The Concepcion del Oro region is within the Sierra Madre Oriental fold and thrust belt.  The geology is characterized by alternating anticlines that form the sierras and synclines that form the valleys between the sierras.  Most of the rocks exposed are Jurassic and Cretaceous platform sedimentary rocks, although some older volcano-sedimentary basement rocks are present in the San Julian area.  In several areas the sedimentary rocks have been intruded by intermediate plutons of Late Tertiary to Early Cretaceous age.  The mineralization in the region is generally closely associated by the intrusive rocks and consists of skarns and replacements as mantos, chimneys and irregular bodies controlled by lithology and structures. 

EXMIN has acquired nearly 46,800 hectares in the Melchor Ocampo region, and controls parts of 3 target areas: Las Coloradas, Trebol/Cerro Gordo, and San Julian.  Two of the areas, Las Coloradas and Trebol/Cerro Gordo were partly explored by international mining companies in the past, and all three areas are adjacent to concessions with past producing mines and abundant prospects.  The Las Coloradas and Trebol/Cerro Gordo targets are described below. 

Las Coloradas Target

EXMIN acquired 5 concessions in the Las Coloradas target located just southeast of the Melchor Ocampo pueblo; one concession was staked when declared free by the Mexican government and the other 4 concessions were optioned from Mexican nationals. 

The area was previously explored by Echo Bay in the 1990’s.  Echo Bay was exploring in the district for sedimentary rock hosted replacement gold deposits, but also encountered a silver-lead-zinc mineralized system at Las Coloradas.  The nearly contiguous concessions controlled by EXMIN cover about 32 hectares (80 acres) over the area identified by Echo Bay, as well as about 35 hectares (86 acres) over the possible down dip extension (Fig. 11).  All of the concessions are adjacent to and partly surrounded by several concessions controlled by a subsidiary of Goldcorp.

Mineralization at Las Coloradas consists of replacements of moderately dipping sedimentary rocks in the north limb of the Zuloaga anticline that makes up the Sierra Zuloaga.  EXMIN has obtained part of the Echo Bay data package including reverse circulation drill hole data.  Eight drill holes were completed within or close to the boundaries of the acquired concessions, and the mineralized intercepts suggest that a large deposit potentially may be present (see table below).  One of the holes intersected 69 meters with 51 g/t silver, 1.2 % lead and 1.1 % zinc and was drilled on ground controlled by EXMIN.  This drill hole was stopped due to drilling problems and ended in mineralization.  Further drilling is required to confirm the presence of a significant tonnage of mineralized rock. 

Table 8. Echo Bay intercepts¹ at the Las Coloradas target

1.-Drilling by Echo Bay was conducted under the supervision of Dr. Craig Gibson. Samples were subjected to normal quality control/quality assurance procedures, including insertion of standard samples into the sample stream and second lab check analyses, and are believed to be reliable.

2.-Drill holes or intercepts in holes 13, 14, 16 and 35 are believed to be on EXMIN ground, and intercepts within the remaining holes are believed to be within 50 meters of the concession boundaries.

Trebol/Cerro Gordo

In 2007, EXMIN was approached by AmMex Gold Mining (OTCBB AMXG) to stake an area with known potential for polymetallic mineralization near Melchor Ocampo.  EXMIN has a larger infrastructure in Mexico, has concessions in the area, and was available to move quickly to acquire this ground that had been declared open for staking by the Mexican government.  Under the agreement, EXMIN staked the concession based on geologic information provided by AmMex for a 30% interest, and AmMex will provide detailed data and fund a first round of exploration drilling totaling US$ 150,000 for its 70% interest.  Title was received in February 2008, and EXMIN is project operator for the initial phase of exploration. 

The concession staked by EXMIN covers a 7 km by 2 km magnetic anomaly in regional data obtained from the Mexican government.  The magnetic anomaly is located in a valley near outcropping mineralization with several small mines and prospects that were exploited in the past.  The majority of the mines in the region are located in areas near similar magnetic anomalies which typically indicate the presence of intrusions that are closely associated with mineralization in the region. 

The area of the magnetic anomaly was previously explored by an international mining company.  Stream sediment and soil samples taken in the area show anomalous metal values, and seven samples of loose rock fragments, or “float”, collected in the valley fill material in the region of the anomaly averaged 0.435 grams per metric ton (g/t) gold, and 5 g/t silver, with one sample yielding 1 g/t gold and 229 g/t silver; one sample also reported 1.46% lead.  The property was dropped before drilling the anomaly due to low metals prices.  EXMIN has completed a ground magnetic survey over the regional magnetic anomaly to better define the shape of the anomaly to aid in orientation of drill holes programmed for the second quarter of 2008.  The geologic environment is very similar to that of the Peñasquito deposit and provides an excellent and easily accessible exploration target.