, its shows a tendency to the model mean
grade it is lower than the composites, with a average difference of 0.1410 g/t for the model
8.75 m.
17.13.2 CLASSIFICATION REVIEW

Resource classification is also reviewed using bench of 100 m and through north-south
sections (bench from 2634 till 3334), and displays north-south sections located from
the130 684 to 131 284 east coordinates. The Figures 27, 28 and 29 are displaying the
8.75 m block classification in benches and in a N-S section
Page - 109 -
Figure 27 Classification Example, Bench 2 634, 8.75 m blocks.
Measured
Blocks
Indicated
Inferred
Drillhole Traces
Figure 28 Classification Example, Bench 2 734, 8.75 m blocks
Page - 110 -
Figure 29 Classification Example, Section North-South; East 130,684, 8.75 m blocks
Blocks
Indicated
Measured
Inferred
Drillhole Traces
17.13.3 ORE RESOURCES TONNAGE

Based on gold cut off grade of 0.3 g/t for oxides and 0.45 g/t for sulphides, the ore
resource model estimate the following quantities of minerals.
Table 22.- Tonnage, Oxides, 8.75 m Blocks.

Tonnage
Au (g/t)
Ag (g/t)
Cu (%)
S(%)
Measured
49,381,696
0.61
4.5
0.014
0.75
Indicated
42,993,839
0.89
6.1
0.017
0.83
8,265,559
0.99
7.5
0.018
0.81
Inferred
Page - 111 -
Table 23.- Tonnage, Sulphides, 8.75 m Blocks.
Tonnage
Au (g/t)
Ag (g/t)
Cu (%)
S(%)
Measured
94,949,196
0.82
3.7
0.033
2.98
Indicated
164,869,382
1.19
5.9
0.033
2.86
90,104,945
0.98
4.9
0.027
2.67
Inferred
17.14
The estimates of the Angostura mineral resources summarized in Tables 14 and 17

require several comments:
1. The methodology of the current resource estimate continues to apply the principle of
separating the assay database into a high-grade and a low-grade population, which has
reduced the natural skewness of the assay statistics for each population. The low-grade
populations require very little capping. In the absence of mixed-assay populations,
constraining the influence of the high-grade population is now more controlled and is
accomplished both by capping of high-grade outlier values and by limiting the search
distances during grade interpolation.
2. The search ellipsoids used for grade interpolation reflect the different continuity ranges
of the two gold grade populations as determined by variography in the established six
structural domains of the deposit.
3. The gold grade in the measured mineral resources is lower than that of the indicated
and inferred resource categories. This is due to the fact that the measured tonnage
contains a larger proportion of the low-grade assay population with its larger continuity
range as a result of the Majority Rule described in Section 17.7.
4.
The comparison of the current estimate with the unconstrained December 2007
estimate showed in the Table 15 reflect a small decreasing of the inferred resources,
because the new data added; but this is not completely comparable because the two
estimates used different block sizes (5 m in 2007 versus 6.25 m in 2008).
Page - 112 -
5. According to selected bench, it shows a tendency to the model mean grade it is lower
than the composites mean grade. This gives like result of a conservative model, with an
average difference of 0.1253 g/t to model 6.25m and 0.1410 g/t to model 8.75m. See
Figure 30.
Figure 30 Gold Grade Comparison, Block Modell versus Composites
Page - 113 -
18.
OTHER RELEVANT DATA AND INFORMATION
The perception of the security problem influenced the investor interest in the past, but
important changes and the Colombian reality are projecting a new image Colombia to the
world. The new perception is based on true facts such as strong growth of the economy
and the political and financial stability of the country added to the improvement in the
security levels. Colombia is one of the most stable economies in Latin America with a
increasing Gross Domestic Product (GDP) since 2003 until 2007, with lesser but still
important growth in 2008 because the world crisis.
Colombia is known as the Latin
American oldest and most stable democracy. All presidents have been elected
democratically, except for a short period, between 1953 and 1957, when there was a
military dictatorship.
Some changes to the mining code law are under discussion in the Colombian Congress,
and the new law expected in January 2009.
19.
INTERPRETATION AND CONCLUSIONS
The exploration of the Angostura project has been ongoing since 1995, with some
interruptions. The new mineral resource estimate presented in this technical report has
been prepared to correspond with the increased exploration database. It provides the
newest update and reflects the results of nearly a half year of additional exploration of the
Angostura project since the previous estimate, which was described in a technical report
prepared by Strathcona Mineral Services Limited in January 2008.
The December 2008 resource estimate is reported at cut-off grades of 0.3 g/t and 0.45 t/t
Au for oxidized and un-oxidized mineralization, respectively, as discussed in section 16.8.
The reduction of the earlier cut-off grades was made based on a analysis of the behavior
of the gold grades of the economic blocks obtained within the Metalica Pit, developed
using parameters based in the advanced investigation of the operation costs and the
results of the metallurgical test work as part of the feasibility study phase 1.
19.1
GEOLOGY AND RESOURCES
In Angostura Project gold mineralization occurs non-continuously and it is associated with

structural controls. Mineralization is mainly due to veins or veinlets and the host rock
corresponds partially to gneisses and intrusive rocks, the mineralization is also located in
Page - 114 -
breccias and fault zones. The alteration is mainly due to argillization of the gneisses and
schists, but also silicification and sericitization of the porphyries and intrusive rocks. The
structural history of the area shows a series of faulting and deformation events, including
reactivation of older structures (principal strike is the NE direction), which controls the
emplacement of intrusives and probably also alteration and mineralization stages. The
development of secondary structural paths in this project (EW, NE-SW, NW-SE) defines
the division of the deposit into six structural domains.
At Angostura, the definition of the Estimation Units (EU),Block estimation within model, is
complicated and difficult to establish due to different structural and mineralization stages.
This situation generates multiple pulses where some structures are sealed and others are
reactivated. Thus defining one or more geology variables to define the EU is a complex
strategy.
From the former, we can perceive that a probabilistic approach by means of an indicator
kriging is correct as long as it is complemented with a geologic control of the process in
order to avoid overestimation in some areas. Therefore we recommend both a continuous
assessment of the Block Model and an expert geological judgment.
The geological control of mineralization is structural. Nevertheless is recommended the
continuous checking through control sections every 25m to check weaknesses of the
Block Model.
Two grade models were developed for mine planning. One has block dimensions of 6.25m
x 6.25 m, and the other 8.75 m x 8.75 m. Both models simulate high and low grades in the
area; and they were built up based on methodologies for international standards such as
protocols of drill holes sampling and the use of grade estimation methodologies accepted
by norm like the NI43-101 and JORC (inverse to the distance, kriging). Consequently,
each model is robust to be used in long term mine planning and on mine reserves with
different definition such as different cut off criteria used.
The first model (6.25 m) represents a total of 93.1 Mt. @ 0.85 Au (g/t) in oxides and 328.6
Mt @ 1.18 Au (g/t) in sulphides. These values correspond to measured and indicated 86.9
Mt @ 0.81 Au (g/t) y 244.0 Mt @ 1.18 Au (g/t) respectively
Page - 115 -
The second model (8.75 m) represents a total of 100.6 Mt @ 0.763 Au (g/t) in oxides and
349.9 Mt @ 1.039 Au (g/t) in sulphides. These values correspond to measured and
indicated 92.4 Mt @ 0.743 Au (g/t) and 259.8 Mt @ 1.058 Au (g/t) respectively.
20.
RECOMMENDATIONS FOR FURTHER WORK
The exploration activities in the Angostura Project have been completed in October 2008.
The next step is to develop the feasibility study. In August 2008 the feasibility study phase
1, was started.
In this phase the study will consider capital costs, operational costs,
conceptual engineering designs, costs estimation with +- 30% of precision, economical

and financial analysis of the project, sensibility analysis, risk analysis and all the necessary
elements to obtain a complete study at a pre-feasibility level. The results of the phase 1,
will be the start point for the definitive feasibility study (Phase 2), to obtain a bankable
document with a detailed estimation of the parameters studied in the phase 1, including
basic engineering designs and a costs estimation with +- 15% of precision.
20.1
RESOURCES
We recommend doing a new variogram using standard methods, as it is not a good
practice to use variograms initially developed for different covariances.
The method of assign, probability for high grade zones within the block model is
based on the inverse distance to the power of 12. This is similar to use the polygon
method. We suggest in future work to use the kriging method as long as proper
variogram are available.
A new resource estimate needs to be prepared that incorporates all of the new
exploration information that has been generated for the Angostura project after
May 2008.
This updated resource estimate will form the basis for a reserve
estimate developed as part of the feasibility study phase 2.

20.2
MINING AND PIT DESIGN
The mining and pit design in the feasibility study phase 1, includes the following activities:
-
Define the optimum bench height
Establish the primary crushing options for the project.
Page - 116 -
Define the best option for mining transportation between conveyor belt and trucks.
Elaborate the pit design and the mining plan
Geotechnical investigations will determine pit-wall and waste dump design angles,
the geotechnical characteristics of the areas for heap leach, tailings impoundment
and all the mine infrastructure.
Elaborate the project distribution, and the conceptual engineering in the the
feasibility study phase 1, and detailed engineering in the definitive feasibility study
(phase 2) for the open pit, waste dumps, the primary crushing, etc.
The condemnation investigations and drilling have to be completed before the

definitive feasibility study (phase 2).
Evaluate the capital and operational costs for the mining activities.
20.3
MINERAL PROCESSING AND METALLURGICAL TESTING
The metallurgical testing program designed by Greystar and McClelland Laboratories

incorporates all the necessary test work to support at a PFS level most of the alternatives
considered by the GRD Minproc trade off study.
The processing options currently under consideration include:
Heap leaching of oxide ore types.
Heap leaching of low grade transitional and intermediate sulphides ore types.
Milling/flotation treatment of high grade sulphide ore types, followed by:

o
Stirred tank bio-oxidation/cyanidation treatment of flotation concentrate.
Roasting/calcine cyanidation treatment of flotation concentrate.
Heap bio-oxidation/heap leach cyanidation of intermediate sulphides ore types.
Environmental testing. This include metals mobility tests, static, TCLP, and where
appropriate, kinetic (humidity cell) acid rock drainage (ARD) testing.
Comminution Testing. Crusher work index, abrasion index and Bond ball work
index tests for select metallurgical composites.
Page - 117 -
20.4
METALURGICAL PROCESING AND INFRASTRUCTURE
Based in the Hatch Study as a base case, the following activities have to be developed at
a PFS level, in the feasibility study phase 1:
-
Study alternatives of metallurgical processes and define the best option.
Evaluate the best alternative and design the primary, secondary and tertiary
crushers, leaching pads, solution ponds, flotation, concentrates treatment, solution
recovery, dore production, tailing ponds, tailing transport.
Evaluate the best alternatives for all the service infrastructure necessary: access
roads, location of the camps, offices, workshops, warehouses, internal roads,
treatment plants, laboratories, water treatment plants, evaluation of the energy
consumes, refinery, communication systems, Industrial Health and Security,
physical security, construction camp, permanent camp, water supply.
Develop an economic study to define the best option for the mineral transportation
Define the electric installations
Define the capital and operational costs
20.5
HYDROLOGY , HYDROGEOLOGY AND ENVIRONMENTAL BASE LINE
The environmental investigation will cover:

-
hydrology and hydrogeology studies
Environmental Base line studies
All the activities of these studies have to follow standards of the Colombian environmental
laws, the Guidelines of the World Bank and the Equator Principles3.
The following
activities will be developed:
The Equator Principles are a benchmark for the financial industry to manage social and
environmental issues in project financing. www.equator-principles.com
Page - 118 -
Hydrologic characterization of the surficial water for the different project areas such
as the pit, waste dumps, leach pads, tailing ponds, and for the entire mining
infrastructure.
Determine the water balance for all of the mining project
Geochemical characterization of the waste, including the acid potential generation.
Collect all the information necessary for the environmental base line.
The environmental impact study will be started parallel to the definitive feasibility
study (Feasibility Study Phase 2).
20.6
Define the options of water supply for the project

OTHER STUDIES
Some additional studies have to be developed:

-
Geotechnical studies in all of the areas of the mining project
Seismic Risk
Surface Water Management
Page - 119 -
20.7
COST ESTIMATE
Table 24 Angostura Evaluations and Exploration Program Budget for 2009
-Thousands of DollarsActivity
January to December 2009
Field Exploration
Drilling New Exploration Targets
$1 525
Sample Preparation
63
Assaying
125
Field and Camp Costs
599
Security, Health and Safety,Social & Environmental
1 605
Administrative Costs - Management

Administrative Costs
1 688
Management Costs
65
Corporate Management
1 399
Feasibility Study Phase 1
1 510
Feasibility Study Phase 2
6 063
Other Studies
(Include Environmental Impact Study)

Final Design
3 202
Energy, Access roads, etc
4 807
Mining Titles Costs
458
Capital Costs (Land, buildings, equipment)
2 950
Early Works (Project Construction)
Other Costs
Contingency (10%)
2 600
TOTAL
28 659
The costs estimate does not include other early works to be defined in the phase 2 of the
feasibility such as works for the water management in the waste dumps, earth moving, etc.
Page - 120 -
REFERENCES
Australasian Institute of Mining and Metallurgy, Australian Institute of Geoscientists
and Mineral Council of Australia (JORC), 1999
Australasian Code for Reporting of Mineral Resources and Ore Reserves (The JORC
Code) to take effect September 1999.
Canadian Institute of Mining and Metallurgy, 2005
CIM Definitions and Standards on Mineral Resources and Mineral Reserves (adopted by
CIM Council December 11, 2005).
Felder, F., 2004
Social Aspects of Developing a Mining Project in an Area of Conflict. Angostura Project
Colombia. Paper presented at Symposium de Oro, Lima, Peru on May 6, 2004.
Felder, F., Spat, A. & Silva, R., 2000
Angostura Project, A High Sulphidation Gold Silver Deposit located in the Santander
Complex of North Eastern Colombia. Paper presented at Simposio de Oro, Lima, Per,
May 2000
Felder, F., Ortiz, G., Campos, C, Monsalve, I., Silva, A. & Horner, J, 2005
Angostura Project, A High Sulfidation Gold-Silver Deposit located in the Santander
Complex of North Eastern Colombia. Paper given a the Newgen Conference, Perth,
Australia, November 2005
Golder Associates, 1999
Prefeasibility Design Report, Angostura Project. Heap Leach Pad, Tailings Impoundment,
Waste Rock Storage and Surface Water Storage Area. Unpublished Report dated March
17, 1999
Greystar Resources Ltd., 2006
Greystar adds 420,000 Ounces of Gold Resources at Angostura. Press release dated
December 13, 2006
Silencio Test Shows 17% Higher Gold Grades. Press release dated April 30, 2008
Page - 121 -

Greystar Launches Feasibility Study. Press release dated August 18, 2008
Harris, F., 1998
Petrographic Examination of thirty samples from the Angostura project by Vancouver
Petrographics Ltd. dated September 23, 1998
Hatch Ltd., 2007
Angostura NI 43-101 Independent Technical Report (Corrected). Dated July 19, 2007,
available on SEDAR
Horner, J., 2005
Structural Geology and Tectonics of the Angostura Project Area. Unpublished Final Draft
Report by iC consulenten dated May 4, 2005.
Horner, J., 2008
Geological, Geotechnical and Rock Mechanical Services at Angostura Interim Report by
iC consulenten. Unpublished report dated January 17, 2008
KD Engineering Company, Inc., Mine Development Associates and Golder
Associates, 1999
Greystar Resources - Angostura Project. Preliminary Feasibility Study. Unpublished
Report dated March 1999
Kinross Technical Services, 1999
Angostura Underground Mining Examination. Unpublished Report dated October 12, 1999
Lafreniere, T., Brown, P. & Shouldice, T., 2006
A Preliminary Assessment of Metallurgical Response, Angostura Project, North Eastern
Santander, Colombia. Project Km1836. Unpublished report undated (delivered to Greystar
August 24, 2006)
Lavens, T., 1999
1998 Audit of Drill Core Assay Results contained in the Angostura Database. Unpublished
Memorandum to S. Ristorcelli of Mine Development Associates, February 15, 1999
Page - 122 -
McPartland, J. S., 2007

Angostura Phase II Testing Recommendations. Unpublished letter report dated August 7,
2007.
Angostura Metallurgical Update 1/21/08. Unpublished letter report dated January 21, 2008
by McLelland Laboratories, Inc., summarizing the results of metallurgical testwork
completed on Angostura samples to the end of 2007.
Angostura Metallurgical Update 10/22/08. Unpublished letter report dated October 22,
2008 by McLelland Laboratories, Inc., October 2008 Angostura Gold Recovery Estimates.
Mine Development Associates, 1999
Angostura Resources, Santander, Colombia for Greystar Resources. Unpublished Report
dated March 22, 1999
Reeves, J. R., 2006
Technical Report. La Bodega Property, California - Vetas Mining District, Santander
Province, Colombia for Augusta Capital Corp. and Comcorp Ventures Inc., dated April 10,
2006 (available on SEDAR).
Reeves, J. R., 2006
Technical Report. California-Vetas Property, California - Vetas Mining District, Santander
Province, Colombia prepared for Ventana Gold, dated April 10, 2006 (available on
SEDAR).
SGS Lakefield Research Africa (Pty) Ltd, 2007a
Flotation Testwork on a Gold Ore Sample from Angostura in Colombia. Unpublished
Report No. Flotation 07/202 dated August 17, 2007
SGS Lakefield Research Africa (Pty) Ltd, 2007b
Mineralogical Characterization and Gold Deportment Study of a Rougher Flotation
Concentrate Sample from Angostura, Colombia. Unpublished Mineralogical Report No.
MIN 0707/117 dated August 23, 2007
Page - 123 -
Smee, B., 2005a

Interim Recommendations for Quality Control Procedures, Angostura Project, Colombia.
Unpublished report dated August 2005
Smee, B., 2005b
A Review of Quality Control Data, August to December, 2005. Unpublished report dated
December 2005
Smee, B., 2007
A Review of Quality Control Data, January 2006 to May, 2007. Unpublished report dated
July 2007
Smee, B., 2008
A Review of Quality Control Data, October 2008, Angostura project, Colombia .
Unpublished report dated October 2008
Snider, L., 2004
Results of Remodeling the 1999 La Alta with New Assay Values. Unpublished
memorandum dated March 19, 2004
Snowden Mining Industry Consultants, 2005a
Technical Report for the Angostura Project, Santander, Colombia. Report dated April 11,
2005 (available on SEDAR)
Snowden Mining Industry Consultants, 2005b
Greystar Resources Ltd.: Technical Report, Project No. 05V463. Amended Resource
Update, Angostura Project, Santander, Colombia, dated November 10, 2005 (available on
SEDAR)
Spat, W. J., 2000
Political-Risk Management in the Northern Andean Countries. Mining Engineering,
October 2000, pages 34 to 37
Strathcona Mineral Services Limited, 2000
Angostura Gold-Silver Project, Colombia. Review of Resource Estimate Prepared by
Kinross Technical Services. Unpublished report dated June 2000.
Page - 124 -

Angostura Gold-Silver Project, Colombia. Updated Review of the 1999 Resource Estimate
Prepared by Kinross Technical Services. Unpublished report dated May 17, 2002.
Angostura Gold-Silver Project, Colombia. Technical Report on the 1999 Resource
Estimate Prepared by Kinross Technical Services. Amended and restated. Report coauthored with Barton G. Stone, P.G., dated September 24, 2003 (available on SEDAR).
Technical Report. Mineral Resource Estimate, Angostura Gold Project, Santander,
Colombia for Greystar Resources Ltd. Dated August, 2004 (available on SEDAR).
Technical Report. Updated Mineral Resource Estimate, Angostura Gold Project,
Santander, Colombia for Greystar Resources Ltd. Dated August 30, 2006 (available on
SEDAR).
Technical Report December 1, 2007, Mineral Resource Estimate, Angostura Gold Project,
Santander Colombia for Greystar Resources Ltd. Dated January 31, 2008 (available on
SEDAR).
Thompson, A., 2004
Petrographic Report, Angostura Project. Unpublished report by PetraScience Consultants
Inc. dated 23 June 2004
Thompson, A., 2005a
Inc. dated 14 January 2005
Thompson, A., 2005b
SEM Analysis of Gold- and Silver-Bearing Minerals from the Angostura Project.
Unpublished report by PetraScience Consultants Inc. dated 30 June 2005
Page - 125 -
Thompson, A., 2005c

Petrographic Report A & B (part 2), Angostura Project. Unpublished reports by
PetraScience Consultants Inc. dated 26 September 2005
Thompson, A., 2005d
Inc. dated 16 December 2005
Ventana Gold Corp., 2007
Management Discussion and Analysis for the Period Ending September 30, 2007.
Available on SEDAR
Ventana Gold Corp., 2008
Ventana Anounces New Gold Discovery in Colombia 106.5 Meters of 7.81 g/t Au. Press
release dated June19, 2008
Page - 126 -
CERTIFICATE OF QUALIFICATION
Page - 128 -

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TECHNICAL REPORT

January 21, 2009

Marco Alfaro Sironvalle

Metlica Consultores S.A.

PROPERTY LOCATION AND DESCRIPTION ..............................................................................- 2 -

PROJECT HISTORY ......................................................................................................................- 3 -

ANGOSTURA GEOLOGY AND MINERALIZATION ......................................................................- 3 -

FUTURE PROGRAM ......................................................................................................................- 8 -

GENERAL AND TERMS OF REFERENCE ...................................................................................- 9 -

CONTRIBUTORS TO REPORT .................................................................................................. - 11 -

RELIANCE ON OTHER EXPERTS ...................................................................... - 12 -

PROPERTY DESCRIPTION AND LOCATION ..................................................... - 13 -

PROPERTY AND TITLE IN COLOMBIA ..................................................................................... - 15 -

LAND TENURE ............................................................................................................................ - 19 -

ENVIRONMENTAL REGULATIONS ........................................................................................... - 19 -

OBSERVATIONS AND CONCLUSIONS .................................................................................... - 22 -

ACCESSIBILITY, PHYSIOGRAPHY, CLIMATE, LOCAL RESOURCES AND

PROJECT HISTORY .......................................................................................... - 23 -

GENERAL REMARKS ................................................................................................................. - 23 -

EXPLORATION HISTORY .......................................................................................................... - 24 -

PRIOR MINERAL RESOURCE ESTIMATES .............................................................................. - 26 -

HISTORICAL PRODUCTION ...................................................................................................... - 29 -

GEOLOGICAL SETTING .................................................................................... - 30 -

DEPOSIT TYPE ..................................................................................................... 33

MINERALIZATION AND ALTERATION .................................................................. 33

GENERAL REMARKS ...................................................................................................................... 33

HIGH-GRADE ACCUMULATIONS .............................................................................................. - 40 -

BULK MINERALIZATION ............................................................................................................ - 42 -

DISSEMINATED MINERALIZATION ........................................................................................ - 42 -

ALTERATION AND ORE MINERALOGY .................................................................................... - 42 -

OBSERVATIONS AND CONCLUSIONS .................................................................................... - 45 -

SAMPLING METHODS AND APPROACH ........................................................... - 47 -

GENERAL REMARKS ................................................................................................................. - 47 -

DIAMOND DRILLING .................................................................................................................. - 47 -

SURFACE SAMPLING ................................................................................................................ - 49 -

OBSERVATIONS AND CONCLUSIONS .................................................................................... - 51 -

SAMPLE PREPARATION, ANALYSIS AND SECURITY ...................................... - 51 -

EARLIER FIELD PROGRAMS (1995 TO 2000) .......................................................................... - 51 -

2003 TO 2008 PROGRAMS ........................................................................................................ - 53 -

OBSERVATIONS AND CONCLUSIONS .................................................................................... - 55 -

DATA VERIFICATION ....................................................................................... - 56 -

ASSAYS 1995 TO 1999............................................................................................................ - 56 -

ASSAYS 2003 TO 2008............................................................................................................ - 57 -

BULK DENSITY ........................................................................................................................... - 60 -

OBSERVATIONS AND CONCLUSIONS .................................................................................... - 62 -

ADJACENT PROPERTIES ................................................................................. - 63 -

MINERAL PROCESSING AND METALLURGICAL TESTING .............................. - 64 -

GENERAL REMARKS ................................................................................................................. - 64 -

HISTORICAL TESTWORK .......................................................................................................... - 65 -

CURRENT TESTWORK .............................................................................................................. - 66 -

PROCESS SELECTION .............................................................................................................. - 68 -

COMMINUTION PARAMETERS ................................................................................................. - 69 -

HEAP LEACH PARAMETERS .................................................................................................... - 69 -

FLOTATION AND OXIDATION CIRCUIT .................................................................................... - 72 -

MINERAL RESOURCE ESTIMATION ................................................................. - 73 -

GEOLOGICAL MODEL ................................................................................................................ - 73 -

LOW-GRADE AND HIGH-GRADE POPULATIONS AND THEIR STATISTICS ......................... - 74 -

HIGH-GRADE PROBABILITY INTERPOLATION ....................................................................... - 79 -

GOLD-GRADE VARIOGRAPHY ................................................................................................. - 81 -

GRADE INTERPOLATION .......................................................................................................... - 84 -

RESOURCE CLASSIFICATION .................................................................................................. - 87 -

DECEMBER 2008 UNCONSTRAINED ANGOSTURA MINERAL RESOURCE

DECEMBER 2008 CONSTRAINED ANGOSTURA MINERAL RESOURCE ESTIMATE .......... - 97 -