April 28, 2017
Dear Fellow Shareholder,
The Company is continuing to concentrate its exploration efforts in 2017 in Peru on the New Pecoy and Tororume Cu, Mo (Au,Ag) Porphyry District as well as advancing its Hurricane Ni-Cu-PGE project through a joint venture with a multinational mining company. Our diamond drill programs have been successful at Pecoy (2014-16), outlining a large Porphyry Cu-Mo(Au,Ag) deposit that now has an updated estimated Mineral Inventory of 612 Million tonnes at a grade of 0.337% Cu, 0.010% Mo, 0.049 g/t Au and 1.286 g/t Ag (at a 0.25% Cu cutoff) or 420 Million tonnes at a grade of 0.370% Cu, 0.011% Mo, 0.054 g/t Au and 1.371g/t Ag (at a 0.285% Cu cutoff). The mineral inventory remains open for significant expansion. All work expenditures and cash payments required under the agreement to earn a 51% interest in the Pecoy have been met. We have also notified our partners of our intention to exercise our right to earn an additional 29% to bring our total interest in the Pecoy project to 80%.
In 2017 the work at Pecoy will be focused on various engineering studies, including powerline, road construction and processing plant. Metallurgical test work on the various types of mineralization has been positive to date and additional work on the Oxide and enrichment zones is planned for 2017. These studies are necessary to form the basis for a Preliminary Economic Assessment ("PEA") study of the project planned for 2018. To fund this year's exploration activities, the Company has closed private placements to date in 2017 through existing shareholders totalling CAD$3.5 million at a price of C$2.00 per share providing us with cash on hand of CAD$5 million as of March 31st. The 100% owned Tororume porphyry system is a larger system than Pecoy and it is expected that drill permits will be received in the first half of 2017. Once the permits have been finalized, the Company plans to complete up to 6,000 metres of preliminary drilling targeting the Main and East potassic zones over a strike length of 4 kilometres. Tororume is located 8 kilometres north of Pecoy and therefore has the potential to increase the value of our business model in the new Pecoy-Tororume Porphyry District. The Company continues to have a strong exploration team of professionals with considerable experience in resource drilling and project development work. We continue to maintain a strong balance sheet that will allow us to complete the work required to take us toward completing a PEA at Pecoy and a preliminary mineral inventory estimate for Tororume.
We believe that our efforts at Pecoy and Tororume in Peru, along with an improving copper market and the projects close location to the coast and infrastructure position us to realize the full value of the Company in the near term.
Brian R. Booth
President and CEO