The Prosperidad was acquired by our Company from Herandez Ventures Inc. in September 2010 for the sum of $5,000 which included a geological report.
We have acquired a 100% interest in the Prosperidad consisting of a 7 unit claim block containing approximately 94.5 hectares (approximately 250 acres). The Prosperidad is located 55 kilometers (37.5 miles) southeast of the city of Butuea and 60 kilometers (41 miles) northeast of city of Bislig, both located in the Philippines. We have undertaken Phase I of our exploration program but need funds to start and complete Phase II. The directors and officers have agreed to contribute funds to cover this shortage of funds in order that the Company, if required, can complete Phase II of its exploration program. No written agreement has been entered into. The Company will move forward with further exploration activities once the above mentioned funds are available. Once the funds are available, the Board and Directors in consultation with our geologist will determine the exact date of commencement of Phase II.
The Company is currently performing no exploration activities on the Prosperidad until such time as it receives the funding to do so.
Based on the recommendation of Ricardo Ramos as set forth in his report dated December 15, 2011 wherein he indicated in his geological report that based on field observation, laboratory results, and reviews of available geological and historical data, further exploration work is warranted on the property management has decided to proceed with Phase II when the Company has adequate funds to do so.
Our Company has all the mineral rights relating to the Prosperidad below and above surface.
In fact, our Company is the only party having an interest in the Prosperidad and it has not entered into any agreements regarding the Claim and there are no outstanding royalties or charges of any kind. There is a tax on any income from the Prosperidad, if the Company is able to sell minerals therefrom, in the amount of 11%.
The Prosperidad Claim can be identified in the Philippines by the following information:
The Prosperidad will be in good standing until such time as it is abandoned by the Company. When our Company obtained its licensing for its exploration work it was required to pay a fee to the Department of Energy and Natural Resources of $560. When renewing the existing license it has 30 days to make the required payment of a similar amount and it can take upwards to 14 days to process the application.
We engaged the services of Alfredo Jumpay, Professional Geologist, to prepare a geological report on the Presperidad which was issued to us on October 1, 2010. Mr. Jumpay graduated from the University of the Far East in Manila, Philippines in 1975 with a Bachelor of Science Degree in Geology and in 1978 obtained his Master of Science degree from the same university. He has work for the past 20 years as a geologist for such companies as Divio Resources, Hernandez Explorations and Borocay Ventures. He is a member of the Geological Society of the Philippines and has consulted for companies around the world.
Our company has no revenue from the Prosperidad and we do not anticipate earning revenues until such time as we enter into commercial production. We are presently in the exploration stage of our business and we can provide no assurance that commercially viable mineral deposits exist on the Prosperidad, or that, if such deposits are discovered, we will be able to enter into further substantial exploration or development programs. Further exploration is required to determine the economic and legal feasibility of the Prosperidad.
To acquire the Prosperidad the directors purchased 290,000,000 common shares at $0.001 per share to give the Company the needed cash. These funds were used to incorporate the Company, purchase the Prosperidad, engage the services of Alfredo Jumpay, professional geologist, prepare a geological report on the Prosperidad, obtain a title opinion to the Prosperidad, obtain audited financial statements and undertake Phase I of the exploration program.
Very few mineral exploration properties ever become producers whereby commercial viable mineralization is extract from the property. Until we undertake considerable exploration on the Prosperidad our Company is considered an exploration company.
Until we complete our Phase II exploration program we will not know if there is any gold on the Prosperidad and even when we have completed Phase II we might not have any indication as to whether there is gold on our mineral claim. If we do not find any gold on the Prosperidad then we will have to abandon the claim which might lead us to ceasing operations.
1. Direct purchase from the Department of Energy and Natural Resources; or
2. Purchase from an existing mineral property owner.
The Company will be required to obtain an Exploration Permit when it commences its exploration work. Normally this is obtained by the geologist assigned to undertake the exploration program.
During the exploration stage there is no requirement to obtain a bond. A bond is needed only when development of the Prosperidad occurs, meaning the extraction of minerals. We must adhere to the environmental requirements the Department of Environmental and Natural Resources. Mines and Geoscience has the right to inspect and demand reclamation work on our property in the event to do not adhere to the requirements.
Additional approvals maybe required from the Department of Environmental and Natural Resources or other governmental departments depending upon the work we will be undertaking on the Prosperidad. In the event we decided to cut trees we will require a license to cut from the applicable governmental department. In deposing of waste, being rock and soil material removed during the development stage of the Prosperidad, we will also be required to obtain approves for this.
At the present time we do not know the amount of money which will be required to adhere to all the environmental regulations since only after the completion of Phases I and II will we have some idea of the actual costs required in the future. Hopefully these costs will not be so prohibitive that we will have to decide to do no further work on the Prosperidad.
There are many exploration companies in the Philippines and many of them are better financed and have mineral claims where mineral showing are positive. We are exploring the Prosperidad and will not know until the completion of Phase II whether there are minerals of merit on our claim. These other mineral companies have more money to hire more employees than we have at the present time. Many geologists would rather work with a company which can offer them full time employment rather than being employed for a short period of time during our exploration program. We compete with other mineral resource exploration and development companies for the acquisition of new mineral properties. These competitors may be able to spend greater amounts of money to acquire mineral properties of merit or on exploring their mineral properties and on developing their mineral properties. In addition, they may be able to afford greater geological expertise in the targeting and exploration of mineral properties. This competition could adversely impact our ability to finance further exploration and to achieve the financing necessary for us to develop our mineral properties.
We will also compete with other junior mineral exploration companies for financing from a limited number of investors that are prepared to make investments in junior mineral exploration companies. The presence of competing junior mineral exploration companies may impact our ability to raise additional capital in order to fund our exploration programs if investors are of the view that investments in competitors are more attractive based on the merit of the mineral properties under investigation and the price of the investment offered to investors.
We have not incurred any research expenditures since our incorporation.
Geological Terms
Various geological terms used in this Form 10-K are defined as follows:
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Amphilbolite
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crystallized rock formed under high temperature ranging from 450° to 700° C which contains some quartz but not in great quantities.
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Anastomosing
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Said to be channel pattern of a braided stream.
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Andesite
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A rock of fine grain and darkish color which contains some quartz and/or feldspar.
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Anorthosite
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A granular plutonic igneous rock composed chiefly of a soda-lime feldspar, as labradorite.
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Aplite
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A fine grained granite consisting chiefly of quartz and feldspar.
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Argillite
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An argillaceous rock, differing from shale in being metamorphosed, and from slate in having no slaty cleavage.
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Assays
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Examination and determination as to weight, measure, quality, etc. test.
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Auriferous
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Gold bearing, as ore.
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Basalt
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A dark-grey to black, dense to fine-grained igneous rock, consisting of basic plagioclase.
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Bauxite
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A aluminium hydroxide consisting of several minerals occurring in masses and earthly form.
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Caldera
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A large crater formed by the collapse of the central part of a volcano.
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Chanrockites
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A rock containing granite but composed mainly of quartz.
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Chert
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A hard, dense and fine grained sedimentary rock consisting of interlocking crystals of
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Chrysocolla
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A source of copper and an ornamental stone.
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Claim
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A piece of property either purchased or staked for minerals which a company owns.
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Clinopyrozene
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A type of rock consisting of magnesium and iron as its chief mineralization.
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Cretacious Age
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Of the nature of chalk or relating to chalk beds which were deposited during this period.
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Crystalline
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Resembling crystal; transparent.
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Dolerite
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A loosely dark igneous rock with course basalt.
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Dynamothermal
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A rock which has been formed under pressure and extreme heat.
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Extrusive
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Forced out at the surface; effusive or volcanic.
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Fault
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A break in the continuity of a rock bed.
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Feldspar
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Feldspar occurs in all rocks and constitutes 60% of the Earths crust.
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Gabbro
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It is approximate intrusive equivalent to basalt.
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Gangue
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That part of an ore that is not economically desirable but cannot be avoided in mining.
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Geomorphologic
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Pertaining to the form of the Earth or of its surface features.
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Gneiss
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A rock corresponding in composition to granite and some feldspar rocks.
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Grade
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The relative quantity or the percentage of ore-mineral or metal content in an orebody.
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Granite
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Any very hard natural igneous rock formation of visible crystalline texture consisting essentially of quartz.
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Greenstone
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The term is used frequently when no accurate determination is possible.
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Granulites
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A whitish granular rock consisting of feldspar, quartz and small red garnets.
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Granodiorite
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A combining form meaning granite.
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Gypsum
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Hydrous calcium sulfate. It is used as a dressing for soil or making plaster of Paris.
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Hornfels
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A rock fine grained in texture which is formed by high temperatures.
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Hydrothermal
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Of or pertaining to hot water and the action of hot water.
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Igneous
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A rock formed by the action of heat within the Earths surface and associated with fusion.
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Ilmenite
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Iron black titanic iron ore.
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Intrusions
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A mass of igneous rock that, while molten, was forced into or between other rocks.
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Landsat
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Multispecral data from satellite remote sensing imagery that provides landscape patterns reflecting geological structures, types of rocks and vegetation.
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Laterites
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Red residual soil developed in humid, tropical, and subtropical regions of good drainage.
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Leptynite
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A fissile or schistose containing some quartz, feldspar and mica..
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Limestone
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A rock consisting chiefly of calcium carbonate, ie., organic remains such as shells.
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Lode
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A mineral deposit consisting of a zone of veins.
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Metamorphic
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An ore deposit that has been subject to great pressure, high temperatures and alteration by solutions.
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Metasediment
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A rock which has been subject to metamorphism.
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Mica
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A rock yielding touch, elastic flakes and sheets, colorless, white, yellow green or black. Basically an industrial mineral used in electrical units and in insulation.
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Mineralization
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A process whereby mineral are introduced in various rock often forming potential ore bodies.
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Mineral Reserve
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Mineral Reserves are sub-divided in order of increasing confidence into Probable Mineral Reserves and Proven Mineral Reserves. A Probable Mineral Reserve has a lower level of confidence than a Proven Mineral Reserve.
A Mineral Reserve is the economically mineable part of a Measured or Indicated Mineral Reserve demonstrated by at least a Preliminary Feasibility Study. This Study must include adequate information on mining, processing, metallurgical, economic and other relevant factors that demonstrate, at the time of reporting, that economic extraction can be justified. A Mineral Reserve includes diluting materials and allowance for losses that may occur when the material is mined.
A Probable Mineral Reserve is the economically mineable part of an Indicated and, in some circumstances, a Measured Mineral Resource demonstrated by at least a Preliminary Feasibility Study. This Study must include adequate information on mining, processing, metallurgical, economic and other relevant facts that demonstrate, at the time of reporting, that economic extraction is justified.
A Proven Mineral Reserve is the economically mineable part of a Measured Mineral Resource demonstrated by at least a Preliminary Feasibility Study. This Study must include adequate information on mining, processing, metallurgical, economic and other relevant factors that demonstrate, at the time of reporting, that economic extraction is justified.
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Monzonite
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A granular plutonic rock containing equal amounts of orthoclase and plagioclase.
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Nodules
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A rounded mass of irregular shape; a little lump.
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Ore
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A rock containing commercial viable mineralization.
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Paragniesses
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An assemble of minerals within an ore deposit.
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Pegmatite
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Basically quartz and feldspar occurring in granite.
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Placer
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A place where gold is obtain by washing.
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Pyrite
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A common mineral of a pale brass-yellow color and metallic luster.
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Pyrrhotite
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A rock that can be a source of nickel.
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Quartz
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Any hard, gold or silver ore, as distinguished from gravel or earth.
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Quartzite
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A very hard sandstone containing chiefly quartz grains that are completely cemented.
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Quaternary
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It became 2 to 3 million years ago and extends to the current period.
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Radioelement
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A form or sample of an element containing one or more radioactive isotopes.
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Rutile
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A reddish-brown mineral consisting of titanium dioxide.
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Schistosity
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A type of cleavage.
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Sedimentary
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Form by or from deposits of sediment which have been water transported.
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Shear
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An action or stress, resulting from applied forces, which causes or tends to cause two contiguous parts of a rock body to slide relatively to each other in a direction parallel to their plane of contact.
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Silica
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A mineral occurring in quartz similar to an opal.
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Stockwork
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A mineral deposit consisting of a three-dimensional network of planar to irregular veinlets closely enough spaced that the whole mass can be mined.
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Sulphides
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One of the elements present in varying quantities in most coal as part of ash and is used in the steel making business.
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Telluride
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Ores of the precious metals (chiefly gold) containing tellurium.
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Tonalite
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Basically comprising feldspar and quartz.
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Wollastonite
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This mineral is found in contact-metamorphosed limestone and occurs in cleavable masses.
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Zircon
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If this rock is cut and polished it is an exceptionally brilliant gemstone.
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For ease of reference, the following conversion factors are provided:
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Metric Unit
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U.S. Measure
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U.S. Measure
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Metric Unit
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1 hectare
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2.471 acres
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1 acre
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0.4047 hectares
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1 metre
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3.2881 feet
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1 foot
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0.3048 metres
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1 kilometre
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0.621 miles
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1 mile
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1.609 kilometres
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1 gram
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0.032 troy oz.
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1 troy ounce
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31.1 grams
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Geological Report on the Prosperidad
Results of previous exploration on or near the Prosperidad has indicated there are some interesting areas for future exploration, hence the Company decided to acquire the mineral claim.
Disclaimer by Alfredo Jumpay, Professional Geologist
In the report prepared by Alfredo Jumpay, he stated that he visited the Prosperidad between September 28 to 30, 2010 subsequent to reviewing various geological reports both historical and current comprising geological surveys, assessment reports, maps and various other documents available. This allowed him to assess the potential of the Prosperidad as to whether future exploration work should be undertaken. From this information he was able to recommend a two Phase exploration program as shown above.
Description of the Prosperidad
Prosperidad consists of one unpatented mineral claim which is located 55 kilometers North East of the city of Butuan at UTM co-ordinates Latitude 08°3448N and Longitude 125°5347E. In order to obtain rights to the Prosperidad the Company entered into an agreement with Hernandez Ventures Inc. whereby a 100% interest in the Prosperidad was transferred to it and recorded with the Mineral Resources Department of the Ministry of Energy and Mineral Resources of the Government of the Philippines.
ACCESSIBILITY TO THE PROSPERIDAD, REGIONAL CLIMATE AND LANDSCAPE
Accessibility to the Prosperidad is by the Philippines only highway from Butuan and then reverting to an all weather gravel road to actually reach the Prosperidad. The country side was formed approximately 350 million years ago during a period called the Carbon period. This period is representative of abundant vegetation which later turned into peat and hence coal and/or large shallow marches. The area near Butuan has large coal reserves which supply of coal mining industry in existence today.
With the Philippines being situated between 5 and 22 degrees North latitude means that the country has a tropical climate with high temperatures for most of the year and also has relatively high amounts of rain mainly during the months of October to December but there is nevertheless rain every month during the year. This results in the vegetation being lush since the annual rainfall in approximately between 1 to 1.5 meters. With the terrain being rather steep 60% of the rainfall tends to run downhill to the sea whereas 40 % seeps through to the islands underground water aquifier.
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Being located in a mining area, the city of Butuan does have experienced people to undertake exploration and development work and the city offers all the necessary services needed for an exploration and development:, including police, hospitals, groceries, fuel, helicopter services, hardware and other necessary items. There are many drilling companies and assay facilities in Butuan.
HISTORY
The Philippines is composed of limestone generally of which has been developed over the years from deposits of shell and sand. The limestone was, over the centuries, pushed upwards, thereby making it possible to find various shells and sea fossils in the upper parts of the mountains. This occurrence is even happening today and is the cause that the Philippine Plate, on which much of the country of the Philippines is situated, is slowly diving under the Eurasian Plate of the mainland of Asia.
Philippines have mountains which are high but have little or no forest cover in many of the areas of these mountains. The peaks can be as high as 1,000 plus meters. The Philippines is a small island being only 35 kilometres wide and approximately 300 kilometres long. With the high mountains in parts of the country and the excessive rain at times means the rainwater washes down the slopes into the sea which cause continual erosion of the land.
The Philippines has coal reserves in the central part of the island as well as both gold and copper reserves. Many of these reserves are being mined.
There has been limited, if any, exploration work on the Prosperidad but it is ready for Phase I of our exploration program. Phase II will commence once Phase I has properly been evaluated by our geologist and a recommendation is made to the Board of Directors.
GEOLOGICAL SETTING
Regional Geology of the Area
The hilly terrains and the middle level plain contain crystalline hard rocks such as charnockites, granite gneiss, khondalites, leptynites, metamorphic gneisses with detached occurrences of crystalline limestone, iron ore, quartzo-feldspathic veins and basic intrusives such as dolerites and anorthosites. Coastal zones contain sedimentary limestones, clay, laterites, heavy mineral sands and silica sands. The hill ranges are sporadically capped with laterites and bauxites of residual nature. Gypsum and phosphatic nodules occur as sedimentary veins in rocks of the cretaceous age. Gypsum of secondary replacement occurs in some of the areas adjoining the foot hills of the Western Ghats. Lignite occurs as sedimentary beds of tertiary age. The Black Granite and other hard rocks are amenable for high polish. These granites occur in most of the districts except the coastal area.
There is electrical power in the area and therefore any requirements during the exploration period will be met. In the event that there is a power shortage the Company will be able to rent generators to meet its demand. During Phase I and II there will be no requirements for electrical power since the exploration program will consist of surveying, mapping and sampling.
Stratigraphy
The principal bedded rocks for the area of Prosperidad (and for most of the Philippines for that matter) are Precambrian rocks which are exposed along a wide axial zone of a broad complex.
Gold, if present, which is in close proximity to the Prosperidad is generally concentrated within extrusive volcanic rocks in the walls of large volcanic caldera.
Intrusive
In general the volcanoes culminate with effluents of hydrothermal solutions that carry precious metals in the form of naked elements, oxides or sulphides.
These hydrothermal solutions intrude into the older rocks as quartz veins. These rocks may be broken due to mechanical and chemical weathering into sand size particles and carried by streams and channels. Gold occurs also in these sands as placers.
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Recent exploration result for gold occurrence in Butuan, is highly encouraging. Gold belt in sheared gneissic rocks is found in three subparallel auriferous load zones where some blocks having 250 to 500 metre length and 1.5 to 2 metre width could be identified as most promising ones.
GEOLOGICAL STRUCTURE
Veins form in high-grade, dynamothermal metamorphic environment where metasedimentary belts are invaded by igneous rocks.
ROCK TYPES ASSOCIATED WITH THE PROSPERIDAD
Hosted by paragneisses, quartzites, clinopyroxenites, wollastonite-rich rocks, pegmatites. Other associated rocks are charnockites, granitic and intermediate intrusive rocks, quartz-mica schists, granulites, aplites, marbles, amphibolites, magnetite-graphite iron formations and anorthosites.
FOLDING AND FAULTING SETTINGS:
Katazone (relatively deep, high-grade metamorphic environments associated with igneous activity; conditions that are common in the shield areas).
ENVIRONMENTAL DEPOSITS:
Veins form in high-grade, dynamothermal metamorphic environment where metasedimentary belts are invaded by igneous rocks.
DEPOSIT TYPES
Deposits are from a few millimeters to over a metre thick in places. Individual veins display a variety of forms, including saddle-, pod- or lens-shaped, tabular or irregular bodies; frequently forming anastomosing or stockwork patterns
Mineralization is located within a large fractured block created where prominent northwest-striking shears intersect the norths triking caldera fault zone. The major lodes cover an area of 2 km and are mostly within 400m of the surface. Lodes occur in three main structural settings:
(i) steeply dipping northweststriking shears;
(ii) flatdipping (1040) fractures (flatmakes); and
(iii) shatter blocks between shears.
Most of the gold occurs in tellurides and there are also significant quantities of gold in pyrite.
MINERALIZATION
No mineralization has been reported for the area of the Prosperidad but structures and shear zones affiliated with mineralization on adjacent properties pass through it.
EXPLORATION
Previous exploration work has not to Mr. Jumpay knowledge included any attempt to drill the structure on Prosperidad. Records indicate that no detailed exploration has been completed on the property.
PROPERTY GEOLOGY
To the east of the property is intrusives consisting of rocks such as tonalite, monzonite, and gabbro while the property itself is underlain by sediments and volcanics. The intrusives also consist of a large mass of granodiorite towards the western most point of the property.
The area consists of interlayered chert, argillite and massive andesitic to basaltic volcanics. The volcanics are hornfelsed, commonly contain minor pyrite, pyrrhotite.
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DRILLING SUMMARY
No drilling is reported on the Prosperidad.
There are no reserves on the Prosperidad and our Phases I and II are ones of exploration.
We required an exploration license to undertake Phase I of our exploration program. The license was obtained by our geologist who did the work and the fee was $560 which was included in the total amount for Phase I. When, and if, a drilling program is recommended we will have to obtain a drilling license but at this time we cannot determine the amount required since it will depend in part as to the number of feet we will be drilling. This will only occur if our geologist recommends we continue to explore the Prosperidad and determine if there is a reserve thereon.
SAMPLING METHOD; SAMPLE PREPARATION; DATA VERIFICATION
All the exploration conducted will be in according to generally accepted exploration procedures that are consistent with generally accepted exploration practices. No opinion as to the number of soil and other samples we will take during our initial exploration program. This will be left to the discretion of our geologist.
No other procedures of quality control were employed and no opinion on their lack is expressed.
INTERPRETATIONS AND CONCLUSIONS
The locale of the Prosperidad is underlain by the units of the Precambrian rocks that are found at those mineral occurrence sites.
These rocks consisting of cherts and argillites (sediments) and andesitic to basaltic volcanic have been intruded by granodiorite. Structures and mineralization probably related to this intrusion are found throughout the region and occur on the claim. They are associated with all the major mineral occurrences and deposits in the area.
Mineralization found on the claim is consistent with that found associated with zones of extensive mineralization. Past work however has been limited and sporadic and has not tested the potential of the Prosperidad.
Potential for significant amounts of mineralization to be found exists on the Prosperidad and it merits intensive exploration.
RECOMMENDATIONS
Alfred Jumpay has recommended a two-stage exploration program as indicated below.
The program would consist of air photo interpretation of the structures, geological mapping, both regionally and detailed on the area of the main showings, geophysical survey using both magnetic and electromagnetic instrumentation in detail over the area of the showings and in a regional reconnaissance survey and geochemical soil sample surveying regionally to identify other areas on the Prosperidad that are mineralized. The effort of this exploration work is to define and enable interpretation of a follow-up diamond drill program, so that the known mineralization and the whole property can be thoroughly evaluated with the most up to date exploration techniques.
Budget
The proposed budget for the recommended work is US$44,575 (Php 1,916,000) is as follows:
Phase I
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Program (Paid)
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U.S. Dollars
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Philippine Pesos
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Geological mapping
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8,139
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350,000
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Geological surveying
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6,741
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290,000
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Total of Phase I
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14,880
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640,000
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Phase II
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Geochemical surveying and surface sampling
(including sample collection and assaying)
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29,695
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1,276,000
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Total of Phases I and II
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44,575
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1,916,000
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For a review of exploration work undertaken on Phase I refer to pages 22 to 32 inclusive wherein Ricardo Ramos describes the work performed.
Phase II will follow up on a number of significant geological discrepancies that were shown during the geological mapping and surveying done under Phase I. Mr. Ramos states that these discrepancies justify field follow-up. In these areas of discrepancies additional soil and rock samples will be taken for assaying in order to determine the mineralization.
With Phase I completed it is estimated that Phase II will take approximately three to four weeks to complete with a minimum of two workers performing the exploration procedures. We will commence Phase II, when the funds are available, since management has reviewed the results of Phase I with Mr. Ramos and will follow up on the discrepancies shown during the mapping and surveying done under Phase I.
The above conversion rate has been done at PHP 43.2 to US $1.00.
Exploration Program under Phase I
The Company engaged the services of Ricardo Ramos, Professional Geologist, of Quezon City, Philippines who undertook Phase I of the Companys exploration program. Our previous geologist, Alfred Jumpay was not available at the time. Mr. Romas has worked as a geologist for the past 18 years and is a member of trhe Geological Society of the Philippines. He visited the Prosperidad property from October 29 to 31, 2011. He issued his report entitled Report on Geological Mapping of the Prosperidad Gold Claim on December 15, 2011. The following has been taken from his report.
Introduction
Locally, rocks on and near the property is rich in mineral resources. The high elevation forest of the district have concentrations of heavy minerals like Ilmenite, Rutile, and Zircon which offer scope of exploitation for industrial purpose. These rocks have been tilted to near vertical during widespread normal faulting and basin development related to extensional regional detachment faulting. A series of trenches and adits in the central property area provide good exposure to the veins.
An integrated geological mapping approach, in which existing geological map data are re-compiled on the basis of the interpretation of aerial photographs, satellite imagery and airborne geophysical data before and during progressing fieldwork provides solutions that meet this requirement, since it facilitates the time-efficient production of consistent up-to-date digital geological map databases covering large regions that can be easily upgraded in future mapping campaigns.
Working Methodology
A seamless coverage of 1:250 000 scale provisional geological maps was prepared during the preliminary phase of the regional geological mapping of the LOT 2 and LOT 3 areas and their extensions in Prosperidad with the objective to produce the most up-to-date geological map coverage over the project areas before fieldwork commenced. The preparatory compilation work comprised the recovery of old airborne geophysical surveys, digitizing of previously published maps, geometric co-registration of the spatial data layers, various image processing and enhancement techniques and knowledge-driven geological image interpretation. In addition to describing the methodology, we present examples of image processing and interpretation results to illustrate how significant geological information was extracted from the multi-source image data sets. The data processing and interpretation tasks were conducted in phase with fieldwork progress
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Property Description and Location
Prosperidad Gold Claim has no known environmental concerns or parks designated for any area contained within the claims. The property is surrounded by trees and mostly covered by thin tropical forest. The geologist identified three quartz filled fractures systems within the sedimentary rocks transecting the central area of property (referred to as the north, central and south veins). The veins are generally one metre in width, parallel to the local schistosity, and can be traced for up to 200 meters on surface. In some areas, the veins have an estimated width of up to 3 meters. A series of trenches and adits in the central property area provide good exposure to the veins. The main zone consists of an epithermal quartz filled fault zone found within the local limestone and conglomerate country rocks. Hematite and carbonate alteration, and chrysocolla mineralization were commonly noted at each sample location within the quartz gangue and the immediate wall rocks. Frequently, quartz veins had a vesicular texture. The south zone is located approximately 340 meters south of the main zone. This zone has similar mineralogy and orientation to the main zone. The approximate width of the south zone varied from 0.5 to 2 meters (1.5 to 6.5 feet). The north zone is located 175 meters north of the main zone. Only one vein exposure was identified here. The mineralogy of the north zone and orientation is similar to that of the main and south zones.
Geometric Transformation
All LANDSAT ETM scenes provided to the project were geo referenced on UTM projection, zone. The required datum transformations became available through a technical report on the adjustment of the old geodetic network of Agusan Del sur, conducted for an urban-environmental management project. Thirty-five LANDSAT ETM scenes covering the LOT 2 and LOT 3 areas and their extensions were re-sampled to fit the MOZNET datum using bicubic re-sampling. The re-registration of the LANDSAT scenes to the MOZNET datum facilitated the registration of GPS stations collected during fieldwork without having to apply datum transformations to the GPS measurements afterwards. The ASTER 1A and 1B scenes are by standard registered on UTM projection with WGS84 datum (equivalent to the MOZNET datum) to a nominal accuracy of 100 meters. They were interactively registered to 1 to 2 pixel accuracy by shifting the scenes until they fitted the GPS track logs within a tolerance of one to two pixels (1530 meters).
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Several enhanced products were derived from the LANDSAT 7 ETM scenes to support geological image interpretation. The enhancement methods that were employed included: linear and interactive contrast stretching of single bands and color composite images and principal component analysis. In generating color composite images from the twenty possible combinations of the six 30-metre bands, the discrimination of rocks (or related soil cover) was considered an important factor in selecting an optimal triplet for discrimination of litho logical units. Another less important factor for consideration was the possibility to detect litho logical variations indirectly expressed as broad-scale geobotanic relationships in natural and semi-natural vegetation communities. The band combinations RGB (red, green, blue) 731 and RGB 732 provided attractive color composites, particularly for LANDSAT scenes acquired over relatively dry areas or during dry periods. Both band triplets exploit the strong and broad absorption features of carbonate and hydroxyl-bearing minerals between about 2.22.4 microns, a range overlapping with the wavelength position of ETM band 7. The 731 and 732 band combinations also provide information on the spectral slope between 0.4 and 0.7 microns (the visible range comprising band 1, band 2 and band 3), which is diagnostic for the presence of iron-oxide minerals. Good exposures of carbonate and mica rich rocks typically appear in shades of blue on such cooler composites, whereas rocks with red alteration, due to high contents of iron-oxides, appear in yellow to reddish tones. The use of these diagnostic spectral properties of rocks and derived soil material is obviously hampered in areas with moderate to dense vegetation cover. In these areas, however, subtle geobotanic relationships between natural vegetation communities and their substrate may be exploited by using band combinations that include the prominent and steep slope between the visible red and near infra-red range of the green vegetation spectrum. Hence, RGB 473 was used as an additional combination to maximize spectral discrimination of litho logical units in areas with higher green biomass densities. Principal component analysis was used to exploit the sun illumination of the LANDSAT scenes. PCA generates a new orthogonal set of bands along the lines of maximum variance among the original bands. This effectively minimizes redundant information, particularly because the original bands tend to be highly correlated. The new bands, called principal components, are ordered according to the percentage of variance they explain. The first principal component contains the information that is common among the multispectral bands, which is usually strongly related to the scene illumination. As a result, PC1 provides optimal enhancement of relief features, which may be exploited for outlining litho logical units on their variable geomorphologic expression. PC1 images, for example, appeared to enhance the differences between granites and intrusive rocks of mafic composition and the differences among different felsic suites themselves, as well as the more subtle small-scale linear patterns reflecting differences in the degree of penetrative foliation bedding fabric in various plutonic, metamorphic and sedimentary rock units.
Topography
The gamma-ray spectrometry channels were enhanced and displayed as ternary radioelement maps in RGB color space using linear contrast enhancement with cut-off percentages of 2%. In areas with a very high or low gamma-ray response, stretching intervals were interactively adjusted. The total field and first vertical magnetic derivative grids were enhanced in color-shaded relief images, using an illumination inclination angle and azimuth of respectively 25 and 300 degrees for the relief shading and a rainbow hue spectrum. Diagram below presents color enhancements of the total magnetic intensity and ternary radioelement grids from the merged geophysical surveys. During the course of the compilation phase of the LOT 3 project, digital elevation data with a spatial resolution of 90 meters. The data were relief-shaded from three different directions using an inclination angle of 30 degrees above the horizon and three declination angles of 270, 315 and 360 degrees. The individual shaded-relief enhancements were combined in a color composite image, such that topographic features were rendered in different colors. Diagram B presents a sub scene of the color shaded relief image that was enhanced interactively during image interpretation through linear contrast stretching to adapt the enhancement to the local prevailing topographic relief characteristics. The resultant relief-shaded color composite image appeared to be particularly useful in tracing the boundaries between Quaternary units. Twenty-eight LANDSAT TM scenes were combined in four image map mosaics that cover the LOT 2 and LOT 3 project areas. The band combination 7-3-1 in RGB was selected, as this provides optimal spectral information for geological interpretation. The mosaic was compiled in several steps, from small to large areas, to keep the color balance in hand and to avoid boundary effects. Histogram matching and/or feathering in the overlap was sometimes needed.
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Field Work Planning
Areas of high outcrop density and secondary roads were interpreted from the 15-metre TM band 8 and color composite images of bands 7, 3 and 1 for the entire project area. Most areas of good bedrock exposure can be recognized as positive features in the topographic relief with a rough and 'dotty' image texture. It was difficult to identify the primary and secondary roads, such that only segments of many could be identified. Some roads or paths do not appear to be connected to the paved road network and instead appear to originate from minor settlements in remote areas. Additional roads were identified from color composites of geometrically corrected ASTER scenes, now available. A digital interpretation guide map was prepared to document areas considered of specific interest for follow-up work before the start of the first field season. The interpretation guide shows areas of specific interest as numbered polygons on the interpretation. The polygons are linked to an attribute table with a memo field for details on the reasoning followed during the interpretation, including preliminary geological ideas and hypothesis to be verified during fieldwork. The targets overlap with areas defined in the fieldwork activity plan, previously submitted. The interpretation guide also contains a number of traverse suggestions with concise description of follow-up targets along the traverse Lot 2 and Lot 3.
Rock Sampling
Due to magnetic susceptibility contrasts between the met basalt and met sedimentary units within them. The airborne radioelement concentrations of the Archaean units are generally low with the exception of some granitoid units. The greenstone belts generally display dark green hues and smooth image texture on the LANDSAT ETM color composite images and form linear positive features that outline foliation form lines within the greenstone belts. Met basalts have the darkest tone while schist and psammite are slightly lighter in tone (B,D). On a LANDSAT ETM731 color composite image, the granitoids and gneisses exhibit light pink, white-yellow tones and display moderate to coarse image textures. Isolated Achaean granite-gneiss domes forming circular basement inliers have been outlined on the magnetic data (A) and LANDSAT ETM color composite images (C). Their interpretation is supported by their inferred lower structural position and the similar hue and texture of the units on the LANDSAT color composite images when compared with granitoid and gneiss units on 1:250 000 scale geological maps of the Prosperidad area towards the west.
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Sampling preparation, Analysis and Security
Rock and Soil samples were collected under the direct supervision geologist using plastic bags and sealed in the field by the supervisor with security tape.
Samples were transported under supervision of the geologist to the airport at the City of Butuan where they were dispatched by airfreight to the laboratory.
Sample Preparation and laboratory in Manila states that the samples showed no signs of any tampering whatsoever.
The following sample preparation procedures were followed by the laboratory:
- The entire sample was oven dried; sample size was approx 20-25 kg.
- The sample was passed through a jaw crusher if necessary.
- The entire sample was pulverized in LM3 ring mills to a specification of at least 85% passing 753.
- The entire sample was mixed and homogenized prior to sampling for assay.
- Assays for gold were carried out on all samples with gold determined by fire assay on 30g sample with AAS finish.
- Cu, Pb, Zn, Ag - by AAS following conc. HCl and HCl/HNO3/HClO4 leach in latter stages on 1g sample.
- 1 in 34 samples were subject to repeat assay.
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Analytical Results
SAMPLE NO
Cu,ppm
Pb,ppm
Zn,ppm
Au,ppm
Ag,ppm
|
|
|
|
|
|
170070
|
70
|
15
|
50
|
0.04
|
0.5
|
169070
|
61
|
<5
|
92
|
0.03
|
<0.5
|
168070
|
56
|
5
|
71
|
0.01
|
<0.5
|
167070
|
35
|
<5
|
22
|
0.02
|
<0.5
|
170071
|
115
|
5
|
99
|
0.02
|
<0.5
|
169071
|
102
|
<5
|
72
|
<.01
|
<0.5
|
168071
|
72
|
<5
|
65
|
<.01
|
0.5
|
167071
|
85
|
<5
|
90
|
0.01
|
<0.5
|
166071
|
118
|
5
|
112
|
0.02
|
<0.5
|
165071
|
128
|
<5
|
65
|
0.01
|
<0.5
|
164071
|
90
|
11
|
98
|
0.01
|
<0.5
|
168072
|
80
|
10
|
60
|
0.04
|
0.5
|
167072
|
101
|
5
|
82
|
0.02
|
<0.5
|
166072
|
65
|
<5
|
38
|
0.01
|
<0.5
|
165072
|
76
|
5
|
23
|
0.02
|
<0.5
|
164072
|
112
|
20
|
81
|
0.04
|
<0.5
|
168073
|
100
|
10
|
78
|
0.01
|
0.5
|
167073
|
79
|
5
|
65
|
<.01
|
0.5
|
168074
|
85
|
<5
|
12
|
0.01
|
0.5
|
167074
|
115
|
12
|
104
|
0.03
|
<0.5
|
169075
|
140
|
<5
|
56
|
0.01
|
<0.5
|
168075
|
94
|
11
|
89
|
0.01
|
<0.5
|
167075
|
138
|
<5
|
56
|
0.01
|
<0.5
|
166075
|
90
|
11
|
98
|
0.01
|
<0.5
|
169076
|
102
|
10
|
80
|
0.04
|
0.5
|
168076
|
97
|
5
|
78
|
0.02
|
<0.5
|
167076
|
65
|
<5
|
38
|
0.01
|
<0.5
|
166076
|
76
|
5
|
23
|
0.02
|
<0.5
|
168077
|
112
|
30
|
81
|
0.04
|
<0.5
|
167077
|
70
|
40
|
50
|
0.04
|
0.5
|
166077
|
96
|
5
|
92
|
0.03
|
<0.5
|
168078
|
87
|
<5
|
71
|
0.01
|
<0.5
|
167078
|
55
|
<5
|
32
|
0.02
|
<0.5
|
167079
|
110
|
5
|
100
|
0.02
|
<0.5
|
Conclusion and Recommendation
The setting of the Prosperidad Gold Mine is triggered by the units of the Precambrian rocks that are found at those mineral sites. Grass-root exploration has been conducted and surveyed. Mineralization found on the claim is consistent with that found associated with zones of extensive mineralization. Structures and mineralization probably related to this intrusion are found throughout the region and occur on the claim. They are associated with all the major mineral occurrences and deposits in the area. Potential for significant amounts of mineralization to be found exists on the property and it merits intensive exploration. We have presented the data processing and integration methodology and a summary of geological image interpretation results that supported the regional geological field mapping component of LOT 2, LOT 3 and their extensions. We have shown that the integrated enhancement and digital interpretation of airborne geophysical, optical remote sensing and SRTM data lend themselves to extract a large number of litho logical and structural patterns.
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These patterns appeared to be regionally consistent and supported geological map compilation in combination with insights obtained from geological field mapping. Integrated image enhancement, in which image data of higher spatial resolution substituted the intensity of the ternary radioelement color composite, proved to be very effective for geological mapping. It was by far the most useful enhancement technique for outlining bedrock units in the Precambrian basement and helped in analyzing relationships between the Phanerozoic sedimentary cover, landscape morphology and topography. A systematic comparison of the newly published geological map coverage and the image database will highlight a number of geologically significant discrepancies that justify field follow- ups in a variety of terrains and for a variety of purposes. However, based on field observations, laboratory results, and reviews of available geological and historical data, further exploration work is warranted at the property.
Gold Mineralization on the Prosperidad
Until we complete our two Phase exploration program we will not know if there is any gold on the Prosperidad and even when we have completed these two programs we might not have any indication as to whether there is gold on our mineral claim. If we do not find any gold on the Prosperidad then we will have to abandon the claim which might lead us to ceasing operations.
Other Mineralization on the Prosperidad
Once we complete Phase II, we will have a better understanding of the mineralization on the Prosperidad.
Effect of Existing or Probable Governmental Regulation in the Philippines
Government and environmental regulations exist in the Philippines and our exploration plans are subject to these various federal, state and local laws. The rules are dynamic and are generally becoming more demanding as we approach the mining stage, which in our case might never happen. Our plans aim to safeguard public and environmental health. We are currently in compliance with all material mining, health, safety, and environmental statutes of the Republic of the Philippines. Requirements for health, safety and environmental are not onerous on us during the exploration stage since basically we will not be disturbing any fish life in the small streams located on the Prosperidad, up-rooting trees and shrubs or causing a change in the land scrape. There is no bonding requirement for us during the exploration stage. Nevertheless, if we do disburse the landscape the Government will require us to put the area back into the same
If, and when, if ever, we are fortunate to consider developing a mine on the Prosperidad, the following requirement will have to be adhered to.
Mine safety and environment protection will have to comply with the requirements of safety and sanitary as set forth by the Secretary of Mines for the Philippines under Republic Act No. 7305. No person under 16 years of age shall be employed in any phase of the mining operation and no person under 18 years of age will be allowed below ground. If more than 50 workers are employed there has to be at least one licensed mining engineer with at least 5 years of experience in mining operations.
The regional director shall have exclusive jurisdiction over the safety inspection of all installations, surface and underground.
Every mining company will undertake an environmental protection and enhancement program covering the period of the mineral agreement or permit. Such environmental program shall be incorporated in the work program which the mining company has submitted as accompanying documents in obtaining their mining permit. This program shall set forth the steps for rehabilitation, regeneration, revegetation and reforestation as well as what will be done to any and all tailing ponds. None of the above impacts our Company during its exploration periods.
The cost and effect of compliance with environmental laws at this time is undeterminable by us.
The main agency that governs the exploration of minerals in the Philippines is the Mineral Resources Department of the Ministry of Energy and Mineral Resources. The Ministry of Energy and Mineral Resources manages the development of public conservation lands and implements policies and programs respecting their development while protecting the environment.
We will be subject to ensuring, during our exploration programs. that there are no environmental impacts which affect streams on the Prosperidad which could endanger the fish and other small wildlife. We are able to clear away small brush but any large trees are subject to the Department of Forestry and permission to cut must be obtained. At
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the present time both Phase I and II should have no environmental impact on our claim. There is no bonding requirements for us but the geologist used in our exploration program must be fully bonded and approved by the Department of Environmental and Natural Resources.
When we commenced exploration on the Prosperidad, the Department of Mines in the Philippine required us to complete and submit a Form MGB 50-1 along with a fee of $560. This is a licensing fee and was paid in full prior to the commencement of Phase I.
A new license can take up to 30 days to process and the renewal of an existing license takes up to 14 days to process. There are no bonding requirements for the Company but the mining company used for exploration purposes must be fully bonded and approved by the Department of Environmental and Natural Resources (DENR) and Mines and Geoscience. The DERN also has the right to inspect the Companys property on demand to ensure all criteria are being met.
Changes to current federal, state and local laws in the jurisdiction in which we operate may require additional costs and financing. These changes are unpredictable and the additional requirements may render certain exploration activities uneconomical and lead to business failure.
The Companys Main Product
At present we do not have a main product since we have not defined an ore reserve on the Prosperidad and hence are unable to sell any minerals. We are exploring for gold which if found will be our main product.
Plant and Equipment
With the Philippines being a hub for mining activities in Asia, ultra modern equipment is used by the various mining companies. The high safety standards enforce the level of good equipment being available with the most modern and up to date mining equipment being at our disposal.
There is no plant or equipment on the Prosperidad at the present time and it is expect that during Phase II there will be no need for either plant or equipment.
Additional Mineral Claims
Our Company has only one mineral claim, being the Prosperidad as more fully described above. It has no intention at the present time to acquire an additional mineral claim. The Company wishes to focus its attention on the exploration program on the Prosperidad.
Employees
As of November 30, 2013, our Company did not have any employees either part time or full time other than its directors and officers. In exploring the Prosperidad it will use the services of qualified geologists who will only be retained during the exploration program. Once the program is over the Company will evaluate the need to hire additional employees if it is warranted.
Our previous geologist, Alfredo Jumpay, was not engaged either full time or part time by the Company since the date of his report-- October 2010. No agreement was made with him, either verbally or in writing, indicating he was employed with our Company. When Phase I was undertaken, Mr. Jumpay was unable to undertake the work due to other commitments and the Company hired Ricardo Ramos to do the work under Phase I and prepare a report on his findings. No agreement in writing was entered into with Mr. Ramos to undertake the work on Phase I. He merely agreed to do the work and prepare the geological report on his findings.
Once his report was completed Mr. Ramos ceased his association with our Company until such time as we might require his services again.
Our executive officers do not work full time for our Company but during the present period are devoting approximately 30 hours a month for John Ngitew and 20 hours a month for Grace Parinas on the affairs of our Company. Our President was instrumental in incorporating the Company, having a mineral property identified to our Company, seeking a geologist to visit the claim and subsequently prepare a geological report on the Prosperidad and recommend a work program in addition to identifying professional help such as an attorney, auditors and transfer agent.
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We are not a party to any employment contracts or collective bargaining agreements. The Philippines area has a relatively large pool of people experienced in exploration of mineral properties; being mainly geologist and mining consultants. In addition, there is no lack of worker and consultants initially on a part time basis.
Risk Associated with the Prosperidad
Our Company is aware of certain risk associated with the Prosperidad as follows:
1. We realize that any money spent on the Prosperidad might be lost money never to be recovered. Very few mineral claims that are explored ever turn into actual mines which produce saleable minerals.
2. We realize that even though we actual discover mineralization on the Prosperidad that it might not be of the tonnage nor grade to make it profitable to mine it. Without the tonnage or grade there is no point in our Company trying to mine and sell the mineral on the claim. Another factor which must be borne in mind is that the world price for minerals fluctuates on a daily bases and hence even if the tonnage and grades are there the price per ounce might be too low to make it worthwhile for us to extract the minerals.
3. Because we are small and have not undertaken sufficient exploration work on the Prosperidad we might find it extremely difficult to raise money for future exploration work. If our directors wish to continue exploring they may have to contribute the funds to the Company themselves.
4. We have never undertaken a survey of the Prosperidad to determine the exact boundaries of our claim. If we are fortunate enough to discover an ore body of merit we might become involved in a legal dispute with another party as to our boundaries. This will be expensive and time consuming to our Company and presently we do not have the funds to dispute a long-term court case.
5. Mining has many risks attached to it which we are presently not insured against and may never be. For example, the Prosperidad might be subject to cave-ins or moving rocks which will injure our workers and which might lead to court action and government intervention. Without insurance any funds we have on hand would have to be directed to disputing any claim made against us.