La Arena Project

The La Arena Project (the "Project") consists of 20,673 hectares in 44 concessions located 480 km north-northwest of Lima, the capital of Peru, and approximately 18 km from Huamachuco, a town of approximately 20,000 people. It is situated on the eastern slope of the Western Cordillera, close to the Continental Divide at an average altitude of 3,400 metres above sea level.

The Project lies within a multi-million ounce gold district that includes the Lagunas Norte mine (Barrick Gold Corporation) located at Alto-Chicama, the Comarsa mine (Compania Minera Aurifera Santa Rosa S.A.), the La Virgen mine (Compania Minera San Simon S.A.), the Shahuindo gold-silver exploration project (Sulliden Exploration Inc.) and the Tres Cruces gold exploration project (New Oroperu Resources Inc.).

The Lagunas Norte mine produced 763,000 at total cash costs of $269 per ounce in 2011. Proven and probable mineral reserves at Lagunas Norte, as of December 31, 2011, were estimated at 6.1 million ounces of gold. This information is taken from information reported on the Barrick Gold Corporation's website.

The Project can be accessed via a 160 km national roadway from the coastal city of Trujillo directly east towards Huamachuco, passing through Chiran, Shorey/Quiruvilca and the Alto Chicama project (owned by Barrick Gold Corporation). The road from Alto Chicama to the Project site is paved. An air strip that accommodates small airplanes is also present at Huamachuco. There is a power line within the La Arena Project area and there is abundant water available.