SECTION 19: MINERAL RESOURCE AND MINERAL RESERVE ESTIMATES

In an internal report for St. Elias Mines Ltd. by Sivertz (1999), an inferred mineral resource for the Cruz Vein System was calculated at 2.3 to 2.8 million tonnes containing 154,000 to 190,000 ounces of gold and 945,000 ounces of silver. These figures were calculated to a depth of about 90 meters below surface using a cut-off grade of 0.5 g/t gold and 15.0 g/t silver. At current gold and silver prices, the value of this inferred resource is about $US 62 million. Data for the calculations were based on assay results from 91 trenches and 18 diamond drill holes totaling 1,860 meters. The author has reviewed the calculations done by Sivertz and is satisfied that reasonable care was taken and sufficent data available to support the tonnages and grades reported as inferred mineral resource. The data and calculations used for the estimates are included in Appendix 10.

And this from a news release on July 13, 2011

The verification programinvolved the collection of 101 one-metre-long channel samples of vein material along a strike length of 850 meters.In addition, 81 one-metre-long channel samples were collected from the foot-wall and hanging-wall volcanic rocks that host the vein system.Samples were submitted to CIMM Labs, which is an ISO-certified facility in Lima.

Vein material of the Cruz Vein system yielded gold in rock assays from 0.08 to 15.46 grams. Seventy-two samples were above 1 gram gold and twelve samples were above 5 grams. The Cruz quartz vein/stockwork system contains individual quartz-calcite veins up to 6.5m wide, although most of the exposures in the system consist of narrower veins forming sheeted zones over widths up to several tens of metres (Summary Report, Sivertz, 1999.)