The Santo Domingo project includes two related styles of mineralisation. The principle target is a group of gold-copper porphyry prospects, particularly Divisoria, where strong alteration and weak mineralisation are interpreted as being peripheral to a potentially significant deposit.
Recently discovered silver-base metal veins close to the porphyries are also being explored in preparation for drilling.

Tenement acquisition agreement

Elementos SA and Rolando Gramage (an Argentinean resident) have entered into an agreement under which Elementos SA has been granted a 48 month option to acquire the Santo Domingo properties. As consideration under the option agreement, Elementos SA agreed to pay Rolando Gramage, unless the option has been previously been exercised:

• US$35,000 on October 2011;
• US$35,000 on April 2012;
• US$35,000 on October 2012;
• US$35,000 on April 2013;
• US$35,000 on October 2013;
• US$35,000 on April 2014;
• US$35,000 on October 2014; and
• US$35,000 on April 2015;

Upon exercise of the option, the Company will acquire the tenements and must pay Mr Gramage US$ 530,000 on or before October 2015.

• A copper-gold style porphyry system with potential for 100-1000 million tones across three discrete prospective zones. The setting is analogous to the Alumbrera mine, a large copper-gold porphyry deposit 430 kilometres to the north; and

• A polymetalic low sulphidation epithermal vein system rich in silver and base metals.

Historical exploration

The project area is characterised by a significant number of historic small scale gold and base metal workings. Exploration activities until the time of the Initial Public Offering iwas limited to reconnaissance scale mapping and outcrop and talus sampling. In conjunction with detailed ASTER satellite imagery interpretation, three large prospective alteration zones have been identified, mapped and sampled at El Arriero, Alunita and Divisoria. In addition to visible pyrite and copper mineralisation, anomalous copper/gold/molybdenum mineralisation is widespread across the main target zones.

Recent exploration activities

Yvette

The Yvette high-grade, polymetallic vein system was discovered during reconnaissance exploration east of the El Arriero porphyry prospect. OId historic mine workings are scattered along the trends of three, previously unidentified veins with a total strike length 2.5 kilometres.

Wide spread sampling over the prospect area has returned peak assay results of 3,552g/t silver,24% lead, 16% zinc and 7.3 g/t gold. The figure below outlines significant sample assay results reported to date. The focus of on-going exploration is to expand the size of the known mineralised area, which is open in all directions, and delineate targets ready for drilling in 2011.

Sampling highlights, Santa Domingo

The Company believes the area has potential for a low tonnage, high-grade deposit amendable to underground mining. This would be separate from any future development of the porphyry systems at Santo Domingo.

Divisoria

Divisoria is a gold-copper porphyry mineralised system with a footprint of 300 x 200 metres, open in all directions. Key characteristics of the system include:

• Widespread disseminated porphyry gold-copper mineralisation; and small, high-grade gold, copper and polymetallic veins and breccias;
• A strong, porphyry related, zoned alteration system, including potassic alteration) a strong indicator of close proximity to the core of a porphyry system); and,
• Located on a structural intersection inside a large circular feature, which also encompasses the El Arriero and El Arriero Extension prospects.

The Divisoria exploration program commenced in August 2010 to follow-up historic reconnaissance sampling. Work completed to date includes field mapping and sampling over an area of 600 metres square. The on-going program is aimed at generating drill targets through:

• Targeting higher-grade zones within porphyry stockwork mineralisation; and
• Expanding the size of vein and breccia structures along strike and to depth.

The Company believes that Divisoria may represent the margin of a larger, higher-grade system at a shallow depth.

• Divisoria – gold-copper porphyry with cross cutting high grade gold-copper-base metal veins and breccias;
• El Arriero and El Arriero Extension – low grade porphyry environment representing the periphery of a porphyry system;
• Alunita – transitional porphyry – epithermal target (currently being explored by the Company); and
• Yvette – distal veins of high-grade silver-polymetallic vein mineralisation.

The Company believes that the Santo Domingo district has potential to be a significant centre of mineralisation. The focus of on-going exploration at each prospect includes:

• Yvette - expanding the size of the known mineralised area through further sampling and geological mapping. This will include delineating new vein segments and exploring for potential strike extensions to the north and south. Subject to the success of the on-going field program, geophysics and a drilling program will be planned for the second half of calendar 2011;
• Divisoria - expanding the Au-Cu disseminated mineralisation zone which is open in all directions, through further sampling in untested areas. The aim is to prepare drill targets within the disseminated mineralisation as well as the vein and breccia targets, which offer the potential for near surface, high-grade mineralisation at Divisoria;
• Alunita, El Arriero and the El Arriero Extension – follow-up fieldwork and drill target generation, although these are potentially slightly deeper targets than in Divisoria and are subsequently of lower priority; and
• District-scale exploration across the 250 square kilometre tenement package, which remains largely unexplored.

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