Junin Mineral Property: Sampling & Analysis

Sampling Method and Approach

Micon reviewed summary reports prepared by Ascendant and previous operators and examined drill core from several of the holes drilled during the CODIGEM-JICA-MMAJ campaign.

Core was split using either a manual guillotine or hammer/chisel but mostly by diamond saw. Samples were taken in 1 m or 2 m intervals depending on the campaign. For the most part, sampling was continuous throughout the hole at these intervals and representative of the mineralization. Fifty percent of the core was sent for analysis and the remaining half was retained in the core boxes for reference. The available core is presently stored at an Ecuadorian government facility. Ascendant has a renewable agreement with the government for permanent access to the core. Micon reviewed drill core from several holes and confirmed the presence of quartz vein, stockworks, alteration zones and sulphide mineralization. Observed core recovery was good and sampling representative for the great majority of core inspected.

A proportion of the core is still in good condition and in Micon’s opinion the core and core boxes have been labelled and maintained in a manner consistent with good industry practice. The remaining proportion of the core has suffered the ravages of time, but some may still be recovered. Ascendant plans to move all the core to its own facility in the near future.

Sample Preparation, Analyses and Security
The exploration work summarized in the Junin Report was conducted between 1991 and 1997. Little information is available as to the sample preparation protocol, security or analytical procedures.

It is Micon's opinion that the assays for the drill core reviewed are consistent with the amount and type of mineralization that are observed in the drill cores viewed, and that the sampling of the drill core was satisfactory.

The core storage facilities appear to be reasonably secure.

Data Verification

Little information is available as to the sample preparation protocol implemented during the various historical exploration works.

No assay certificates or original drill hole logs are available for inspection, and in conducting this property review Micon has relied upon the drill hole data supplied by Ascendant in the available reports. For the most part, the available reports include detailed fair copy logs and listings of analyses completed. The reports are copies of the original reports held by the Ministry of Energy and Mines.

Micon has satisfied itself as to the presence of copper-molybdenum mineralization, alteration zoning and vein structures on the property. This was achieved by observation of direct evidence in river outcrop and in drill core. Verification of the location of the historical drill sites and other works was not possible on the concession site due to the dense nature of the tropical forest and growth of vegetation in the years since such works took place.

Mineral Resource Estimates

In 2004 Ascendant conducted an in-house re-evaluation of the exploration data and calculated an inferred mineral resource. Based on this work and in accordance with NI 43-101 requirements Micon subsequently determined an inferred mineral resource of 982 million tonnes grading 0.89% copper, 0.04% molybdenum, 1.9 g/t of silver and 0.01 g/t of gold, or a 1.21% copper equivalent at a 0.4% economic copper cut-off grade. Similar data is also presented for copper cut-off grades of 0.2% and 0.3% copper. All tonnage is expressed in metric tonnes.

One of the primary objectives of the reinterpretation and analysis work completed by Ascendant was to obtain a revised resource estimate from exploration work completed by previous operators. The interpretation of the mineralized zones was used to create a 3D geological model using proprietary computer modelling software, Surpac Vision version 5.0H.

Database

Ascendant compiled only borehole data from the drilling program described under the heading "Drilling" above into a Microsoft™ Access database. The database was constructed using the normal arrangement of database tables; collar, survey and etc that are required for the spatial location of the holes and associated samples and geology. A total of 30 holes and 4,940 analyses from drill core samples are present in the database. No surface sampling is included in the estimation process.

A surface topography model was created from digitizing of the topographic contour plan available from previous exploration.

Bulk Density

From the very limited analyses available, a fixed value of 2.67 tonnes per cubic metre was established for all zones. A more comprehensive evaluation of bulk density should be undertaken for future estimates.

Geological and Block Modelling

The sectional interpretations created by Ascendant demonstrate apparent continuity of alteration and mineralization between cross sections. These interpretations were used by Ascendant to create 3D wireframe models of the supergene zone, and alteration and hypogene zone below the supergene. The interpretation of the supergene zone is based on alteration and the occurrence of minerals associated with secondary enrichment. The interpretation of the hypogene zone is based on mineral and alteration occurrence, as described under the heading “Mineralization” above. The hypogene (or Internal) model is broadly equivalent to a zone of > 0.8 % Cu, and inspection of limited drill core indicates that the morphology of this zone is coincident with the development of consistent quartz vein stockworks, observed between cross sections. A low grade (or External) model of the altered zone outside the hypogene zone was interpreted based on sample values and mineral and alteration occurrence. The low grade model broadly forms a zone of > 0.2% Cu to < 0.8 % Cu mineralization. Intersections of low grade material within any of the zones were restricted to less than 10 m where practically possible. The sectional interpretations were adjusted such that boundaries were coincident with the relevant borehole intersections marking the change between each zone and to facilitate later flagging of informing samples. The base of mineralization was taken as 1,300 m a.m.s.l., which is consistent with previous estimates.

An orthogonal block model was constructed by Micon to encompass the three wireframes with block sizes of X = 75 m, Y = 75 m, and Z = 25 m. Block size was derived from the approximate borehole spacing of 150 m. Sub-blocking to 12.5% of the parent block size was used for volume accuracy. Each block was flagged according to each of the three geological zones as they occur below the topographic model.

Assay Composites

Assay values in the database were flagged according to their zone using the geological model wireframes. The flagging was checked and assay values were composited to 10 m regular length composites within the respective zones. At the extremity of the zone(s) and in areas of narrow intersection, sample lengths of less than 10 m were included in the composites.

Grade Modelling

Grades were interpolated into blocks constrained by the wireframes of the geological models using only composites derived from samples flagged within the respective zones This resulted in 86 composites from 16 drill holes for the supergene zone; 404 composites from 23 drill holes for the External zone; and 119 composites from 14 drill holes for the Internal or hypogene zone being used for the three separate estimations. Inverse distance weighting was employed for the interpolation. A protocol of different search radii was developed such that samples from at least two drill holes were used to estimate each block, with search distances reduced in areas of greater drill hole density. In areas of sparse data density, the search radius is four times the drill hole spacing. The same protocol was employed for copper, molybdenum and silver. Gold was not estimated.

Volumes derived from the geological wireframes were compared with volumes derived from the block model and differences were found to be negligible. Overall interpolated grade was compared with a simple estimation derived from an average of the informing samples and found to be consistent.