Zafranal 43 101 Technical Report PDF

AQM Copper Inc.
Zafranal Copper Project Peru
Technical Report
December 2010 Resource Estimate
Document No. 60246-00000-23-002-001
AMEC Minproc
25/02/2011

Technical Report
Approved
Revision
Date
25.02.11
Item
Description
Prepared
Issued for Client use
Page
A Manfrino
Section
Reviewed
B Peters
Study
Manager
Sign-off
Client
N Ricketts
Comments
* Use after Rev. 0
60246-00000-23-002-001
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Technical Report
Important Notice
This notice is an integral component of this Technical Report and should be read in its entirety and
must accompany every copy made of the Technical Report.
This Technical Report has been prepared for AQM Copper Inc (AQM) by AMEC Minproc Limited
(AMEC Minproc). The Technical Report is based on information and data supplied to AMEC Minproc
by AQM and other parties and where necessary AMEC Minproc has assumed that the supplied data
and information is accurate and complete.
The conclusions and estimates stated in the Technical Report are to the accuracy stated in the
Technical Report only and rely on assumptions stated in the Technical Report. The results of further
work may indicate that the conclusions, estimates and assumptions in this Technical Report need to
be revised or reviewed.
AMEC Minproc has used its experience and industry expertise to produce the estimates and
approximations in the Technical Report. Where AMEC Minproc has made those estimates and
approximations, it does not warrant the accuracy of those amounts and it should also be noted that all
estimates and figures contained in the Technical Report will be prone to fluctuations with time and
changing industry circumstances.
The Technical Report should be construed in light of the methodology, procedures and techniques
used to prepare the Technical Report. Sections or parts of the Technical Report should not be read or
removed from their original context.
This Technical Report is intended to be used by AQM, subject to the terms and conditions of its
contract with AMEC Minproc. Recognising that AQM has legal and regulatory obligations, AMEC
Minproc has consented to the filing of the Technical Report with Canadian Securities Regulatory
Authorities and its publishing on the SEDAR filing System. Except for the purposes legislated under
provincial securities laws, any other use of this report by any third party is at that partys sole risk.
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Technical Report
Title Page
Project Name:
Zafranal Copper Project
Title:
Technical Report
Location:
Peru
Effective Date of Technical Report:

Effective Date of Mineral Resources:
25th February 2011

25th February 2011
Qualified Persons
Annick Manfrino (Engineer ENSG, MAIG), Consultant Resource Analyst to AMEC Minproc Limited
is the Qualified Person (QP) responsible for the preparation of the December resource estimate of
the Zafranal Main Zone detailed in Section 17. Annick Manfrino is also responsible for the overall
compilation of the Technical Report and prepared Sections 1,2,3,12,13,14,15,18, 19 and 20 in
addition to Section17.
Greg Harbort (Ph.D. MAusIMM), Manager Process at AMEC Minproc Limited is the QP responsible
for the process and metallurgical data presented in the Technical Report and summarised in
Section 16.
James McCrea (P. Geo.) is the QP responsible for compiling a summary of the geology and
exploration activities for the Zafranal Project.
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Technical Report
Table of Contents
Important Notice ........................................................................................................... ii
1
1.1
1.2
1.3
1.4
1.5
1.6
SUMMARY ............................................................................................................... 12
SCOPE, BACKGROUND & LAND OWNERSHIP ........................................................................... 12
GEOLOGY, MINERALISATION & EXPLORATION ........................................................................ 13
METALLURGICAL & PROCESS STUDIES .................................................................................... 13
DATABASE & MINERAL RESOURCE ........................................................................................... 14
CONCLUSIONS ............................................................................................................................. 15
RECOMMENDATIONS .................................................................................................................. 16
2
2.1
2.2
2.3
2.4
2.5
INTRODUCTION ...................................................................................................... 17
SCOPE OF THE REPORT ............................................................................................................. 17
QUALIFICATIONS & PERSONNAL SITE INSPECTIONS .............................................................. 17
PRINCIPAL SOURCES OF INFORMATION .................................................................................. 18
INDEPENDENCE ........................................................................................................................... 19
DEFINITIONS & ABBREVIATIONS ................................................................................................ 19
RELIANCE ON OTHER EXPERTS ........................................................................... 20
4
4.1
4.2
PROPERTY DESCRIPTION & LOCATION ............................................................... 20

BACKGROUND INFORMATION ON PERU ................................................................................... 20
PROJECT LOCATION.................................................................................................................... 20
4.2.1
Mineral Rights, Agreements & Royalties.......................................................................... 22
MINERAL TENURE, AGREEMENTS & ENVIRONMENTAL REGULATION .................................. 24
4.3.1
Mineral Tenure ................................................................................................................24
4.3.2
Environmental Regulations & Exploration Permits ........................................................... 25
4.3
5
5.1
5.2
5.3
5.4
5.5
6
6.1
6.2
6.3
ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE &

PHYSIOGRAPHY ..................................................................................................... 26
ACCESSIBILITY ............................................................................................................................. 26
CLIMATE ........................................................................................................................................ 26
LOCAL RESOURCES .................................................................................................................... 26
INFRASTRUCTURE ....................................................................................................................... 27
PHYSIOGRAPHY ........................................................................................................................... 27
HISTORY ................................................................................................................. 28
BACKGROUND INFORMATION .................................................................................................... 28
EXPLORATION HISTORY ZAFRANAL PROJECT ..................................................................... 29
6.2.1
Introduction ...................................................................................................................... 29
6.2.2
Geology ........................................................................................................................... 30
6.2.3
Geochemistry ..................................................................................................................31
6.2.4
Geophysics ...................................................................................................................... 34
6.2.5
Drilling ............................................................................................................................. 34
EXPLORATION HISTORY - SICERA SOUTH PROSPECT ........................................................... 37
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6.4
6.5
6.6
6.7
6.8
6.3.1
Geochemistry ..................................................................................................................39
6.3.2
Drilling ............................................................................................................................. 40
EXPLORATION HISTORY - SICERA NORTH PROSPECT ........................................................... 40
6.4.1
Geochemistry ..................................................................................................................41
EXPLORATION HISTORY - CAMPANERO PROSPECT ............................................................... 43
6.5.1
Geology, Mineralisation & Alteration ................................................................................ 43
6.5.2
Drilling ............................................................................................................................. 44
EXPLORATION HISTORY - ROSARIO PROSPECT ..................................................................... 45
EXPLORATION HISTORY - GANCHOS ........................................................................................ 46
EXPLORATION HISTORY - PAMPAS (CHICHARRON) ................................................................ 47
7
7.1
7.2
GEOLOGICAL SETTING .......................................................................................... 47

REGIONAL GEOLOGY .................................................................................................................. 47
PROPERTY GEOLOGY ................................................................................................................. 49
7.2.1
Lithology .......................................................................................................................... 50
7.2.2
Structure .......................................................................................................................... 53
DEPOSIT TYPES ..................................................................................................... 58
9
9.1
9.2
MINERALISATION .................................................................................................. 58
LEACHED CAP & SECONDARY ENRICHMENT ........................................................................... 58
PRIMARY SULFIDE MINERALISATION & HYDROTHERMAL ALTERATION ............................... 61
9.2.1
Early veinlets EDM, A-type & B-type ............................................................................ 62
9.2.2
Intermediate veinlets C-type ......................................................................................... 62
9.2.3
Late veinlets D, E & F-types ......................................................................................... 62
10
10.1
10.2
EXPLORATION ........................................................................................................ 64
EARLY EXPLORATION ................................................................................................................. 64
GEOPHYSICS ................................................................................................................................ 67
11
11.1
11.2
11.3
11.6
11.7
11.8
11.9
11.10
DRILLING ................................................................................................................ 67
INTRODUCTION ............................................................................................................................ 67
DIAMOND CORE DRILLING .......................................................................................................... 68
REVERSE CIRCULATION DRILLING ............................................................................................ 84
11.3.1 Zafranal ........................................................................................................................... 84
11.3.2 Sicera South & Sicera North ............................................................................................ 87
DRILLING ORIENTATION .............................................................................................................. 90
DRILLING QUALITY ....................................................................................................................... 90
11.5.1 Core recovery considerations .......................................................................................... 90
11.5.2 Diamond-RC Drillhole Twins ............................................................................................ 91
SURVEYING .................................................................................................................................. 91
GRID CONTROL ............................................................................................................................ 92
DRILLHOLE COLLARS .................................................................................................................. 92
DOWNHOLE SURVEYING............................................................................................................. 92
SURFACE TOPOGRAPHY ............................................................................................................93
12
SAMPLING METHOD & APPROACH ....................................................................... 93
11.4
11.5
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Technical Report
12.1
12.2
12.3
12.4
12.5
12.6
12.7
DIAMOND CORE SAMPLING & LOGGING ................................................................................... 93

RC SAMPLING & LOGGING .......................................................................................................... 94
GEOLOGICAL LOGGING .............................................................................................................. 94
STRUCTURAL DATA ..................................................................................................................... 95
GEOTECHNICAL DATA ................................................................................................................. 95
ROCK DENSITY MEASUREMENT ................................................................................................ 95
SAMPLE QUALITY ......................................................................................................................... 96
13
13.1
13.2
13.3
SAMPLE PREPARATION, ANALYSES & SECURITY ............................................... 96

SAMPLE SECURITY ...................................................................................................................... 96
ANALYTICAL LABORATORY, SAMPLE PREPARATION & ANALYTICAL PROCEDURES.......... 96
ADEQUACY OF PROCEDURES ................................................................................................... 96
14
14.1
14.5
DATA VERIFICATION ............................................................................................. 97

DRILLING & SAMPLING INTERNAL QUALITY CONTROL PROCEDURES ................................. 97
14.1.1 Collar location .................................................................................................................. 97
14.1.2 Downhole Survey ............................................................................................................ 97
14.1.3 QAQC Data Verification ................................................................................................... 97
14.1.4 Database Generation & Validation................................................................................. 100
INDEPENDENT GEOLOGIST DRILLING & SAMPLING DATA VERIFICATION .......................... 100
AMEC MINPROC DRILLING & SAMPLING DATA VERIFICATION ............................................. 101
14.3.1 Drilling ........................................................................................................................... 101
14.3.2 Sampling ....................................................................................................................... 101
14.3.3 Collar location ................................................................................................................ 101
14.3.4 Downhole survey ........................................................................................................... 101
14.3.5 Sample database integrity ............................................................................................. 101
14.3.6 Independent samples .................................................................................................... 102
ANALYTICAL QUALITY CONTROL PROCEDURES & ASSESSMENT....................................... 102
14.4.1 Introduction .................................................................................................................... 102
14.4.2 Blanks............................................................................................................................ 102
14.4.3 Standard Samples ......................................................................................................... 103
14.4.4 Duplicate samples ......................................................................................................... 111
14.4.5 Data Quality Summary................................................................................................... 112
COMPARISON OF DATA TYPES TWIN DRILLHOLES ............................................................ 112
15
ADJACENT PROPERTIES ..................................................................................... 114
16
16.1
16.2
16.3
16.4
16.5
16.6
16.7
16.8
MINERAL PROCESSING & METALLURGICAL TESTING ...................................... 114

HISTORICAL TECK TESTING ..................................................................................................... 114
2010 AMEC MINPROC TESTING PRELIMINARY RESULTS ................................................... 114
SAMPLE SELECTION .................................................................................................................. 115
SAMPLE INSPECTION ................................................................................................................ 115
OXIDE SAMPLES......................................................................................................................... 115
SUPERGENE SAMPLES .............................................................................................................116
HYPOGENE SAMPLES ............................................................................................................... 117
COMMINUTION TESTWORK ...................................................................................................... 117
14.2
14.3
14.4
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Technical Report
16.9
FLOTATION TESTWORK ............................................................................................................118
17
17.1
17.2
17.9
17.10
17.11
17.12
17.13
MINERAL RESOURCE & MINERAL RESERVE ESTIMATES ................................. 118

INTRODUCTION .......................................................................................................................... 118
STUDY DATA ............................................................................................................................... 119
17.2.1 Drillhole Database & Solids ........................................................................................... 119
17.2.2 Data Preparation ........................................................................................................... 120
GEOLOGICAL MODEL ................................................................................................................ 121
17.3.1 Lithological Model .......................................................................................................... 121
17.3.2 Structural model ............................................................................................................ 123
17.3.3 Mineralogical Model ....................................................................................................... 123
17.3.4 Alteration Model............................................................................................................. 125
GRADE ENVELOPE MODELS..................................................................................................... 126
TOPOGRAPHY ............................................................................................................................ 130
STATISTICAL ANALYSIS & VARIOGRAPHY .............................................................................. 131
17.6.1 Sample Coding .............................................................................................................. 131
17.6.2 Data Compositing .......................................................................................................... 133
17.6.3 Statistical Analysis .........................................................................................................133
17.6.4 Outlier Analysis - Capping ............................................................................................. 140
17.6.5 Variography ...................................................................................................................142
BLOCK MODEL DEVELOPMENT ................................................................................................ 147
17.7.1 Model Characteristics .................................................................................................... 147
17.7.2 Model Coding ................................................................................................................ 147
17.7.3 Model Transformation .................................................................................................... 147
GRADE ESTIMATION .................................................................................................................. 147
17.8.1 Estimation Technique .................................................................................................... 147
17.8.2 Domain Constraints ....................................................................................................... 148
17.8.3 Search Strategy & Kriging Neighbourhood .................................................................... 148
DENSITY ASSIGNMENT ............................................................................................................. 149
MODEL VALIDATION................................................................................................................... 151
RESOURCE CLASSIFICATION ................................................................................................... 154
RESOURCE REPORTING ...........................................................................................................156
MINERAL RESERVES ................................................................................................................. 158
18
OTHER RELEVANT DATA AND INFORMATION ................................................... 158
19
INTERPRETATION & CONCLUSIONS .................................................................. 159
20
RECOMMENDATIONS ........................................................................................... 161
21
REFERENCES........................................................................................................ 163
22
DATE AND SIGNATURE PAGES ........................................................................... 164
23
ILLUSTRATIONS ................................................................................................... 172
17.3
17.4
17.5
17.6
17.7
17.8
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Technical Report
List of Tables
Table 1-1
Table 1-2
Table 1-3
Table 2-1
Table 4-1
Table 6-1
Table 6-2
Table 6-3
Table 6-4
Table 6-5
Table 11-1
Table 11-2
Table 11-3
Table 11-4
Table 11-5
Table 11-6
Table 12-1
Table 14-1
Table 14-2
Table 14-3
Table 14-4
Table 14-5
Table 14-6
Table 14-7
Table 16-1
Table 16-2
Table 16-3
Table 16-4
Table 17-1
Table 17-2
Table 17-3
Table 17-4
Table 17-5
Table 17-6
Table 17-7
Table 17-8
Table 17-9
Table 17-10
December 2010 Model Resource Report within the Cu Envelope at a 0.2% CuTotal
Cut-off Grade by Resource Category ................................................................................... 14
December 2010 Model Resource Report within the Cu Envelope
Measured+Indicated ............................................................................................................. 15
Geology & Exploration Proposed 2011 Budget ..................................................................... 16
Qualified Persons & Responsibilities .................................................................................... 18
Zafranal Concession List ......................................................................................................21
Teck Drilling Phases at Zafranal ........................................................................................... 34
Zafranal Teck Drillhole Location ........................................................................................... 36
Teck Sicera South 2007 Drilling Programme ........................................................................ 40
Teck 2006-2007 Drilling Programme Campanero/Sicera West .......................................... 44
Teck 2006 Las Pampas Drilling Programme......................................................................... 47
Significant Results from AQM Diamond Drilling Programme in the Zafranal Main Zone ....... 68
AQM Drillhole Collar Location as at November 2010 ............................................................ 77
Significant Results from AQM RC Drilling Programme in the Zafranal Main Zone ................ 85
RC Collar Location for Sicera South & Sicera North ............................................................. 87
RC Collar Location for Sicera South & Sicera North ............................................................. 88
Distribution of Downhole Surveying Methods in the Zafranal 2009-2001 Drilling
Programme ........................................................................................................................... 93
Number of Samples Collected for Bulk Density Measurements by Lithology ........................ 96
Standards used for the 2009-2010 Zafranal Drilling Programme .......................................... 98
Summary of Zafranal Analytical QAQC Programme ........................................................... 102
Blanks Statistics ................................................................................................................. 103
AQM Standards Characteristics.......................................................................................... 104
Standard Results ................................................................................................................ 104
Field Duplicate Results .......................................................................................................111
Twin Drillhole List ............................................................................................................... 113
Zone Samples .................................................................................................................... 115
Selection of Oxide Samples ................................................................................................ 116
Selection of Supergene Samples........................................................................................ 116
Selection of Hypogene Samples ......................................................................................... 117
Drillhole Data & Block Model Codes ................................................................................... 132
Summary Statistics of 2 m Composites inside the 0.2% CuTotal Grade Envelope ............. 136
CuTotal Average Grade for 2 m Composites inside the 0.2% CuTotal Grade Envelope ..... 137
Variogram Parameters........................................................................................................ 144
Block Model Characteristics ............................................................................................... 147
Kriging Neighbourhood Parametres .................................................................................... 148
Average Bulk Density .........................................................................................................151
Cut-off Grade by Resource Category ................................................................................. 156
Cut-off Grade by Resource Category & Mineralogical Domain ........................................... 156
December 2010 Model Resource Report within the Cu Envelope
Measured+Indicated ...........................................................................................................157
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Technical Report
Table 17-11
Table 19-1
Table 20-1
December 2010 Model Resource Report within the Cu Envelope Inferred ...................... 157
Cut-off Grade by Resource Category ................................................................................. 161
Geology & Exploration Proposed 2011 Budget ................................................................... 161
List of Figures
Figure 4-1
Figure 4-2
Figure 4-3
Figure 6-1
Figure 6-2
Figure 6-3
Figure 6-4
Figure 6-5
Figure 6-6
Figure 6-7
Figure 6-8
Figure 6-9
Figure 6-10
Figure 7-1
Figure 7-2
Figure 7-3
Figure 7-4
Figure 7-5
Figure 7-6
Figure 7-7
Figure 7-8
Figure 9-1
Figure 9-2
Figure 10-1
Figure 10-2
Figure 10-3
Figure 11-1
Figure 11-2
Figure 11-3
Figure 11-4
Figure 11-5
Figure 12-1
Figure 14-1
Figure 14-2
Figure 14-3
Figure 14-4
Figure 14-5
Figure 17-1
Figure 17-2
Zafranal Location Map .......................................................................................................... 21

Zafranal Concession Map ..................................................................................................... 23
Zafranal Property with Mineralised Zones............................................................................. 24
Teck Geology, Alteration & Drillhole Map ............................................................................. 31
Zafranal Gridded Copper Geochemistry ............................................................................... 32
Zafranal Gridded Gold Geochemistry ................................................................................... 33
Sicera South Prospect Geology & Alteration ...................................................................... 38
Sicera South Prospect Geological Model........................................................................... 39
Sicera South Prospect Geochemistry & Drillhole Location................................................. 39
Sicera North Prospect Geology & Geochemistry ............................................................... 42
Sicera North Prospect Geology & Geochemistry (detail) ................................................... 43
Campanero Prospect Geology, Alteration & Drillhole Location Map .................................. 45
Ganchos Prospect Geology & Drillhole Location Map ....................................................... 46
Zafranal Regional Geological Map ........................................................................................ 48
Zafranal Regional Geological Map Legend ........................................................................... 49
Zafranal Main Zone Geological Map ..................................................................................... 50
Zafranal Main Zone Alteration Map ....................................................................................... 50
Zafranal Structural Controls ..................................................................................................55
Zafranal Porphyry Relative to the Incapuquio Fault System ................................................. 56
Section 793 700N Mineralisation Zoning & Faults ............................................................. 56
Evidence of Structural Control at Zafranal ............................................................................ 57
Photo - Casts Filled with Hematite ........................................................................................ 61
Photo Parallel D Veins ....................................................................................................... 61
Zafranal Main Zone Surface Geochemical Results for Gold .............................................. 66
Zafranal Sicera South Zone Surface Geochemical Results for Copper ............................. 66
Magneto-tellurics Depth Slice 200m below Surface .............................................................. 67
Diamond Drilling completed by AQM during 2010 ................................................................ 84
RC Drilling completed by AQM during 2010 ......................................................................... 87
RC Drilling completed on the Sicera South Target................................................................ 89
RC Drilling completed on the Sicera North Target ................................................................ 89
Average Core Recovery % vs. CuTotal Grade Bins.............................................................. 91
Lithological Codes used at Zafranal ...................................................................................... 95
Chronological Sequence of Blank Results for CuTotal & Au ............................................... 103
CuTotal & Au Standards Global Chronological Graphs.................................................... 106
CuTotal & Au Standards - Chronological Graphs................................................................ 106
CuTotal & Ag Standards - Chronological Graphs................................................................ 110
Field Duplicates Scatter Graphs ......................................................................................... 112
3D View Zafranal Lithological Units Zafranal Diorite ..................................................... 121
3D View Zafranal Lithological Units Microdiorite ........................................................... 122
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Figure 17-3
Figure 17-4
Figure 17-5
Figure 17-6
Figure 17-7
Figure 17-8
Figure 17-9
Figure 17-10
Figure 17-11
Figure 17-12
Figure 17-13
Figure 17-14
Figure 17-15
Figure 17-16
Figure 17-17
Figure 17-18
Figure 17-19
Figure 17-20
Figure 17-21
Figure 17-22
Figure 17-23
Figure 17-24
Figure 17-25
Figure 17-26
Figure 17-27
Figure 17-28
Figure 17-29
Figure 17-30
Figure 17-31
Figure 17-32
Figure 17-33
Figure 17-34
3D Views Zafranal Lithological Units Dykes .................................................................. 122

3D View Zafranal Topography & Structural Features ....................................................... 123
Threshold Ratios & Mineralogical Domain Boundaries ....................................................... 124
Long Section at 8224350N looking North ........................................................................ 124
Section 793300E looking East ......................................................................................... 124
Section 793800E looking East ......................................................................................... 125
3D View Zafranal Alteration Units Potassic Alteration ................................................... 125
3D View Zafranal Alteration Units Hornfels Alteration ................................................... 126
Long Section at 8224350N Copper Grade Envelope, Supergene Zone & Drillhole
Traces ................................................................................................................................ 126
Section 793300N Copper Grade Envelope, Supergene Zone & Drillhole Traces ............ 127
Section 793800N - Copper Grade Envelope, Supergene Zone & Drillhole Traces ............. 128
Long Section at 8224350N Gold Grade Envelope, Supergene Zone & Drillhole
Traces ................................................................................................................................ 129
Section 793300N Gold Grade Envelope, Supergene Zone & Drillhole Traces.................... 129
Section 793800N Gold Grade Envelope, Supergene Zone & Drillhole Traces.................... 130
3D Views of Zafranal Topography & Drillhole Traces ......................................................... 131
Histogram of Sample Lengths inside the Cu Envelope ....................................................... 133
Average Grade for CuTotal and Au per Mineralogical & Geological Domains .................... 134
Average Grade for CuTotal, Au and Sulphur per Mineralogical & Geological Domains
only data included in the copper envelope ........................................................................ 135
CuTotal Average Grade Variation with Easting & Relative Elevation inside 0.2%
CuTotal Grade Envelope .................................................................................................... 137
Au Average Grade Variation with Easting & Relative Elevation inside 0.1 g/t Au Grade
Envelope ............................................................................................................................ 137
Au Average Grade Variation with Relative Elevation inside 0.2% CuTotal Grade
Envelope ............................................................................................................................ 138
Log Probability Plots of CuTotal Grades Composites inside the 0.2% CuTotal
Envelope per Mineralogy .................................................................................................... 138
Log Probability Plots of Supergene CuTotal & CuCN Grades Composites inside the
0.2% CuTotal Envelope per Lithology ................................................................................. 139
0.2% CuTotal Envelope per Alteration Domain ................................................................... 139
Log Probability Plot of Gold Composites inside the 0.2% CuTotal Envelope per
Mineralogy .......................................................................................................................... 140
Spatial Distribution on Plan View of +2.5% CuTotal Assay Values with Associated
Gold & Arsenic.................................................................................................................... 141
Spatial Distribution on Plan View of +0.8 g/t Au Assay Values with Associated Arsenic ..... 142
Modelled Variograms ..........................................................................................................144
Variation of Density Measurements with Relative Depth per Mineralogical Zone &
Lithology ............................................................................................................................. 150
Variation in Average Bulk Density Measurements with Elevation in Hypogene .................. 151
December 2010 CuTotal Resource Model Long Sections with Drillhole Data & Block
Model.................................................................................................................................. 152
December 2010 CuTotal Resource Model Sections with Drillhole Data & Block
Model.................................................................................................................................. 153
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Technical Report
Figure 17-35
Figure 17-36
Figure 17-37
Grade Trends Input Drilling Data & Output Grade CuTotal Model Average Grade
per Easting ......................................................................................................................... 154
Resource Classification Long Sections ............................................................................ 155
Grade Tonnage Diagrams December 2010 Resource Model Measured+Indicated
Resource ............................................................................................................................ 157
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SUMMARY
1.1
SCOPE, BACKGROUND & LAND OWNERSHIP
AMEC Minproc Limited (AMEC Minproc) and AQM Copper Inc. (AQM) have prepared an Independent
Technical Report on the Zafranal Copper Project (the Project, the Zafranal Project). This report
complies with disclosure and reporting requirements set forth in the National Instrument 43-101,
Companion Policy 43-101CP, and Form 43-101F1.
This report presents the December 2010 Mineral Resource estimate for the AQM Zafranal Project in
Peru. The trigger for the preparation of the Technical Report was the press release disclosure of the
Zafranal Main Zone Mineral Resource made by AQM on 13th January 2011.
The Zafranal Project is located in south western Peru, in the Huancarqui and Lluta Districts in the
Provinces of Castilla and Caylloma, in the Department of Arequipa. The property is on two Peruvian
National Topographic system map sheets, namely Huambo (32-r) and Aplao (33-r).
The property is located northwest of the city of Arequipa, approximately 150 road kilometres from the
town.
The Project is comprised of the Zafranal Main Zone porphyry and five other porphyry prospects,
namely; Campanero, Ganchos, Sicera South, Sicera Norte and Rosario, all of which are located within
the Zafranal mining concessions covering 26 899.63 hectares.
On May 14, 2009, AQM Copper Inc. through its wholly owned subsidiary AQM Copper Per SAC and
Teck Per SA (Teck) jointly announced the signature of an option/joint venture agreement (the Teck
Option) whereby Teck granted AQM Copper Per SAC an option to acquire an initial 51% interest in
the Zafranal copper-gold porphyry project from Teck, subject to Teck's right to earn-back to a 60%
interest. The agreement also provided options for AQM Copper Per SAC to increase its interest to
60%, and to 100% if Teck did not exercise its earn-back right.
On July 8th 2010, AQM Copper Per SAC and Teck announced the signing of an amendment of the
original option agreement, whereby AQM immediately vested a 50% interest in the Project and the
formation of a 50/50 Joint Venture between Teck and AQM Copper Per SAC with respect to the
project. All cash payments, NSR royalty payments and back-in rights to Teck were eliminated in
exchange for the issuing of 5 million AQM Copper Per SAC shares, the full funding of an additional
$10.7 million in exploration expenditures on top of the $7.5 million originally stipulated by the option
agreement, and the right for Teck to choose to become Project operator once a production decision has
been made.
At the time of writing of this report, all of the above conditions have been met and the 50/50 Joint
Venture is officially operational, with both parties contributing equally to the Project expenditures. AQM
Copper Per SAC remains the Project operator.
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Technical Report
1.2
GEOLOGY, MINERALISATION & EXPLORATION
The Late Cretaceous to early Paleocene, 81 million year old Zafranal porphyry copper-gold deposit lies
near the northern end of the Porphyry Copper Belt in southern Peru and is the oldest of all the known
porphyry deposits occurring within the belt. The porphyry belt is controlled by the Incapuquio Fault
System, a series of parallel to semi-parallel NW trending faults traversing much of the rigid continental
margin of southern Peru.
The Zafranal Main Zone lies within a fault-bounded block with north and south bounding faults trending
generally east-west. The host rocks within this block are Jurassic volcanoclastics, quartzite and fine
grained sedimentary interbedded within the volcanoclastics, and intrusive feldspar porphyry, which
have been intruded by diorites. Locally strongly deformed Cretaceous granodiorite batholithic rocks are
located north of the block and Jurassic sediments of the Yura Formation to the south of the block.
The deposit is supergene enriched with a leached cap ranging from 40 metres to 110 metres thick and
a supergene enriched blanket underlying it ranging up to 180 metres thick. The hypogene protore
below the enriched blanket has not been fully tested so is still of unknown depth. The deposit at the
surface is phyllically altered within the volcanics and sediments and biotite, phlogopite, chlorite and
sericite altered within the later diorites that intrude them. Pre-oxidation and leaching of the hypogene
mineralisation at surface occurred primarily as stockworks of sulphide vein-veinlets in quartz-sericite or
phyllically altered rocks within the volcano-sedimentary rocks and very minor to no mineralisation
occurring within the diorites at surface. The enriched copper sulphide blanket below the leached cap
transcends both the diorites and volcano-sedimentary rocks.
AQM has completed surface geochemical sampling in the Main Zone and the Sicera South targets. It
has also commissioned a magneto-tellurics study on the Zafranal Main Zone.
As of the date of this report, AQM has completed 67 283.50 metres of diamond and reverse circulation
(RC) drilling in 193 holes within the Main Zone.
1.3
METALLURGICAL & PROCESS STUDIES
The metallurgical testwork completed to date is as follows:
A metallurgical test programme on individual and composite samples was conducted at bench scale
evaluating comminution, flotation, regrinding, thickening, leaching and tailing characterisation
Bond abrasion indices varied from 0.09 to 0.22, increasing with depth, indicating a moderately
abrasive material
Morell crusher work indices varied from 4.56 kWh/t to 10.9 kWh/t. The wide distribution indicates
the coarse material varies from moderately soft to very hard at depth
Bond ball mill work indices fell in a narrow range between 9.86 kWh/t and 12.29 kWh/t indicating a
moderately hard material for ball milling
From a SAG mill grinding perspective, the material varied from soft (3.81 kWh/m3) to moderately
hard ( 9.37 kWh/m3) at depth
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Locked cycle copper recovery varied from 87.6% for supergene material to 91.4% for hypogene
material
Locked cycle gold recovery varied from 60.6% for supergene material to 74.5% for hypogene
material
Locked cycle concentrate grade varied from 41.0% Cu for supergene material to 33.0% Cu for
hypogene material, with no penalty elements above smelter limits
1.4
DATABASE & MINERAL RESOURCE
AMEC Minproc considers that AQMs assay, drillhole survey, drillhole collar and geological data
provides a reasonable representation of the geology and mineralisation of the Zafranal Project at the
current drillhole spacing and study level. AMEC Minproc considers that the data is also of sufficient
quality to support an Indicated Resource classification in the most densely drilled portions of the deposit
with limited in-filled areas of Measured Resource.
Resource estimation of the Zafranal Main Zone has been completed using a domain-controlled ordinary
kriging. Three-dimensional solid modelling of mineralogical and lithological domains have been
combined with a 0.2% total copper grade envelope to define, from the statistical analysis of the data, a
domain model to control the variography and the estimation process.
Density has been assigned to the model from a large number of measurements which were analysed
within the domains defined for the estimation process.
The resource model has been validated statistically and visually on sections and plans; it provides a
good representation of the Zafranal mineralisation, both in terms of grade averages and grade spatial
distribution within the grade envelopes.
The December 2010 resource estimate of the Zafranal Main zone at a 0.2% total copper cut-off grade is
presented in Table 1-1 with detailed report at different cut-off grades for Measured+Indicated material in
Table 1-2.
Mine planning work by AMEC Minproc indicates that using a copper price of $2.00/lb and gold price of
$800/oz, the resource would define a pit shell suitable for open pit mining. This work resource
demonstrates reasonable prospects for economic extraction. The work suggests that the 0.2% total
copper cut-off grade is reasonable.
Table 1-1
Cut-off Grade by Resource Category

Resource Category
Measured
Indicated
Measured+Indicated
Inferred
% Total
Tonnage
CuTotal
%
CuCN
%
CuS
%
Au
g/t
17
5%
0.93
0.71
0.12
0.09
284
81%
0.44
0.19
0.05
0.08
301
86%
0.47
0.22
0.05
0.08
51
14%
0.32
0.06
0.02
0.06
Tonnage
Mt
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Note:
CuCN corresponds to ALS Cu-AA16S cyanide soluble copper grade, CuS corresponds to ALS Cu-AA06S
weak sulphuric acid soluble copper grade
Table 1-2
December 2010 Model Resource Report within the Cu Envelope Measured+Indicated
CuTotal
Cut-off Grade %
1.5
Tonnage
Mt
CuTotal
%
CuCN
%
CuS
Au
g/t
1.0
19
1.30
0.99
0.19
0.12
0.9
27
1.20
0.91
0.17
0.11
0.8
37
1.11
0.84
0.15
0.11
0.7
49
1.02
0.76
0.14
0.11
0.6
67
0.92
0.67
0.13
0.10
0.5
89
0.82
0.58
0.11
0.10
0.4
122
0.72
0.47
0.10
0.10
0.3
200
0.57
0.32
0.07
0.09
0.2
301
0.47
0.22
0.05
0.08
0.1
313
0.46
0.21
0.05
0.09
CONCLUSIONS
The Zafranal property currently holds a Measured plus Indicated resource of 301 Mt @ 0.47% total
copper at a 0.2% total copper cut-off grade in the Zafranal Main Zone. It was optioned by
AQM Copper Per SAC in May of 2009 from Teck. The option agreement was modified in July
2010 whereby AQM Copper Per SAC vested a 50% interest by making additional expenditures
totalling US$10.7 million and issuing Teck an additional 5 million shares. These commitments have
now been fulfilled and the Project is run as a 50/50 corporate Joint Venture between TRL and
AQM Copper Per SAC.
The Zafranal Property is made up of six copper-gold prospects: Zafranal Main Zone, Sicera South,
Sicera North, Campanero, Ganchos and Rosario. AQM Copper Per SAC has focused its
exploration on the Zafranal Main Zone.The geology of the Main Zone is dominated by a sequence
of Jurassic age volcanic and sedimentary rocks intruded by porphyritic diorite and microdiorite
stocks and plugs. Later dioritic and aphanitic intermediate composition dykes and sills cross-cut the
area. A complex set of EW and NW-SE reactivated faults appear to control hypogene
mineralisation. Supergene copper mineralisation is only affected by late normal movements along
these same faults.
Copper mineralisation occurs as oxides, a laterally continuous 50 m to 180 m thick blanket of

secondary enrichment and a large zone of primary mineralisation that remains open in all
directions. Porphyry-style copper-gold mineralisation has been identified over a 3.3 km strike
length, up to 600 metres in width and up to 400 metres in thickness.
AQM has completed a first phase, 67 283.50 metre drill programme at the Zafranal Main Zone and
a 5 529 metre RC exploratory drilling programme at its Sicera South and Sicera North targets.
Scout drilling at the Sicera South and Sicera North targets has identified potentially significant
hypogene copper mineralisation that could significantly increase the overall mineral inventory at
Zafranal.
The resource at the Zafranal Main Zone, as of January 13th 2011 is shown in Table 1-1.
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1.6
RECOMMENDATIONS
AQM has commissioned AMEC Minproc to complete a Scoping Study for the Zafranal Copper Project
the first quarter of 2012; it is planned that the study will include the following:
Geology & Exploration
An additional 28 500 metres of diamond drilling for the Zafranal Main Zone in order to better define
the limits of the mineralization and increase the Measured and Indicated component of the Zafranal
Main Zone resource
An additional 30 000 metres of diamond drilling in the Sicera North area, where exploratory
drilling during 2010 identified a potentially significant hypogene copper target with a large alteration
area
An additional 22 000 metres of of reverse circulation drilling on various satellite porphyry targets
and gravel covered areas
A complementary geophysical campaign on the satellite targets
Further detailed mapping of the Zafranal Main Zone and all of the satellite targets
Additional analytical QAQC independent laboratory checks assays
The proposed budget for the geology and exploration activities is planned as follows:
Table 1-3
Geology & Exploration Proposed 2011 Budget
Item
Estimated Cost (US$)
Main Zone Drilling (28 500 m all cost)
$6 000 000
Sicera North Diamond Drilling (30 000m all in cost)
$6 300 000
RC Drilling on Satellites and Gravel Covered Areas (22 000m all in cost)
$2 900 000
Geophysics on Satellite targets
Mapping & other Geological Studies
Total
$200 000
$200 000
$15 600 000
Metallurgical & Process

It is recommended that the 2011 test programme be designed to more fully determine leach, flotation
and comminution variability throughout the mineralisation - dependent on ore type and oxidation levels,
quantify the extent of recovery variability- in order to generate a better understanding of the impact of
mineralogy on recovery and evaluate the impact of copper mineralogy and ore variability with respect to
hardness, competency and throughput, in alignment with the preliminary mine plan.
It is planned that locked cycle flotation test work will be conducted, with both site bore water and sea
water. It is recommended that the test programme be conducted on a mine plan weighted basis. It is
anticipated that ore will be grouped into early mine life, mid-mine life and late mine life for detailed
evaluation. The test work programme will be weighted towards the earlier mine life samples.
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Technical Report
Base conditions as developed in the 2010 test programme will be used for the flotation programme. A
leach plan will be developed to evaluate sulphuric acid, and bacteria assisted leach options for oxide,
leached cap and supergene ore types.
Resource Modelling
Following the completion of the additional drilling, the resource estimate of the Zafranal Main Zone will
be updated for the 2011 Scoping Study. Additional resource analysis and estimation will include the
following:
Update of the copper and gold estimates with the added 2011 drilling information
Estimation of the accessory elements S, Fe, As and Zn
Analysis and estimation of the CRU-31 test data to develop a relative hardness model for mine
planning purposes
The Sicera North target will also be interpreted and modelled to arrive at a comprehensive total project
resource encompassing the Zafranal Main Zone and the satellite deposits.
Mining, Geotechnical, Hydrological/Hydrogeological, Environmental & Engineering
Project work for these disciplines will continue over the course of 2011 to produce reliable information
to scoping study level for the Zafranal Main Zone and the satellite deposits.
INTRODUCTION
2.1
SCOPE OF THE REPORT
This Technical Report on the Zafranal Copper Project has been prepared to comply with the disclosure
and reporting requirements set forth in the National Instrument 43-101, Companion Policy 43-101CP,
and Form 43-101F1. The report is intended as a summary of current activities on the property, to
provide support for written disclosures regarding the December 2010 resource estimate for the Main
Zone of the Zafranal deposit completed by AMEC Minproc and to provide recommendations for further
project work. It complies with Canadian National Instrument 43-101 for the Standards of Disclosure for
Mineral Projects of December 2005 (the Instrument) and the resource and reserve classifications
adopted by CIM Council in November 2004.
The trigger for the preparation of the Technical Report was the press release disclosure of the Zafranal
Main Zone Mineral Resource made by AQM on 13th January 2011.
2.2
QUALIFICATIONS & PERSONNAL SITE INSPECTIONS
AMEC Minproc was appointed by AQM to complete a resource estimation of the Zafranal deposit,
undertake metallurgical testing and compile the Technical Report. AMEC Minproc is currently
undertaking a scoping study for the Project which will include a resource update, metallurgical testwork,
mine design, plant and infrastructure design and development of capital and operating costs.
The current report documents the first AMEC Minproc resource estimate and provides information on
the preliminary metallurgical testwork results.
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The following professionals were instrumental in the completion of the Technical Report:
Annick Manfrino (Engineer ENSG, MAIG), Consultant Resource Analyst to AMEC Minproc Limited,
is the Qualified Person (QP) responsible for the preparation of the current estimate detailed in
Section 17. Annick Manfrino visited the AQM Zafranal properties and ALS Chemex Arequipa and
Lima laboratories between the 16 and 19 February 2010 and was at the Zafranal site for a duration
of 2 days. Annick Manfrino is also responsible for the overall compilation of the Technical Report
and the preparation of Sections 1, 2, 3, 12, 13, 14, 15, 17, 18, 19 and 20.
Greg Harbort (Ph.D. MAusIMM), Manager Process at AMEC Minproc Limited is the QP responsible
for the process and metallurgical data presented in the Technical Report summarised in Section 16.
Greg Harbort has visited the Zafranal properties and ALS Chemex Arequipa and Lima laboratories
on several occasions in 2010.
James McCrea (P. Geo.) is the QP responsible for compiling a summary of the geology and
exploration activities for the Zafranal Project and providing recommendations for further work in
these disciplines. James McCrea is responsible for the preparation of Sections 4, 5, 6, 7, 8, 9, 10
and 11. James McCrea is an independent geologist and has been involved in the exploration
activities at Zafranal for several years
Responsibilities for the preparation of certain sections of the Technical Report are listed in Table 2-1.
Table 2-1
Qualified Persons & Responsibilities

Relevant Technical Report
Qualified Person
Company
Annick Manfrino
AMEC Minproc
1,2,3,12,13,14,15,17,18,19,20
Greg Harbort
AMEC Minproc
16
James McCrea
Independent geologist
4,5,6,7,8,9,10,11
2.3
Sections
PRINCIPAL SOURCES OF INFORMATION
In addition to site visits undertaken to the Zafranal Project in 2009 and 2010, the authors of this report
have relied extensively on information provided by AQM.
Information and data used in this report consists of field observations made by the authors, data
collected by AQM in the field and reports from the previous operators of the Zafranal Project.
Information concerning mining concessions comes from Perus mining claim registry: Instituto
Geolgico Minero y Metalrgico (INGEMMET). A detailed list of references and sources of information
is provided in the References section (Section 21) of this report.
The authors have made all reasonable enquiries to establish the completeness and authenticity of the
information provided and identified, and a final draft of this report was provided to AQM along with a
written request to identify any material errors or omissions prior to lodgement.
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2.4
INDEPENDENCE
AMEC Minproc is not an associate or affiliate of AQM, or of any associated company. AMEC Minprocs
fee for this Technical Report is not dependent in whole or part on any prior or future engagement or
understanding resulting from the conclusions of this report. The fee is in accordance with standard
industry fees for work of this nature.
James McCrea who authored the geological sections and the historic and current exploration activities
sections on the Zafranal Project is an independent Qualified Person under NI 43-101,
2.5
DEFINITIONS & ABBREVIATIONS
Currency used in this report is in United States dollars. Copper grades are Total Copper grades unless
otherwise specified.
Definitions of terms and acronyms used in this report are listed below:
AA
Ag
amsl
AusIMM JORC
Au
Avg
bn
CIM
cp
Cu
CV
DDH
dg
Fe
g
g/t
ha
kg
km
L
m
Mg
Mo
NI 43-101
Pb
ppm
py
RC
Si
m
Zn
atomic absorption spectroscopy

silver
above mean sea level
Australasian Institute of Mining and Metallurgy, Joint Ore Reserve Committee
gold
average
bornite
Canadian Institute of Mining, Metallurgy and Petroleum
chalcopyrite
copper
coefficient of variation (CV)
Diamond Drill Hole
digenite
iron
gram
grams per tonne
hectares
kilogram
kilometre
litre
metre
magnesium
molydenum
Canadian National Instrument 43-101
lead
parts per million
pyrite
reverse circulation
silicon
micron
zinc
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RELIANCE ON OTHER EXPERTS
The authors have relied, and believe to have a reasonable basis to rely upon the employees and
contractors of AQM and its Peruvian subsidiary, AQM Copper Per SAC. Tom Henricksen, P.Geo,
Chief Geologist for AQM and Alvaro Fernndez-Baca, P.Geo, General Manager of AQM who compiled
the history, drilling and other geological sections for this report.
The exploration and drilling reports of Teck were used as a source to write the exploration history and
other geological sections of this report.
AMEC Minproc relied on the drillhole database information and wireframe models provided by AQM
and Atticus Associates (Atticus) to calculate the Zafranal resource estimate.
PROPERTY DESCRIPTION & LOCATION
4.1
BACKGROUND INFORMATION ON PERU
Peru has a long history of mining, dating back to pre-colonial times. Since 1994, Peru has liberalised its
mining laws allowing foreign and domestic investment into its mining sector, which has led to significant
growth in the sector and in the economy in general. Over 50% of Peruvian exports are mineral ores or
metal, and a significant portion of the countrys tax revenue originates from the mining sector.
Perus economy has diversified significantly in the last 10 years, thanks to free trade agreements with
most of its major trading partners. Although mining remains the dominant sector in the economy,
textiles, agribusiness and industrial goods are slowly gaining importance.
Liberal economic policies implemented in the early 1990s mean that Peru has seen a long period of low
inflation and a stable economy. Excepting 2009, Peru has seen annual economic growth of over 5%
since the early 2000s. Economic stability has also allowed very large mining investments to go ahead
in the last few years, including the Bayovar phosphate deposit, the Las Bambas copper deposit and the
expansion of the Cerro Verde copper mine. Additionally, the country has a significant labour pool
experienced in the mining sector.
4.2
PROJECT LOCATION
The Zafranal property is located along the Incapuquio Fault System which hosts the Southern Peru
Copper Belt, approximately 153 road kilometres northwest of the city of Arequipa (Figure 4-1). The
geographic centre of the property is located at approximately 16o 0228.8 degrees south latitude and
72o 1418.8 west longitude. The UTM (Zone 18S) coordinates using datum PSAD56 are 794 200 m
east and 8 224 400 m north.
The Zafranal property covers 26 899.63 hectares in the district of Huancarqui in the province of Castilla
and the district of Lluta in the province of Caylloma, Departmento of Arequipa, Peru. The property is on
two Peruvian National Topographic system map sheets: Huambo (32-r) and Aplao (33-r). Concession
details are listed in Table 4-1 and shown in Figure 4-2, as verified by the author.
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Technical Report
Figure 4-1
Zafranal Location Map
Table 4-1
Zafranal Concession List
Concession
Ministry
Expiry
Concession
Concession
Name
Code
Date
Granted
Holder
Campanero 1
01-02782-08
Trmite
06/30/10
05.05.2008
TECK
1,000
Campanero 2
Charo 1
01-02781-08
Trmite
06/30/10
05.05.2008
TECK
400
01-05540-07
Trmite
06/30/10
25.10.2007
TECK
1,000
Sicera 1
Sicera 2
01-02489-03
Titulado
06/30/10
22.07.2003
TECK
1,000
01-02950-03
Titulado
06/30/10
05.09.2003
TECK
500
Sicera 3
01-03137-03
Titulado
06/30/10
25.09.2003
TECK
900
Sicera 4
01-03303-03
Titulado
06/30/10
13.10.2003
TECK
1,000
Zafranal 1
01-01354-03
Titulado
06/30/10
16.04.2003
TECK
730.2475
Zafranal 2
01-01751-03
Titulado
06/30/10
20.05.2003
TECK
27.1999
Zafranal 3
01-01753-03
Titulado
06/30/10
20.05.2003
TECK
525
Zafranal 4
01-02694-03
Titulado
06/30/10
12.08.2003
TECK
799.9947
Zafranal 7
01-03138-03
Titulado
06/30/10
25.09.2003
TECK
862.6361
Zafranal 8
01-03400-03
Titulado
06/30/10
24.10.2003
TECK
473.5635
Zafranal 9
01-03575-03
Titulado
06/30/10
05.11.2003
TECK
500
Zafranal 10
01-03608-03
Titulado
06/30/10
12.11.2003
TECK
600.0007
Zafranal 11
01-03609-03
Titulado
06/30/10
12.11.2003
TECK
600.0007
Zafranal 12
01-02607-04
Titulado
06/30/10
03.08.2004
TECK
970.6124
Zafranal 13
01-02608-04
Titulado
06/30/10
03.08.2004
TECK
1,000
Zafranal 14
01-02609-04
Titulado
06/30/10
03.08.2004
TECK
848.8026
Zafranal 15
01-02610-04
Titulado
06/30/10
03.08.2004
TECK
23.7606
Status*
Hectares

Technical Report
Concession
Ministry
Name
Code
Expiry
Concession
Concession
Date
Granted
Holder
Zafranal 16
01-02611-04
Zafranal 17
01-02612-04
Titulado
06/30/10
03.08.2004
TECK
837.8157
Titulado
06/30/10
03.08.2004
TECK
1,000
Zafranal 18
Zafranal 21
01-02613-04
Titulado
06/30/10
03.08.2004
TECK
1,000
01-02616-04
Titulado
06/30/10
03.08.2004
TECK
1,000
Zafranal 34
01-02629-04
Titulado
06/30/10
03.08.2004
TECK
1,000
Zafranal 35
01-02630-04
Titulado
06/30/10
03.08.2004
TECK
700
Zafranal 36
01-02631-04
Titulado
06/30/10
03.08.2004
TECK
500
Chcharron_N_5
01-02090-03
Titulado
06/30/10
23.06.2003
TECK
1,000
Chicharron_N_6
01-02091-03
Titulado
06/30/10
23.06.2003
TECK
700
Chicharron_N_7
01-02092-03
Titulado
06/30/10
23.06.2003
TECK
1,000
Chicharron_N_8
01-02093-03
Titulado
06/30/10
23.06.2003
TECK
1,000
Chicharron_11
01-02104-03
Titulado
06/30/10
23.06.2003
TECK
1,000
Amalia Guillermina
01-01725-03
Titulado
06/30/10
15.05.2003
AQM
200
AQP I
01-02098-09
Trmite
06/30/10
17.08.2009
AQM
800
AQP II
01-02099-09
Trmite
06/30/10
17.08.2009
AQM
500
01-02100-09
Trmite
06/30/10
17.08.2009
AQM
900
AQP III
Status*
Hectares
*Concession status: Titulado, titled or Trmite, awaiting final publication
4.2.1
Mineral Rights, Agreements & Royalties
On May 14, 2009, AQM through its wholly owned subsidiary, AQM Copper Per SAC, and Teck Per
SA (previously defined) jointly announced the signature of an option/joint venture agreement (the Teck
Option) whereby Teck granted AQM Copper Per SAC an option to acquire an initial 51% interest in
the Zafranal copper-gold porphyry project from Teck, subject to Teck's right to earn-back to a 60%
interest. The agreement also provided options for AQM Copper Per SAC to increase its interest to
60%, and to 100% if Teck did not exercise its earn-back right.
On July 8th 2010, AQM Copper Per SAC and Teck announced the signing of an amendment of the
original option agreement, whereby AQM Copper Per SAC immediately vested a 50% interest in the
Project and the formation of a 50/50 corporate Joint Venture between TRL and AQM Copper Per SAC.
All cash payments, NSR royalty payments and back-in rights to Teck were eliminated in exchange for
the issuing of 5 million AQM shares, the full funding of an additional $10.7 million in exploration
expenditures on top of the $7.5 million originally stipulated by the option agreement, and the right for
TRL to choose to become Project operator once a production decision has been made.
At the time of writing of this report, all of the above conditions have been met and the 50/50 Joint
Venture is officially operational, with both parties contributing equally to the Project expenditures.
AQM Copper Per SAC remains the Project operator.
The Project covers an area of 26 899.6 has, including 19 799.6 ha 100% owned by Teck and the 4 700
ha Chicharron option from BHPB Minerals (BHPB Option), which is subject to a 1.5% capped NSR
royalty.
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Technical Report
Teck has already properly exercised the BHPB Option, and title transfer has been formalised in favour
of Teck. AQM has also acquired the Amalia Guillermina claim which hosts the Sicera North prospect.
The purchase was executed on June 26, 2009, and AQM now owns 100% of the property after making
a onetime payment of US$50 000 to the owner. Under the terms of the Teck option, any additional
property staked or acquired by AQM, such as Amalia Guillermina, automatically becomes part of the
Zafranal Project and are subject to the terms of the Teck Option.
All the concessions are in good standing as of the effective date of this Report. AQM has paid the
annual license fee for the concessions for the year 2011. The Property has not been legally surveyed.
Known porphyry-type Cu-Au mineralisation on the Zafranal property is located in six separate and
distinct areas (Figure 4-3Error! Reference source not found.). These prospect areas are called the
Zafranal Main Zone, Campanero, Ganchos, Rosario, Sicera South, and Sicera North.
Figure 4-2
Zafranal Concession Map
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Technical Report
Figure 4-3
Zafranal Property with Mineralised Zones
4.3
MINERAL TENURE, AGREEMENTS & ENVIRONMENTAL REGULATION
4.3.1
Mineral Tenure
Peru is a country with a stable mining industry and mature mining laws. The General Mining Law of
Peru was changed in the mid 1990s to foster the development of the countrys mineral resources. The
law defines and regulates different categories of mining activities according to stage of development
(prospecting, exploitation, processing, and marketing). Titles over mineral claims are controlled by
INGEMMET (Geological, Mineral and Metallurgical Survey of Peru). Mining titles (mining concessions)
are granted using UTM coordinates (PSAD56) to define areas in hectares. New mining concessions
shall be at least of 100 ha in size (1 km2), and must be oriented in a north-south or east-west direction.
Pre-existing concessions, based on the old system (punto de partida or starting point system), can be
at any orientation.
The old framework which has been in force since 1992 establishes that mining concessions are
irrevocable if its titleholder complies with the annual payment of US$ 3.00 of validity fee per hectare and
reaches a minimum production of US$ 100.00 per hectare within six years following the year in which a
mining concession was granted, or otherwise pays a US$ 6.00 penalty per hectare per year as of the
first semester of the seventh year until such production is reached (penalties increase to US$ 20 from
the 12th year).
Currently a new regulation establishes that the holder of mining concessions shall achieve a minimum
production of at least one Peruvian Tax Unit (approximately US$ 1 900) per hectare per year, within a
10 year term following the year in which the mining concession title is granted. If the minimum
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production is not reached in the referred term, the mining concession holder shall pay penalties
equivalent to 10% of the Peruvian Tax Unit per hectare.
If minimum production within a 15 year term from the day in which the mining concession was granted
is not achieved, the mining concession will be cancelled unless a qualified major force event occurs and
is approved by the Mining Authority, or by paying the applicable penalties and providing evidence of a
minimum investment of at least ten times the amount of the applicable penalties. In this last case the
mining concession will not be cancelled up to a maximum term of five additional years (total term 20
years). If minimum production is not reached in the 20 year term the concession title will be inevitably
cancelled. According to these rules, the Project must reach production no later than 2018 or, should the
minimum required investment be spent, 2023 before the claims are cancelled.
While the holder of a mining concession is protected under the Peruvian Constitution and the Civil
Code, it does not confer ownership of land and the owner of a mining concession must deal with the
registered land owner to obtain the right of access to fulfil the production obligations inherent in the
concession grant. It is important to recognise that all transactions and contracts pertaining to a mining
concession must be duly registered with the Public Registry in the event of subsequent disputes at law.
Peru levies a gross concentrate sales royalty on commercial mineral production. The sliding-scale
royalty is levied based on gross annual sales of concentrate. Gross annual sales of up to US$ 60
million are subject to a 1% royalty, those between US$ 60 and US$ 120 million are subject to a 2%
royalty and gross annual sales of over US$ 120 million are subject to a 3% royalty.
4.3.2
Environmental Regulations & Exploration Permits
The General Mining Law, administered by the Ministry of Energy and Mines (MEM), may require a
mining company to prepare an Environmental Evaluation (EA), an Environmental Impact Assessment
(EIA), a Programme for Environmental Management and Adjustment (PAMA), and a Closure Plan prior
to mining construction and operation.
The Supreme Decree N 020-2004-EM classifies the environmental requirements for mining and
exploration programs as follows:
Category I: this category includes mining projects involving small scale drilling programmes up to
and including a maximum 20 drill pads, a disturbed area of less than 10 hectares considering
drilling platforms, trenches, auxiliary facilities and access means or the construction of tunnels with
a total maximum length of 50 metres. These projects require the preparation of an Environmental
Impact Declaration (Declaracin de Impacto Ambiental DIA-).
Category II: this category includes mining projects involving more than 20 drill pads, a disturbed
area of more than 10 hectares considering drilling platforms, trenches, auxiliary facilities and
access, or the construction of tunnels over a total length of 50 metres, require an authorisation
called an Environmental Impact Study-semi detailed (Estudio de Impacto Ambiental-semi
detallado, or EIA-sd) and is approved by the Ministry of Energy and Mines. Category II permits,
which include mining projects involving more than just drilling, must include, prior to their submittal
to the Ministry of Energy and Mines, water-use permits from the Ministry of Agriculture, land-use
agreements with the surface rights owners and evidence of having held town-hall meetings in all
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nearby communities. Additionally, the EIA-sd must include a detailed reclamation programme once
the drilling phase ends.
Permits are usually granted within 4 months of their submittal.
There are no known environmental liabilities at Zafranal.
ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE &

PHYSIOGRAPHY
5.1
ACCESSIBILITY
The Zafranal Property is located 90 kilometres northwest of the city of Arequipa, (population ~1 000
000), capital of the Arequipa Department in southern Peru. The property is 153 road kilometres from
Arequipa. Road access to the east side of the Zafranal property is by 42.2 kilometres of paved
Highway 34A to the Pan-American Highway South (1-S) junction then 53.3 kilometres on the PanAmerican to Pedregal. Pedregal is west of Arequipa. From Pedregal one takes gravel Highway 1-SJ
for 42.6 kilometres north toward Huambo in the Cachimayo quebrada, then approximately 15 kilometres
on an improved dirt road to the project camp. Access to the west side of the property is from Corire,
along the Rio Majes. Corire is northwest of Pedregal and is accessed by continuing along the PanAmerican to the west from the Pedregal turn-off for another 16.4 kilometres to the junction with paved
Highway 1-SG, then north on Highway 1-SG for 46.2 kilometres to Corire (population ~2 700) then
northeast up the improved dirt road in the Sicera quebrada for 30 kilometres to a central location
relative to the Main Zone and satellite deposits. Corire is the closest community to the Zafranal mining
concession via road access.
Access roads connecting the east and west sides of the property, allowing access between the six
known prospects, have been completed by AQMs contractors.
5.2
CLIMATE
The climate at Zafranal is sub tropical desertic and is dry and moderate year-round, although some rain
may fall during January and February with approximately 52 mm of precipitation per year.
Temperatures approximately range from a low of 6o C to a high of 35o C with an average maximum
temperature of 28.2o C and an average minimum temperature of 12.3o C. The scarce rain does not
permit agriculture except where irrigated in the river valleys and the limited rainfall does not support
enough vegetation to sustain grazing. These characteristics make this zone almost uninhabitable. The
dry temperate climate allows exploration and mining activities to continue year round.
5.3
LOCAL RESOURCES
Bus transportation is available between Arequipa and Pedregal, and public transportation is also
available along Highway 1-SJ up to Huambo from Pedregal. The final 15 kilometres is covered only by
private transportation, four-wheel drive vehicle preferred, but not necessary. Internal drill roads are
four-wheel drive only.
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Fuel and groceries may be purchased in the communities of Corire and Pedregal and these
communities would serve as a source for unskilled labour but major purchases and hiring would be
from Arequipa.
Arequipa is the closest major centre to the project site and would be the source for hiring experienced
mining personnel and for large purchases of supplies and equipment. Regular flights serve Arequipa
from Lima and other points in Peru. Lan Per operates up to 9 flights a day and other airlines add an
extra 4 flights per day. The Arequipa airport is considered an international airport capable of receiving
charter flights from neighbouring countries, with twice-weekly regular flights to Arica (Chile) available.
5.4
INFRASTRUCTURE
The Zafranal prospects are green field sites, and thus existing site infrastructure is limited to an
exploration camp and drill roads. The Property is large enough to host an open pit or underground
mining operation, including a large open pit, mill, tailings facilities, waste dumps, and leach pads. AQM
has surface rights for exploration activities on the Zafranal property area, but the owners, the Autodema
irrigation agency, have the right to establish rules and land lease rates for any mining activity.
Corire is located beside the Majes River which has an average flow rate of 24 m3/s and is a potential
water resource for the project although there is an elevation difference of approximately 1200 metres
between the two locations. The project has the necessary permits to extract water for its exploration
activities. In previous drilling, Teck encountered water saturated gravels within the property,
representing a potential water source for the Project. AQM will continue to evaluate the potential of this
aquifer to provide water for a future processing plant.
EGASA is the power generator for the Arequipa Department, which relies primarily on hydroelectric
generation. They forecast a power deficit for the next two years in the area but have two large
hydroelectric projects with a combined output of 1000 MW scheduled for development as soon as
financing can be re-established. These projects are located in the Arequipa Department, fairly close to
Zafranal and the 220 KV electrical grid passes within 45 km of the potential mine site. In addition, gasfired generation plants are being added to the power distribution grid that connects the Arequipa
Department with the rest of Peru. This grid is being upgraded from 220 KV to 550 KV.
TISUR is the owner of the private port of Matarani, which is located 170 km via road from Zafranal. The
port currently handles approximately 3 million tonnes of cargo a year and has the capacity to handle 13
million tonnes with some investment. TISUR currently receives cathode and concentrate from mines at
Tintaya via truck and Cerro Verde via rail and has an expansion plan ready to accommodate the Las
Bambas mine if they are successful in the bidding process. Matarani is a modern facility with good
environmental controls. It operates 24 hours per day, 365 days per year, and has its own backup
power generation to ensure continuous operation. Only a few days are lost each year due to bad
weather.
5.5
PHYSIOGRAPHY
The region around Zafranal is characterised by steep, deeply dissected topography. Elevations range
from approximately 1050 metres near the Rio Majes up to a peak of 3280 metres on the Zafranal 13
concession in the north central part of the property. Outcrop is primarily limited to quebrada bottoms
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and steeper slopes, with more moderate topography covered by colluvium and dust. The natural
vegetation consists of widely-spaced cacti and shrubs. Cactus species include (Cereus macrostibas,
cereus candelaris) and the "chilca" (baccharis sp.) recognised by its greater size; and the "pinco pinco"
(Hypericum sp.) plant capable of reaching some 50 centimetres in height. The representative wildlife
species in the area correspond to wildlife typically found in the South American Desert Coastal regions
of the Pacific. The fauna in this bioregion is scarce, due essentially to the adverse factors of extreme
aridity and almost total lack of vegetation. Foxes, Culpeo Zorro or Andean Fox, (Lycalopex culpaeus),
pumas (Puma concolor) and guanacos (Lama guanicoe) have been sighted along with their tracks on
the prospect. Bird life on the prospect is limited and representative species would be house sparrows
(Passer domesticus) and the hummingbird (Oreotrochilus estella). Included with fauna are ants, lizards
and spiders like the argiope sp. These arachnids are normally found in the driest zones.
HISTORY
6.1
BACKGROUND INFORMATION
Mining and exploration in the Southern Peru Porphyry Copper Belt have been important components of
the social and economic history of the region.
Most of the significant exploration and mining developments in southern Peru in the twentieth century
occurred between 1940 and 1960. Toquepala was first prospected in the 1800s. Cerro de Pasco
recognised it as a porphyry copper deposit in 1937. The company drove several adits by hand and
began drilling in 1939, after a shaft cut high grade sulphides. Cerro's drilling "defined" about 60 Mt of
1.7% Cu in approximately 30 holes. Worldwide, a period of growth in mineral exploration followed the
Second World War, particularly due to a report by the U.S. President's Materials Policy Commission
(Paley, 1951), which indicated that a shortage of mineral resources was likely within the next decade.
This edict set off an intense search for mineral deposits. Peru was not excluded from this trend and a
new Mining Code promoting the mineral industry had already been enacted in 1950. This legal
framework led to the discovery of a number of new deposits and to the further development from known
mining districts in Peru.
Due to the renewed interest in worldwide exploration, plus the Peru governments need for capital to
develop its resources, the American company ASARCO was asked in the late 1940s and 1950s to
evaluate and submit an offer for the area that eventually became the great Toquepala porphyry copper
ore deposit. American geologists Harold Courtright and Kenyon Richard completed the first systematic
exploration at Toquepala in the Southern Peru Copper Belt.
A few years later, another American company, Cerro Corporation, began the systematic evaluation of
nearby Cuajone, another porphyry copper prospect in southern Peru. ASARCO formed a Peru
subsidiary, Southern Peru Copper Corporation (Southern Peru), which first operated Toquepala and
later operated Cuajone. The original corporate partners in Southern Peru were ASARCO, Cerro
Corporation, Newmont Mining, and Phelps Dodge. Now both Toquepala and Cuajone are operated by
Grupo Mexico which acquired ASARCO.
The Peru governments expropriation wave in 1968 to 1975 slowed the exploration and development,
as did the terrorist activities during the1980s. In addition, low copper prices in the late 1990s and early
in the in new millennium limited exploration and mine development in Peru.
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Since the 1990s, due principally to diminishing terrorist activities and laws encouraging exploration and
mining, Peru has again become a favourable locale for exploration and development. Since 2004, due
to the increase in copper prices, junior and intermediate mining companies, and several majors, have
enjoyed varying amounts of success in acquiring and exploring copper properties in Peru. The junior
companies include Peru Copper (Toromocho), Monterrico Resources (Rio Blanco), Candente
Resources (Caariaco), Chariot Resources (Mina Justa), Milpo (Pucajaja), Antares Minerals (Haquira),
and Norsemont Mining (Constancia). Other districts with significant porphyry copper deposits and/or
prospects, actively being mined or explored by different majors and juniors, include Cerro Corona,
Michiquillay, Galeno, Magistral, and Aguila. These properties are all in various stages of exploration
and development.
According to Teck reports (2004 and 2005), the Zafranal porphyry copper prospect lies along the
northern extension of the Southern Peru Copper Belt in Southern Peru (Figure 4-1Figure 6-1). The
current Zafranal 26 900 hectare project area includes: the Zafranal Main Zone, plus porphyry copper
prospects at Campanero, Ganchos, Sicera South, Sicera North, and Rosario (Figure 6-2Figure 6-2).
Limited drilling had been completed in the 1990s by Phelps Dodge at Sicera South, optioned from
Milpo. Phelps Dodge had claims in the 1990s on the Main Zone of Zafranal but did not conduct drilling.
Phelps Dodge had also staked the oxide copper area known as Rosario and reportedly drilled four
shallow drillholes there in the 1990s. Limited drilling has been carried out at the Campanero, Sicera
South, and Ganchos (Chicharron area) areas in 2006 and 2007 by Teck. Western Mining and BHP
Biliton held land positions within the current concession area but did not conduct any drilling.
The following are descriptions of the historical work conducted on the Zafranal Main Zone, plus the
other five prospects within the current Zafranal land holdings. These descriptions have been
summarised from private Teck reports.
6.2
EXPLORATION HISTORY ZAFRANAL PROJECT
6.2.1
Introduction
Artisanal gold miners have been producing from veins in the upper Sicera drainage for many years
the exact date is not know but probably less than 20 years in the Zafranal Main Zone area. Currently
there are approximately 400 artisanal miners working from several camps in the area from veins that
are up to 1 metre in width with grades ranging from 15 g/t to 2 g/t Au. These gold veins are peripheral
to the porphyry copper mineralisation. There has been no production of copper on the Zafranal Main
Zone, although oxide copper has been mined at the Campanero prospect.
In early 2003, geologists from Teck Cominco, as it was known in those days, were led by artisanal
miners to outcrops of porphyry-style copper mineralisation in an area known as Cerro Zafranal. The
original team of Teck geologists included geologists and prospectors and was led by Manuel Montoya.
The property examination was part of a porphyry generative programme and systematic
reconnaissance work in southern Peru aimed at evaluating targets in the Southern Peru Porphyry
Copper Belt along or adjacent to the regional Incapuquio Fault System. The original trip into the area
was on foot, approximately 15 kilometres from the nearest road. Zafranal, as well as two other
properties to the northwest, were staked in 2003. AQM geologists Tom Henricksen, Jos Corzo and
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Jhony Medrano first visited the Property in mid 2008 prior to the start of negotiations for the acquisition
of the Project from Teck.
6.2.2
Geology
The Zafranal Main Zone has historically been the most explored member of a number of porphyry
systems, located within a NW-trending cluster about 15 km by 10 km in size that also includes the
Campanero, Rosario, Sicera North, Sicera South and Ganchos prospects.
The geological descriptions in this History section are summarised from Teck reports for the field
campaigns between 2003 and 2007. AQM has carried out, and is currently completing, extensive,
geologic, geochemical, and geophysical studies at Zafranal and these are discussed in later chapters of
this report.
Teck recognised that basement rocks in the area are represented by Precambrian gneisses which are
in contact through reverse faulting with Palaeozoic and Mesozoic sedimentary rocks. Well bedded
siliciclastic and carbonate marine sediments, as well as massive andesite beds of Jurassic age
belonging to the Yura Group and Guaneros Formation, are locally exposed along NW-trending outcrops
facing the flats located to the west of the district. These units are cut by multiphase, batholith-scale
granitoid intrusions and by small stocks of Upper Cretaceous to Paleocene age. The Jurassic
Guaneros Formation volcanic-sedimentary sequence is the unit that hosts the intrusive complexes
responsible for the alteration and mineralisation at Zafranal.
Teck mapped the Zafranal deposit at a 1:10 000 scale starting in 2003 with updates made through
2005. Property-scale geological descriptions are available in previous Teck reports by M. Smith and W.
Tejada (March 2004) and W. Tejada (Sept. 2005). Figure 6-1 shows Tecks geological map for the
Zafranal Main Zone. AQM has re-mapped the area and a description of the lithological units is included
in Section 7.2.1.
Argon-Argon dating of three outcrop samples was performed by UBC laboratories in Vancouver. Two
of the samples were specimens collected from pervasively sericite-altered outcrops near ZFRC04-001
and ZFRC04-010 and one sample came from a late mineral dyke exposed along a road cut near
ZFRC04-011. Results are the following:
Sericite sample # 1: 81.3 Ma (sample taken near drillhole ZFRC04-010)
Sericite sample # 2: 82.2 Ma (sample taken near drillhole ZFRC04-001)
Hydrothermal biotite sample (late mineral dyke): 76.7 Ma (near drillhole ZFRC04-011)
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Figure 6-1
6.2.3
Teck Geology, Alteration & Drillhole Map
Geochemistry
Teck collected approximately 238 surface rock samples on the Zafranal deposit. The copper and gold
results of this rock sampling are shown in Figure 6-2 and Figure 6-3. Relatively large (2-4 kg) samples
were taken of representative rock types collected with the aim of blanketing the area of the phyllic zone
of alteration at relatively even sample spacing. The samples themselves generally represent chip
samples at least 1 m long or outcrop samples representing an area of at least two square metres. Most
samples represent outcrop, although in some locations, notably the ridge tops, it was necessary to
sample areas of sub crop in order to achieve a relatively even distribution of samples.
Pulps were analysed at ALS Chemex Peru, including 32 element ICP and gold by fire assay with AA
finish.
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Figure 6-2
Zafranal Gridded Copper Geochemistry

Technical Report
Figure 6-3
Zafranal Gridded Gold Geochemistry

Technical Report
6.2.4
Geophysics
This summary was adapted from a Teck geophysical report written by W. Tejada et. al. in March, 2005,
and is based in part on a geophysical survey and report by Zonge Ingenieria y Geofisica (Chile) S.A.
completed in 2004.
Having already drilled several highly interesting intercepts at Zafranal, it was subsequently decided to
perform some geophysical orientation-surveys. In-loop TEM (Time-domain Electro Magnetics) and AMT
(Audio-frequency MagnetoTellurics) surveys were completed in late November 2004. In-loop TEM was
chosen because chalcocite is an extremely conductive mineral (40 times more conductive than
chalcopyrite and 3000 times more than pyrite) and it was hoped that this method could help image the
quasi-horizontal enrichment blanket present at Zafranal. AMT was suggested by the contractor based
on previous experience.
Whereas the 3-component TEM survey yielded profiles requiring
interpretation, the AMT data were inverted to provide a resistivity-depth image. Those inverted AMT
data appear to have imaged both the top of the enrichment blanket and the continuation of the primary
sulphides to depth.
The AMT method successfully separated unaltered, barren rocks from the more altered, mineralised
rocks. Production rates for AMT are similar to IP, yet although AMT does not respond to chargeable
minerals per se, it does provide a much deeper-looking resistivity section, giving a view towards
controlling structures at depth. Only two lines of TEM were collected at Zafranal, but there are
indications that an enrichment blanket is detectable.
6.2.5
Drilling
Thirty-two RC holes and four diamond drillholes were drilled by Teck on the property for a total of 11
805 m of drilling (Figure 6-1). Drillholes were generally spaced 250 m to 400 m east-west along strike
and 200 m on section. Table 6-1 displays the different drilling phases and Table 6-2 summarises all
previous Teck drilling programmes at Zafranal.
Table 6-1
Teck Drilling Phases at Zafranal
Phase
No of Drillholes
Total Meters
Period
Drillhole Type
12
3 689
May-June 2004
RC
10
3 312
Sept.-Oct. 2004
RC
1 556
Nov. 2004
Diamond
10
3 248
Sept. 2005
RC
Total
36
11 805
The 2004 Zafranal RC programme consisted of two phases totalling 22 drillholes for a total of 7 001 m.
First phase RC drilling was carried out during June 2004 and consisted of 12 drillholes (3 689 m)
collared at 180/-65 in two east-west trending fences separated by approximately 250 m. Results of
this first pass programme outlined a +1 kilometre-long enriched copper blanket hosted by quartzdiorite/diorite porphyritic to equigranular stocks intruded into a strongly foliated volcanoclastic
sequence. Best total copper results using a 0.2% cut-off grade came from the central part of the
property and included the following intercepts:
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ZFRC04-007
70 m @ 1.08% Cu (120-190m) & 104 m @ 0.27 g/t Au
ZFRC04-008
110 m @ 1.02% Cu (116-226m) & 36 m @ 0.24 g/t Au
ZFRC04-009
94 m @ 0.61% Cu (164-238)
ZFRC04-010
74 m @ 0.73% Cu (174-268m)
The second phase RC programme carried out in September 2004 (3 312 m) tested the possible
southern extension of mineralisation intersected in RC drillholes 7 to 10. This programme included a
total of 10 drillholes (drillholes 13 to 22) most of which were collared along an E-W fence located
approximately 200 m due south of drillholes 7 to 10. Best intercepts, using a 0.2% cut-off, include the
following intervals (ICP total copper):
ZFRC04-013
44 m @0.32% Cu (108-152 m)
ZFRC04-016
4 m @ 0.62% Cu (160-164 m)
ZFRC04-017
40 m @ 0.4% Cu (116-156 m)
ZFRC04-018
30 m @ 0.52% Cu (32-62 m)
ZFRC04-018
42 m @ 0.3% Cu (142-184 m)
ZFRC04-019
20 m @ 0.33% Cu (136-156 m)
ZFRC04-022
6 m @ 0.4% (122-128 m)
In addition, during November 2004 a diamond drilling campaign totalling 1 556.15 m (four drillholes)
was carried out in order to develop a better geological model of the Zafranal system and to gain more
reliable samples for geochemical assays and petrological studies. Drillhole ZFDDH04-001 twinned
previous drillhole ZFRC04-008, while diamond drillholes ZFDDH04-002, ZFDDH04-003 an ZFDDH04004 were collared at the same locations of RC drillholes ZFRC04-008, ZFRC04-0010 and ZFRC04-007
respectively, but oriented due north in order to test the possible extension of mineralisation to the north
of the main mineralised zone. All four drillholes were inclined between -55 to -70. Drillholes with
significant Cu and Au intervals identified during the diamond drill programme are listed below for total
copper grades:
ZFDDH04-0001 (twin of ZFRC04-008) 166.5 m @ 1.00% Cu (113-279.5 m),
includes 110 m @ 1.22% Cu & 0.16 g/t Au (119-229 m)
ZFDDH04-002
92 m @ 0.94% Cu (136-228 m)
ZFDDH04-004
77.2 m @ 1.80% Cu (75-152.2 m) & 19m @ 0.14 g/t Au
Diamond drillholes ZFDDH04-002 and ZFDDH04-004 returned impressive results and confirmed that
high-grade copper mineralisation is not only centred near drillholes ZFRC04-007 & 008 but actually
extends to the north for at least 100 metres. Moreover, comparison of grades between drillhole
ZFRC04-008 and its diamond twin ZFDDH04-001 indicates a consistent 19% increase in copper and
gold grades in the core samples. In September 2005 a reverse circulation drill programme consisting of
10 drillholes (3 248 m) tested the possible western and eastern extensions of the mineralisation
encountered in previous programmes. A total of three drillholes (drillholes ZFRC04-023, ZFRC04-024
and ZFRC04-025) tested the eastern most side of the Zafranal system; one drillhole (ZFRC05-026)
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tested the area north of ZFRC04-012, while drillholes 27 to 32 tested the westernmost portion of the
system.
Intervals with significant Cu values identified during the 2005 drill programme are listed below for total
copper grades:
ZFRC05-023
60 m @ 0.38% Cu (34-94 m)
ZFRC05-024
24 m @ 0.67% Cu (40-64 m)
ZFRC05-026
36 m @ 0.22% Cu (110-146 m)
ZFRC05-027
20 m @ 0.25% Cu (72-92 m)
ZFRC05-027
22 m @ 0.21% Cu (130-152 m)
ZFRC05-028
16 m @ 0.22% Cu (110-126 m)
ZFRC05-029
20 m @ 0.24% Cu (100-120 m)
Intervals with significant total copper values identified during the 2005 drill programme are listed below.
Table 6-2
Zafranal Teck Drillhole Location
Drillhole
Easting
Northing
Elev.
Azimuth
Dip
Length
Year
Datum
ZFRC04-001
794 841
8 224 508
2 773
180
-65
295
2004
SAD 56 - Zone 18
ZFRC04-002
794 497
8 224 671
2 878
180
-65
310
2004
SAD 56 - Zone 18
ZFRC04-003
794 193
8 224 555
2 826
180
-65
304
2004
SAD 56 - Zone 18
ZFRC04-004
793 825
8 224 590
2 763
180
-65
268
2004
SAD 56 - Zone 18
ZFRC04-005
793 527
8 224 598
2 690
180
-65
250
2004
SAD 56 - Zone 18
ZFRC04-006
793 201
8 224 454
2 625
180
-65
312
2004
SAD 56 - Zone 18
ZFRC04-007
793 516
8 224 259
2 640
180
-65
266
2004
SAD 56 - Zone 18
ZFRC04-008
793 822
8 224 322
2 738
180
-65
348
2004
SAD 56 - Zone 18
SAD 56 - Zone 18
ZFRC04-009
794 211
8 224 350
2 787
180
-65
350
2004
ZFRC04-010
794 501
8 224 388
2 776
180
-65
334
2004
SAD 56 - Zone 18
ZFRC04-011
794 790
8 224 299
2 742
180
-65
350
2004
SAD 56 - Zone 18
ZFRC04-012
795 251
8 224 529
2 826
180
-65
302
2004
SAD 56 - Zone 18
ZFRC04-013
792 965
8 224 364
2 613
180
-65
350
2004
SAD 56 - Zone 18
ZFRC04-014
792 899
8 223 897
2 543
180
-65
294
2004
SAD 56 - Zone 18
ZFRC04-015
793 282
8 224 108
2 634
180
-65
316
2004
SAD 56 - Zone 18
ZFRC04-016
793 493
8 224 062
2 619
180
-65
348
2004
SAD 56 - Zone 18
ZFRC04-017
793 825
8 224 160
2 663
180
-65
334
2004
SAD 56 - Zone 18
ZFRC04-018
794 215
8 224 149
2 674
180
-65
330
2004
SAD 56 - Zone 18
ZFRC04-019
794 507
8 224 191
2 693
180
-65
350
2004
SAD 56 - Zone 18
ZFRC04-020
794 795
8 224 091
2 697
-80
330
2004
SAD 56 - Zone 18
ZFRC04-021
793 828
8 224 595
2 768
-75
314
2004
SAD 56 - Zone 18
ZFRC04-022
792 963
8 224 369
2 613
-65
346
2004
SAD 56 - Zone 18
ZFDDH04-001
793 820
8 224 322
2 738
180
-65
379.4
2004
SAD 56 - Zone 18
ZFDDH04-002
793 824
8 224 322
2 738
-65
390.8
2004
SAD 56 - Zone 18
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Drillhole
Easting
Northing
Elev.
Azimuth
Dip
Length
Year
ZFDDH04-003
794 496
8 224 388
2 776
-70
388.35
2004
Datum
SAD 56 - Zone 18
ZFDDH04-004
793 514
8 224 259
2 639
-55
397.6
2004
SAD 56 - Zone 18
ZFRC05-023
795 915
8 224 098
2 695
180
-65
276
2005
SAD 56 - Zone 18
ZFRC05-024
795 699
8 224 200
2 768
180
-65
350
2005
SAD 56 - Zone 18
ZFRC05-025
795 166
8 224 293
2 782
180
-70
330
2005
SAD 56 - Zone 18
ZFRC05-026
795 090
8 224 616
2 715
180
-65
366
2005
SAD 56 - Zone 18
ZFRC05-027
793 525
8 224 606
2 691
-65
326
2005
SAD 56 - Zone 18
ZFRC05-028
793 197
8 224 460
2 625
-65
336
2005
SAD 56 - Zone 18
ZFRC05-029
792 625
8 224 731
2 519
180
-65
330
2005
SAD 56 - Zone 18
ZFRC05-030
792 762
8 225 157
2 592
180
-65
340
2005
SAD 56 - Zone 18
ZFRC05-031
792 315
8 225 064
2 528
180
-65
288
2005
SAD 56 - Zone 18
ZFRC05-032
791 919
8 224 832
2 519
180
-70
306
2005
SAD 56 - Zone 18
Total
6.3
11 805
EXPLORATION HISTORY - SICERA SOUTH PROSPECT
The Sicera South porphyry system is located 6.5 km west of the Zafranal Main Zone. The porphyry
prospects within the Zafranal land package in the upper Sicera drainage, in the pampas in front of the
mountains, were examined many years prior to the discovery of the Zafranal deposit. Phelps Dodge
optioned the prospect from Milpo in the mid-1990s and drilled several inconclusive drillholes;
subsequently Teck drilled several RC drillholes examining the western and northern extension gravelcovered areas.
Teck recognised that the geologic setting at Sicera South (Figure 6-4) is similar to other prospects
within the Zafranal land package with a gneissic Precambrian basement overlain by a Jurassic
sedimentary sequence (Yura Group) both intruded by a granodiorite stock of the Coastal Batholith.
AQM in 2010 has modified the early work of Teck and these activities are discussed in later sections.
Sediments at Sicera South are calcareous in nature and range from limestone, silty limestone to silt.
The Sicera South porphyry system is controlled in part by the Incapuquio Fault System.
Alteration at Sicera South was originally recognised by Teck as centred on an east-west trending, 1.1
km by 1.8 km zone, exhibiting moderate to strong phyllic alteration. Rocks outside the phyllic core are
altered to an epidote-chlorite-silica assemblage. A hematite-jarosite dominated leached capping is
present over the prospective area. Alteration and mineralisation limits are well defined at surface and
by previous drilling to the west and north but may extend to the east under a post-mineral reverse fault
(Figure 6-5). Phyllic alteration is overall moderate in intensity but it can be strong locally. Rocks within
the phyllic altered zone are converted to a white, earthy mass in which texture is still preserved, thus
primary textures are not obliterated favouring the recognition of different rock units.
Potassic alteration has only been recognised as patchy exposures in several places within the phyllic
altered zone and consists of secondary biotite flakes after hornfels and/or secondary biotite narrow
veinlets. The strong chlorite alteration observed in many of the dykes and in some of the intrusions
does not seem to originate from the alteration of previously potassic (biotite)-altered lithologies but to be
the result of the alteration of hornblende or magmatic biotite.
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Copper mineralisation in Sicera South is dominated by oxide specimens especially neotocite, Cu-wad,
malachite, atacamite, tenorite, chrysocolla and chalcantite. Sulphide mineralisation is restricted to
quartz-chalcopyrite veinlets or to weak disseminations of chalcopyrite within the microdiorite or the
andesitic dykes.
The bulk of the surface copper mineralisation is located inside a 1.0 km by 0.45 km north-northwest
trending area spatially coincident with the strongest development of a dense dyke swarm inside the
hornblendic diorite porphyry. Mineralisation in this area consists of strong copper oxide (mainly Cuwad) staining, fracture-controlled coatings and disseminations. This mineralisation seems to increase
to the north and east where it is apparently cut off by a reverse fault.
Figure 6-4
Sicera South Prospect Geology & Alteration

Technical Report
Figure 6-5
6.3.1
Sicera South Prospect Geological Model
Geochemistry
The Sicera South porphyry was intensively sampled by Phelps Dodge and Milpo in the mid 1990s.
Teck results from the 49 samples collected during the recently completed field programme confirmed
the results of the 257 samples previously taken by Phelps Dodge and Milpo (Figure 6-6).
Figure 6-6
Sicera South Prospect Geochemistry & Drillhole Location
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6.3.2
Drilling
Phelps Dodge drilled two drillholes in Sicera South on lands leased from Milpo in the mid-1990s (Figure
6-6). During the 2007 drill program, a total of four RC drillholes were drilled by Teck in the Sicera South
region.
Drillholes in the Sicera South region were collared in order to test the potential for copper mineralisation
along the northern extension of the Sicera South porphyry as well as to evaluate the pampa areas
located south of it. Drillhole CH07RC-011 was collared in post-mineral gravels immediately 120 metres
to the north of the outcropping Sicera South porphyry. This drillhole returned encouraging Cu results
(123 m @ 0.23% Cu) associated with hypogene copper mineralisation. Table 6-3 summarises the data
of drillholes drilled at Sicera South in 2007.
Table 6-3
Teck Sicera South 2007 Drilling Programme

Drillhole
CH07RC-010
Easting
Northing
Elevation
Azimuth
Dip
Length
785 292
8 224 141
1 725
330o
-80o
40m
CH07RC-010A
785 300
8 224 138
1 725
90
CH07RC-011
787 060
8 225 570
2 052
270
CH07RC-013
785 469
8 224 333
1 750
0o
60m
-80
250m
-90o
108m
-70
During the 2007 programme a total of four drillholes were collared in the Sicera South region (drillholes
CH07RC-010, 010A, 011,013). Of these, three drillholes were collared 1 km south of Sicera South and
despite being collared in altered outcrops they bottomed in post-mineral gravels. This is interpreted to
be caused by a low-angle thrust fault with the fault plane located at around an elevation of 1705 m that
puts slides of the Cretaceous sequences on top of the Tertiary Moquegua Formation. This fault was
previously mapped in the field but was considered to have a much steeper dip angle rather than the sub
horizontal attitude shown by drillholes. Drillhole CH07RC-011 located 120 m north of Sicera South
intercepted encouraging copper mineralisation (120 m @ 0.23% Cu) hosted by a diorite porphyry stock
showing strong chlorite alteration, 1-2% disseminated pyrite and traces to 1% chalcopyrite. This
mineralisation is thought to represent hypogene sulphide copper mineralisation at the margins of the
Sicera South porphyry.
6.4
EXPLORATION HISTORY - SICERA NORTH PROSPECT
The Sicera North prospect is located approximately 5 kilometres north of the Sicera South prospect and
6 kilometres south of the Rosario prospect. Much of the property was acquired in 2009 by AQM and
the core of the prospect has had no previous drilling.
The geological setting first described by Teck of the Sicera North is shown on Figure 6-7. The gneissic
Precambrian basement is overlain by a Jurassic siliciclastic sequence (Yura Group) made up of
quartzites and shales interbedded and possibly overlain by massive andesitic flows and breccias.
During the Upper Cretaceous the whole stratigraphic column was intruded by a multi-pulse, medium to
coarse-grained granitoid batholith (Batolito de la Costa). The geology has been modified by AQM
through surface work and drilling in 2010 and is described in a later section.
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Rapid erosion as a response to massive uplift during the early to mid Cenozoic (Incaic tectonic phase)
led to the formation of a large, thick sequence of gravels (Moquegua Group) that filled topographic
depressions forming a regional pediplain along the Andes foothills in southern Peru.
Hydrothermal alteration (Figure 6-7) at the Sicera North porphyry system covers an overall area of 3 km
by 1 km and has a NW-trending elongated shape.
Mineralisation at Sicera North is associated with the strong phyllic altered core and includes a hematite
leached cap, an oxide zone and primary sulphide mineralisation. A hematite leached cap is exposed
over a 300 x 200 metre area in the northernmost corner of the phyllic altered zone and it is defined by
moderate to strong hematite coatings, veinlets, boxworks and earthy aggregates with local secondary
alunite veinlets and fracture-coatings. The leached cap is hosted by strongly phyllic-altered quartzfeldspar porphyry. Copper oxides occur within the leached capping.
Sulphide mineralisation is clearly recognisable along the creek that runs along the centre of the phyllic
altered zone. Primary sulphide mineralogy is dominated by traces to 3% chalcopyrite and up to 15%
pyrite with local chalcocite and covellite impregnations on pyrite. Most pyrite and chalcopyrite is
contained by thick (1cm) sheeted veinlets and disseminations either on the quartz-eyed intrusive or in
the gneiss.
Copper mineralisation, although scattered all over the phyllic zone is focused on its northern half where
the transition from oxides to sulphides is clearly visible. In that sector, the oxide zone reaches its
maximum exposed vertical thickness (approximately 50 m) but elsewhere mineralisation is more erratic
and has lower grades.
6.4.1
Geochemistry
Geochemical results for 112 rock samples collected by Teck are shown graphically in Figure 6-7 and
Figure 6-8. Much more sampling has been carried out by AQM in 2010 and is reported in a later
section. Copper results ranged to a maximum of 3.06% Cu but they were generally between 150 ppm
and 500 ppm in the hematite leached cap, 500 ppm to 1700 ppm in the oxide zone and 0.15% to 0.3%
in the sulphide zone. Most of the copper is concentrated in the oxide zone and in the primary zone
exposed at the bottom of the southwest-trending creek drainage, near the centre of the system. The
higher copper grades (0.15% to 0.3%) come from chalcopyrite-chalcocite-covellite disseminated and
vein-controlled mineralisation located below the leached cap and the oxide zone. A total of 47 samples
(42% of the total) returned copper grade values higher than 300 ppm.
A total of 18 samples returned gold values greater than 30 ppb with a maximum of 6.55 g/t Au, but
almost all anomalies range between 30 ppb and 1 000 ppb. None of the gold anomalies are located
within the strongly phyllic-altered copper-bearing core of the system but to the north of it in the
surrounding, less-altered gneissic host rock. Gold anomalies are associated with quartz veins, veinlets
and structures hosted by the gneiss and by mafic dykes.
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Figure 6-7
Sicera North Prospect Geology & Geochemistry
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Figure 6-8
6.5
Sicera North Prospect Geology & Geochemistry (detail)
EXPLORATION HISTORY - CAMPANERO PROSPECT
The Campanero prospect is the westernmost prospect in the Zafranal land package. At Campanero
there is no evidence of previous development work except for small old workings in the Campanero
copper showing. Artisanal miners have been actively working the copper showings on a small scale in
recent years.
From a historical exploration standpoint, BHP Billiton completed in 2000 an induced polarization survey
to define chargeability and resistivity anomalies under the pampa area that could be related to covered
disseminated sulphide mineralisation. This survey was conducted in two separate areas of the
Chicharron region: one south of Campanero (over a 6 km by 1km area) and one south of Ganchos
(over a 4 km by 7 km area).
6.5.1
Geology, Mineralisation & Alteration
Campanero is a porphyry copper prospect, similar to Sicera North and SurError! Reference source
not found.. The information reported in this section shows the work of Teck. AQM has done
significant work in 2010 and this information is reported in a later section.
The prospect seems to be controlled by splays of the Incapuquio Fault. The host rocks are in part
quartzite and siltstone of the Upper Jurassic - Lower Cretaceous Yura Group. The prospect exhibits a
leached capping (hematite/goethite), with a moderate to strong phyllic stockwork. Two types of
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intrusions crop out at Campanero. One is an intermediate quartz diorite porphyry showing hematite,
goethite, jarosite disseminated and in veinlets, sheeted veins, plus local chrysocolla on fractures. Also
occurring is secondary biotite overprinted by sericite alteration. Post-mineral quartz diorite porphyry
with chlorite alteration is also observed.
6.5.2
Drilling
A 2006 drill programme by Teck consisted of nine RC drillholes totalling 2 163 m. The programme
included drilling of four drillholes in the Campanero area (Figure 6-9) and five drillholes in the pampa
areas. Drilling at Campanero encountered weak secondary copper mineralisation (chalcocite) hosted
by quartzite of the Yura Group. The five drillholes that targeted the geophysical anomalies in the
pampa area did not reach bedrock. Table 6-4 includes the intersections from the 2006 RC drill
programme and 2007 diamond drill programme at Campanero.
Table 6-4
Drillhole
Teck 2006-2007 Drilling Programme Campanero/Sicera West

From
To
Interval
CuTotal
CH06RC001
160
210
50
0.11
CH06RC007
192
202
10
0.13
CH06RC008
152
174
22
0.19
CH06RC009
70
86
16
0.83
CH06RC009
110
124
14
0.45
CH06RC009
160
222
62
0.29
CH07DDH01
NSV
CH07DDH02
NSV
CH07DDH03
168
235
67
Tr
No significant copper mineralisation was encountered, with two of the diamond drillholes intercepting
only weak secondary copper mineralisation consisting of chalcocite traces over pyrite. This weak
supergene mineralisation is hosted by quartzite and siltstone of the Yura Group which show moderate
to strong silicification. The leached cap at Campanero consists of hematite and goethite and can be up
to 85 m thick.
The weak enrichment blanket identified to date in Campanero consists only of local, thin chalcocite
coatings over pyrite. Thus enrichment at Campanero is immature and weak although it can attain
thickness of as much as 113 m (i.e. drillhole CH07DDH-001). The best copper values in Campanero
were intercepted during the 2006 RC drill programme and came from drillholes located closer to the
Campanero surface showings (e.g. drillhole CH06RC009 located 300 m east of the showing returned
up to 16 m @ 0.83% Cu and 62 m @ 0.29% Cu). The areas tested in 2007 are interpreted to represent
just the distal parts of the porphyry system exposed at the showings in Campanero. Stronger copper
mineralisation defined to date, both surface and drilling, is located closer to the Campanero copper
showing, either along or on the south side of the principal structure in the pampas.
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Figure 6-9
.
6.6
Campanero Prospect Geology, Alteration & Drillhole Location Map
EXPLORATION HISTORY - ROSARIO PROSPECT
The Rosario prospect is the northernmost prospect in the Zafranal land package. The area was
discovered in November 2002 as part of the regional exploration work carried out by Phelps Dodge on
the north western extension of the porphyry copper belt in Southern Peru. Originally, Phelps Dodge
accessed Rosario from Sicera North by a dirt path on foot or by mules. Now the property can be
accessed by a road constructed to carry out the drilling by Phelps Dodge. Teck has not performed
detailed work on the Rosario prospect.
The oldest rocks (Figure 6-10) in the area are represented by metasediments of the early Paleozoic
Ongoro Formation, which occur in the south western sector of the study area, being characterised by
NW-oriented, sub-vertical-dipping sedimentary and volcanic hornfels, carbonaceous shale, fine-grained
sandstone and impure limestone. These rocks were subsequently intruded by a series of intrusive
rocks belonging to the late Cretaceous-early Tertiary coastal batholith, grading in composition from
diorites to coarse-grained granodiorites.
A 350 m by 250 m, copper oxide-bearing, medium-grained granodiorite-diorite body occurs in the
centre of the mineralised area. This granodiorite shows weak-to moderate chloritisation, and apparently
secondary biotite. Quartz-limonites-green copper oxides-(chalcopyrite) veinlets occur, mainly E-W
oriented, but in some places develop zones of weak stockwork-like veining. Copper grades range from
0.02% up to 3.81% Cu. A core of 100 m by 80 m shows the best copper oxide grades, from 0.1% to
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around 4% Cu. Among the copper species brochantite, chrysocolla, minor malachite and copper wad
were identified. Scarce relics of partially oxidised chalcopyrite were found within this area.
Phelps Dodge completed five RC drillholes at Rosario. Significant assays were not reported from these
drillholes. Phelps Dodge abandoned the claims soon after.
6.7
EXPLORATION HISTORY - GANCHOS
The Ganchos prospect is south of Zafranal Main Zone and mostly covered with gravels and the
Moquegua Formation. Exploration by Teck consisted of limited geology, geophysics, and RC drilling
that has not encountered any bedrock to date. AQM completed additional geologic studies in 2010,
reported in a later section.
A historic geologic map with drill locations, of the Ganchos area is shown in Figure 6-10.
In 2006 and 2007 a total of three drillholes (CH06RC005, CH07RC012, and CH07RC014) were
collared south of Ganchos in order to test the possible presence of concealed porphyry mineralisation
below post-mineralisation gravels. RC 005, drilled in 2006, was collared in Quaternary alluvium and
never actually reached bedrock. RC 012 and RC 014, drilled in 2007, were collared near altered
bedrock but soon (after approximately 25 m) were followed by the red beds of the Lower Moquegua
Formation, both drillholes ending up in post-mineralisation gravels. This is interpreted to be caused by
a low-angle thrust fault similar to that at Sicera South.
Figure 6-10
Ganchos Prospect Geology & Drillhole Location Map
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6.8
EXPLORATION HISTORY - PAMPAS (CHICHARRON)
The Pampas (Chicharron) area is a term named after the former joint venture with BHP Biliton. This
prospect is limited to the zone that encompasses the mostly gravel covered pampas between
Campanero and GanchosError! Reference source not found.. There have been efforts by BHP
Biliton and Teck to drill test this area, but bedrock has not been encountered.
Four exploratory RC drillholes were drilled in 2006 by Teck in the area between the Campanero and
Ganchos prospects in the pampas. Table 6-5 gives the location and drill information.
Table 6-5
Teck 2006 Las Pampas Drilling Programme

Length
Drillhole
Easting
Northing
Elevation
Azimuth
Dip
CH06RC002
781 890
8 222 218
1 450
-70
232
CH06RC003
784 719
8 223 239
1 701
45
-70
250
CH06RC004
785 357
8 219 703
1 450
45
-70
250
CH06RC006
788 918
8 217 026
1 351
45
-70
250
None of these drillholes intersected bedrock.
GEOLOGICAL SETTING
7.1
REGIONAL GEOLOGY
The regional geology description was taken from an internal AQM report on the surface mapping of
Zafranal authored by Russell Smith (2010).
The Late Cretaceous to early Paleocene, 81 million year old Zafranal porphyry copper-gold deposit lies
near the northern end of the Southern Peru Porphyry Copper Belt and is the oldest of all the known
porphyry deposits occurring within the belt (Clark et al, 1990; Quang et al, 2003). The 81 million year
old age is from an age date determined from Teck samples taken from a strongly phyllic altered finegrained sediment. The porphyry belt is controlled by the Incapuquio Fault System, a series of parallel to
semi-parallel NW trending faults traversing much of the rigid continental margin of southern Peru. The
Incapuquio Fault System stretches from near the Chilean border at its southern terminus to an
undefined point north of the Rio Majes and Colca Canyon, which lies north of Zafranal (Figure 7-1 and
Figure 7-2). The Incapuquio Fault System has weakened the crust to allow no less than five major
porphyry copper deposits to form of which Zafranal is one of them.
The Zafranal deposit appears to lie between several of the Incapuquio faults and just west of the most
north easterly fault of this fault system. The Incapuquio Fault System is considered to be mostly a dip
slip fault system exhibiting progressive uplifting to the northeast, toward the uplifted Andes Mountains
lying to the east. Evidence of the dip slip nature of the faulting occurs at Zafranal and the Cerro Verde
deposits where basement Precambrian gneiss (Arequipa massif) has been uplifted in increasingly
uplifted blocks eastward toward the Andean mountains. The presence of uplifted gneissic basement
rocks shows uplift of the Andean mountains, partially due to the Incapuquio Fault System and not
accretion in the upper crust. There is local evidence of left lateral faulting along the Incapuquio system
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in the form of lower order, local wrench faults, indicating that the rocks to the northeast have moved
north westward relative to the rocks to the southwest. This fault movement along with dip slip
movement has created dilation and an extensional environment producing crustal weakening along
which imbricate E-W faults formed in a horsetail pattern and porphyry copper deposits were emplaced.
However, structural evidence suggests several reactivation events leading to both extensional and
compressional movements along the same faults, often showing evidence of right lateral movement
along some of the Incapuquio fault splays.
The rocks occurring in the Zafranal area are Precambrian gneiss, Cretaceous granodiorite and Jurassic
volcanoclastic and sedimentary rocks which have been intruded by Paleocene diorite to late Cenozoic
dykes. The lowlands or pampa to the west of the foothills running out to the Pacific Ocean are covered
by relatively flat lying Miocene to recent sediments that were deposited from the eroding Andes. These
sedimentary rocks thicken toward the Andes, their source, and are generally referred to as the
Moquegua Formation. Inter-bedded within these unconsolidated gravels to fine-grained sediments are
basalt and andesite flows of probable Miocene age.
Figure 7-1
Zafranal Regional Geological Map
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Figure 7-2
7.2
Zafranal Regional Geological Map Legend
PROPERTY GEOLOGY
The property geology studies by AQM began in 2009 at Zafranal and were originally led by Russell
Smith (2010). Fernando Rivera and others have completed major revisions to the original geology, in
part based on new exposures along drill roads and the observations made from extensive core and RC
drilling. The most recent compilations of Rivera for the Zafranal Main Zone are presented in Figure 7-3.
The Zafranal deposit lies within an east-west trending fault-bounded block. The host rocks within this
block are a sequence of Jurassic volcanic, volcanoclastic and sedimentary units which have been
intruded by diorites. These rocks are in contact with a genissose unit and Cretaceous granodiorite
batholithic rocks to the north and Jurassic sediments of the Yura Formation to the south.
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Figure 7-3
Zafranal Main Zone Geological Map
Figure 7-4
Zafranal Main Zone Alteration Map
7.2.1
Lithology
Zafranals geology is dominated by a thick volcano-sedimentary sequence belonging to the LowerJurassic Guaneros Formation. This unit is made of interbedded sedimentary and volcanic rocks,
the sedimentary members being limolite, sandstone and sedimentary breccia (debris flows), while
volcanic members include tuff, breccia and andesitic lava flows, together with sub-volcanic units of
andesitic composition. This sequence is affected by a strong quartz-sericite alteration within the
Zafranal porphyry alteration zone.
As is the case for several other porphyry deposits in the Southern Peru Copper belt, the Zafranal areas
main intrusive events occurred during the Upper Cretaceous. The various intrusions observed in the
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east-west trending Main Zone are of intermediate composition, being mostly diorite and quartz diorite.
These intrusions are believed to be responsible for the significant hydrothermal alteration (4.5 km x 1
km) associated with this porphyry-type deposit. The intrusive complex comprises several units
according to the following sequence:
Zafranal Diorite: The oldest recognised intrusion, a greenish-grey porphyritic rock composed of
plagioclase, hornblende and quartz crystals. It outcrops as stocks and dykes everywhere in the ore
body, cutting Jurassic volcanoclastic rocks. This intrusive body shows sericite-chlorite-biotite
alteration (phyllic superimposed on potassic) on surface, together with thin D-type and B-type
veinlets, the latter turning into A-type at depth. This intrusion is postulated as an early hypogenecopper-mineralising phase in the deposit.
Microdiorite: This is a fine-grained greenish grey rock made of plagioclase, hornblende and small
amounts of quartz. It basically outcrops as stocks and apophyses in the western and eastern ends
of the orebody, with a chlorite-biotite alteration and moderate superimposed sericite. It is
potassically altered at depth: quartz (silicification) + secondary biotite + chlorite +/- potash feldspar,
accompanied by thin B-type and A-type veins. This microdiorite, which cuts through the Zafranal
diorite, appears to represent the main mineralising phase responsible for copper in the primarysulphide zone. It has also been observed that the Zafranal diorite tends to be more mineralised
when it is in contact with microdiorite, which leads to conclude that the former is mineralised by the
latter.
Quartzdiorite: This rock is dark grey, has a phaneritic texture and is made of plagioclase,
hornblende and quartz eyes. It generally shows chlorite-biotite alteration, and commonly pyrite (1%)
and magnetite. This unit cuts through the above-named intrusive bodies as dykes and is
characterised by its lack of any economically viable hypogene mineralisation.
Post-mineral diorites, occurring as dykes and small apophyses, are the last intrusive events in the
deposit. These may be propyllitcally altered or unaltered, and cut through all the above-named units
without showing any type of mineralisation.
A gneissic rock consisting mainly of strongly foliated volcanic and intrusive rocks occurs north of the
north bounding fault. This unit has been mapped as Precambrian gneiss in the past, but more detailed
mapping shows it as lacking in evidence of high-grade metamorphism, and in being closely associated
to the largest structures found in the Main Zone. Several tectonic events, including major shearing,
have given it its strongly deformed (or gneissic) appearance, often with mylonitic textures, which
gradually grades into foliated host rock volcanic to the south and granodiorite to the north.
Jurassic-Cretaceous volcano-sedimentary host rocks make up a large part of the east-central part of
the block. The volcano-sedimentary rocks within the block contain a much more felsic volcanic
component than the almost purely sedimentary sequence found to the south of the block and outside of
it.
The volcanoclastic rocks appear to lie below a sugary quartzite unit which has a grainy texture with
grain sizes ranging from coarse to very fine grained. This sugary quartzite may be part of the Yura
Formation of Jurassic age; however, they appear to be more massive than those of the Yura Formation
seen nearby and lie within a sequence of rocks that has a higher volcanic component than the Yura
quartzite. There are also fine grained clay-rich sediments interbedded within the volcanoclastic,
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however, they are generally not subdivided into a mappable unit unless the sediment content is greater
than 50% of the rock. One of these areas can be seen along the drill access road leading to drillhole
ZFRC04-001 drilled by Teck. The greater proportion of the rocks mapped as sediments in light green
colour on the accompanying geologic map (Figure 7-1) are sugary fairly uniform homogenous quartzite
beds and silicified volcanic beds.
Intruded into the Jurassic volcanoclastic and sedimentary rocks within the block are a feldspar porphyry
and diorite intrusions, and possibly younger quartz porphyry and rhyolitic dykes.
A large area of andesite to andesite breccia occurs at the south western edge of the mapped area and
extends for some distance to the west off the map (Figure 7-1). These rocks are interpreted as Jurassic
but younger than the volcanoclastic and sedimentary sequence described above within the block and
appear to also be younger than the sediments found outside of the block.
Late Cretaceous to Paleocene biotite microdiorite, hornblende diorite and hornblende quartz diorite
intrude all the older Jurassic rocks described above. A biotite microdiorite stock occurring at the west
edge of the geologic map appears to be pre-mineralisation.
Pre-mineralisation quartz diorite porphyry, originally thought to be post-mineral, intrusions dominate the
central part of the block hosting the Zafranal Main Zone. Although originally emplaced as stock-like and
locally dyke-like features, these quartz diorite intrusions were originally vertically emplaced and often
occur as sill-like, possibly flat-faulted, bodies close to the surface and can be seen intruding along
faults, bedding, foliations and intense zones of jointing trending in a general west-southwest direction.
At depth these sills may merge downward into stock-like bodies.
Microdiorite stocks intrude the porphyritic diorite and are the main host for porphyry-style alteration and
mineralisation. Within the central part of the deposit several narrow dykes of quartz porphyry occur but
these dykes represent a very small proportion of the rocks within the core of the deposit.
Rhyolitic dykes trending Az. 070o-080o occur in the north-central part of the deposit and underlie the
highest topographic point of the deposit. It is unclear whether there are only dykes in this area or
rhyolite flows.
Post-mineral dykes cut through the deposit in two general directions. One set of dykes trends N-S and
the other trends SW-NE. The dykes vary in composition, but generally have a dioritic composition with
some containing varying abundances of quartz phenocrysts which are generally described as round
quartz eyes. Several andesitic dykes also cut through the deposit. The andesitic dykes are much more
prevalent outside the block to the south and west where most are seen cutting Jurassic sediments.
Most post-mineralisation dykes are believed to have intruded along faults, which are part of the block
faulting seen segmenting the sediments and volcanoclastic rocks that lie central to the deposit.
All the rocks within the Zafranal deposit are extremely altered making it difficult to identify original rock
types. Further drilling and interpretation of the subsurface lithologies within the volcano-sedimentary
sequence and intrusions will undoubtedly lead to a better understanding of the host rock geology within
the deposit.
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7.2.2
Structure
Copper-gold porphyry deposits such as Zafranal are open systems formed by the introduction of
magmas and hydrothermal solutions into the rock along geological structures caused by the strain
applied by regional and localized magmatic forces. The importance of regional-scale strain in the
Zafranal deposit is clear, as the observed faults associated to it control the location and form of the
intrusive bodies. Magmatic forces are evidenced by the location of concentric and radial veins in
the various outcrops. The relative importance of either force within the deposit has evolved over
time and space as evidenced by the pattern of the different intrusions. Furthermore, structural
controls have been very significant during the supergene enrichment process, as faults, joints,
foliation and bedding planes have provided permeability for surface waters to percolate to relatively
deep levels. Fault zones are frequently more permeable than surrounding rock thus enabling thick
supergene enrichment areas to develop.
The main structural controls defined are chronologically sequenced from oldest to youngest as
follows (Rivera et al., 2010):
Northern and Southern Transgressive Faults (Iquipi-Clavelinas System): Zafranal is enclosed to the
North and South by two tectonic features running E-W in a straight line. They clearly respond to a
strong structural control caused by Andean tectonics. These large structures would be the original
structural controls for the deposit location and may be part of the Iquipi-Clavelinas fault system.
Such structural morphology shows Zafranal occurring within a transgressive fault system bounded
to the North and South by these major structures. The location of the deposits intrusive bodies,
alteration and mineralisation zones fits within the limits of these large structures.
Foliation, E-W Faults, Folds, Lineation: Structural observations made at the outcrop level show the
existence of a foliation event affecting the entire deposit. This event may be directly linked to the
movement of strike-slip faults, in turn caused by shearing efforts within this structural event,
simultaneously forming E-W trending structures. This deformation has affected Zafranal both before
and after the intrusive events and hypogene copper alteration-mineralisation processes. In volcanic
rocks with strong quartz-sericite alteration and presence of D-type veins, foliation cuts through
these veins and foliates the veins sericitic halo . Both on surface and at depth, porphyry intrusions
also show crystal lineation, particularly in hornblendes, thus proving that the shearing event also
affected them during their emplacement . The Zafranal deposits major transgressive deformation
has caused a series of folds (synforms-antiforms) within the structural corridors bounded by the
NW-SE faults (Az. 130-140). Fold axes run E-W between the aforesaid normal strike-slip
structures.
N-E Fault System (Az. 050-060): This fault system is seen on surface as a series of continuous
structures mainly along the Eastern and Western edges of the system. The relative absence of this
type of faults in the central part is a result of the prevalence of subsequent dextral strike-slip
structures (Az. 130-140) that have sliced the system progressively to the northeast. This NEstructure system, together with the E-W structures, favoured the ascent of magma, and the large
stocks associated with the main copper mineralisation are found at the intersection of both systems.
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Normal Strike-Slip Fault System (Az. 130-140): These structures are found in the central part of
the deposit and appear as very long continuous structures with well-developed fault breccias up to
2 m wide. These structures run parallel to the Cincha-Lluta (Incapuquio) fault system and are the
result of strong regional shearing deformation. Subsequent to the various intrusions, these dextral
strike-slip structures show displacements of up to 400 m. During the Tertiary and following the
secondary enrichment formation, these important structures were tectonically reactivated
(associated with the Andean orogeny) as normal faults, progressively downdropping the enrichment
blanket to the south (Figure 7-6). The latest signs of motion (normal faults) can be identified in
outcrops, as well as diamond-drill cores, and is much better preserved than earlier strike-slip
indicators.
The Zafranal Main Zone is partially bounded by WNW to E-W faults, which lie between major
regional NW trending faults of the Incapuquio Fault System. These faults are part of the broadly
transgressional environment created by right lateral strike slip and dip slip movement along some
of the NW trending Incapuquio faults, subsequently reactivated as extensional faults. This
environment has allowed for the juxtaposition of a block of Jurassic volcanoclastic rocks and
sedimentary rocks and later diorite intrusions with older rock terrains. The block is bounded both
north and south by faults. The block is in contact to the north with deformed gneissose rocks and
Cretaceous granodiorite, and steeply dipping Jurassic sedimentary rocks to the south.
Within the central part of the deposit, block faulting of the sedimentary and volcanoclastic rocks is
prolific. The sugary quartzite coloured light green on the accompanying geologic map (Figure 7-3)
do not have a continuous outcrop pattern and are displaced along generally east-west faults, which
are believed to have upwards movement to the north. The volcanoclastic and sugary quartzite
beds in this area are believed to be folded into a broad gently southwest plunging syncline.
Bedding is obscured by alteration within the central part of the deposit; however the overall form of
the syncline is interpreted by the outcrop pattern of the quartzite and volcanoclastic.
Faulting within the deposit is prolific and both Paleocene diorite and younger dykes were intruded
along some of these faults. Many of the intrusions, including diorite, quartz diorite or microdiorite
bodies, have fault-bounded contacts as well as clearly intrusive contacts with chilled margins. The
intrusions also intruded along weakened steeply dipping highly jointed zones and along possible
bedding and foliation within the volcanoclastic and quartzite rocks. In cross-section many of the
upper portions of the diorite bodies are sill-like, possibly flat-faulted bodies that probably mimic the
original bedding within the volcanoclastic rock sequence. Other diorite intrusions are clearly crosscutting.
Late post-mineralisation dykes trend in two general directions; N-S and 070o. These dykes
probably follow pre-existing faults and offset by these faults is likely. The dips of these 070 dykes vary
from sub-vertical to approximately 45 to the south.
Faulting is prevalent within the Zafranal Main Zone. This fault strikes E-W and dips to the south
showing drag with upward movement on the north side. Faults like these are sympathetic to the
Incapuquio Fault System which has the same movement with north side up but greater displacement.
Foliation within the volcanoclastic sequence is ubiquitous. It also cuts across the interbedded fine
grained sedimentary rocks within the volcanoclastic unit but is less apparent in the more massive and
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silicified quartzite that lies above the foliated volcanoclastic unit. Most of the foliation strikes to the
southwest and generally dips to the south along the north side of the deposit and dips to the north on
the south side of the deposit. Foliation is notably absent in the fine-grained feldspar porphyry that
intrudes the volcanoclastic unit and interbedded finer grained sedimentary rocks to the west.
Figure 7-5
Zafranal Structural Controls

Technical Report
Figure 7-6
Zafranal Porphyry Relative to the Incapuquio Fault System
Figure 7-7
Section 793 700N Mineralisation Zoning & Faults
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Note: Section 793 700N seen from the East, showing the main dextral faults reactivated with normal motion, the blanket
(supergene enrichment) downdropping southwards, and the deposits primary-sulphide potential, mainly consisting of
chalcopyrite.
Figure 7-8
The
North
Evidence of Structural Control at Zafranal
Fault
forms
the
Zafranal
deposits
Strongly foliated volcanic units (Az. 110/65)
transpressive jog and northern boundary of the alterationmineralisation zone (looking eastward)
D-type thin vein cut by the foliation - foliation affects the
Hornblende Lineation in Zafranal Diorite
sericitic halo
Fault system Az. 130-140
NE fault system that affects the deposit on the West
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DEPOSIT TYPES
Mineralisation at Zafranal is an Andean example of a porphyry copper, gold, and molybdenum deposit
(Modified after Nicolson, 2003). A generic description from Pantaleyev (1995) summarises the common
features of porphyries as large zones of hydrothermally altered rock containing quartz veins and
stockworks, sulphide-bearing veinlets; fractures and lesser disseminations in areas up to or greater
than 10 square kilometres in size, commonly coincident wholly or in part with hydrothermal or intrusion
breccias and dyke swarms. Deposit boundaries are determined by economic factors that outline ore
zones within larger areas of low-grade, often concentrically zoned mineralisation.
Important geologic controls on porphyry mineralisation include large structural zones and intersections,
igneous contacts, cupolas and the uppermost bifurcating parts of stocks and dyke swarms. Intrusive
and hydrothermal breccias and zones of intense fracturing due to coincident or intersecting multiple
mineralised fracture sets commonly coincide with the highest metal concentration. Quartz porphyry
intrusions often are genetically related to the best primary grade sulphide mineralisation.
The effects of surface oxidation commonly modify porphyry deposits in weathered environments. Low
pH meteoric waters generated by the oxidation of iron sulphides leach copper from copper-bearing
sulphides, re-depositing the copper as secondary chalcocite, digenite, and covellite in relatively flat
tabular zones below the water table. This process results in a copper-poor leached cap above a
supergene-enriched copper blanket, which in turn lies above a deposit of hypogene or primary grade
copper, generally chalcopyrite and lesser bornite.
The secondary copper sulphides sometimes are oxidised to copper oxides, such as malachite,
chrysocolla, and brochantite. Occasionally, these copper oxides are deposited at some distance away
from the main deposits to form large exotic copper deposits.
Other deposit styles associated with porphyry copper deposits (spatially and genetically) include
epithermal quartz veins and other quartz vein systems, lead-zinc-silver veins and replacements, and
skarns.
MINERALISATION
The mineralisation descriptions are modified from internal AQM reports on the surface mapping of the
Zafranal Main Zone authored by Russell Smith and Fernando Rivera (2010) and rock descriptions
authored by Gene Tobey.
Porphyry copper-gold mineralisation occurs within a large roughly east-west trending hydrothermally
altered zone that is more than 7 kilometres in length and as much as 1.7 kilometres in width in a northsouth direction.
9.1
LEACHED CAP & SECONDARY ENRICHMENT
The large altered and mineralised area at Zafranal has a subdued colour anomaly. The subdued colour
of the leached cap is partly due to the presence of recent volcanic ash covering the prospect and also
to the presence of less altered and less mineralised early porphyritic diorite or quartz diorite intrusions
that are often close to the surface and directly above much of the better mineralisation, both primary
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and secondary, hosted mostly in younger microdiorite and older volcanoclastic rocks. The deposit has
been intensely leached and has a well developed leached cap over the top of the supergene enriched
deposit at depth. Very little primary sulphide, hypogene mineralisation is present in outcrop, so little
can be said about it except by interpretation of leached outcrops. At surface all forms of sulphides are
absent except for occasional pyrite along with chalcopyrite in some more silicified rocks where acid
ground waters could not invade the rock and oxidise and leach it. Most of the rocks where silicification
is so abundant that oxidising fluids did not invade the rock are in general the sugary quartzites through
the central part of the deposit and local rhyolite and quartz porphyry rocks. The best supergene
enrichment zone is generally associated with phyllic alteration consisting of a sericite + quartz +
chlorite/biotite + clays + pyrite assemblage. The thickness of this zone can reach up to 150 m,
averaging 75 m throughout the deposit, with grades up to 7% Cu. Although no dating information
exists on Zafranals supergene enrichment, the agreed age of this mineralisation corresponds to
the Upper Eocene to Lower Miocene, similar to other enrichments zones within porphyries in the
Paleocene Belt (Quang et al., 2005). Extensional reactivation of the main strike-slip faults (azimuth
130-140) is responsible for downdropping the secondary enrichment layer towards the south.
Some of the thickest leached cap occurs under ridges where it has been better preserved. The more
pyrite-rich (now as limonite casts) volcanoclastic rocks and late microdiorite intrusion within the leached
cap probably provided much of the acid sulphate solutions to oxidise, leach and transport the copper
from the upper portions of the deposit to the enriched blanket. Some of the sulphides within the
volcanoclastic unit may have been indigenous to them and not supplied by later porphyry-style
mineralisation. The early porphyritic diorite (Zafranal diorite) intrusions, at least at the surface, do not
appear to have contained enough sulphides to generate the acid necessary to form the leached cap
and move copper lower to form an enriched copper sulphide chalcocite blanket. Drilling has indicated
that some of the strongest leached capping at the Zafranal Main Zone lies beneath the weakly oxidised
and mineralised porphyritic diorite at the contact with the underlying younger microdiorite. This contact
is often a low-angle fault zone that probably provided a local conduit for acid-bearing waters and
subsequent secondary enrichment. The supergene enriched blanket is comprised of some hypogene
chalcopyrite and is enriched with secondary chalcocite, which is found either replacing the chalcopyrite
or occurring as coatings on it.
Copper oxides of chrysocolla, neotocite, malachite and azurite generally occur above the main
supergene enriched blanket and below the leached cap. This type of oxide copper mineralisation
occurs within the leached cap associated with an intense phyllic alteration (sericite + quartz + clays).
Oxide mineralisation can be up to 50 m thick, containing average grades up to 0.4% Cu. The leached
cap itself is 30 m to 200 m thick. The copper-oxide zone defines former supergene enrichment zones
(paleoblanket) preserved within the oxidised leach zone. Chalcocite is replaced by copper oxides,
particularly the following species: brochantite, chrysocolla, chalcantite, neotocite, tenorite and
psilomelanes.
Occasionally, copper oxides occur above and below perched chalcocite blankets that are within the
leached capping. Locally, copper oxides and suspect disseminated sooty chalcocite of the supergene
enriched blanket is at least partially exposed at surface along the walls of the more deeply incised
valleys and gullies around the property. The copper oxides occurring as fracture fillings and suspect
sooty chalcocite observed at surface are generally visible as disseminations where the enriched blanket
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comes close to being exposed. Wherever the enriched blanket is nearest the surface, usually near
creek bottoms, it has been extensively weakened by surface oxidation and leaching so in those areas
copper oxides are more prevalent and chalcocite is very minor. Copper oxides occur there both within
volcanoclastic rocks and in diorites that are chlorite, phlogopite, sericite altered.
Copper oxides also occur in the deeply incised valley to the west of Tecks ZFDDH04-001 drillhole.
Some of the most spectacular amounts of copper oxides of chrysocolla, malachite and azurite seen on
the property occur within post mineralisation dykes that contain enough carbonate or calcite to have
precipitated copper in the form of the previously described minerals.
The volcanoclastic rocks may have had both primary pyrite and chalcopyrite occurring selectively along
bedding. These same volcanoclastic rocks may have then been subjected to an overprint of phyllic
alteration from the porphyry system. Conversely, the so-called bedded sulphides may just be related
to the Zafranal porphyry system, similar to contact-type skarn or hornfels mineral deposits. Similarly,
differing concentrations of hematite along possible bedding may be mimicking the layered
concentrations of chalcocite that occurred previously within the volcanoclastics. Successive leaching of
the chalcocite blanket has left hematite in the casts once filled with chalcocite that partially or wholly
replaced chalcopyrite during the enrichment process. Hematite is found locally in higher concentrations
within the central zone of more intense phyllic alteration in the volcanoclastic rocks. This area is
underlain by some of the best supergene enriched zones.
Hypogene mineralisation occurs both as veins, stockworks, and disseminations. As previously
mentioned most hypogene mineralisation observed on surface is hosted within the volcanoclastic
sequence and the microdiorite. The younger dioritic intrusives at surface contain consistent
background copper amounts (typically between 1000 ppm and 1500 ppm Cu) and typically represent
the best surface geochemical anomalies on the property. However, at deeper levels within the deposit
higher grade hypogene mineralisation, closely associated to the intrusive contact with the younger
microdiorite, is more evident within these rocks and may occur as shells of mineralisation within the
diorites typical of most porphyry models. The overlying enriched blanket is much smaller than the
underlying hypogene mineralisation which is extensive at depth albeit at much lower grade.
The enriched copper sulphide blanket occurring below the leached cap ranges up to 180 m thick. The
supergene enriched blanket is lens-shaped in N-S cross-section and appears to dip to the south and
somewhat to the west where it thins out in those directions. Within the enriched blanket, chalcocite has
mainly replaced chalcopyrite, with local coatings on pyrite. As erosion has taken place, the supergene
enriched blanket has progressively been remobilised to deeper levels, as well as laterally. Locally
abundant live limonite, principally hematite, at the surface in the leached cap is evidence that the
blanket has undergone successive leaching and re-deposition at depth.
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Figure 9-1
Photo - Casts Filled with Hematite
Figure 9-2
Photo Parallel D Veins
Casts filled with hematite are left over from the successive
Parallel D veins, vein-veinlet type, with sulphide vein cores
downward migration of the supergene enriched blanket of
and altered phyllic, sericite fringing selvages. These veins
chalcocite occur within the leached cap
occur within the central core of the feldspar porphyry. The

intermittent rock to the veinlets is weakly phyllically altered.
9.2
PRIMARY SULFIDE MINERALISATION & HYDROTHERMAL ALTERATION
The principal unit hosting the primary copper mineralisation at Zafranal is the microdiorite. This rock
hosts the greater percentage of hypogene sulphides (chalcopyrite). However, new drillhole results from
the eastern area show similarly mineralised Zafranal diorite, mainly in contact with large microdiorite
bodies. This primary mineralisation is related to a potassic alteration zone with a quartz (silicification) +
secondary biotite + chlorite +/- potassic feldspar assemblage. Chalcopyrite can be found in this area,
both disseminated and in veinlets, together with A-type and B-type thin veins (quartz-chalcopyritepyrite, quartz-chalcopyrite-molybdenite). In this type of mineralisation, average copper grades range
from 0.35% to 0.4% Cu, locally increasing up to 1% Cu. As an example of primary mineralisation
hosted by microdiorite, drillhole ZFDDH10-018 yields 0.38% Cu between 219 m and 503 metres (284 m
intercept).
The Zafranal diorite also hosts hypogene mineralisation, mainly as chalcopyrite-pyrite veinlets and
lesser disseminated amounts. Its copper grade is typically 0.15% to 0.23% Cu. However, it shows
primary mineralisation exceeding 0.3% Cu when intruded by microdiorite stocks, thus indicating its
mineralisation by the microdiorite. The same occurs locally within the Jurassic volcanics.
Primary copper mineralisation with grades ranging from 0.35% to 0.45% Cu has been observed at
Zafranal at depths of up to 400 m. The hypogene copper mineralisation potential thus remains open at
depth.
The Zafranal Main Zone is characterised by the presence of a large area of phyllic alteration lying
between E-W bounding faults, with a weak propylitic zone surrounding the Main Zone to the north and
south of these bounding faults. Zafranal hydrothermal alteration is in part lithologically controlled;
phyllic alteration occurs both as stockwork and locally pervasive within felsic volcanoclastic rocks,
sediments and the microdiorite that intrudes them. The early diorite porphyries generally exhibit biotite,
phlogopite, and chlorite type alteration, with local quartz-sericite-sulphide veinlets and local pervasive
phyllic alteration.
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All hydrothermal alteration studies, including core logging and core mapping, are utilising the following
scheme:
9.2.1
Early veinlets EDM, A-type & B-type
These veinlets are those without alteration halo, or with halos composed of rock stable minerals, i.e.
quartz, feldspars, biotite and anhydrite. They are formed in the late magmatic or early hydrothermal
(magmatic fluids) stage at relatively high temperatures (+400o C) in the transition from the realm of
ductile deformation and fracturing, and often carry chalcopyrite, bornite and molybdenite ( pyrite,
digenite).
The EDM (early dark micaceous) types are composed of biotite or greenish sericite (phengitic mica
contains higher Fe, and has a higher ratio of Si/Al than the sericites formed in later stages) quartz,
andalucite; and are usually the earliest veinlets that carry visible copper sulphides. Some members of
this family may be composed only of biotite, of magnetite-quartz, or of amphibole-magnetite-biotite
without sulphides.
The A-type are composed of granular quartz, without centreline, with or without K-feldspar halo, with
irregular non-matching walls (possibly indicating replacement formation), and are usually of little extent
laterally, although in drill core this is difficult to determine. These veinlets often carry major amounts of
chalcopyrite and bornite and are most common in the core of the system. A-type quartz veinlets may
amount to 20% or more of the rock volume.
The B-type are usually the major carriers of molybdenum values, and are the first of the brittle fracture
era, have appreciable lateral extent, centreline sutures or banded character and bilateral symmetry, and
have either no halo, K-feldspar, or weak sericite halos (halo to veinlet ratio < 1 or 2).
9.2.2
Intermediate veinlets C-type
These veinlets often have halos composed of chlorite/sericite or sericite/clay. They are formed at an
early hydrothermal stage and usually carry chalcopyrite, bornite ( pyrite, molybdenite); they contribute
major amounts of copper to the grade in some deposits (Chuquicamata). In these early hydrothermal
stage veinlets, the sericite in the alteration halo usually has a greenish cast (phengitic) with higher Si,
Fe and Mg content. The halo to veinlet width ratio is not high in this stage (2 to 5), but the total content
of copper sulphides is often greater in the halo, forming a cloudlike disseminated zone around the
central fracture.
9.2.3
Late veinlets D, E & F-types
These veinlets have texturally destructive halos composed of minerals not stable in fresh rock, white
sericite or of sericite, carbonate, and clay with gypsum and/or anhydrite. The late veinlets are
continuous and through going, usually with halo to veinlet width ratios greater than 5. These veinlets
often result from hydrothermal fluids (150-250o C) with a large component of meteoric origin.
The earlier D-type carries dominant pyrite ( chalcopyrite, molybdenite), with wide halos of greyish to
white sericite sometimes coarse enough to be termed muscovite. When these veinlets have
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chalcopyrite in the fracture it is usually subordinate to pyrite, and the halos rarely contain appreciable
disseminated chalcopyrite.
The late structurally controlled mineralisation (E-type), typical of the Central Andean porphyry copper
deposits is characterised by carbonate (ankerite-dolomite, or rhodochrosite), gypsum-anhydrite-barite,
with pyrite, chalcopyrite, tennantite-tetrahedrite, and sphalerite-galena. These veins are often
encountered with thicknesses from 5 cm to as much as 1 m. The alteration halos consist of
sericite/clay and are typically 5 to 10 times vein width. This veining stage is often responsible for
almost all arsenic/antimony present as contaminants in porphyry copper deposits.
There are also very late (dying thermal stage) veinlets (F-type), with gypsum, carbonate, chlorite or
epidote, some of which have alteration halos of clays (sericite), the clays include both non swelling
types (mapped as kaolinite), and swelling clays (smectite). This stage also includes zeolite/calcite
veinlets, and the zeolites may range from sodic to calcic types. These veinlets usually do not carry any
metal values; however, they may contain pyrite as a sulphidation product of in situ iron.
The phyllic alteration within the Jurassic volcanoclastic and sedimentary rocks takes on the form of both
stockworks of quartz-sericite veinlets and pervasive sericite alteration and silicification. Pervasive
silicification is most evident in the sugary quartzites that make up most of the mappable sedimentary
rocks on the property. These rocks are made up almost entirely of intergrown quartz grains that were
probably metamorphosed to a major extent during the Cretaceous coinciding with the intrusion of the
Cretaceous Caldera batholiths of granodiorite. These rocks were later phyllically altered during the
alteration process due to the Zafranal mineralising event and silica further invaded these rocks both by
veining and redistributing the silica that was already present in the rocks. Sericite within the quartzite is
associated with quartz veining, stockworks and locally occurs as a pervasive low grade sericitisation
throughout the rocks. The pervasive sericite would be derived from the minor clay component of the
quartzite. Alunite occurs within the more intense phyllic altered portion of the leached cap, however it
has been observed with more frequency around the peripheries of the more intense phyllic altered zone
of the deposit rather than central to it.
The early diorite porphyries at surface are typically altered as in many diorite hosted porphyry copper
deposits worldwide in that they exhibit early biotisation then later altered to chlorite and/or phlogopite.
The phyllic alteration is later and collapsed on the early biotisation. This early biotisation is not
considered potassic by many geologists studying porphyry coppers, but rather a form of contact
metasomatism and recrystallisation of minerals. The hornblende and original book biotite in these
rocks are locally replaced by successive alteration effects, first to biotite, then the other minerals listed
above and only the outlines of the remnant hornblende remain.
The strongest phyllic alteration, both pervasive and stockwork, is associated with the late microdiorite
as has been noted in the early drilling by AQM. D veins are common within the central portion of the
microdiorite intrusion and intruded volcanic rocks near the west end of the area mapped (Figure 7-3).
The D veins are parallel veins and veinlets with sulphide cores having quartz sericite selvages
bordering the central veins and veinlets. A west-southwest trending zone of parallel D veins trends
through the central part of this area which may continue to the west of the known deposit under fresh
young andesite exposed in the structural hanging-wall.
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Phyllic alteration is generally moderate to weak in the quartz porphyry dykes at the eastern end of the
property and the gneissose rocks that they intrude are only weakly sericitised. Banding within these
deformed rocks has not been destroyed by alteration and can easily be seen as biotite and or chlorite.
Potassic alteration is most commonly seen in the microdiorite intrusive unit and, to a lesser extent, in
the Zafranal diorite. No pink feldspars have been noted during mapping, but significant hydrothermal
biotite has been found in these intrusive rocks. Some of the biotite may be metasomatic in nature, but
most of the secondary biotite found to date shows clearly its hydrothermal origin.
A pervasive acid leaching type alteration associated with the leached cap is prevalent over the entire
deposit and takes the form of weak argillic alteration. All the rocks that occur within the central part of
the deposit are bleached with all the plagioclase feldspars bleached to a white creamy colour. The
plagioclase phenocrysts within the volcanoclastics and diorites exhibit varying degrees of acid sulphate
alteration.
Along the south side of the deposit and against the south bounding fault is an area of intense argillic
alteration. The argillic zone may occur within the microdiorite, some possible sedimentary rocks and
some early dykes. The argillically altered zone is more strongly bleached, being whitish in colour with
yellowish jarosite and common copper oxides. The diorite porphyry to the north, lying adjacent to this
zone, is not very altered but has the typical chlorite, phlogopite, sericite alteration that it exhibits
throughout much of the property. The less altered diorite also outcrops over the top of the NW portion
of the argillic zone covering a part of it. The argillic zone is deeply incised with several deep erosion
gullies as it is soft and easily eroded.
The general lack of propylitic alteration seen outside of the mineralised block between the north and
south faults suggests that the faulting occurred post alteration and mineralisation. Phyllic alteration
within the block appears to be terminated abruptly at the fault boundaries across which only weak
propylitic alteration occurs. The gneissose rocks to the north of the north bounding fault are only
slightly propylitically altered with epidote and/or chlorite. Similarly the thinner bedded sediments
exposed south of the south-bounding fault contain only minor amounts of epidote and chlorite.
Peripheral gold and gold-copper veins surround the copper-gold deposit. They occur outside of the
fault block, up to ten kilometres away and have been worked by artisanal miners who target narrow
quartz-chlorite-epidote altered zones and veins for their gold content.
10
EXPLORATION
10.1
EARLY EXPLORATION
Teck discovered the Zafranal copper-gold porphyry in 2003. Details of the Teck 2003 to 2007
exploration programmes on the Zafranal Main Zone Porphyry and surrounding prospects are included
in the exploration history section of this report.
AQMs exploration programme at Zafranal started in June of 2009 on the Zafranal Main Zone with
surface rock geochemical sampling and mapping. AQMs field crews remapped the Zafranal Main
Zone and completed a systematic surface rock geochemical sampling programme on a 100 m grid.
Assay results obtained from rock sampling show a distinct copper anomaly in the leached cap overlying
the enriched zone identified by Teck in its 2004 and 2005 drilling campaigns. The 2009 results show
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that the geochemical anomaly extends beyond the zone of strong phyllic alteration in the Main Zone.
Geological mapping of the main deposit has outlined an east-west trending, funnel-shaped zone of
strong phyllic-alteration over a 4500 m by 500 m to 1500 m area. This altered zone is hosted by a
strongly foliated, fine-grained volcano-sedimentary unit of Jurassic age cut by several generations of
porphyritic diorite stocks and dykes of dacitic composition with weak to moderate phyllic alteration and
moderate to strong biotite alteration. Geological interpretation of drillhole data indicates that the
copper-gold rich porphyry system is associated with a multiphase biotite-altered quartz diorite to diorite
stock located at the centre of the Zafranal alteration system (Tejada, 2005).
Results of the surface rock geochemical sampling programme are shown in Figure 10-1 and Figure
10-2.
Field work on the satellite prospects within the project commenced in September of 2009, including
work at the Sicera South, Sicera North and Ganchos prospects, where extensive areas phyllic alteration
and leached capping crop out and are similar to that observed at the Zafranal Main Zone.
AQM completed a surface rock geochemical sampling programme on the Sicera South zone, and
announced the results on November 5th, 2009. This zone is located 6.5 km west of the Zafranal Main
Zone. The Sicera South zone is marked by a 3 km by 1.8 km zone of phyllic alteration exhibiting a welldeveloped leached cap, typical of porphyry copper prospects in the area. The leached capping occurs
within a sequence of Mesozoic limestone, shale and sandstone units intruded by diorite and minor
quartz-diorite dykes and plugs. Sicera South lies along an east-west structural trend, which includes
the Zafranal Main Zone. This structural trend is a splay of the Incapuquio Fault System, controlling the
location of both the supergene-enriched Zafranal Main Zone and Sicera South targets. Field crews
sampled the Sicera South zone, focusing along access roads built by previous operators. A total of 223
samples were collected, of which 14% (31 samples) yielded copper values over 0.1% Cu; 50% of these
samples (i.e. 112 samples) were higher than 300 ppm. The significant portion of samples with plus 300
ppm copper suggests that a significant supergene enriched blanket, such as the one in the Zafranal
Main Zone, may exist at Sicera South. Geochemical results for Sicera South are shown in Figure 10-2.
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Figure 10-1
Zafranal Main Zone Surface Geochemical Results for Gold
Figure 10-2
Zafranal Sicera South Zone Surface Geochemical Results for Copper
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10.2
GEOPHYSICS
At the request of AQM, Zonge Ingeniera y Geofisca (Chile) S.A. in partnership with Jos Arce
Geophysical SRL of Lima, performed a magneto-tellurics (MT) study on the Zafranal Main Zone. The
study was preformed from November 9 to 12, 2009. The data collected from this study was compiled
with previous MT data acquired in 2004 for Teck. In these studies, MT data was acquired with an array
of pseudo tensorial dipoles (100 m). This study provides for the purchase of 5.7 line kilometres of MT
data, which was integrated with the results from five line kilometres of MT data acquired in 2004. The
MT data taken and processed is of good quality, with errors in the apparent resistivity typically less than
1.5%. The inverse modelling of observed data in 1 and 2 dimensions generated reasonable models
and a good fit between calculated and observed data. Results of inverse modelling of resistivity data
defined a coherent zone of low resistivity that is interpolated over an area of approximately 1000 m by
500 m coincident with a zone of porphyry-type alteration and mineralisation. New data acquired in this
study may indicate an area of low resistivity responses to the east. (Scarbrough, 2009). Figure 10-3
shows a 2D depth slice 200 m below surface.
Figure 10-3
Magneto-tellurics Depth Slice 200m below Surface
Note: Magneto-tellurics depth slice 200 metres below surface, incorporating both 2004 and 2009 data. The results show
the central part of the Main Zone as a low resistivity anomaly, extending both to the east and northwest
11
DRILLING
11.1
INTRODUCTION
The first phase 2009-2010 drilling programme started on December 24, 2009, the day the permit to drill
was received. The completed drilling programme consisted of 67 283.50 metres of diamond and RC
drilling. The initial part of the drilling programme concentrated on the Zafranal Main Zone to confirm
several of Tecks RC drillholes from the 2004 and 2005 drilling programmes. This has been followed by
step out drilling on 100 metre centres in the main zone using diamond drillholes, some of which were
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pre-collared with RC drilling through the leached zone (40 m -100 m) in order to expedite and minimise
spending throughout the programme. One RC and up to five diamond drill rigs were mobilised to the
project. Teck's previous exploration efforts at Zafranal included a total of 11 805 m of drilling in 36
drillholes (32 RC, 4 diamond).
In addition to the Zafranal prospect, the drilling programme included exploratory drilling on surrounding
satellite targets within the Zafranal Property boundary. These additional targets include the Sicera
South and Sicera North copper-gold porphyry prospects.
The drilling programme was completed by AK Drilling International S.A. (AK Drilling) under the
supervision of AQM's exploration team.
11.2
DIAMOND CORE DRILLING
Diamond drilling in the Zafranal Main Zone was conducted by up to 4 UDR200 LS, all-hydraulic, trackmounted rigs, supplied and operated by AK Drilling. A 5th rig was briefly added in late September 2010.
This machine was a larger, track-mounted, UDR650 rig operated by Consorcio J & M of Arequipa,
Peru. No diamond drilling was done on any of the satellite prospects. The first diamond rig was
mobilised on December 24th, 2009, with subsequent equipment added throughout 2010. All drilling
equipment at Zafranal was capable of drilling with HQ-sized core (63.5 mm diameter) down to depths of
up to 700 m, after which NQ-sized lines (47.6 mm diameter) were used.
Water for drilling was trucked in from the Majes River, approximately 60 km southwest of the main
drilling area, to a storage area located at an elevation of approximately 2 000 m.a.s.l. From there, water
was pumped to a second storage area approximately 200 m higher, and thence trucked to a main water
tank from where it was gravity fed to the various drill rigs.
Drillholes in the Main Zone were spotted based on the interpretation of results from the earlier Teck
campaigns, and were aimed at defining a compliant resource and extending the known limits of the
porphyry mineralisation.
A total of 150 diamond drill holes were completed on the Main Zone at the time of writing of this report
(Figure 11-1). Significant results, using a 0.2% Cu cut-off and a maximum 6 metre internal dilution, are
summarised in Table 11-1.
Table 11-1
Significant Results from AQM Diamond Drilling Programme in the Zafranal Main Zone
From
m
To
m
Interval
m
Cu
Au
g/t
ZFDDH09-005
99.7
192.2
92.5
0.62%
0.08
Incl.
101
119.5
18.5
1.78%
0.10
Drillhole
ZFDDH09-006
Comments
166.95
348
181.05
0.59%
0.11
Twin of ZFRC04-009
Incl.
169
210
41
0.98%
0.09
Ended in Mineralisation
ZFDDH10-007
41
159
118
1.00%
0.09
Incl.
42
89
47
2.01%
0.13
ZFDDH10-008
74
251
177
0.74%
0.19
Twin of ZFRC04-007
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To
m
Interval
m
114.5
181
66.5
1.31%
0.25
174
230
56
0.90%
0.08
Incl.
176.45
206.5
30.05
1.34%
0.09
And
264
425.1
161.1
0.32%
0.10
Drillhole
Incl.
ZFDDH10-009
ZFDDH10-010
From
m
Cu
Au
g/t
76
147.55
71.55
0.44%
0.24
And
164.3
186.95
22.65
0.52%
0.29
And
210
364
154
0.39%
0.09
ZFDDH10-011
114
171.9
57.9
0.43%
0.09
And
190
346.5
156.5
0.49%
0.11
86
230
144
0.68%
0.13
100.6
130
29.4
1.62%
0.19
ZFDDH10-012
Incl.
ZFDDH10-013
133
204
71
1.78%
0.35
Incl.
138
195.5
57.5
2.09%
0.41
And
253
292
39
0.31%
0.06
And
302
328.05
26.05
0.40%
0.05
ZFDDH10-014
40
145
105
1.16%
0.12
Incl.
64
128
64
1.55%
0.11
And
152
194
42
0.47%
0.06
And
216
256
40
0.33%
0.05
ZFDDH10-015
66.6
129.6
63
0.57%
0.17
And
187
275.15
88.15
0.44%
0.15
ZFDDH10-016
148.3
203
54.7
0.61%
0.13
And
275.75
351
75.25
0.82%
0.07
31.8
159
127.2
0.61%
0.08
ZFDDH10-017
Incl.
34
60
26
0.91%
0.11
ZFDDH10-018
88.65
469
380.35
0.62%
0.11
Incl.
88.65
193
104.35
1.17%
0.11
26
171
145
1.21%
0.10
Incl.
70.6
161
90.4
1.68%
0.09
ZFDDH10-020
63.5
149
85.5
1.23%
0.07
Incl.
63.5
106
42.5
1.38%
0.08
Incl.
114.5
135
20.5
1.51%
0.09
192
220
28
0.45%
0.05
230.85
322
91.15
0.55%
0.04
47
154
107
1.09%
0.07
ZFDDH10-019*
ZFDDH10-021
And
ZFDDH10-022*
Incl.
87
146
59
1.53%
0.10
And
176
333
157
0.39%
0.11
ZFDDH10-023*
98.7
268
169.3
0.86%
0.19
Incl.
157
187
30
1.78%
0.16
ZFDDH10-024
166.85
190.6
23.75
0.54%
0.05
And
196.5
221.8
25.3
0.62%
0.05
And
292
320.75
28.75
0.22%
0.09
Comments
Twin of ZFRC04-010
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Technical Report
From
m
To
m
Interval
m
Cu
Au
g/t
ZFDDH10-025
142
274
132
0.42%
0.11
ZFDDH10-026
65
93
28
0.40%
n/a
ZFDDH10-027
96.5
190.45
93.95
0.24%
0.07
ZFDDH10-028
178
306
128
0.80%
0.14
Incl.
202
259.75
57.75
1.29%
0.20
ZFDDH10-029
164
420
256
0.44%
0.11
Incl.
168
202
34
1.05%
0.09
Drillhole
ZFDDH10-030
64
88
24
0.36%
0.25
And
124
224
100
0.60%
0.10
Incl.
168
188
20
1.36%
0.12
ZFDDH10-031
83
210
127
0.56%
0.04
Incl.
83
97
14
1.22%
0.08
ZFDDH10-033
146
220
74
0.38%
0.09
And
241
286.7
45.7
0.29%
0.07
And
386
484
98
0.29%
0.11
ZFDDH10-034
177
232
55
0.42%
0.09
And
292
354
62
0.32%
0.13
52.85
142
89.15
0.58%
0.04
ZFDDH10-036
92
292
200
0.63%
0.15
Incl.
166
199
33
0.98%
0.15
ZFDDH10-035
And
349.8
384
34.2
0.27%
0.08
ZFDDH10-037
139.15
168
28.85
0.32%
0.03
ZFDDH10-038
128
340.65
212.65
0.52%
0.11
Incl.
184
209.15
25.15
1.47%
0.16
ZFDDH10-039
104
292
188
0.73%
0.13
Incl.
124
144
20
1.37%
0.09
Incl.
190
240
50
1.19%
0.19
And
318
410
92
0.29%
0.06
ZFDDH10-040
14
160.2
146.2
0.52%
0.06
Incl.
29
53
24
1.01%
0.05
And
291
307
16
0.53%
0.28
156.75
182
25.25
0.37%
0.06
196
256
60
0.76%
0.07
ZFDDH10-041
And
And
276
316
40
0.35%
0.08
And
373.45
434
60.55
0.36%
0.07
ZFDDH10-042
51
117
66
1.03%
0.09
Incl.
71.5
115.2
43.7
1.34%
0.09
ZFDDH10-043
220
402
182
0.39%
0.07
ZFDDH10-044
28
57
29
0.31%
n/a
And.
87.3
151
63.7
0.41%
0.04
ZFDDH10-045
63
117
54
1.02%
0.05
Incl.
79
103
24
1.37%
0.05
Comments
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Technical Report
Drillhole
ZFDDH10-046
From
m
To
m
Interval
m
Cu
Au
g/t
Comments
128
486.8
358.8
0.70%
0.11
Incl.
149.5
241
91.5
1.10%
0.10
Incl.
433
443
10
1.25%
0.28
ZFDDH10-047
ZFDDH10-048
No Significant Results
71
155
84
0.80%
Incl.
89.3
126.5
37.2
1.15%
0.03
0.03
ZFDDH10-050
103
192
89
0.60%
0.07
And
202
236
34
0.24%
0.05
And
286
328
42
0.28%
0.04
And
353
389.85
36.85
0.27%
0.05
And
418
450
32
0.24%
0.03
ZFDDH10-051
152
377
225
0.53%
0.11
Incl.
159
209
50
1.20%
0.16
And
401
436
35
0.32%
0.06
ZFDDH10-052
36.7
59
22.3
0.49%
0.01
ZFDDH10-053
85.75
119
33.25
0.78%
0.04
Incl.
151.85
196
44.15
0.43%
0.09
ZFDDH10-054
46
181.4
135.4
0.63%
0.05
ZFDDH10-055
64.9
110
45.1
0.81%
0.03
ZFDDH10-056
284
443.6
159.6
0.28%
0.06
ZFDDH10-057
104
169
65
0.72%
0.03
ZFDDH10-058
22.55
59
36.45
0.24%
<0.01
ZFDDH10-059
95.5
144
48.5
0.42%
0.01
And
160
184
24
0.54%
0.01
And
190
204
14
0.31%
0.02
ZFDDH10-060
114
165
51
0.32%
0.01
ZFDDH10-061
112
190
78
0.58%
0.08
Incl.
156
180
24
1.02%
0.07
ZFDDH10-062
68
84
16
0.36%
0.02
And
111
141
30
0.28%
0.02
ZFDDH10-63
88
260
172
0.66
0.16
Incl.
89.5
102
12.5
1.22
0.13
And
270
340
70
0.32
0.07
And
345
369
24
0.28
0.06
ZFDDH10-64
82.5
98
15.5
0.42
0.03
And
114
144
30
0.38
0.05
ZFDDH10-65
ZFDDH10-66*
58.8
137
78.2
0.42
0.05
And
154
286
132
0.36
0.1
And
296
426
130
0.38
0.12
ZFDDH10-67
90
98
0.33
0.01
ZFDDH10-68
38.6
73.3
34.7
0.3
0.02
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Technical Report
Drillhole
From
m
To
m
Interval
m
Cu
Au
g/t
ZFDDH10-69
154
185
31
0.27
0.02
ZFDDH10-70
145.5
302
156.5
0.28
0.07
And
380
452
72
0.32
0.1
ZFDDH10-71
50
98
48
0.23
0.01
ZFDDH10-72
108
130
22
0.4
0.03
ZFDDH10-73
46
61.8
15.8
0.42
0.04
70.5
234
163.5
0.36
0.1
And
And
240
362
122
0.4
0.15
And*
410
428.85
18.85
0.28
0.05
78
120
42
And
163.2
224.3
61.1
0.7
0.07
Incl.
163.2
184
20.8
1.12
0.07
And
ZFDDH10-74
ZFDDH10-75
0.47
0.21
229.5
267
37.5
0.25
0.05
ZFDDH10-76
111
312.4
201.4
0.68
0.08
Incl.
115
172
57
1.13
0.11
ZFDDH10-77
12
142
130
0.43
0.08
And
152
180
28
0.28
0.1
And
190
202
12
0.49
0.13
And
232
267
34
0.39
0.06
ZFDDH10-78
87
99
12
0.24
<0.01
ZFDDH10-79
24
40.15
16.15
0.28
<0.01
And
172
190
18
0.32
0.05
And
238
324
86
0.29
0.07
ZFDDH10-80
106
302
196
0.58
0.12
Incl.
138
180
42
1.11
0.12
ZFDDH10-82
71
108
37
0.52
0.14
And
116
166
50
0.46
0.08
And
180
278
98
0.43
0.09
ZFDDH10-83
11
60.9
49.9
0.29
0.13
80
164.7
ZFDDH10-81
ZFDDH10-84
ZFDDH10-85
Comments
84.7
0.42
0.08
ZFDDH10-86
140
160
20
0.28
0.03
And
268
316
48
0.32
0.05
And
336
358
22
0.28
0.04
And
366
382
16
0.26
0.05
And
390
404
14
0.27
0.07
ZFDDH10-87
37
143
106
0.31
0.13
And
181
205
24
0.23
0.08
And
253
269.1
16.1
0.44
0.18
And
278.6
344
65.4
0.28
0.07
60246-00000-23-002-001
Page 72

Technical Report
Drillhole
From
m
To
m
Interval
m
Cu
Au
g/t
ZFDDH10-88
76
266
190
0.35
0.07
And
280
364
84
0.25
0.08
And
378
408
30
0.24
0.1
ZFDDH10-89
148
264
116
0.8
0.14
Incl.
154
214
60
1.06
0.15
ZFDDH10-90
170
208
38
0.41
0.09
ZFDDH10-91
265.5
293.3
27.8
0.27
0.03
And
300
338.35
38.35
0.35
0.05
And
367.4
396.85
29.45
0.3
0.03
ZFDDH10-92
24.4
48.7
24.3
0.5
0.03
80
100
20
0.28
0.06
ZFDDH10-93
92
110
18
0.31
0.02
ZFDDH10-94
34.4
58
23.6
0.5
0.03
And
ZFDDH10-95
63
143
80
0.46
0.07
And
205
241
36
0.27
0.07
And
279.2
300
20.8
0.32
0.1
And
312
334
22
0.3
0.09
ZFDDH10-96
196
210
14
0.25
0.02
And
274
290
16
0.24
0.06
And
314
410
96
0.29
0.06
And
429.45
462
32.55
0.25
0.06
ZFDDH10-97
ZFDDH10-98
54
102
48
0.47
0.07
And
112
128
16
0.32
0.07
14.65
38
23.35
0.3
0.06
48
76
28
0.69
0.04
And
88
111.55
23.55
0.31
0.08
And
127
198
71
0.3
0.08
And
208
255
47
0.23
0.04
ZFDDH10-99
And
ZFDDH10-100
140
162
22
0.24
0.02
And
173
217.9
44.9
0.31
0.04
And
230
346
116
0.36
0.08
And
360
394
34
0.22
0.05
100
148
48
ZFDDH10-104
88
128
40
0.38
0.04
ZFDDH10-105
78.9
244
165.1
0.47
0.12
84
100
16
1.02
0.13
And
274
294.7
20.7
0.25
0.05
ZFDDH10-106
69.8
106
36.2
0.55
0.07
ZFDDH10-107
12
116
104
0.38
0.05
ZFDDH10-101
ZFDDH10-102
ZFDDH10-103
Incl.
Comments
0.28
0.03
60246-00000-23-002-001
Page 73

Technical Report
Drillhole
From
m
To
m
Interval
m
Cu
Au
g/t
ZFDDH10-108
61.7
92
30.3
0.51
0.04
ZFDDH10-109
96
108
12
0.26
0.02
ZFDDH10-110
138
158
20
0.4
0.52
ZFDDH10-111*
36.3
378
341.7
0.37
0.1
And
420
446.45
26.45
0.27
0.15
ZFDDH10-112
53
161
108
0.28
0.03
ZFDDH10-113
80
98
18
0.29
0.04
And
128
154
26
0.26
0.09
And
168
273
105
0.27
0.07
And
384
438
54
0.29
0.06
ZFDDH10-114
144
368
224
0.39
0.08
Incl
146
172.8
26.8
0.11
ZFDDH10-115
92
174
82
1.35
0.15
Incl.
107.9
162
54.1
1.8
0.2
And
231
251
20
0.65
0.22
And
304
327
23
0.32
0.07
ZFDDH10-116
112
112
0.13
Incl.
44
101.1
57.1
1.57
0.12
And
119.1
153.1
34
0.63
0.11
And
182
240.8
58.8
0.36
0.06
ZFDDH10-117*
90
180
90
0.28
0.05
And
194
207
13
0.4
0.06
ZFDDH10-118
118
302
184
0.53
0.07
Incl.
128
182
54
1.08
0.07
ZFDDH10-119
82
120
38
0.47
0.02
ZFDDH10-120
ZFDDH10-121
ZFDDH10-122
97.7
130
32.3
0.29
0.02
And
148
166
18
0.39
0.09
And
202
218
16
0.24
0.07
And
276
332
56
0.22
0.05
ZFDDH10-123
98
142
44
0.35
0.1
ZFDDH10-124
376
414
38
0.26
0.03
And
Comments
443
514
71
0.28
0.04
ZFDDH10-125
119.4
186
66.6
0.45
0.05
And
364.6
524.1
159.5
0.27
0.07
And
562
594
32
0.42
0.77
And
656
664
0.87
1.87
ZFDDH10-126
136
146
10
0.31
0.02
ZFDDH10-127
44
211
167
0.61
0.1
Incl.
54
94
40
1.3
0.11
And
244.5
271.5
27
0.3
0.06
60246-00000-23-002-001
Page 74

Technical Report
From
m
To
m
Cu
Au
g/t
ZFDDH10-128
82
104
ZFDDH10-129
74.7
104
22
0.83
0.04
29.3
0.39
0.03
ZFDDH10-130
118
166
ZFDDH10-131
310
336
48
0.39
0.04
26
0.22
0.04
And
358
And
416
382
24
0.27
0.09
444
28
0.25
And
0.06
460
482
22
0.24
0.05
ZFDDH10-132
78.4
107.9
29.5
0.37
0.03
ZFDDH10-133
44.55
72
27.45
0.4
0.03
Drillhole
Interval
m
And
80
96
16
0.33
0.04
And
116
144
28
0.6
0.05
And
152
178.3
26.3
0.25
0.05
And
200
220
20
0.3
0.04
And
352
426
74
0.36
0.08
ZFDDH10-134
138
150
12
0.33
0.03
ZFDDH10-135
115.8
198
82.2
0.7
0.47
218
436
218
0.32
0.17
And
ZFDDH10-136
ZFDDH10-137
116
126.5
10.5
0.59
0.05
And
166
274
108
0.69
0.07
ZFDDH10-138
38
76
38
0.39
0.17
And
138
189
51
0.57
0.08
ZFDDH10-140
84
178
94
And
278
386
108
0.26
0.06
ZFDDH10-141
90
114
24
0.56
0.05
ZFDDH10-139
ZFDDH10-142
Comments
0.41
0.07
80
92
12
0.32
0.02
And
213.25
234
20.75
0.37
0.03
And
272
280
0.85
0.23
And
296
318
22
0.32
0.1
ZFDDH10-143
10
44
34
0.28
0.15
And
120
188
68
0.6
0.07
Incl.
150
172
22
1.12
0.12
ZFDDH10-144
95
108
13
0.31
0.02
ZFDDH10-145
16
14
0.31
0.11
And
52.5
100
47.5
0.38
0.03
ZFDDH10-146
83.5
137.3
53.8
0.7
0.06
Incl.
106
137.3
31.3
0.88
0.07
And
154
175.22
21.2
0.81
0.07
ZFDDH10-147
46
388
342
0.55
0.06
Incl.
68
117.95
49.95
1.79
0.07
ZFDDH10-148
138
164
26
0.44
0.1
60246-00000-23-002-001
Page 75

Technical Report
Drillhole
From
m
To
m
Interval
m
Cu
Au
g/t
ZFDDH10-149
74.8
95
20.2
0.54
0.08
And
104.1
214.25
110.15
0.33
0.05
And
248
307
59
0.28
0.05
And
317
361
44
0.27
0.07
ZFDDH10-150
135
260
125
0.86
0.07
Incl.
135
160
25
1.01
0.11
Incl.
233
258
25
1.44
0.09
And
314
390
76
0.35
0.12
ZFDDH10-151
ZFDDH10-152
29.5
54
24.5
0.68
0.01
ZFDDH10-153
48
64
16
0.33
0.02
ZFDDH10-154
Comments
149
240
91
0.78
0.15
Incl.
197.8
216
18.2
1.21
0.27
And
298
340
42
0.39
0.08
397.4
27.7
0.3
0.07
And
369.7
* drillhole ends in mineralisation
60246-00000-23-002-001
Page 76

Technical Report
Table 11-2
Drillhole
AQM Drillhole Collar Location as at November 2010

Easting
Northing
Elevation
Total Depth
Drillhole Type
Azimuth
Dip
Date Started
Date Finished
ZFDDH09-005
793512.4
8224178.2
2622.0
248.4
diamond
180.0
-65.0
31-Dec-09
11-Jan-10
ZFDDH09-006
794197.8
8224362.4
2764.9
348.0
diamond
185.6
-66.7
30-Dec-09
1-Jan-10
ZFDDH09-007
793506.7
8224369.5
2596.4
249.1
diamond
3.9
-58.6
20-Feb-10
20-Feb-10
ZFDDH10-008
793498.9
8224270.5
2607.2
350.2
diamond
180.0
-63.2
11-Jan-10
20-Jan-10
ZFDDH10-009
794487.7
8224398.8
2760.6
425.1
diamond
182.3
-60.0
14-Jan-10
25-Jan-10
ZFDDH10-010
793499.3
8224269.3
2607.2
576.9
diamond
355.3
-86.7
20-Feb-10
20-Feb-10
ZFDDH10-011
793985.3
8224345.6
2750.3
346.5
diamond
176.8
-64.5
20-Feb-10
20-Feb-10
ZFDDH10-012
793383.0
8224262.5
2573.9
306.9
diamond
181.2
-63.2
3-Feb-10
8-Feb-10
ZFDDH10-013
793887.2
8224424.5
2752.1
367.1
diamond
180.0
-63.1
7-Feb-10
16-Feb-10
ZFDDH10-014
793392.4
8224385.5
2557.7
335.0
diamond
181.5
-64.4
9-Feb-10
16-Feb-10
ZFDDH10-015
793593.6
8224331.7
2619.6
336.8
diamond
183.5
-65.0
9-Feb-10
17-Feb-10
ZFDDH10-016
793895.3
8224338.9
2739.0
401.5
diamond
184.8
-65.6
16-Feb-10
27-Feb-10
ZFDDH10-017
793392.4
8224386.2
2557.7
316.7
diamond
2.0
-64.5
17-Feb-10
22-Feb-10
ZFDDH10-018
793591.1
8224461.8
2672.3
503.0
diamond
179.9
-64.1
17-Feb-10
4-Mar-10
ZFDDH10-019
793388.2
8224189.4
2608.4
258.9
diamond
181.1
-64.9
22-Feb-10
26-Feb-10
ZFDDH10-020
793296.3
8224251.1
2548.9
271.0
diamond
180.5
-74.8
26-Feb-10
31-Mar-10
ZFDDH10-021
793892.9
8224266.1
2718.9
336.6
diamond
180.0
-64.8
27-Feb-10
9-Mar-10
ZFDDH10-022
793385.2
8224085.5
2606.5
355.9
diamond
359.5
-65.0
3-Mar-10
10-Mar-10
ZFDDH10-023
793586.8
8224255.2
2637.3
344.4
diamond
180.0
-63.0
4-Mar-10
13-Mar-10
ZFDDH10-024
794206.0
8224356.4
2764.9
608.5
diamond
180.0
-84.8
9-Mar-10
31-Mar-10
ZFDDH10-025
794388.7
8224412.7
2749.8
393.4
diamond
180.0
-70.0
11-Mar-10
31-Mar-10
ZFDDH10-026
793385.4
8224084.3
2606.4
356.3
diamond
180.0
-75.8
10-Mar-10
17-Mar-10
ZFDDH10-027
793593.3
8224457.4
2672.6
367.4
diamond
359.9
-78.2
14-Mar-10
22-Mar-10
60246-00000-23-002-001
Page 77

Technical Report
Azimuth
Dip
ZFDDH10-028
Drillhole
Easting
794582.1
Northing
8224459.6
Elevation
2818.4
Total Depth
348.9
diamond
Drillhole Type
180.3
-67.2
Date Started
14-Mar-10
Date Finished
16-Mar-10
ZFDDH10-029
794601.4
8224389.6
2777.6
493.2
diamond
180.0
-65.0
16-Mar-10
17-Mar-10
ZFDDH10-030
794588.1
8224285.0
2706.9
334.5
diamond
0.0
0.0
3-Apr-10
9-Apr-10
ZFDDH10-031
793287.7
8224349.0
2562.3
249.9
diamond
185.4
-73.4
17-Mar-10
21-Mar-10
ZFDDH10-032
794184.7
8224454.2
2799.8
407.3
diamond
178.6
-62.6
19-Mar-10
20-Mar-10
ZFDDH10-033
794090.5
8224422.8
2779.4
503.6
diamond
180.1
-63.5
20-Mar-10
21-Mar-10
ZFDDH10-034
794083.3
8224336.3
2752.2
417.9
diamond
182.7
-68.8
21-Mar-10
22-Mar-10
ZFDDH10-035
793287.2
8224347.5
2562.3
251.9
diamond
324.2
-70.2
21-Mar-10
25-Mar-10
ZFDDH10-036
794083.1
8224261.2
2727.0
410.9
diamond
174.8
-68.2
22-Mar-10
23-Mar-10
ZFDDH10-037
793590.8
8224535.9
2657.1
244.0
diamond
2.7
-77.6
22-Mar-10
14-Apr-10
ZFDDH10-038
794190.7
8224264.6
2710.5
375.8
diamond
178.4
-64.3
23-Mar-10
24-Mar-10
ZFDDH10-039
794399.6
8224333.7
2715.3
413.5
diamond
177.3
-63.3
24-Mar-10
25-Mar-10
ZFDDH10-040
793398.0
8224474.6
2583.2
500.8
diamond
358.0
-72.3
25-Mar-10
1-Apr-10
ZFDDH10-041
793885.3
8224498.2
2777.2
445.9
diamond
179.4
-65.2
1-Apr-10
13-Apr-10
ZFDDH10-042
793485.3
8224449.3
2625.1
331.0
diamond
0.7
-65.3
4-Apr-10
7-May-10
ZFDDH10-043
794588.4
8224545.5
2850.0
423.5
diamond
179.2
-63.0
10-Apr-10
10-Apr-10
ZFDDH10-044
793187.5
8224283.2
2533.4
231.8
diamond
180.6
-75.5
26-May-10
26-May-10
ZFDDH10-045
793284.6
8224178.9
2578.5
244.5
diamond
181.6
-74.9
26-May-10
26-May-10
ZFDDH10-046
794683.7
8224421.0
2812.6
486.8
diamond
179.5
-75.5
22-Apr-10
4-May-10
ZFDDH10-047
793184.3
8224138.5
2546.8
204.8
diamond
213.0
-73.3
22-Apr-10
26-May-10
ZFDDH10-048
793294.6
8224250.8
2548.8
292.7
diamond
270.0
-65.6
25-Apr-10
30-Apr-10
ZFDDH10-049
793095.1
8224255.3
2534.9
264.0
diamond
179.6
-73.5
1-May-10
6-May-10
ZFDDH10-050
793698.6
8224495.2
2721.1
488.8
diamond
178.7
-80.0
4-May-10
15-May-10
ZFDDH10-051
794690.0
8224353.9
2771.2
494.3
diamond
178.4
-73.9
5-May-10
17-May-10
ZFDDH10-052
793077.0
8224176.0
2497.6
259.7
diamond
175.8
-75.1
7-May-10
11-May-10
ZFDDH10-053
793186.4
8224378.2
2577.1
261.5
diamond
175.7
-72.9
12-May-10
15-May-10
60246-00000-23-002-001
Page 78

Technical Report
Azimuth
Dip
ZFDDH10-054
Drillhole
Easting
793288.7
Northing
8224346.8
Elevation
2562.3
Total Depth
187.6
diamond
Drillhole Type
272.9
-65.5
Date Started
17-May-10
Date Finished
19-May-10
ZFDDH10-055
793095.7
8224255.3
2534.9
193.7
diamond
356.5
-65.2
16-May-10
19-May-10
ZFDDH10-056
794682.2
8224503.1
2837.5
524.5
diamond
179.8
-74.5
18-May-10
21-Jun-10
ZFDDH10-057
793284.8
8224177.6
2578.5
208.2
diamond
269.8
-65.6
19-May-10
21-Jun-10
ZFDDH10-058
792994.5
8224223.9
2482.8
153.2
diamond
180.0
-75.1
20-May-10
23-May-10
ZFDDH10-059
793079.7
8224387.8
2580.1
284.7
diamond
178.8
-73.5
23-May-10
27-May-10
ZFDDH10-060
792988.3
8224344.5
2578.5
247.8
diamond
180.0
-74.7
23-May-10
28-May-10
ZFDDH10-061
794695.5
8224262.5
2709.0
287.5
diamond
180.4
-75.8
24-May-10
29-May-10
ZFDDH10-062
792889.2
8224269.6
2523.8
240.1
diamond
179.2
-78.1
28-May-10
1-Jun-10
ZFDDH10-063
794797.4
8224377.1
2734.3
371.4
diamond
180.0
-75.6
28-May-10
6-Jun-10
ZFDDH10-064
793287.1
8224433.4
2600.4
284.0
diamond
360.0
-68.3
28-May-10
3-Jun-10
ZFDDH10-065
792992.1
8224125.2
2507.2
183.4
diamond
359.7
-74.6
30-May-10
2-Jun-10
ZFDDH10-066
794787.9
8224452.0
2748.0
428.1
diamond
179.9
-74.7
2-Jun-10
12-Jun-10
ZFDDH10-067
792895.1
8224343.3
2562.0
152.9
diamond
179.7
-75.1
3-Jun-10
10-Jun-10
ZFDDH10-068
793495.0
8224548.0
2630.4
149.4
diamond
359.9
-79.0
3-Jun-10
11-Jun-10
ZFDDH10-069
793789.7
8224515.6
2761.0
267.7
diamond
359.0
-73.7
6-Jun-10
11-Jun-10
ZFDDH10-070
794872.7
8224500.0
2729.2
492.8
diamond
176.0
-74.5
9-Jun-10
20-Jun-10
ZFDDH10-071
792888.4
8224190.5
2468.7
169.0
diamond
179.8
-71.9
11-Jun-10
14-Jun-10
ZFDDH10-072
793970.5
8224507.6
2781.2
261.6
diamond
359.9
-83.9
12-Jun-10
15-Jun-10
ZFDDH10-073
794880.5
8224443.7
2704.1
428.9
diamond
178.0
-73.4
13-Jun-10
22-Jun-10
ZFDDH10-074
792794.4
8224226.6
2442.1
161.7
diamond
179.0
-75.2
14-Jun-10
16-Jun-10
ZFDDH10-075
794089.8
8224182.2
2706.6
318.0
diamond
177.0
-75.5
15-Jun-10
22-Jun-10
ZFDDH10-076
793806.4
8224333.7
2708.7
396.5
diamond
179.0
-83.8
14-Jun-10
16-Jun-10
ZFDDH10-077
794867.2
8224353.8
2683.6
333.3
diamond
178.7
-73.5
20-Jun-10
26-Jun-10
ZFDDH10-078
792896.0
8224342.4
2561.8
190.7
diamond
268.5
-67.0
21-Jun-10
25-Jun-10
ZFDDH10-079
794993.4
8224544.5
2667.0
338.4
diamond
179.0
-75.9
22-Jun-10
1-Jul-10
60246-00000-23-002-001
Page 79

Technical Report
Azimuth
Dip
ZFDDH10-080
Drillhole
Easting
794391.1
Northing
8224284.0
Elevation
2695.0
Total Depth
366.0
diamond
Drillhole Type
176.6
-65.6
Date Started
23-Jun-10
Date Finished
1-Jul-10
ZFDDH10-081
792787.9
8224137.5
2431.4
119.6
diamond
178.0
-84.6
26-Jun-10
28-Jun-10
ZFDDH10-082
794779.9
8224310.5
2726.2
380.0
diamond
179.7
-75.4
26-Jun-10
3-Jul-10
ZFDDH10-083
794593.3
8224216.5
2681.1
240.9
diamond
177.0
-64.3
26-Jun-10
1-Jul-10
ZFDDH10-084
792893.1
8224099.0
2451.7
125.6
diamond
357.5
-75.1
28-Jun-10
30-Jun-10
ZFDDH10-085
793591.8
8224187.8
2615.2
290.6
diamond
180.0
-63.6
30-Jun-10
6-Jul-10
ZFDDH10-086
794092.9
8224521.6
2796.3
463.4
diamond
180.0
-64.5
1-Jul-10
11-Jul-10
ZFDDH10-087
794993.6
8224408.5
2670.2
450.6
diamond
179.6
-74.8
2-Jul-10
12-Jul-10
ZFDDH10-088
795090.9
8224511.9
2744.9
501.2
diamond
178.9
-76.0
3-Jul-10
18-Aug-10
ZFDDH10-089
794574.6
8224364.2
2750.9
267.3
diamond
179.2
-59.8
5-Jul-10
12-Jul-10
ZFDDH10-090
793895.7
8224183.8
2678.2
318.9
diamond
178.9
-65.8
7-Jul-10
17-Jul-10
ZFDDH10-091
794191.3
8224522.6
2813.4
448.8
diamond
177.1
-64.5
12-Jul-10
18-Aug-10
ZFDDH10-092
795100.1
8224594.1
2717.4
345.0
diamond
180.0
-75.4
13-Jul-10
19-Jul-10
ZFDDH10-093
794683.6
8224578.8
2826.5
367.8
diamond
180.0
-75.4
13-Jul-10
21-Jul-10
ZFDDH10-094
794990.1
8224294.7
2669.5
299.0
diamond
180.0
-80.6
17-Jul-10
23-Jul-10
ZFDDH10-095
795085.8
8224437.7
2717.4
481.1
diamond
178.1
-73.8
17-Jul-10
27-Jul-10
ZFDDH10-096
794772.3
8224545.4
2795.9
522.6
diamond
179.6
-75.0
21-Jul-10
2-Aug-10
ZFDDH10-097
794284.4
8224499.4
2820.4
358.0
diamond
176.0
-84.4
21-Jul-10
29-Jul-10
ZFDDH10-098
795107.9
8224350.8
2713.4
300.2
diamond
175.5
-74.6
23-Jul-10
30-Jul-10
ZFDDH10-099
795190.0
8224389.3
2749.9
383.0
diamond
177.0
-76.0
28-Jul-10
9-Sep-10
ZFDDH10-100
794398.9
8224503.1
2800.6
404.0
diamond
175.0
-65.0
29-Jul-10
7-Aug-10
ZFDDH10-101
795194.5
8224555.0
2785.9
369.2
diamond
176.0
-75.6
30-Jul-10
8-Aug-10
ZFDDH10-102
794877.4
8224602.3
2733.1
179.3
diamond
0.0
0.0
2-Aug-10
5-Oct-10
ZFDDH10-103
795186.7
8224623.1
2745.0
433.3
diamond
180.0
-74.2
29-Jul-10
7-Aug-10
ZFDDH10-104
794781.9
8224223.0
2703.1
290.4
diamond
175.4
-74.7
23-Sep-10
23-Sep-10
ZFDDH10-105
795190.1
8224467.3
2776.0
398.1
diamond
178.0
-77.1
8-Aug-10
16-Aug-10
60246-00000-23-002-001
Page 80

Technical Report
Azimuth
Dip
ZFDDH10-106
Drillhole
Easting
795291.1
Northing
8224500.3
Elevation
2809.0
Total Depth
304.7
diamond
Drillhole Type
177.4
-75.1
Date Started
13-Aug-10
Date Finished
18-Aug-07
ZFDDH10-107
794865.7
8224273.9
2677.1
312.7
diamond
169.6
-74.5
13-Aug-10
18-Aug-07
ZFDDH10-108
795284.1
8224436.5
2780.9
306.4
diamond
174.4
-74.9
15-Aug-10
23-Sep-10
ZFDDH10-109
794970.7
8224621.2
2694.8
410.8
diamond
180.0
-75.2
17-Aug-10
23-Sep-10
ZFDDH10-110
794696.1
8224183.1
2663.2
304.3
diamond
172.3
-75.3
20-Jan-10
8-Feb-10
ZFDDH10-111
795025.9
8224461.0
2711.8
446.5
diamond
178.2
-78.6
22-Aug-10
31-Aug-10
ZFDDH10-112
795276.3
8224359.4
2741.4
337.8
diamond
180.0
-75.4
3-Feb-10
8-Feb-10
ZFDDH10-113
793591.4
8224539.0
2657.4
458.5
diamond
175.9
-65.6
25-Aug-10
3-Sep-10
ZFDDH10-114
794482.9
8224400.2
2760.8
453.7
diamond
180.0
-82.9
9-Feb-10
16-Feb-10
ZFDDH10-115
793510.1
8224179.4
2622.0
357.8
diamond
359.5
-85.4
3-Mar-10
10-Feb-10
ZFDDH10-116
793384.4
8224336.1
2557.5
286.8
diamond
179.0
-75.8
1-Sep-10
8-Sep-10
ZFDDH10-117
793097.3
8224436.9
2570.9
207.0
diamond
180.0
-73.3
3-Sep-10
6-Sep-10
ZFDDH10-118
794495.2
8224207.4
2678.3
389.8
diamond
181.0
-85.0
4-Sep-10
12-Sep-10
ZFDDH10-119
792988.6
8224343.3
2578.5
163.1
diamond
359.5
-78.8
8-Sep-10
11-Sep-10
ZFDDH10-120
793887.8
8224579.3
2776.2
255.1
diamond
178.8
-85.6
8-Sep-10
12-Sep-10
ZFDDH10-121
793697.7
8224021.3
2568.5
166.1
diamond
360.0
-89.0
9-Sep-10
11-Sep-10
ZFDDH10-122
793697.3
8224553.9
2713.0
401.8
diamond
176.4
-78.9
11-Sep-10
18-Sep-10
ZFDDH10-123
794087.3
8224183.3
2706.6
356.7
diamond
177.5
-65.6
12-Sep-10
20-Sep-10
ZFDDH10-124
794088.8
8224569.1
2785.5
517.7
diamond
173.0
-65.2
12-Sep-10
23-Sep-10
ZFDDH10-125
794683.2
8224419.4
2812.6
732.8
diamond
353.8
-86.1
14-Sep-10
18-Oct-10
ZFDDH10-126
793474.7
8224076.9
2600.9
171.0
diamond
180.0
-83.1
18-Sep-10
20-Sep-10
ZFDDH10-127
793392.5
8224390.4
2558.2
403.7
diamond
179.1
-84.0
18-Oct-10
18-Oct-10
ZFDDH10-128
793591.7
8224149.5
2590.0
220.0
diamond
177.8
-59.4
21-Sep-10
23-Sep-10
ZFDDH10-129
793377.4
8224552.4
2629.9
259.0
diamond
180.0
-85.9
18-Oct-10
25-Sep-10
ZFDDH10-130
793810.0
8224168.5
2638.5
240.4
diamond
175.9
-71.7
23-Sep-10
26-Sep-10
ZFDDH10-131
794397.5
8224503.4
2800.9
598.6
diamond
174.5
-75.8
23-Sep-10
5-Oct-10
60246-00000-23-002-001
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Technical Report
Azimuth
Dip
ZFDDH10-132
Drillhole
Easting
793097.3
Northing
8224440.5
Elevation
2571.3
Total Depth
425.7
diamond
Drillhole Type
349.0
-86.6
Date Started
25-Sep-10
Date Finished
ZFDDH10-133
794831.2
8224606.7
2752.0
550.6
diamond
174.3
-74.8
26-Sep-10
3-Oct-10
ZFDDH10-134
793895.5
8224120.1
2644.0
353.7
diamond
179.6
-65.7
28-Sep-10
18-Oct-10
ZFDDH10-135
794677.6
8224422.6
2812.8
626.1
diamond
90.0
-75.0
30-Sep-10
13-Oct-10
ZFDDH10-136
795215.9
8224306.9
2754.0
414.0
diamond
175.4
-80.6
4-Oct-10
9-Oct-10
ZFDDH10-137
793885.9
8224436.5
2752.9
385.0
diamond
269.7
-74.9
6-Oct-10
13-Oct-10
ZFRC09-033
793811.7
8224337.8
2708.6
280.0
RC
0.0
-65.0
19-Dec-09
20-Dec-09
ZFRC09-034
793499.2
8224271.7
2607.2
252.0
RC
359.8
-55.1
28-Dec-09
31-Dec-09
ZFRC09-035
793512.6
8224176.7
2622.3
104.0
RC
179.8
-64.9
20-Dec-09
21-Dec-09
ZFRC10-036
794488.1
8224400.3
2760.6
300.0
RC
179.3
-84.9
1-Jan-10
2-Jan-10
ZFRC10-037
793688.4
8224422.7
2681.5
295.0
RC
179.5
-63.3
2-Jan-10
3-Jan-10
ZFRC10-038
793690.9
8224334.6
2666.1
280.0
RC
180.0
-63.6
3-Jan-10
7-Jan-10
4-Oct-10
ZFRC10-039
793690.7
8224262.7
2657.2
350.0
RC
179.3
-59.8
7-Jan-10
10-Jan-10
ZFRC10-040
794472.0
8224481.2
2812.9
301.0
RC
0.0
-70.0
10-Jan-10
12-Jan-10
ZFRC10-041
794491.9
8224279.5
2701.2
300.0
RC
178.0
-69.0
12-Jan-10
14-Jan-10
ZFRC10-042
793988.7
8224420.6
2763.8
300.0
RC
179.1
-63.6
14-Jan-10
16-Jan-10
ZFRC10-043
793990.6
8224260.8
2726.7
360.0
RC
180.0
-62.7
16-Jan-10
18-Jan-10
ZFRC10-044
794287.8
8224414.4
2794.4
350.0
RC
180.0
-62.3
18-Jan-10
21-Jan-10
ZFRC10-045
793806.5
8224263.5
2688.7
350.0
RC
180.0
-61.8
21-Jan-10
23-Jan-10
ZFRC10-046
793805.9
8224413.3
2720.4
321.0
RC
0.0
-63.5
23-Jan-10
25-Jan-10
ZFRC10-047
793683.6
8224424.9
2681.1
313.0
RC
359.8
-81.8
25-Jan-10
29-Jan-10
ZFRC10-048
793690.9
8224172.0
2619.8
314.0
RC
179.8
-64.9
29-Jan-10
1-Feb-10
ZFRC10-049
793988.9
8224428.0
2763.8
350.0
RC
0.0
-84.6
1-Feb-10
2-Feb-10
ZFRC10-050
794289.9
8224417.0
2794.6
350.0
RC
180.0
-83.3
3-Feb-10
5-Feb-10
ZFRC10-051
794395.5
8224205.3
2659.8
350.0
RC
180.0
-68.3
5-Feb-10
7-Feb-10
ZFRC10-052
794388.1
8224413.7
2749.8
350.0
RC
0.0
-68.3
8-Feb-10
10-Feb-10
60246-00000-23-002-001
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Technical Report
Azimuth
Dip
ZFRC10-053
Drillhole
Easting
794286.4
Northing
8224343.1
Elevation
2763.7
Total Depth
350.0
RC
Drillhole Type
180.0
-63.4
Date Started
10-Feb-10
Date Finished
14-Feb-10
ZFRC10-054
794277.6
8224232.4
2699.9
314.0
RC
180.0
-63.9
15-Feb-10
19-Feb-10
ZFRC10-055
795786.2
8224076.4
2708.4
300.0
RC
180.0
-72.9
19-Feb-10
21-Feb-10
ZFRC10-056
795592.4
8224007.4
2722.2
296.0
RC
0.0
-62.4
22-Feb-10
4-Mar-10
ZFRC10-057
796012.4
8224066.0
2594.6
171.0
RC
179.3
-64.6
26-Feb-10
27-Feb-10
ZFRC10-058
796274.4
8223946.3
2633.5
286.0
RC
180.0
-65.0
28-Feb-10
2-Mar-10
ZFRC10-059
796693.0
8223793.9
2588.7
286.0
RC
0.0
-75.6
2-Mar-10
4-Mar-10
ZFRC10-060
793510.5
8224176.1
2622.0
250.0
RC
180.0
-65.5
4-Mar-10
5-Mar-10
ZFRC10-061
793983.7
8224159.9
2667.8
292.0
RC
180.0
-74.6
5-Mar-10
7-Mar-10
ZFRC10-062
793696.9
8224025.4
2568.7
273.0
RC
0.0
-66.6
31-Mar-10
31-Mar-10
ZFRC10-063
793489.5
8223989.6
2536.1
300.0
RC
0.0
-64.3
31-Mar-10
31-Mar-10
ZFRC10-064
793699.4
8224493.6
2721.2
350.0
RC
180.0
-78.5
11-Mar-10
12-Mar-10
ZFRC10-065
793992.3
8224029.3
2616.1
286.0
RC
359.6
-64.2
25-Mar-10
31-Mar-10
ZFRC10-066
794279.8
8224016.4
2601.3
328.0
RC
359.9
-65.3
3-Apr-10
6-Apr-10
ZFRC10-067
793291.3
8223971.8
2574.7
286.0
RC
358.8
-65.4
6-Apr-10
9-Apr-10
ZFRC10-068
793807.6
8224330.0
2709.0
350.0
RC
180.0
-63.6
10-Apr-10
12-Apr-10
ZFRC10-069
793281.7
8224517.8
2611.8
350.0
RC
0.0
0.0
12-Apr-10
25-May-10
ZFRC10-070
793381.5
8224549.1
2629.7
337.0
RC
359.2
-79.0
14-Apr-10
16-Apr-10
ZFRC10-071
793274.7
8224122.8
2604.6
309.0
RC
8.3
-89.6
16-Apr-10
23-Apr-10
ZFRC10-072
794590.0
8224585.8
2855.6
400.0
RC
178.6
-67.7
23-Apr-10
25-Apr-10
ZFRC10-073
793985.2
8224588.8
2789.2
368.0
RC
179.7
-85.0
25-Apr-10
26-Apr-10
ZFRC10-074
793888.9
8224575.1
2776.3
372.0
RC
179.8
-64.3
27-Apr-10
28-Apr-10
ZFRC10-075
793686.8
8224598.6
2706.1
366.0
RC
179.6
-73.3
28-Apr-10
25-May-10
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Technical Report
The results obtained have confirmed the existence of a large porphyry system at Zafranal, which is
typically zoned with a leached cap near surface, a higher grade enriched blanket of secondary
sulphides and a large zone of primary mineralisation. Mineralised intercepts in the Main Zone have
confirmed the elongated E-W nature of the orebody, extending its limit to approximately 2.4 km in strike
length, up to 600 m width and thicknesses of up to 500 m. The mineralisation remains open, along
certain sections, to the north, the south and locally at depth.
Figure 11-1
Diamond Drilling completed by AQM during 2010
11.3
REVERSE CIRCULATION DRILLING
11.3.1
Zafranal
A total of 17 951 metres in 43 RC drill holes were completed on the Zafranal Main Zone between
December 26th 2009 and April 30th 2010, using a Foremost W750 rig operated by AK Drilling (Figure
11-2). AK Drilling supplied an auxiliary booster in case of drilling difficulties. This drilling method utilises
a dry percussion method, whereby a rotary bit, or hammer, crushes rock as it advances downhole. The
crushed rock is pushed upwards within the drilling rod and is ultimately recovered from a cyclone. RC
drilling does not use water and is therefore recommended in dry climates such as Zafranal in order to
minimise overall water use, and is cheaper and faster than diamond drilling. However, the geological
information obtained is less detailed than that obtained from the diamond drilling method.
A total of 9 diamond drill holes were pre-collared using the RC rig. This method involves drilling the
upper, unmineralised portion of a drill hole using the RC method. The target depth was determined by
interpreting the bottom of the barren leach cap as interpreted from the geological sections and the
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Page 84

Technical Report
results from previous drill holes. Once the target depth was reached, the RC rig was moved to a new
location, and the pre-collared hole was completed using a diamond drilling method. The RC portion of
pre-collared diamond holes used an RC suffix and the samples were sent for analysis.
Significant results from the RC drilling programme on the Main Zone, using a 0.2% Cu cut-off and a
maximum 6 metre internal dilution, are summarised in Table 11-6.
Table 11-3
Drillhole
ZFRC09-033
Significant Results from AQM RC Drilling Programme in the Zafranal Main Zone
From
m
126
To
m
238
Interval
m
112
Cu
0.79%
Au
g/t
0.08
Incl.
139
184
45
1.21%
0.09
ZFRC09-034
71
238
167
0.89%
0.18
Incl.
76
154
78
1.38%
0.18
Incl.
98
116
18
2.54%
0.13
ZFRC10-036
146
206
60
0.70%
0.12
Incl.
152
172
20
1.12%
0.10
And
221
297
76
0.34%
0.09
ZFRC10-037
135
235
100
0.57%
0.09
Incl.
135
173
38
0.97%
0.11
ZFRC10-038
81
258
177
0.44%
0.27
Incl.
96
141
45
0.55%
0.69
And
153
196
43
0.60%
0.09
ZFRC10-039
171
295
124
0.96%
0.14
Incl.
171
244
73
1.19%
0.19
ZFRC10-041
119
300
181
0.60%
0.07
Incl.
120
167
47
1.30%
0.12
ZFRC10-042
124
223
99
0.58%
0.06
Incl.
154
171
17
1.25%
0.08
ZFRC10-043
213
354
141
0.69%
0.06
ZFRC10-040
Comments
Twin of ZFDDH04-002
Twin of ZFDDH04-004
No significant Results
Incl.
220
278
58
1.02%
0.09
ZFRC10-044
219
316
97
0.78%
0.10
Incl.
249
293
44
1.13%
0.12
ZFRC10-045
132
157
25
1.09%
0.10
And
188
314
126
0.41%
0.04
ZFRC10-046
151
221
70
0.36%
0.04
ZFRC10-047
70
241
171
0.53%
0.04
Incl.
96
141
45
1.04%
0.07
ZFRC10-048
56
101
45
0.45%
0.10
And
119
158
39
0.77%
0.07
ZFRC10-049
85
130
45
0.51%
0.06
ZFRC10-050
143
213
70
0.56%
0.08
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Drillhole
And
ZFRC10-051
From
m
251
To
m
318
Interval
m
67
0.31%
Au
g/t
0.08
156
174
18
0.40%
0.06
ZFRC10-052
Cu
ZFRC10-053
190
304
114
0.58%
0.11
And
329
350
21
0.30%
0.08
ZFRC10-054
181
254
73
0.46%
0.09
ZFRC10-055
ZFRC10-056
ZFRC10-057
Comments
20
44
24
0.29%
0.10
ZFRC10-058
ZFRC10-059
ZFRC10-060
84
168
84
0.58%
0.09
ZFRC10-061
148
163
15
0.26%
0.02
ZFRC10-062
99
139
40
0.47%
0.02
ZFRC10-064
108
280
172
0.61%
0.06
Incl.
149
170
21
1.01%
0.07
And
298
350
52
0.32%
0.06
ZFRC10-065
120
129
0.45%
0.16
And
166
178
12
0.33%
n/a
And
223
243
20
0.28%
n/a
ZFRC10-063
ZFRC10-066
ZFRC10-067
ZFRC10-068
130
262
132
0.92%
0.11
Incl.
138
171
33
1.36%
0.11
And
307
349
42
0.67%
0.05
ZFRC10-069
ZFRC10-070
299
327
28
ZFRC10-071
92
127
35
0.53%
0.24
0.94%
0.05
ZFRC10-072
ZFRC10-073
ZFRC10-074
172
226
54
0.31%
0.02
ZFRC10-075
84
94
10
0.30%
0.01
And
302
322
20
0.26%
0.04
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Figure 11-2
11.3.2
RC Drilling completed by AQM during 2010
Sicera South & Sicera North
AQM also completed a total of 3105 metres of RC drilling in the Sicera South target and an additional
2425 metres in the Sicera North target. Table 11-5 shows collar information for the drilling programme
in these two targets.
Figure 11-2 and Figure 11-3 respectively show the drill location in Sicera South and Sicera North.
Results from this programme show potentially significant copper mineralisation in drillhole SSRC10-008
in Sicera South and drillholes SNRC10-005 and SNRC10-006 in Sicera North. Significant results, using
a 0.2% Cu cut-off and a maximum 6 metre internal dilution, are shown in Table 11-3.
Table 11-4
RC Collar Location for Sicera South & Sicera North
SNRC10-02
From
m
34
To
m
83
Interval
m
49
Cu
%
0.3
Au
g/t
0.01
SNRC10-03
38
65
27
0.5
0.01
And
71
85
14
0.24
0.01
Drillhole
SNRC10-04
SNRC10-05
30
57
27
0.27
0.02
And
63
80
17
0.2
0.03
And
85
96
11
0.34
0.03
And
100
125
25
0.29
0.03
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From
m
140
Drillhole
And
To
m
181*
Interval
m
41
Cu
%
0.3
Au
g/t
0.03
SNRC10-06
14
78
64
0.36
0.03
And
94
115
21
0.4
0.02
And
123
151
28
0.32
0.02
And
177
245
68
0.36
0.02
SSRC10-03
SSRC10-04
SSRC10-05
SSRC10-06
140
151
11
0.4
0.02
SSRC10-07
70
86
16
0.2
<0.01
And
106
118
12
0.53
0.02
And
188
204
16
0.27
<0.01
SSRC10-08
266
302
36
0.29
0.02
And
308
343
35
0.34
0.02
SSRC10-09
10
58
48
0.64
0.05
And
78
96
18
0.3
0.03
And*
277
319
42
0.33
0.04
SSRC10-10
SSRC10-11
SSRC10-12
Table 11-5
214
226
12
0.27
0.01
RC Collar Location for Sicera South & Sicera North

Target
Easting
Northing
Elev.
SSRC10-003
SICERA SOUTH
787391.64
8224886.96
2160
85
-65
256
SSRC10-004
SICERA SOUTH
787384.35
8224897.36
2160
265
-75
350
SSRC10-005
SICERA SOUTH
787337.8
8225020.58
2160
255
-75
244
SSRC10-006
SICERA SOUTH
787256.44
8225177.13
2160
255
-75
196
SSRC10-007
SICERA SOUTH
787312.08
8225267.72
2170
270
-85
350
SSRC10-008
SICERA SOUTH
787069.38
8225403.11
2085
350
-75
350
SSRC10-009
SICERA SOUTH
787241.08
8225391.57
2100
335
-80
319
SSRC10-010
SICERA SOUTH
787065.84
8225302.4
2055
350
-75
350
SSRC10-011
SICERA SOUTH
786,804.97
8,225,412.42
2030
250
-70
340
SSRC10-012
SICERA SOUTH
786,977.86
8,225,372.99
2070
360
-70
350
SNRC10-002
SICERA NORTH
785386.91
8228363.87
2025
60
-80
328
SNRC10-003
SICERA NORTH
785385.29
8228363.86
2025
180
-75
170
SNRC10-004
SICERA NORTH
785312.94
8228415.21
2045
60
-70
232
SNRC10-005
SICERA NORTH
785675.27
8228057.23
2080
60
-65
181
SNRC10-006
SICERA NORTH
785807.74
8228145.2
2065
110
-70
311
SNRC10-007
SICERA NORTH
785559.82
8228527.93
2180
190
-70
238
SNRC10-008
SICERA NORTH
785559.82
8228527.93
2180
190
-65
265
SNRC10-009
SICERA NORTH
785562.45
8228529.62
2180
360
-80
350
SNRC10-010
SICERA NORTH
785462.88
8228514.08
2140
190
-70
350
Drillhole
Az.
Dip
Length
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Figure 11-3
RC Drilling completed on the Sicera South Target
Figure 11-4
RC Drilling completed on the Sicera North Target
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11.4
DRILLING ORIENTATION
The mineralisation shows a flat-lying to gently south dipping enrichment blanket generally between 40
m and 80 m thick (and up to 180 m thick) underlain by hypogene chalcopyrite-dominated mineralisation
hosted in diorite and microdiorite intrusive rocks. The enrichment blanket appears to be younger than
most faulting on the property and is hosted in intrusive rocks, volcanic host rocks and even late diorite
and andesitic rocks.
In relation to true thickness and orientation, the enrichment blanket is flat-lying to gently south dipping
(-20 degrees) and appears to be relatively undisturbed by faulting or deformation. However, late
normal faulting appears to have locally displaced the blanket by no more than 10 m. Therefore steeper
inclined drillholes cut the blanket more perpendicularly then flatter inclined drillholes. As an example,
the true thickness of the blanket cut by a -65o drillhole would be 90% of the reported interval.
Hypogene mineralisation is controlled by lithology and by structural breaks. The higher grade primary
mineralisation appears to be closely associated to microdiorite intrusive rocks, occurring both within it
and in other rocks in contact with the microdiorite. Two large microdiorite bodies have been recognised
on the Main Zone, both occurring as near vertical plugs, that are displaced by up to 200 m by NWtrending dextral strike-slip faults. These microdiorite plugs are interpreted to have been emplaced in a
roughly northeastern orientation. Their current apparent E-W orientation is a result of subsequent
tectonic displacement. North-South oriented drillholes should cut these higher grade hypogene zones
perpendicularly, with shallower holes giving a better true thickness estimate than steeper ones.
11.5
DRILLING QUALITY
11.5.1
Core recovery considerations
Average core recovery for AQM diamond drillholes is 96% with 91% of the samples having a recovery
greater than 90%. Within the 0.2% Cu Total grade envelope used as a constraint for the resource
estimation, the average core recovery is 97%. There is no evidence of variation of recovery percentage
with copper grade or lithology in the mineralised zone.
A graph of average core recovery versus CuTotal grade bins using 0.2% grade increments is presented
in Figure 11-5.
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Figure 11-5
Average Core Recovery % vs. CuTotal Grade Bins
100
99
Core Recovery %
98
97
96
95
94
93
92
91
90
0.0
0.5
1.0
1.5
CuTotal Grade Bin % - 0.2% increments
2.0
Drilling recoveries and core quality were commented on by Ambrus (2010). Core recoveries in several
drillholes were reviewed by Ambrus and reported as averaging about 95% and rarely dropping below
90% locally despite very high fracturing (RQD rarely exceed 30%).
RC recoveries were reviewed in 5 drillholes and these drillholes displayed irregular and below standard
recoveries with averages of 68 to 83% per drillhole. Normal acceptable recoveries would be 90% and
ideally 95% with 5% lost as dust and due to sample handling. The unrecovered materials remain in the
drillhole and are possibly injected into the open spaces of the highly fractured rock mass and later
incorporated in the forthcoming samples producing a random downhole contamination.
11.5.2
Diamond-RC Drillhole Twins
The conclusions of a diamond-RC twin drillhole comparison completed by AMEC Minproc in May 2010
are provided in Section 14.5.
11.6
SURVEYING
Surveyors established two control points within the Zafranal Main Zone during 2009, both of which were
tied to primary geodesic points using a differential GPS. The PSAD56 datum (Zone 18S) is used for all
survey work at Zafranal. Air photos obtained during 2009 were georeferenced using the same control
points, thus generating detailed 1:2 000 scale topographic maps of the area as well as orthophotos.
Once a cement collar and a PVC pipe or drill rod were in place, every drill collar was surveyed by
Geotopomin, a surveying company based in Arequipa, using a Leica TC-405 total station and the
previously established control points. Geotopomin crews periodically visited Zafranal to survey drill
collars and access roads.
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11.7
GRID CONTROL
No grid was established on Zafranal. 1:2000 scale orthophotos were used to plan the drilling program,
using North-South sections spaced 100 m apart. Individual drill holes were spaced between 40 m and
100 m apart within each section.
11.8
DRILLHOLE COLLARS
Drillholes were oriented by AQM geologists using Brunton compasses. Drillhole angles were
established using inclinometers.
Once a drillhole was completed, a 3 metre long piece of PVC pipe or HQ drill rod was left behind and
cemented in for surveying with a total station. The drillhole number, azimuth, inclination and total depth
were marked on aluminium tags cemented-in and/or directly on the cement collar.
11.9
DOWNHOLE SURVEYING
Three downhole surveying tools have been used during AQM drilling campaign at Zafranal. The
Deviflex and Gyroscope are non-magnetic tools, while the Flexit is magnetic. All diamond and RC
drllholes completed on the Zafranal Main Zone have been surveyed using one of these methods.
However, due to collapsing walls, a small minority of drillholes could not be surveyed or re-entered.
Table 11-6 summarises the distribution of the various downhole surveying methods during the
programme.
All RC drillholes were initially surveyed using the Deviflex tool. However, due to some inconsistencies
and operation difficulties, some drillholes were re-entered and re-surveyed using a gyroscope.
The Deviflex and gyroscope tools are wireline supported and collect data inside the rods from the end
of a drillhole to surface every 2 seconds. A complete reconstruction of the drillhole is then downloaded
to the Zafranal database. The magnetic Flexit tool must be sent to the bottom of a drillhole once the
rods are pulled back at least 6 m. As a result, readings are collected only where the tool is sent down.
In most drillholes surveyed using this method, this was done every 50 m.
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Table 11-6
Distribution of Downhole Surveying Methods in the Zafranal 2009-2001 Drilling
Programme
Method
Number of Diamond Drillholes
Number of RC Drillholes
Flexit
25
Deviflex
12
17
Gyroscope
103
33
11.10
SURFACE TOPOGRAPHY
Topographic maps were prepared by Horizons, a Lima-based airborne photography and mapping
company. Flights were completed in late 2009, and 1:2000 and 1:5000 scale maps were generated.
Two control points tied in to the Peruvian geodesic network were used to georeference the aerial
photos and generate the topographic maps and the orthophotos.
All surface mapping and drill planning was done using 1:2000 maps for the Main Zone. 1:5000 maps
were used for outlying areas and satellite targets.
12
SAMPLING METHOD & APPROACH
Sampling at Zafranal has been from two parts of the exploration/drilling program. Surface sampling is
described in the exploration history sections of this report and contains the number of samples, results
and relative areas of the surface sampling (geochemical) programs. Sampling protocols for the drilling
programme are described below.
Sampling protocols used at Zafranal are standard industry practice for copper porphyry type deposits
with sample intervals of 1 to 2 metres for RC and diamond drillholes. Sample quality is to industry
standard for the diamond drillholes.
12.1
DIAMOND CORE SAMPLING & LOGGING
Diamond core sampling and logging procedures are described herein:
The core is loaded from the core tube into 3 m corrugated plastic core boxes labelled with box
numbers and interval runs in metres
Samples are picked up from drill site with a pick-up truck and brought to core logging facility at
camp. The core is logged by geologists for alteration, mineralisation, lithologies, and structures and
assessed by geotechnicians for RQD
The core is then cut in half using gas-powered core saws. The half core of 2 m intervals or lesser, if
it contains structural, lithological, mineralogical, or alteration differences, is placed in plastic lab
sample bags weighing 5 to 7 kg per 2 m sample
Standards, blanks and duplicates are inserted after the core is cut at the logging facility. Duplicates
are cut into s; ( duplicate sample, original sample, core sample kept in core shack) 2 m
interval lab sample bags are placed in rice bags totalling 35 kg and samples for entire drillholes are
sent to ALS Chemex in Arequipa for preparation
The pulps are sent to ALS Chemex in Lima for analysis.
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12.2
RC SAMPLING & LOGGING
RC sampling and logging procedures are described herein:
1 metre RC chip samples are collected into buckets (directly from the rig tubing, then each 1 metre
sample is weighed before being distributed into the sampling sieve
Sample weight ranges from 12 to 33 kg with an average of 20 kg
Approximately 1/3 of the recovered sample or (5.5 to 10 kg, on average 7 kg) is placed into
laboratory mesh sacks and the remainder is placed in rice bags
5 field blanks (granodiorite batholith), 5 duplicates and 6 (2 of each coded standards) standards for
a total of 16% are inserted at random every 100 samples using excel =randbetween formula
Standards, duplicates and blanks are inserted during the sample procedure at the Zafranal camp
Samples are placed into rice sacs that equate to 25 kg each and are picked up at the drill sites once
the drillhole is finished and brought to camp with a 5 tonne truck
Once entire drillholes are organised for shipment to the laboratory with proper documents at camp,
they are taken to the ALS Chemex Laboratory in Arequipa by an AQM representative in a 5 tonne
truck. RC chips samples are prepared in Arequipa
The pulps are sent to ALS Chemex in Lima for analysis
12.3
GEOLOGICAL LOGGING
Geological logging was completed out by AQM geologists in the Main Zone camp. Core was
transported from the drill site to camp twice a day, using AQM vehicles, under the supervision of a AQM
geologist. Once in the core shack, the core was logged manually, using the codes established for each
lithology. Additional codes were created during the programme, as new lithologies were encountered.
The creation of new codes was approved by one of the AQMs Qualified Persons before being entered
into the database. Sulphide contents were estimated visually and subsequently verified with assay data.
Approved lithologies used throughout the programme are listed in Figure 12-1.
Drill logs included lithological, alteration, mineralisation and structural codes, as well as a detailed
description of the observations made by the logger. Once a log was completed, it was digitally entered
into the database by Company personnel. Hard copies are kept in the Zafranal camp; digital copies are
stored in the Companys server in Lima, as well as in a securely stored back-up.
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Figure 12-1
12.4
Lithological Codes used at Zafranal
STRUCTURAL DATA
Structural data was measured by project geologists and recorded manually once drill core arrived in
camp. Data was subsequently entered into the digital database on a daily basis. The information
recorded included fractures and joints, orientation with respect to core axis, faulting (gouge, tectonic
breccias, etc.), veining and preferred vein orientation.
12.5
GEOTECHNICAL DATA
Geotechnical data was collected by Company personnel immediately upon arrival of the core to the
core shack. Recovery, hardness, fracture intensity and RQD information is measured and recorded
manually, and subsequently entered into the Project database. Unusual readings (e.g. recoveries
exceeding 100%) were double-checked by Company geologists and corrected accordingly.
12.6
ROCK DENSITY MEASUREMENT
A total of 753 samples were collected for bulk density measurements by ALS Chemex laboratory in
Lima. Samples were chosen and collected every 40 m by project geologists thus ensuring that all
lithologies and alterations present at Zafranal were well represented, whether they contained
mineralisation or not. Individual pieces of core measuring over 10 cm in length were collected and put
into sealed and padded plastic bags to preserve sample integrity.
Table 12-1 shows a summary of the samples collected for bulk density measurements.
Bulk density samples were coated in paraffin and analysed by ALS Chemex using the OA-GRA09
method, described as follows:
The rock or core section is weighed and then slowly placed into a bulk density apparatus which is filled
with water. The displaced water is collected into a graduated cylinder and measured. From the data, the
bulk density is calculated:
Density = Weight of sample (g)/Volume of water displaced (cm3)
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Details on the bulk density data is provided in Section 17.9.

Table 12-1
Number of Samples Collected for Bulk Density Measurements by Lithology
Lithology
Number of Samples
Late quartz diorite
20
Microdiorite
185
Volcanoclastics
204
Dry diorite
Monzodiorite
Post Mine. dyke
Zafranal Diorite
332
TOTAL
753
12.7
SAMPLE QUALITY
All soil, rock, and core sampling was carried out by trained individuals under the supervision of AQM
geologists. The soil and samples were located by standard GPS, often slightly modified when located
on surveyed roads. The soil and rock samples were collected in double-marked bags and shipped to
the laboratory approximately every two weeks or with shipments of core. Core sample intervals were
marked in the boxes and shipped when the drillhole was completed.
13
SAMPLE PREPARATION, ANALYSES & SECURITY
13.1
SAMPLE SECURITY
All sampling was done at the drill site and in the core shack and was performed by AQM personnel. RC
samples were quartered and sealed in cloth bags at the drill site. Samples were then put into large rice
bags, which were subsequently sealed and sent to Arequipa in a sealed truck.
Half core samples are collected in the core shack and individual sample bags are put into sealed rice
bags which are transported to ALS Chemex sample preparation facility in Arequipa in a sealed truck.
Numbered zap-straps supplied by ALS Chemex are used to seal each individual rice bag. The truck
used to transport samples to Arequipa was sealed with a large padlock. The keys to the padlock are
kept by the Zafranal Project Chief Geologist and the manager of the ALS Chemex facility in Arequipa.
13.2
ANALYTICAL LABORATORY, SAMPLE PREPARATION & ANALYTICAL PROCEDURES
Samples are prepared in ALS Chemex facility in Arequipa and subsequently sent to ALS Chemex in
Lima, an ISO 17025 certified laboratory, for analysis.
13.3
ADEQUACY OF PROCEDURES
AQM has reviewed and audited the preparation procedures used at ALS Chemex facility in Arequipa.
The methods used conform to international standards and are considered adequate by the authors.
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14
DATA VERIFICATION
14.1
DRILLING & SAMPLING INTERNAL QUALITY CONTROL PROCEDURES
The quality control measures used at Zafranal, as taken from AQM QAQC protocol, are as follows:
Core is photographed on site upon arrival at the core shack and subsequently sawed in half once it
is logged by AQM geologists, with one half sent for analysis and the other is stored for future
reference and assay verification. Duplicates of core are generated from the laboratory of the half
core
Sample intervals are generally 2 metres, though field geologists may vary the intervals according to
geological contacts and features; however no samples under 0.50 m are collected
One metre samples are collected from the reverse circulation drilling. RC chips are split twice on
site using a riffle splitter, with 25% of the sample being sent to the laboratory for assay and the rest
stored for future verification purposes
AQM has established a rigorous QAQC programme at Zafranal which includes the insertion of
blanks, duplicates and certified standards into the sample stream. Three standards were generated
by SGS Laboratories in Lima from coarse rejects from previous drill programs. One blank, one
standard and a field duplicate are inserted randomly in every twenty samples
All Zafranal samples are shipped to ALS Chemex sample preparation facility in the city of Arequipa,
where they are crushed and pulverised
Prepared samples are shipped to ALS Chemex certified laboratory in Lima where they are analysed
for gold, copper and multi-element ICP.
14.1.1
Collar location
All drill collars were surveyed using a total station GPS device. A 3-metre long piece of PVC or HQ drill
rod was left in the collar and drillhole numbers are clearly marked on cement markers.
14.1.2
Downhole Survey
Downhole survey information has not been independently verified. However, CoreTech of Lima, has
resurveyed several diamond drillholes and RC drillholes using the gyroscope tool. Some RC drillholes
originally not surveyed by the Deviflex tool were re-entered and surveyed using the non-magnetic
gyroscope. A small number of RC drillholes show significant deviations (over 15 in azimuth); these
represent an insignificant amount within the overall Project database.
14.1.3
QAQC Data Verification
AQMs quality control program, as summarised in the sampling protocol (Section 13), utilises 3
Standard Reference Materials (SRM), or standards at any given time. A total of 15 standards have
been used during the 2010 drilling program, Nine of the standards were prepared from coarse rejects
from the Zafranal Project by SGS Laboratories, Lima, an ISO certified laboratory, Three standards were
prepared at Inspectorate Laboratories, Lima. Three certified standards were supplied by Ore Research
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and Exploration Pty Ltd of Australia. The reported values for these Standard Reference Materials, as
reported by SGS and Ore Research and Exploration Pty Ltd are presented in Table 14-1.
AQM has conducted a check analysis programme at Zafranal. 33 pulp samples were re-numbered and
sent in for analysis at ALS Chemex in Lima. 16 coarse reject samples were sent to CIMM Lab in Lima
for preparation and analysis. These samples were designed to control the assay and preparation
procedures respectively. The results are satisfactory and are summarised in Table 14-2.
Sample preparation, security and analytical procedures at Zafranal are all to industry standard practice.
Table 14-1
Standard
Standards used for the 2009-2010 Zafranal Drilling Programme

Gold Grade
Confidence Limits
ppb
Copper Grade
Confidence Limits
ppm
101
203
34
10471
638
201
110
31
6196
305
301
66
17
3055
182
111
--
--
15000
1100
222
--
--
22600
1200
333
--
--
68700
1600
444
128
20
12900
800
555
95
20
6387
532
666
83
22
3133
221
700
89
20
3467
190
800
98
20
6661
116
900
99
10
11663
231
777
346
3440
500
888
836
12
7420
700
999
2900
70
15500
2000
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Table 14.2
Comparison of coarse reject assays between ALS Chemex and CIMM laboratories
Drillhole
From m
To
m
Interval
ALS
Cu_ICP
ppm
CIMM
Cu_ICP
ppm
ALS
CuSolH+
%
CIMM
CuSolH+
%
ALS
Cu-AA16s
%
CIMM
CuCN
%
ALS
Cu-AA62s
%
CIMM
CuRes
%
ZFDDH10-019
120.00
122.00
2.00
>10000
>10000
0.24
0.27
1.51
1.621
0.18
0.194
ZFDDH10-019
122.00
124.00
2.00
>10000
>10000
0.2
0.214
0.87
0.896
0.11
0.124
ZFDDH10-019
124.00
126.40
2.40
>10000
>10000
0.19
0.22
0.93
0.977
0.13
0.134
ZFDDH10-019
126.40
127.00
0.60
>10000
>10000
1.39
1.396
3.68
6.158
2.17
0.272
ZFDDH10-019
127.00
129.00
2.00
>10000
>10000
0.25
0.277
1.25
1.359
0.08
0.095
ZFDDH10-019
129.00
131.00
2.00
9590
9763
0.17
0.188
0.73
0.761
0.06
0.072
ZFDDH10-019
131.00
133.00
2.00
>10000
>10000
0.33
0.418
1.86
2.005
0.06
0.076
ZFDDH10-019
133.00
135.00
2.00
>10000
>10000
0.21
0.291
1.47
1.552
0.18
0.187
ZFDDH10-019
135.00
137.50
2.50
>10000
>10000
0.28
0.304
0.84
0.856
0.11
0.111
ZFDDH10-019
137.50
139.40
1.90
>10000
>10000
0.30
0.34
1.48
1.704
0.12
0.117
ZFDDH10-019
139.40
140.70
1.30
>10000
>10000
0.22
0.252
0.78
0.767
0.04
0.040
ZFDDH10-019
140.70
141.60
0.90
>10000
>10000
0.60
0.742
4.26
4.082
0.11
0.137
ZFDDH10-019
141.60
143.00
1.40
>10000
>10000
0.20
0.251
1.00
1.011
0.05
0.05
ZFDDH10-019
143.00
145.00
2.00
>10000
>10000
0.17
0.194
0.93
0.961
0.10
0.101
ZFDDH10-019
145.00
147.00
2.00
>10000
>10000
0.15
0.191
0.83
0.792
0.13
0.120
ZFDDH10-019
147.00
149.00
2.00
4900
4794
0.11
0.12
0.35
0.351
0.02
0.024
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14.1.4
Database Generation & Validation
All lithological, alteration, geotechnical and mineralisation data are recorded on paper log sheets, which
are later typed into the predesigned excel spreadsheets of the same format. The Excel log sheets all
have data validation measures that compel the user to enter only valid information. Text entries are
limited to look-up codes that have been extracted from the database and numeric or date stamp data
are controlled logically. The digital data sheets are uploaded into the database using specifically
designed software that checks the data for consistency, ensuring that all information entered into the
database is fully validated. As a final check an independent database administrator periodically loads
the data files exported from the database into 3D viewer software and reports any anomalous data to
the AQM geologists. If errors are acknowledged in the field data the Excel log sheets are updated and
sent to the database administrator for reload into the database.
Assay information is reported by the laboratory in digital format. The data from each batch returned
from the laboratory is checked through AQM QAQC procedures before being accepted into the
database. The data is imported into the database direct from the laboratory delivered report using
specifically designed software so that there is no need for manipulation of the data sheets, thus
ensuring integrity of the assay data.
The database consists of 2 back-end data stores, one for logged field data and the other for assay, plus
a front-end application all built using Microsoft Access and Visual Basic. The database is designed so
that there is never any need to modify the original data tables as all data interaction is done using
queries in the front end application. The data required for geological evaluation are extracted from the
database through a series of queries and scripts generating export tables in CSV format.
The database and the import software are all password-protected so only the database administrator is
able to interact with the data.
14.2
INDEPENDENT GEOLOGIST DRILLING & SAMPLING DATA VERIFICATION
Data verification by the author included a 2 day site visit to the Zafranal Project. During the site visit the
author examined surface outcrops in the Zafranal Main Zone including the extensive phyllic alteration
zone present over the main zone. The author collected 4 verification samples from the Zafranal Main
zone. Three of the samples were from the phyllically altered volcanics overlying the Zafranal main zone
and one sample was from a copper stained dyke also in the Zafranal main zone. Copper grades from
the 3 phyllically altered samples ranged from 44 ppm to 147 ppm copper and the dyke returned values
of 1.18% copper. Gold values for the phyllic samples were from trace values to 0.53 ppm gold with one
sample reporting 1.95 ppm gold. The high grade gold sample also reported 2 ppm silver and 88 ppm
molybdenum. The sample from the dyke returned trace gold values.
Verification by the author also included examination of the drill core from the 4 Teck diamond drillholes
from the Zafranal main zone. The drill core clearly shows the chalcocite enrichment blanket as reported
in the current drilling at Zafranal. Visual estimates of the percentages of chalcocite were consistent with
the assay results reported for the drilled intervals by Teck.
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14.3
AMEC MINPROC DRILLING & SAMPLING DATA VERIFICATION
14.3.1
Drilling
AMEC Minproc reviewed drill and core handling procedures and witnessed most of these procedures
on site and visited the core preparation facilities and the core shed. AMEC Minproc is of the opinion
that AQM and its contractors are carrying out drilling according to industry standards.
14.3.2
Sampling
AMEC Minproc viewed the complete sampling process on site, from the drill rig, both diamond and RC,
through to the final packaging and labelling of samples for dispatch to the Arequipa preparation
laboratory. AMEC Minproc witnessed the specific security precautions taken by AQM during packaging
and dispatch of samples until they are loaded onto specially freighted trucks and leave site. AMEC
Minproc considers that the sampling and dispatching processes are carried out according to industry
standards and follow strict security procedures.
14.3.3
Collar location
AMEC Minproc visited several drillhole platforms during the site visit and observed AQM practices at
various stages of drilling. After drilling, the drillhole collar is marked and pegged using PVC tubing. The
setup of a permanent concrete monument follows shortly afterwards. Final collar surveys are
measured by Trimble DGPS survey tool and recorded in the database, overprinting the original planned
position.
14.3.4
Downhole survey
AMEC Minproc did not witness the downhole surveying activity whilst on site. Downhole survey is
completed using a Devi-flex tool and a gyroscope tool. The data is input in the database and checked
by AQM geologists and independent database contractors. AMEC Minproc has checked that survey
database is coherent and does not contain obvious errors such as missing information or sharp
changes in orientation.
14.3.5
Sample database integrity
AMEC Minproc made database setup and maintenance recommendations to AQM at the onset of the
site visit and in a memorandum dated 21st of April 2010. AQM implemented the recommendations and
the database used for the December 2010 resource estimate was thoroughly validated by AQM and its
database contractors prior to being transmitted to AMEC Minproc.
AMEC Minproc completed standard checks for logical errors, duplicate data and missing information,
and verified grade ranges and maximum values for grades and grade ratios. A limited number of
anomalies were detected and corrected by AQM prior to obtaining a final validated database for
resource estimation.
AMEC Minproc considers that the database provided has been thoroughly checked and is as error-free
as is practicable to verify.
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14.3.6
Independent samples
No independent samples were collected and submitted by AMEC Minproc.

14.4
ANALYTICAL QUALITY CONTROL PROCEDURES & ASSESSMENT
14.4.1
Introduction
AQM follows standard QAQC procedures with the regular insertion of blanks and certified standards,
and collection of field duplicate samples. The quality control data of drilling used in the resource
estimation has been assessed statistically to determine relative precision and accuracy levels between
various sets of assay pairs and the variation of relative error over time during the exploration
campaigns.
The QAQC data reviewed cover the entire AQM exploration period.
A summary of the QAQC programme is presented in Table 14-2.
Table 14-2
Type of Sample
Summary of Zafranal Analytical QAQC Programme

Number of Samples
Percentage
Frequency
AQM assayed samples
34261
Control Samples
6106
18%
- Blanks AQM
1950
6%
approx. 1 in 20
- Standards AQM
2231
7%
approx. 1 in 15
- Field duplicate AQM
1925
6%
approx. 1 in 20
14.4.2
Blanks
A total of 1950 blank results were reviewed with analysis results for both total copper (CuTotal) and
gold (Au). The blank dataset analysed only covers AQM drillholes.
Blanks are used to monitor contamination during sub-sampling and at the assaying stage and
are used by AQM with a frequency of blank insertion in sample batches of approximately 1 blank to
20 samples.
The blanks statistics are given in Table 14-3 with the chronological graphs of the results illustrated in
Figure 14-1.
The graphs include as reference the warning lines at 10 times (in pink) and 20 times (in red) the
detection limit.
For copper, 23 results exceed 10 times the detection limit, i.e. approximately 1% of the results, and 2
results exceed 20 times the detection limit. For gold, no result exceeds 10 times the detection limit.
A clear decrease in variability is noticeable for the copper blank results for the last part of the campaign,
approximately after drillhole ZFDDH10-031 drilled in March 2010.
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Technical Report
Table 14-3
Blanks Statistics
CuTotal
%
1950
0.001
Au
g/t
1950
0.002
Maximum
0.036
0.021
Average
0.002
0.004
Median
0.002
0.003
Number of Blanks
Minimum
Figure 14-1
Chronological Sequence of Blank Results for CuTotal & Au

BLANKS
BLANKS
0.040
0.04
0.035
0.030
0.025
Au g/t
CuTotal %
0.03
0.02
0.020
0.015
0.010
0.01
0.005
0.00
150000
0.000
160000
170000
180000
190000
200000
150000
160000
Sample ID
14.4.3
170000
180000
190000
200000
Sample ID
Standard Samples
The standards dataset covers the entire AQM exploration campaign.

A total of 15 certified standards have been used over the exploration campaigns. They were chosen to
cover the grade span likely to occur at Zafranal for CuTotal and Au. The frequency of standards
insertion in sample batches is approximately of 1 standard to 15 samples.
The standards characteristics mean reference value & mean+-2 standard deviations for the
acceptable interval values- are presented in Table 14-4.
The statistical characteristics of the standards results including the calculated bias and precision are
presented in Table 14-5.
Global control charts showing all copper and gold standard results in chronological order are given in
The individual control charts with reported values plotted in chronological order are given in Figure 14-3
and Figure 14-4. The graphs show in red the standard reference value and in blue the limits for
acceptable values.
Calculated precision and bias are within adequate ranges for copper and gold and only a limited
number of isolated standard results fall outside of the acceptable intervals with the exception of
Standard333 (the highest copper grade standard at 6.87%) which displays a high proportion of erratic
results. Within the range of the copper mineralisation encountered at Zafranal, there is no evidence of
bias or trend indicating the deterioration of assaying quality over time.
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Table 14-4
AQM Standards Characteristics
Standard
CuTotal
Code
Au
Ag
Ref.
Acceptable
Ref.
Acceptable
Ref.
Acceptable Interval
Value
Interval
Value
Interval
Value
g/t
g/t
from
to
g/t
g/t
from
to
from
to
101
1.047
0.983
1.111
0.203
0.169
0.237
201
0.620
0.589
0.650
0.110
0.079
0.141
301
0.306
0.287
0.324
0.066
0.049
0.083
111
1.500
1.390
1.610
5.6
5.2
6.0
222
2.260
2.140
2.380
6.1
5.6
6.6
333
6.870
6.710
7.030
1.9
1.6
2.2
444
1.290
1.210
1.370
0.128
0.108
0.148
555
0.639
0.586
0.692
0.095
0.075
0.115
666
0.313
0.291
0.335
0.083
0.061
0.105
700
0.347
0.366
0.328
0.089
0.109
0.069
777
0.344
0.394
0.294
0.346
0.354
0.338
800
0.666
0.678
0.655
0.098
0.118
0.078
888
0.742
0.812
0.672
0.836
0.848
0.824
900
1.166
1.189
1.143
0.099
0.109
0.089
999
1.550
1.750
1.350
2.900
2.970
2.830
Table 14-5
Standard Results
CuTotal & Au Standards
Standard
301
666
777
CuTotal %
Au g/t
CuTotal %
Au g/t
CuTotal %
Au g/t
Standard Reference
0.306
0.066
0.313
0.083
0.344
0.346
Number
280
280
216
216
47
47
Minimum
0.274
0.058
0.288
0.071
0.331
0.326
Maximum
0.342
0.082
0.344
0.099
0.360
0.367
average
0.312
0.070
0.317
0.080
0.349
0.346
Median
0.312
0.070
0.317
0.080
0.349
0.346
Bias
2%
5%
1%
-4%
1%
0%
Precision
2%
4%
2%
3%
1%
1%
CuTotal %
Au g/t
CuTotal %
Au g/t
CuTotal %
Au g/t
Standard Reference
0.347
0.089
0.620
0.110
0.639
0.095
Number
170
170
291
291
240
240
Standard
700
201
555
Minimum
0.306
0.077
0.562
0.092
0.589
0.072
Maximum
0.369
0.108
0.661
0.190
0.663
0.111
Average
0.347
0.090
0.613
0.112
0.624
0.091
Median
0.347
0.090
0.612
0.111
0.624
0.091
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Technical Report
CuTotal & Au Standards
Standard
301
666
777
Bias
0%
1%
-1%
2%
-2%
-4%
Precision
2%
4%
2%
5%
2%
4%
CuTotal %
Au g/t
CuTotal %
Au g/t
CuTotal %
Au g/t
Standard Reference
0.666
0.098
0.74
0.84
1.05
0.20
Number
149
149
44
44
250
250
Standard
800
888
101
Minimum
0.599
0.077
0.70
0.81
0.94
0.18
Maximum
0.672
0.125
0.77
0.89
1.10
0.25
Average
0.632
0.099
0.74
0.85
1.03
0.20
Median
0.631
0.098
0.74
0.84
1.04
0.20
Bias
-5%
1%
-1%
1%
-2%
0%
Precision
2%
5%
1%
2%
3%
Standard
Standard Reference
900
444
3%
999
CuTotal %
Au g/t
CuTotal %
Au g/t
CuTotal %
Au g/t
1.166
0.099
1.290
0.128
1.550
2.900
Number
131
131
239
239
37
37
Minimum
1.000
0.083
1.180
0.113
1.460
2.840
Maximum
1.215
0.131
1.345
0.145
1.580
3.030
Average
1.158
0.102
1.289
0.127
1.502
2.920
Median
1.155
0.102
1.290
0.126
1.505
2.900
Bias
-1%
3%
0%
-1%
-3%
1%
Precision
2%
5%
1%
2%
1%
1%
CuTotal & Ag Standards

Standard
111
222
333
CuTotal %
Ag g/t
CuTotal %
Ag g/t
CuTotal %
Ag g/t
Standard Reference
1.500
5.6
2.260
6.1
6.870
1.9
Number
45
45
48
48
44
44
Minimum
1.480
5.2
2.250
5.8
6.650
1.9
Maximum
1.595
6.2
2.420
7.0
7.430
2.4
Average
1.523
5.8
2.345
6.3
6.991
2.2
Median
1.520
5.9
2.345
6.3
6.975
2.2
Bias
1%
4%
4%
3%
2%
13%
Precision
1%
3%
1%
3%
2%
6%
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Technical Report
Figure 14-2
CuTotal & Au Standards Global Chronological Graphs

8.00
1.60
7.00
1.40
6.00
1.00
Cu%
Cu%
CuTotal
1.20
5.00
0.80
4.00
0.60
3.00
0.40
2.00
0.20
149000
159000
169000
179000
189000
199000
Std101
Std111
Std201
Std301
Std444
Std555
Std700
Std777
Std800
Std888
Std900
Std999
149000
SampleID
159000
Std666
169000
179000
Std222
0.40
3.50
0.35
3.00
0.30
189000
SampleID
199000
Std333
2.50
Au
Auppm
Auppm
0.25
0.20
2.00
1.50
0.15
1.00
0.10
0.50
0.05
0.00
0.00
149000
159000
169000
179000
189000
199000
Std101
Std111
Std201
Std222
Std301
Std333
Std555
Std666
Std700
Std777
Std800
Sdt900
Figure 14-3
SampleID
149000
159000
169000
179000
189000
199000
SampleID
Std444
Std888
Sdt999
CuTotal & Au Standards - Chronological Graphs

STANDARD 101
STANDARD 201
1.20
0.68
0.66
1.15
Cu%
Cu%
CuTotal
0.64
1.10
1.05
0.62
0.60
1.00
0.58
0.95
0.56
0.54
0.90
149000
154000
159000
Sample ID
164000
169000
149000
154000
159000
164000
169000
Sample ID
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Technical Report
STANDARD 201
STANDARD 101
0.20
0.26
0.25
0.18
0.24
0.16
0.23
Au g/t
Au g/t
Au
0.22
0.21
0.20
0.19
0.14
0.12
0.10
0.18
0.08
0.17
0.06
0.16
149000
154000
159000
164000
149000
169000
154000
159000
169000
174000
STANDARD 444
STANDARD 301
1.40
0.36
0.34
1.35
0.32
Cu%
1.30
Cu%
CuTotal
164000
Sample ID
Sample ID
0.30
1.25
0.28
1.20
0.26
0.24
149000
1.15
154000
159000
164000
169000
174000
155000
160000
165000
170000
Sample ID
175000
180000
185000
180000
185000
Sample ID
STANDARD 301
STANDARD 444
0.16
0.09
0.15
0.08
0.14
Aug/t
Au g/t
Au
0.07
0.06
0.13
0.12
0.05
0.11
0.04
0.10
0.03
149000
0.09
154000
159000
164000
169000
155000
174000
160000
165000
Sample ID
175000
Sample ID
STANDARD 555
STANDARD 666
0.75
0.36
0.70
0.34
0.65
0.32
Cu%
Cu%
CuTotal
170000
0.60
0.30
0.55
0.28
0.50
155000
0.26
160000
165000
170000
175000
Sample ID
180000
185000
190000
155000
160000
165000
170000
175000
180000
185000
Sample ID
60246-00000-23-002-001
Page 107
190000

Technical Report
STANDARD 666
STANDARD 555
0.11
0.12
0.10
0.11
0.09
Au g/t
Aug/t
Au
0.10
0.09
0.08
0.07
0.08
0.06
0.07
0.05
0.04
0.06
155000
160000
165000
170000
175000
180000
185000
155000
190000
160000
165000
170000
175000
180000
185000
190000
Sample ID
Sample ID
STANDARD 777
STANDARD 700
0.41
0.38
0.39
0.37
Cu%
0.35
Cu%
CuTotal
0.36
0.34
0.33
0.31
0.29
0.32
0.27
0.30
180000
0.25
185000
190000
195000
200000
205000
210000
175000
180000
Sample ID
185000
190000
195000
190000
195000
190000
195000
Sample ID
STANDARD 777
STANDARD 700
0.37
0.12
0.37
0.11
0.36
0.36
0.10
Au g/t
Au g/t
Au
0.35
0.09
0.35
0.34
0.08
0.34
0.33
0.07
0.33
0.32
0.06
180000
185000
190000
195000
200000
205000
175000
210000
180000
STANDARD 888
0.85
0.68
0.80
0.66
0.75
Cu%
Cu%
CuTotal
STANDARD 800
0.70
0.64
0.70
0.62
0.65
0.60
0.60
0.58
175000
185000
Sample ID
Sample ID
0.55
180000
185000
190000
195000
Sample ID
200000
205000
210000
175000
180000
185000
Sample ID
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Technical Report
STANDARD 800
STANDARD 888
0.13
0.90
0.12
0.88
0.86
0.10
Au g/t
Au g/t
Au
0.11
0.09
0.84
0.08
0.82
0.07
0.06
175000
0.80
180000
185000
190000
195000
200000
205000
210000
175000
180000
Sample ID
185000
190000
195000
190000
195000
190000
195000
Sample ID
STANDARD 999
STANDARD 900
1.80
1.25
1.20
Cu%
Cu%
CuTotal
1.60
1.15
1.10
1.40
1.05
1.20
1.00
0.95
175000
1.00
180000
185000
190000
195000
200000
175000
180000
Sample ID
185000
Sample ID
STANDARD 999
STANDARD 900
3.05
0.14
3.00
0.12
Au g/t
Au g/t
Au
2.95
0.10
2.90
0.08
2.85
2.80
0.06
175000
180000
185000
190000
Sample ID
195000
200000
175000
180000
185000
Sample ID
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Technical Report
Figure 14-4
CuTotal & Ag Standards - Chronological Graphs

STANDARD 111
STANDARD 222
2.50
1.65
1.60
2.40
2.30
Cu%
1.50
Cu%
CuTotal
1.55
2.20
1.45
1.40
2.10
1.35
2.00
1.30
155000
155000
160000
165000
160000
165000
170000
170000
175000
180000
175000
180000
Sample ID
Sample ID
STANDARD 222
STANDARD 111
7.50
6.50
7.00
6.50
Ag g/t
Ag g/t
Ag
6.00
5.50
6.00
5.00
5.50
4.50
155000
160000
165000
5.00
170000
155000
Sample ID
160000
165000
170000
Sample ID
STANDARD 333
7.50
7.40
7.30
7.10
Cu%
CuTotal
7.20
7.00
6.90
6.80
6.70
6.60
6.50
155000
160000
165000
170000
175000
180000
Sample ID
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STANDARD 333
2.60
2.40
Ag ppm
Ag
2.20
2.00
1.80
1.60
1.40
1.20
155000
160000
165000
170000
175000
180000
Sample ID
14.4.4
Duplicate samples
A total of 1925 field duplicates results for AQM drillholes were available for analysis.
The frequency of field duplicate insertion in sample batches is approximately of 1 duplicate to 20
samples.
The statistical characteristics of the field duplicate datasets are presented in Table 14-6.
corresponding scatter graphs for CuTotal and Au are presented in Figure 14-5.
The
When using the hyperbolic method* to analyse the adequacy of the results, only 5% and 4% of
duplicates are out of the acceptable range respectively for CuTotal and Au which is well within the 10%
acceptable range for field duplicate and demonstrates the adequacy of AQM sampling practices. This
is corroborated by coefficient of correlation close to 1 at 0.97 and 0.88 for CuTotal and Au between the
original and duplicate datasets.
No coarse nor pulp duplicates were available for analysis.
Table 14-6
Field Duplicate Results

CuTotal %
Original
Number
Au g/t
Duplicate
Original
1925
Duplicate
1925
Minimum
0.0001
0.0001
0.003
0.003
Maximum
7.47
6.98
4.19
2.68
average
0.23
0.23
0.06
0.06
Median
0.13
0.12
0.03
0.03
Bias
0%
-1%
Precision @95% confidence limit

Correlation Coefficient
all duplicates
Diamond drilling only
RC drilling only
16%
23%
0.97
0.88
0.97
0.87
Percentage out of acceptable range
0.99
0.95
101 out of 1925, i.e. 5%
85 out of 1925, i.e. 4%
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Figure 14-5
Field Duplicates Scatter Graphs

Au FIELD DUPLICATES
CuTotal FIELD DUPLICATES

1.00
Field Duplicate Sample Au g/t
Field Duplicate Sample CuTotal%
0.75
0.50
0.25
Diamonddrilling
Diamonddrilling
RCdrilling
RCdrilling
0.00
0.00
Original Sample CuTotal%
0.25
0.50
0.75
1.00
Original Sample Au g/t
*the hyperbolic method is an evaluation method devised by Dr Armando Simon, AMEC Americas (Chile) to assess
duplicate sample results. This method complements the calculation of bias and precision.
14.4.5
Data Quality Summary
The review of the analytical QAQC database by AMEC Minproc indicates that the sample preparation
and assaying conducted by AQM is of reliable and consistent quality, and provide accurate and precise
information which is suitable for resource estimation and mine planning studies.
14.5
COMPARISON OF DATA TYPES TWIN DRILLHOLES
AMEC Minproc completed in May 2010 a diamond-RC drillhole comparison study at the request of
AQM. The conclusions are based on the analysis of seven twin pairs (Table 14-7). The analysis shows
variation between the pairs studied; however some common traits exist, notably:
The RC drilling usually underestimates the diamond results. However, the bias is not constant over
the length drilled, varying according to the material drilled, and apparently compounded by
increasing depth
The bias either starts, or significantly changes magnitude, towards the base of the Supergene zone
and can drastically increase in the Hypogene zone
Analysis of the relative variations of CuTotal, CuCN, CuS and CuResidual suggests that the least
bias is associated with the CuCN content. This indicates that the lower copper grades associated
with the RC drilling are probably a result of a loss of primary mineralisation copper species. There
are indications that the drilling method deficiency could be compounded by sample preparation
issues. This corroborates testwork observations that the weak acid soluble fraction (CuS) is usually
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represented by pulverised material which would be more difficult to adequately sample by RC

drilling and could cause issues during sample preparation.
It is important to note that the December 2010 resource estimate is based exclusively on AQM drilling
and no Teck drilling is included in the resource database. Additionally, the AQM database comprises a
majority of diamond drilling with 79% of the meterage used for the current resource estimate being
diamond drilled, while RC drilling represents the remaining 21%.
Table 14-7
Twin Drillhole List

Diamond Drilling
RC Drilling
Horizontal Shift at
Collar
Drillhole Name &
Collar Coordinates
Drillhole Name &
Collar Coordinates
Company
Easting, Northing,
Company
Easting, Northing,
Elevation
Elevation
ZFDDH04-001
793805.1,
ZFRC04-008
793807.27,
Teck
8224336.86
Teck
8224333.95
2708.36
2708.66
ZFDDH04-002
793809.36,
ZFRC09-033
793811.65,
Teck
8224337.91
AQM
8224337.80
2708.52
2.3m
2708.6
ZFDDH04-004
793501.61,
ZFRC09-034
793499.19,
Teck
8224269.08
AQM
8224271.71
2607.27
1.2m
2607.20
ZFDDH09-005
793512.42,
ZFRC10-060
793510.48,
AQM
8224178.15
AQM
8224176.05
2622.04
2.9m
2622.00
ZFDDH09-006
794197.76,
ZFRC04-009
794196.34,
AQM
8224362.38
Teck
8224357.9
2764.91
4.7m
2764.66
ZFDDH10-008
793498.93,
ZFRC04-007
793500.64,
AQM
8224270.5
Teck
8224269.77
2607.16
2.4m
2607.22
ZFDDH10-009
794487.74,
ZFRC04-010
794488.87,
AQM
8224398.75
Teck
8224396.75
2760.61
3.7m
2.3m
2760.34
Note:
- all twin drillholes are within close proximity, with six pairs of twin drillholes located within 3m of each other, and the
seventh pair within 4.7m of each other
- the assay records are complete for all drillholes for CuTotal, Au and most accessory elements, however, sequential
copper assays are only available for the AQM drillholes, with some partial records available for the Teck drillholes.
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15
ADJACENT PROPERTIES
No data from adjacent properties was used in this report.
16
MINERAL PROCESSING & METALLURGICAL TESTING
16.1
HISTORICAL TECK TESTING
An ore characterisation study was performed by Teck in 2005 on material from the Zafranal Main Zone.
The summary from the Teck report is included below:
Ore characterisation was performed on a suite of RC chip samples from drillholes ZFRC04-007 through
ZFRC04-0010 from the Zafranal exploration property. The objectives of the study were to
determine bulk mineral assemblage and to provide details of the copper mineralogy including
assemblage, grain size and surface exposure
Samples were stage-crushed to 100% passing 850 m, prepared as polished grain mounts and
analysed using MLA techniques to determine both bulk and copper mineralogy
The chip samples were dominated by quartz, plagioclase feldspar and muscovite/sericite. Biotite
mica, chlorite, kaolinite, sulphides, Fe-Ti oxides and apatite occurred in minor to trace amounts
Sulphide minerals consisted of pyrite, with lesser amounts of chalcopyrite, chalcocite and covellite
Secondary copper minerals, such as chalcocite and covellite, hosted 78% of the total copper in the
samples studied. A calculated 94.5% of these minerals exhibited surface exposures of 10% or
greater, suggesting good heap leaching at a relatively coarse grind
Copper distribution by mineral species showed a predominance of secondary copper minerals near
surface and an increase of chalcopyrite downhole for ZFRC04-008 and ZFRC04-010
Chalcocite and chalcopyrite were similar in grain size, with mean P80 of 38 m and 39 m.
Covellite was finer-grained, with a mean P80 of 17 m
No deleterious minerals were identified at the detection limit of the study
No carbonate minerals were identified, indicating that tailings and waste rock may be acid
generating in the presence of water
The proportion of copper occurring as chalcocite and covellite compares well with cyanide soluble
leachate results performed during preliminary ore testing. The 10% H2SO4 soluble copper leach
results correlate more closely to the copper associated with the dissolution of one copper atom from
chalcocite, leaving residual covellite. The cyanide soluble copper leach test combined with
mineralogical evaluation should be used to assess the ore in future. Column leach tests may be
carried out to understand its amenability to heap leaching.
16.2
2010 AMEC MINPROC TESTING PRELIMINARY RESULTS
A metallurgical test programme has been conducted at bench scale and consisted of treatment of
individual and composite samples, selected on specific mineral zones. The mineral zones, designated
material type, approximate number of samples and approximate weights are detailed in Table 16-1
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Variability samples for comminution tests were sourced from diamond drill core and tested at SGS
Laboratories in Santiago, Chile. Variability samples for rougher flotation were sourced from diamond
drill core rejects from all zones, except the oxide composite which included RC chip samples and was
conducted at AMDEL Laboratories in Adelaide, Australia.
Composites were prepared from diamond drill core rejects from all material zones, except the oxide
composite which included RC chip samples, due to the unavailability of core samples. These
composites were used for flow sheet development tests including flotation, regrinding, thickening,
leaching and tailing characterisation.
Table 16-1
Zone Samples
Designated Zone
Number of Samples
Total Sample Weight

kg
16.3
Oxide
10
569
Supergene
20
1270
Hypogene
12
720
SAMPLE SELECTION
The Zafranal core database was analysed by AMEC Minproc to select samples suitable for a
metallurgical test programme. The key criteria used in selecting samples were:
Core extracted in the 20092010 period
Location (Easting / Northing)
Depth
Lithology (rock type)
Zone (supergene, hypogene, etc.)
Mineralisation Continuity (continuous run of a single classification in the above categories).
The test work programme was lithology-based and targeted samples that produced a broad
representation of the oxide, supergene and hypogene zones.
16.4
SAMPLE INSPECTION
A site visit took place from February 15, 2010 to February 18, 2010 to inspect diamond drill core and
RC chip at the Zafranal exploration camp and ALS diamond drill core reject storage in Arequipa.
16.5
OXIDE SAMPLES
The samples selected as oxide samples are detailed in Table 16-2. The selection was based both on
core logging of the mineral zone by Zafranal geologists and the amount of copper reporting as CuS
(WAS Cu) or copper remaining (Rem Cu). Significant variation existed with the oxide zone and
samples varied from heavily oxidised to transition between oxide and supergene.
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Table 16-2
Drillhole
Selection of Oxide Samples

From To Length
Cu
Total
CuCN
CuS
Cu
Res.
Au
Fe
Sample
Designated
ppm
Type
Tests
ZFDDH10-008
74
90
16
0.42
0.03
0.17
0.22
0.2
4.16
0.33
Half Core
Comminution
ZFDDH10-008
90
106
16
0.8
0.6
0.13
0.07
0.28
3.64
1.12
Half Core
Comminution
ZFDDH10-008
74
106
32
0.61
0.32
0.15
0.14
0.24
3.9
0.78
Core Reject
Flotation
ZFRC09-034
86
102
16
1.42
0.86
0.49
0.07
0.11
3.3
2.4
RC Chips
Flotation
ZFRC09-034
102
119
17
2.35
1.44
0.84
0.07
0.12
2.75
1.56
RC Chips
Flotation
ZFRC10-038
55
65
10
0.45
0.01
0.32
0.12
0.07
3.05
0.06
RC Chips
Flotation
ZFRC10-039
48
68
20
0.4
0.07
0.18
0.14
0.7
4.11
0.24
RC Chips
Flotation
ZFRC10-043
72
93
21
0.48
0.01
0.28
0.19
0.13
3.45
0.22
RC Chips
Flotation
ZFDDH10-011
71
90.7
19.7
0.44
0.02
0.24
0.17
0.17
2.58
0.25
Half Core
Comminution
ZFDDH10-019
50
76.6
26.6
0.96
0.49
0.28
0.19
0.15
3.6
0.36
Half Core
Comminution
16.6
SUPERGENE SAMPLES
The samples selected as supergene samples are detailed in Table 16-3. The selection was based both
on core logging of the mineral zone by Zafranal geologists and the amount of copper reporting as
cyanide soluble copper (CuCN), with greater than 70% of copper as CuCN being taken as an indicator
of supergene.
Table 16-3
Drillhole
Selection of Supergene Samples

From
To Length
m
Cu
Total
%
CuCN
CuS
Cu
Res.
%
Au
Fe
ppm
Sample
Type
Designated
Tests
ZFDDH09-005
99.7
122
22.3
1.57
1.13
0.27
0.16
0.2
4.12
1.94
Half Core /
Core Reject
Comminution /
Flotation
ZFDDH09-008
106
134
28
1.22
0.88
0.23
0.11
0.31
3.32
1.39
Half Core /
Core Reject
Comminution /
Flotation
ZFDDH09-005
150
170
20
0.31
0.24
0.03
0.04
0.04
3.45
3.53
Half Core /
Core Reject
Comminution /
Flotation
ZFDDH09-006
167
189
22
0.93
0.82
0.08
0.03
0.07
1.96
1.85
Half Core /
Core Reject
Comminution /
Flotation
ZFDDH09-006
189
210
21
0.77
0.14
0.09
0.1
2.97
1.95
Half Core /
Core Reject
Comminution /
Flotation
ZFDDH09-006
210
230
20
0.57
0.43
0.09
0.04
0.07
3.24
1.78
Half Core /
Core Reject
Comminution /
Flotation
ZFDDH09-006
230
250
20
0.46
0.37
0.06
0.03
0.04
2.77
1.75
Half Core /
Core Reject
Comminution /
Flotation
ZFDDH09-006
250
270
20
0.57
0.44
0.07
0.06
0.07
3.21
2.37
Half Core /
Core Reject
Comminution /
Flotation
ZFDDH09-006
270
291
20.7
0.65
0.47
0.07
0.11
0.13
0.21
1.83
Half Core /
Core Reject
Comminution /
Flotation
ZFDDH10-007
45
66
21
1.75
1.42
0.23
0.11
0.13
3.6
2.56
Half Core
Comminution
ZFDDH10-007
66
87
21
1.94
1.53
0.28
0.14
0.11
3.34
2.16
Half Core
Comminution
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16.7
HYPOGENE SAMPLES
The samples selected as hypogene samples are detailed in Table 16-4. The selection was based both
on core logging of the mineral zone by Zafranal geologists and the amount of copper reporting as Rem
Cu, with greater than 70% of copper as Rem Cu being taken as an indicator of hypogene material. Due
to limited availability of hypogene sample two mixed supergene/hypogene samples were also selected.
Table 16-4
Drillhole
Selection of Hypogene Samples

From To
Lengt
Cu
h
Total
m
%
CuCN
CuS
Cu
Res.
%
Au
Fe
Sample
ppm
Type
Designated
Tests
ZFDDH09-005
124
150
26
0.40
0.22
0.03
0.15
0.04
3.28
Half Core /
2.16
Core Reject
ZFDDH09-008
160
173
13
0.79
0.49
0.07
0.23
0.16
3.04
1.18
Half Core /
Core Reject
Comminution /
Flotation
ZFDDH09-006
291
320
29
0.39
0.05
0.02
0.33
0.19
4.49
2.98
Half Core /
Core Reject
Comminution /
Flotation
ZFDDH09-006
320
342
22
0.49
0.11
0.03
0.35
0.17
3.09
2.39
Half Core /
Core Reject
Comminution /
Flotation
ZFDDH10-009
264
284
20
0.41
0.05
0.02
0.34
0.14
3.31
1.27 Half Core
ZFDDH10-010
200
220
20
0.42
0.03
0.01
0.38
0.13
3.87
2.23 Half Core
Comminution
ZFDDH10-038
121
140
19
0.35
0.04
0.01
0.30
0.35
4.35
3.96 RC Chips
Flotation
ZFDDH09-034
142
154
12
1.15
0.24
0.06
0.85
0.53
4.73
4.49 RC Chips
Flotation
16.8
Comminution /
Flotation
Comminution
COMMINUTION TESTWORK
Hypogene material recorded the highest average abrasion characteristics with an Ai average of 0.22.
Supergene material and oxide had similar abrasion characteristics with average Ai values of 0.14 and
0.09 respectively. A substantial deviation existed in all material types. The wide distribution in abrasion
results indicated the abrasive nature of the samples increased with depth.
The majority of samples did not meet the requirements for Bond crusher work index determination so
the Morrell Crusher Index, as derived from SMC test results was used to determine crusher specific
energy. From a crushing perspective, oxide material was moderately soft (80th percentile - 4.56 kWh/t)
with a relatively narrow distribution of results. Supergene material was moderately hard (80th percentile
- 6.80 kWh/t), although the wide distribution of measurements resulted in amounts of soft, hard and
very hard material. The hypogene material contained similar proportions of hard and very hard
material, with lesser amounts of moderately hard and extremely hard material (80th percentile - 10.90
kWh/t)
From a ball mill grinding perspective, oxide material was moderately soft, with an 80th percentile Bond
ball mill work index of 9.86 kWh/t and a narrow distribution of results. Both supergene and hypogene
material were moderately hard, with 80th percentile work index values of 11.96 kWh/t and 12.29 kWh/t.
There was an increase in the Bond ball mill index with depth.
From a SAG mill grinding perspective, oxide material was soft, with an 80th percentile drop weight index
of 3.81 kWh/m3 and a narrow distribution of results. Supergene material (80th percentile - 5.95 kWh/m3)
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was moderately soft and hypogene material (80th percentile - 9.37 kWh/m3) was moderately hard. The
wide distribution of measurements resulted in amounts of harder material in these material types. There
was an increase in the drop weight index with depth.
16.9
FLOTATION TESTWORK
The flotation testwork results are as follows:
Rougher recovery for the oxide composite was 60.7% for copper and 31.8% for gold, at a flotation
feed grind size p80 of 150 m.
Rougher recovery for the supergene composite was 88.0% for copper and 70.5% for gold, at a
flotation feed grind size p80 of 150 m.
Rougher recovery for the hypogene composite was 92.4% for copper and 75.0% for gold, at a
flotation feed grind size p80 of 106 m.
The locked cycle test on the oxide composite achieved a weighted average final concentrate of 20.8%
Cu, with mass recoveries of 1.5% and 5.5% to final concentrate and rougher concentrate respectively.
This was achieved at a copper recovery of 38.7% and a gold recovery of 23.6%. Recovery variability
between cycles was high to very high.
The locked cycle test for the supergene composite achieved a weighted average final concentrate of
41.0% Cu. This was achieved at a copper recovery of 87.6% and a gold recovery of 60.6%. Recovery
variability between cycles was very high for gold and low for copper.
The locked cycle test for the hypogene composite achieved a weighted average final concentrate of
33.0% Cu. This was achieved at a copper recovery of 91.4% (incl. 2.7% to pyrite concentrate) and a
gold recovery of 74.5% (including 22.4% to pyrite concentrate). Recovery variability between cycles
was high for gold and low for copper
Further test work is in progress on further samples to provide greater coverage of the resource to the
east. These tests will focus on comminution and flotation variability samples, flotation locked cycle tests
and leaching of supergene material.
17
MINERAL RESOURCE & MINERAL RESERVE ESTIMATES
17.1
INTRODUCTION
The December 2010 resource estimate of the Zafranal Main Zone copper deposit is based on
integrated geological, mineralogical and grade interpretations of the information recorded from 172
diamond and RC drillholes solely drilled by AQM in 2009 and 2010. The total drillhole meterage is 53
308 m (79% diamond drilled, 21% RC drilled). The 172 drillholes are drilled on regular 100m spaced
easting fences along the strike of the orebody with 80m or less spacing along the drill fences. Several
areas of the orebody have been infill-drilled with drilling oriented east-west closing up the 100m drill
fences.
AQM is continuing to drill the deposit and the December 2010 resource estimate corresponds to the
resource delineated by drillholes drilled up until mid-October 2010.
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Interpretation wireframe data of the deposit geology, mineralogy and the grade envelopes was supplied
by AQM and was prepared by Atticus using the Leapfrog software package.
The data preparation, the block model preparation, the grade interpolation and resource reporting were
conducted using the GEMS mining software with exhaustive verification in GEMS and Excel. The
statistical and geostatistical analysis were completed using the GeoAccess Professional package, with
accessory use of the GEMS software.
17.2
STUDY DATA
17.2.1
Drillhole Database & Solids
AMEC Minproc was provided by AQM with an updated database for the project on the 6th of November
2010 during a visit to AQMs offices in Lima. Atticus provided the final wireframe data representing the
deposit geological, alteration, mineralogical and grade interpretations by the 24th of November 2010.
These files were used as the basis of the resource work and were imported into the GEMS mining
software.
The drillhole database provided by AQM was a database dump from AQMs master database in Access
format Zafranal DatabaseDump.accdb containing the following tables:
DHCollar
214 records
DHSurvey
8 591 records
DHAssay
40 178 records
DHAu-ICP
40 466 records
DHCuSeq
13 884 records
DHLithologySummary 2 817 records
DHRQD
17 112 records
DHSpecificGravity
753 records
DHQAQC Blanks
2 146 records
DHQAQC Duplicates
2 188 records
DHQAQC Standards
2 231 records
Note that the database contains AQM and Teck drillhole and QAQC data, although no Teck data was
used for the December 2010 resource estimate, only AQM data.
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Atticus provided the following set of wireframes in DXF format:
Topography of the project area
Grade shell wireframes at 0.2% CuTotal and 0.1 g/t Au cut-off grades
Mineralogy zonation wireframes for:
Leached cap
Oxide
Supergene
Transition
Hypogene
Lithological wireframes for:
Zafranal diorite
Microdiorite
Dry diorite
Monzodiorite dykes
Late quartz diorite
Post mineralisation dykes
Volcanic
Gneiss
Structural interpretation wireframes for four fault blocks
Alteration wireframes for the following zones:
Argillic
Potassic
Propylitic
Phyllic
Hornfels
17.2.2
Data Preparation
The database files provided by AQM were imported in GEMS and checked for logical errors including:
Collar and downhole survey integrity
Agreement between collar RL and topography
Interval file from-to integrity
Duplicate sample intervals
Overlapping sample interval
Unmatched drillhole identifiers in collar, survey and interval files
Non-matching downhole distances between tables
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Anomalous maximum values in grades and ratios
Sum of sequential copper values exceeding the CuTotal values
Below detection values were set to 0.001 for copper and Au grades to avoid the presence of zero or
negative values in the database used during compositing and estimation.
17.3
GEOLOGICAL MODEL
Atticus used the assay, mineralogical, lithological and structural data as provided and interpreted by
AQM geological team to construct 3-dimensional solid wireframe models. These models were provided
as DXF files and form the basis of the December 2010 resource estimate. They were not modified by
AMEC Minproc.
17.3.1
Lithological Model
The lithological model is based on the drillhole geological logging. AQM provided Atticus with a
summarised lithological logging for all drillholes available and a sectional interpretation of this data.
The lithological 3D solids of the main lithological units were built using the Leapfrog software. The
sectional interpretation provided by AQM was digitised and used as a guide during the creation of the
solids with Leapfrog.
The solids for the main 5 lithologies Zafranal diorite, monzodiorite, late quartz diorite, post
mineralisation dykes and volcanic were provided to AMEC Minproc as separate files for each
geographical block.
Figure 17-1 to Figure 17-3 illustrate the various lithological solids in Zafranal.
Figure 17-1
3D View Zafranal Lithological Units Zafranal Diorite
Zafranal diorite in red, faults in purple, post mineralisation dykes in light green, late quartzite in dark green
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Figure 17-2
3D View Zafranal Lithological Units Microdiorite
Microdiorite in blue, faults in purple, post mineralisation dykes in light green, late quartzite in dark green
Figure 17-3
3D Views Zafranal Lithological Units Dykes
Dry diorite in yellow, faults in purple, post mineralisation dykes in light green, late quartzite in dark green, monzodiorite in
blue
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17.3.2
Structural model
AQM produced a coherent structural interpretation of the Zafranal deposit from structural field data
including structural mapping, interpretation of aerial photographs, drill core orientation and
mineralisation spatial distribution as observed on sections and plans.
The deposit has been divided into four geographical blocks delineated by faults; two NS trending faults
and one N115o-120o trending fault (Figure 17-4).
Figure 17-4
17.3.3
3D View Zafranal Topography & Structural Features
Mineralogical Model
The mineralogical model is based on a combination of sequential copper assay results, the ratio of
S%/Fe% and drillhole logging information.
All AQM samples were analysed for total copper via ICP. All samples that returned a total copper
content of above 0.2% were sent for additional analysis via sequential copper leach first, digestion by
H2SO4 (CuS, acid soluble or oxide copper), followed by digestion by NaCN (CuCN, cyanide soluble,
typically chalcocite and bornite secondary copper minerals), then finally digestion by HCl and HNO3
(CuRes, residual copper, typically chalcopyrite).
The definition of the majority of the mineralogical domains is based on the percentage of the sequential
copper leach compared to total copper content and the ratio S%/Fe%. The change in S%/Fe% ratio is
sharp at the leached cap-supergene boundary and occurs simultaneously to the sharp change
observed for the sequential copper ratio CuCN/CuTotal at this boundary.
The following grade ratios were used to define the various mineralogical domain boundaries:
Leached cap-supergene boundary: 0.2 S%/Fe% ratio threshold confirmed by the CuCN/CuTotal
ratio when available
Oxide pods within the leached cap zone were modelled based on copper values
Supergene-transition boundary using the CuCN/CuTotal ratio with a 0.50 threshold
Transition-hypogene boundary using a 0.1% threshold on acid soluble copper, i.e. CuCN (CuAA16S cyanide soluble copper) + CuS (Cu-AA06S weak sulphuric acid soluble copper)
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The threshold ratios expressed as percentages are summarised in Figure 17-5.

The assay data was coded according to the criteria chosen and used in the Leapfrog software to
generate the three-dimensional solids of the mineralogical zones. The solids honours the assay coding
interpretation, but given the nature of the deposit, the mineralogical zone boundaries are not always
clearly defined, and the solid models have been created from best fit surfaces that takes in data from
all the evidence available.
Views of the mineralogical solids are presented in Figure 17-6 to Figure 17-8.
Figure 17-5
Criteria
CuS/CuTotal
30% threshold
Threshold Ratios & Mineralogical Domain Boundaries
Leached cap
30%
<30%
Oxide
Leached cap
30%
30%
S/Fe
20% threshold
<20%
<20%
<20%
20%
CuCN/CuTotal
50% threshold
<50%
<50%
<50%
50%
Supergene
Transition
Hypogene
<30%
<30%
<30%
50%
50%
1%
CuS+CuCN 1%
1% cut-off grade
Figure 17-6
20%
<50%
1%
1%
<1%
Long Section at 8224350N looking North
Supergene zone in green, Oxide lenses in red

Figure 17-7
Section 793300E looking East
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Figure 17-8
Section 793800E looking East
17.3.4
Alteration Model
The alteration model is based on the drillhole geological logging. The alteration 3D solids of the main
alteration units were built by Atticus using the Leapfrog software.
The solids define the following alteration zones:
Argillic
Potassic
Propylitic
Phyllic
Hornfels
Figure 17-1 and Figure 17-2 illustrate the zones of potassic and hornfels alteration.
Figure 17-9
3D View Zafranal Alteration Units Potassic Alteration
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faults in dark purple, potassic alteration in brown
Figure 17-10
3D View Zafranal Alteration Units Hornfels Alteration
faults in dark purple, hornfels alteration in green
17.4
GRADE ENVELOPE MODELS
A total copper grade envelope and a gold grade envelope were provided by Atticus. The copper grade
envelope was defined using a 0.2% CuTotal cut-off grade applied on all assay data. The gold grade
envelope used a 0.1 g/t Au cut-off grade.
Both envelopes were created by Atticus using the Leapfrog software from the Zafranal database. A set
of sections and 3D views presented in Figure 17-11 to Figure 17-16 illustrates the relationship between
drillhole and grade envelopes.
The December 2010 Cu envelope defines a total volume of 143 148 000 m3.
Figure 17-11
Long Section at 8224350N Copper Grade Envelope, Supergene Zone & Drillhole
Traces
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Supergene zone in green, copper grade envelope in blue, 500 m grid

Total copper Legend: 0% to 0.2% grey, 0.2% to 0.5% yellow, +0.5% red
Figure 17-12
Section 793300N Copper Grade Envelope, Supergene Zone & Drillhole Traces

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Figure 17-13
Section 793800N - Copper Grade Envelope, Supergene Zone & Drillhole Traces

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Figure 17-14
Long Section at 8224350N Gold Grade Envelope, Supergene Zone & Drillhole Traces
Supergene zone in green, gold grade envelope in yellow, 500 m grid

Gold Legend: 0 g/t to 0.1 g/t grey, +01 g/t pink
Figure 17-15
Section 793300N Gold Grade Envelope, Supergene Zone & Drillhole Traces

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Figure 17-16
Section 793800N Gold Grade Envelope, Supergene Zone & Drillhole Traces

17.5
TOPOGRAPHY
The topography information was imported into GEMS as a surface from a large DXF file provided by
Atticus. The topographic surface covers the entire project area.
A set of plan views and 3D views presented in Figure 17-17 illustrates the project topography.
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Figure 17-17
3D Views of Zafranal Topography & Drillhole Traces
17.6
STATISTICAL ANALYSIS & VARIOGRAPHY
17.6.1
Sample Coding
17.6.1.1 Coding by Lithological Domain

The assay interval data was coded into an alphanumeric field GEOLOGY and a numeric field
GEOLCODE by overlaying the lithological domain solid models.
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17.6.1.2 Coding by Mineralogical & Geographical Domains

The assay interval data was coded into an alphanumeric field MINERA and a numeric field
MINERACODE by overlaying the mineralogical domain solid models. The geographical domains were
included into the MINERACODEG field as the unit digit
17.6.1.3 Coding by Alteration Domain
The assay interval data was coded into an alphanumeric field ALTERATION and a numeric field
ALTERCODE by overlaying the mineralogical domain solid models.
17.6.1.4 Coding by Grade Envelopes
The assay interval data was coded into an alphanumeric field CUENVELOPE and a numeric field
CUENVCODE from the copper grade envelope solid. Similarly for the gold grade envelope solid.
17.6.1.5 Input Data & Block Model Codes
The coding process was validated by visual inspection on section, plan and in 3-D.
The drillhole input data and block model codes for the various coded domains are summarised in Table
17-1 for reference.
Table 17-1
Domain
Lithological Domains
Zafranal diorite
Microdiorite
Late Quartz Diorite
Post Mineralisation Dyke
Volcanics
Gneiss
Dry diorite
Monzodiorite
Drillhole Data & Block Model Codes

Alphanumeric Field
Numeric Field
GEOLOGY
GEOLOGYCODE
ZAFDIO
100
MDIO
200
LTQZDIO
300
PTDIO
400
VC
500
GNEIS
700
DRYDIO
800
MZDIO
900
Mineralogical Domains
MINERA
MINERACODE
Leached cap
LEACH
1000
Oxide
OXIDE
2000
Supergene
SUPERGENE
3000
Transition
TRANSITION
4000
Hypogene
HYPOGENE
5000
Alteration Domains
ALERATION
ALTERCODE
Potassic
Phyllic
Propylitic
Argillic
Hornfels
10000
20000
30000
40000
50000
Potassic
Phyllic
Propylitic
Argillic
Hornfels
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Domain
Alphanumeric Field
Numeric Field
Gneiss phyllic
Gneiss propylitic
Gneiss phyllic
Gneiss propylitic
Gneiss not altered
Gneiss not altered
60000
70000
80000
CUENVELOPE
CUENVCODE
Copper Grade Envelope

-inside envelope
-outside envelope
Gold Grade Envelope
-inside envelope
-outside envelope
Cu%02
20
NOTCODED
NC
AUENVELOPE
AUENVCODE
Au01ppm
10
NOTCODED
NC
Geographical Domains
Block 1 to 4 from west to east
1 to 4 added as unit digit to the MINERACODE, for example 3002 for

Supergene in Block 2
17.6.2
Data Compositing
The dominant sample length at Zafranal is 2 m, but there are a number of 1 m and smaller (and some
larger) intervals (Figure 17-18). To provide valid data for statistical and geostatistical analysis, 2 m
composites were generated. The compositing to 2 m was completed within the mineralogical
boundaries and copper grade envelope to honour the boundaries created from assay data.
Figure 17-18
17.6.3
Histogram of Sample Lengths inside the Cu Envelope
Statistical Analysis
A review of the statistical characteristics of the global deposit data indicates the following:
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The distribution of copper grades as illustrated in Figure 17-19 is dependent on lithology with the
microdiorite and Zafranal diorite having significant higher averages in most mineralogical zones
than the other lithologies
Volcanics and dry diorite carry significant mineralisation in the enriched zones, i.e. oxide,
supergene and transition
The post-mineralisation dykes and monzonite dykes are essentially barren.
The late quartz diorite dykes are well mineralised in the supergene but have lower grade in
hypogene than the Zafranal diorite, microdiorite and volcanics
Consequently, during grade interpolation, the dykes were segregated from the global dataset with
the exception of the late quartz diorite in the supergene horizon
Figure 17-19 shows that the highest gold average grades are found in the oxide zone and leached
cap, mainly for the Zafranal diorite and microdiorite
Figure 17-19
Average Grade for CuTotal and Au per Mineralogical & Geological Domains
0.80
0.2
Cu Total
Au
0.70
0.15
0.50
Average Grade g/t
Average Grade %
0.60
0.40
0.30
0.20
0.1
0.05
0.10
0.00
0
Dry Diorite
Late Quartz Diorite
Microdiorite
Monzodiorite
Post Mine Dykes
Volcanics
Zafranal Diorite
Dry Diorite
Late Quartz Diorite
Microdiorite
Monzodiorite
Post Mine Dykes
Geological Domain
Leached cap
Oxide
Supergene
Transition
Hypogene
Volcanics
Zafranal Diorite
Geological Domain
Leached cap
Oxide
Supergene
Transition
Hypogene
The statistical characteristics of the data included in the 0.2% copper grade envelopes are discussed
below:
A total of 11 546 composites (2m) with CuTotal assays are available in the 0.2% CuTotal envelopes
for an average CuTotal grade of 0.46% CuTotal. This include 2062 composites with CuTotal grade
lowere than to 0.2%, i.e. 18% of the data
With the exception of the microdiorite data which is significantly higher grade in the supergene zone
than for the other lithologies, the total copper grade average does not vary markedly between
lithologies for a given mineralogical zone and the mineralogical domaining remains the main
influencing factor on the copper grade distribution
In the oxide zone, the difference of average grades between lithologies is not as pronounced for
CuS than for CuTotal and CuCN
Gold grades in the copper envelopes are low with better average grades in the Zafranal diorite and
the microdiorite
A statistical summary of the composited data inside the CuTotal grade envelope is presented in
Table 17-2 with detailed average grade by lithology for CuTotal in Table 17-3. The Zafranal diorite
is the predominant lithology inside the Cu envelope with more than half the composites pertaining to
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this lithology, followed by the microdiorite. The microdiorite carries the highest average CuTotal
grades
Figure 17-21 to Figure 17-23 illustrate the grade variations of copper and gold with easting and
relative elevation. These graphs indicate that the western part of the deposit presents higher grade
averages than the rest of the orebody. The supergene zone forms a well defined enrichment zone
marked by significant higher copper grades over the entire deposit with an average thickness in the
order of 100 m
Log probability plots of the various copper species and gold are presented in Figure 17-24 and
Figure 17-27 and illustrate their distribution according to mineralogy, geology and alteration
The Cu envelope data is mostly in potassic and phyllic alteration with little differences in terms of
grade distribution between these two alteration types, hence alteration domains were not used to
specifically segregate data during interpolation of the resource.
Figure 17-20
Average Grade for CuTotal, Au and Sulphur per Mineralogical & Geological Domains
only data included in the copper envelope

0.90
0.80
Cu Total
CuCN
0.80
0.70
0.70
0.60
Average Grade %
Average Grade %
0.60
0.50
0.40
0.30
0.50
0.40
0.30
0.20
0.20
0.10
0.10
0.00
0.00
Dry Diorite
Leached cap
Oxide
Late Quartz
Diorite
Microdiorite
Supergene
Transition
Post Mine Dykes
Volcanics
Zafranal Diorite
Dry Diorite
Geological Domain
Hypogene
Leached cap
0.35
Oxide
Late Quartz
Diorite
Microdiorite
Post Mine Dykes
Supergene
Transition
Hypogene
Zafranal Diorite
Geological Domain
0.16
CuS
Au
0.14
0.30
0.12
Average Grade g/t
0.25
Average Grade %
Volcanics
0.20
0.15
0.10
0.10
0.08
0.06
0.04
0.05
0.02
0.00
0.00
Dry Diorite
Leached cap
Oxide
Late Quartz
Diorite
Microdiorite
Supergene
Transition
Post Mine Dykes
Volcanics
Zafranal Diorite
Dry Diorite
Geological Domain
Hypogene
Series1
Series2
Late Quartz
Diorite
Series3
Microdiorite
Post Mine Dykes
Volcanics
Zafranal Diorite
Geological Domain
Series5
Series4
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Table 17-2
Number
Minimum
Maximum
Mean
Median
Leached cap Data
Number
Minimum
Maximum
Mean
Median
Oxide Data
Number
Minimum
Maximum
Mean
Median
Supergene Data
Number
Minimum
Maximum
Mean
Median
Transition Data
Number
Minimum
Maximum
Mean
Median
Hypogene Data
Number
Minimum
Maximum
Mean
Median
Summary Statistics of 2 m Composites inside the 0.2% CuTotal Grade Envelope

All Composites included in the 0.2% CuTotal Envelope
CuTotal
CuCN
CuS
%
%
%
11 546
9 484
9 484
0.001
0.005
0.005
21.12
10.63
2.94
0.46
0.26
0.07
0.32
0.06
0.03
Au
g/t
9 484
0.005
8.74
0.20
0.18
452
0.012
1.39
0.21
0.18
181
0.005
1.08
0.08
0.01
181
0.01
0.26
0.07
0.06
181
0.03
0.38
0.16
0.17
611
0.059
1.55
0.39
0.33
524
0.005
0.37
0.03
0.01
524
0.03
1.40
0.26
0.18
524
0.015
0.37
0.15
0.15
4 599
0.004
21.12
0.69
0.56
4 129
0.005
10.63
0.55
0.44
4 129
0.01
2.94
0.10
0.08
4 129
0.005
8.74
0.10
0.07
511
0.027
1.47
0.39
0.34
439
0.01
0.63
0.14
0.12
439
0.005
0.35
0.04
0.03
439
0.01
1.38
0.25
0.21
5 373
0.001
2.94
0.30
0.27
4 211
0.005
1.03
0.03
0.02
4 211
0.005
0.33
0.01
0.01
4 211
0.005
2.80
0.30
0.27
Note: the average grades are calculated on uncut values
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Table 17-3
CuTotal Average Grade for 2 m Composites inside the 0.2% CuTotal Grade Envelope
Lithology
Leached cap
Oxide
Supergene
Transition
Hypogene
Total
Litho%
Zaf. Diorite
0.20
0.38
0.65
0.39
0.29
0.42
51%
MicroDiorite
0.22
0.44
0.83
0.42
0.32
0.54
36%
Volcanics
0.27
0.35
LateQzDio
0.21
PostDiorite
0.08
0.30
0.30
0.42
9%
0.26
0.20
0.43
3%
0.36
0.27
0.20
0.30%
0.30
0.31
0.46
0.14
0.27
1%
0.21
0.39
0.69
0.39
0.30
0.46
100%
40%
86%
89%
85%
75%
80%
0.31
0.43
0.75
0.43
0.35
0.54
0.35
DryDiorite
Grand Total
% of data
above 0.2%
Average
Grade of data
above 0.2%
0.48
0.54
Figure 17-21
CuTotal Average Grade Variation with Easting & Relative Elevation inside 0.2%
CuTotal Grade Envelope

1.20
100
Supergene
Transition
Hypogene
50
1.00
0
topofSupergeneZone
supergenezone
upto100m thick
Relative Elevation m
CuTotal %
0.80
0.60
0.40
-50
-100
-150
Leached cap
-200
Oxide
0.20
Supergene
highergradeinthewesternpartofthedeposit
Transition
-250
Hypogene
0.00
-300
792 900 793 100 793 300 793 500 793 700 793 900 794 100 794 300 794 500 794 700 794 900 795 100 795 300
0.0
0.1
0.2
Easting
Figure 17-22
0.3
0.4
0.5
0.6
0.7
0.8
Average CuTotal%
Au Average Grade Variation with Easting & Relative Elevation inside 0.1 g/t Au Grade
Envelope
100
0.24
50
0.22
0
topofSupergeneZone
Au g/t
0.2
0.18
0.16
0.14
-50
-100
-150
Leached cap
Oxide
0.12
-200
0.1
-250
Supergene
Transition
793 300
793 500
793 700
793 900
794 100
794 300
794 500
794 700
794 900
Hypogene
795 100
Easting
2m composites uncut
2m composites cut to 1 g/t
-300
0.0
0.1
0.2
0.3
0.4
Average uncut Au g/t
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Figure 17-23
Au Average Grade Variation with Relative Elevation inside 0.2% CuTotal Grade
Envelope
100
50
topofSupergeneZone
-50
-100
-150
Leached cap
-200
Oxide
Supergene
Transition
-250
Hypogene
-300
0.0
0.1
0.2
0.3
Average Au g/t
Figure 17-24
Log Probability Plots of CuTotal Grades Composites inside the 0.2% CuTotal
Envelope per Mineralogy
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Figure 17-25
0.2% CuTotal Envelope per Lithology
Figure 17-26
0.2% CuTotal Envelope per Alteration Domain
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Figure 17-27
Log Probability Plot of Gold Composites inside the 0.2% CuTotal Envelope per
Mineralogy
17.6.4
Outlier Analysis - Capping
Following the statistical analysis of the data by domains, a detailed review was conducted of the higher
grade values for CuTotal and Au to determine the suitability and level of capping the data prior to
estimation. The review of the higher grade values included the following:
A review of histograms and probability plots: this allows to identify significant breaks in populations
that may be used to interpret possible outliers per combined domain lithological-mineralogicalgeographical
An examination of the spatial distribution of the higher grade values. High grade composites that
exhibit clustering may be considered valid members of the population, while isolated high grade
composites were considered as possible outliers, requiring cutting and/or search restriction.
Examination of the drillhole data on sections indicate that both the higher grade copper and gold values
usually occur in clusters within neighbouring drillholes. High copper and gold values occur over limited
interval lengths.
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The bubble graphs presented below illustrate the location of all total copper values greater than 2.5%.
The highest values are found in the middle part of the deposit and are clearly associated with distinctly
high arsenic values. In the eastern part of the deposit, the association with high arsenic does not occur
and the high grade values appear to be aligned along a NNE direction.
Higher gold values (+0.8 g/t Au) are more evenly distributed over the deposit than higher copper values,
and although the associated arsenic values are clearly higher in the western part of the deposit, the
difference observed between the western and eastern parts of the deposit is not as marked as for
copper.
After examination of the distribution of the data, a topcut of 5% was adopted for total copper grades which affects 6 composites located in the Supergene zone- and a topcut of 1 g/t or 2 g/t for Au grades
(depending on the lithology) was applied to the data prior to the grade estimation.
Figure 17-28
Spatial Distribution on Plan View of +2.5% CuTotal Assay Values with Associated
Gold & Arsenic

8224800
COPPER>=2.5%
8224600
8224400
8224200
8224000
793000
793200
793400
793600
793800
794000
794200
794400
794600
794800
795000
795200
795400
793600
793800
794000
794200
794400
794600
794800
795000
795200
795400
8224800
ASSOCIATEDGOLDASSAYS
8224600
8224400
8224200
8224000
793000
793200
793400
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8224800
ASSOCIATEDARSENICASSAYS
8224600
8224400
8224200
8224000
793000
793200
793400
793600
793800
794000
794200
794400
794600
794800
795000
795200
795400
Note that the bubbles area is proportional to the grade values

Figure 17-29
Spatial Distribution on Plan View of +0.8 g/t Au Assay Values with Associated Arsenic
8224800
GOLDASSAYS>=0.8g/t
8224600
8224400
8224200
8224000
793000
793200
793400
793600
793800
794000
794200
794400
794600
794800
795000
795200
795400
793600
793800
794000
794200
794400
794600
794800
795000
795200
795400
8224800
ASSOCIATEDARSENICASSAYS
8224600
8224400
8224200
8224000
793000
793200
793400
Note that the bubbles area is proportional to the grade values
17.6.5
Variography
Prior to completing the variography, the data was transformed to unfold the various zones using the
top of the Supergene horizon as a reference surface. The unfolded data was used to complete the
variography and the subsequent grade estimation for the Leached cap, Oxide, Supergene and
Transition zones. The Hypogene zone was estimated in real space.
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A preliminary variography analysis was completed for all interpolated grades CuTotal, CuCN, CuS
and Au- separating mineralogical and geographical zones. First pass variograms were calculated using
data pertaining only to the grade envelopes as well as using the complete dataset unscreened.
Variograms based on untransformed data, log transformed data and median indicator data were tested.
This preliminary analysis indicates that:
In the Supergene zone, the CuTotal variography was completed separately for the western part of
the deposit and the eastern part within the CuTotal grade envelope using unfolded data
In the Hypogene and Transition zones, all geographical zones were combined and all data was
used conjointly within the CuTotal envelope in real space
There is insufficient data inside the grade envelopes within the Oxide or Leached cap zones to
obtain meaningful variograms, hence by default, variograms obtained for the Supergene zone have
been used for these domains
In the Supergene zone, the sequential copper data behaves in a similar manner to the total copper
data, and for the purpose of estimation, the CuTotal parameters have been used to estimate the
CuCN and CuS models
Gold exhibits a different spatial distribution to copper and appears to be controlled by steeply
dipping features. All data within the Au envelope was used conjointly for the Au variography in real
space, Median indicator variograms provide the best results and were used to compile kriging
parametres for Au.
The variography results are summarised below:
CuTotal in Supergene Zone in the western part of the deposit: variograms calculated on unfolded
data. The best direction of continuity is horizontal* NNE at N40o azimuth with a long range of 130 m
along this direction and 100 m perpendicularly in the horizontal plane. The vertical range is 17 m
CuTotal in Supergene Zone in the eastern part of the deposit: variograms calculated on unfolded
data. The best direction of continuity is horizontal* slightly off EW at N110o azimuth with a long
range of 160 m along this direction and 135m perpendicularly in the horizontal plane. The vertical
range is 17 m
CuTotal in Hypogene Zone: variograms calculated using data in real space. The best direction of
continuity is along a N130o azimuth with 30o plunge and a 50o dip towards 350o with long ranges of
180 m by 145 m and 110 m
Au in the Au grade envelope: median indicator variograms calculated using data in real space. The
directions define correspond to the Hypogene copper directions with long ranges of 250 m by 200
m and 130 m
The experimental variograms were modelled using spherical models with the nugget value obtained
from a downhole variogram calculated on 2 m lags. The variogram parameters obtained are presented
in Table 17-4. The modelled variograms are presented in Figure 17-30.
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Table 17-4
Element
Directions
Variogram Parameters
CuTotal
CuTotal
Supergene - Western
Supergene - Eastern
N40hz, N130hz, vertical
N110hz, N20hz, vertical
CuTotal
Au
Hypogene
N130-30plunge, N350-
N130-30plunge, N350-
50dip, perpendicular
50dip, perpendicular
C0,C1,C2
0.15,0.40,0.45
0.15,0.40,0.45
0.20,0.30,0.50
0.35,0.30, 0.35
a 1 (m)
110x80x6
115x80x6
70x40x30
100x55x25
a 2 (m)
130x100x17
160x135x17
180x145x110
250x200x130
Note: for Au, median indicator variograms were modelled as the normal variograms were poor
*horizontal in an unfolded space
Figure 17-30
Modelled Variograms
CuTotal
Supergene zone, Western part of Zafranal
o
Downhole variogram azimuth 0 dip-70
Semi-major axis variogram azimuth 130o horizontal
Major axis variogram azimuth 40 horizontal
Minor axis variogram vertical
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CuTotal
Supergene Zone Eastern Part of Zafranal
o
Semi-major axis variogram azimuth 20o horizontal
Major axis variogram azimuth 110 horizontal
Minor axis variogram vertical
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CuTotal
Hypogene Zone
o
Major axis variogram azimuth 130 dip-30
Semi-major axis variogram azimuth 350o dip-50o
Minor axis variogram azimuth 230o dip-20o
Au
o
Semi-major axis variogram azimuth 350o dip-50o
Major axis variogram azimuth 130 dip-30
Minor axis variogram azimuth 230o dip-20o
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17.7
BLOCK MODEL DEVELOPMENT
17.7.1
Model Characteristics
The Zafranal block model was created to encompass the entire volume defined by Atticus solids plus
spare space on the margins to allow for the development of the pit shapes. Given the drillhole spacing
and the continuity characteristics of the mineralisation to estimate, a 25 m by 25 m horizontal block size
is appropriate. A 5 m bench height was chosen for the vertical block size to allow for an adequate
reproduction of the solid volumes and boundaries into the block model without the need to use
subblocking*.
Note that the first downhole variogram range of the grades estimated is also in the order of 5 m. The
block model characteristics are detailed in Table 17-5.
Table 17-5
Block Model Characteristics

Minimum
Maximum
Number
Size
m
Easting
792 675
795 500
113
25
Northing
8 223 800
8 224 850
42
25
Elevation
2 110
2 880
154
*Note that partial blocks have been used to delineate post mineralisation diorite in the block model
17.7.2
Model Coding
As for drillhole data, the block model was coded using the wireframes representing the various
lithological units, mineralogical domains and geographical zones. The copper and grade envelope
solids were also used to code the block model.
For reference, the model codes are identical to the ones used for the drillhole data detailed in Table
17-1.
Volume checks were performed between coded blocks and the grade envelope solids to ensure the
conservation of volumes from the interpreted envelopes.
17.7.3
Model Transformation
Prior to estimation, as for the drillhole data, the block model blocks corresponding to the Leached cap,
Supergene zone and Transition zone were unfolded along the top of the Supergene horizon which
was used as a reference surface. The unfolding procedure alleviates the effect of Zafranals rugged
topography and improves the grade estimation.
17.8
GRADE ESTIMATION
17.8.1
Estimation Technique
Grade estimation for all elements was completed in unfolded space using ordinary kriging for the
Leached cap, Oxide, Supergene and Transition zones. The Hypogene zone for all copper species was
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estimated in real space.

mineralogical domains.
17.8.2
Gold grades were estimated by ordinary kriging in real space for all
Domain Constraints
Given the results of the statistical analysis of the data within the various zones, hard and soft
boundaries* between data during interpolation were used as follows:
Mineralogical boundaries were used as hard* boundaries for all copper species with the exception
of the Transition-Hypogene boundary which was used as soft meaning that part of the Transition
data was used to krige the Hypogene zone given the gradational nature of the grade distribution
either side of this boundary.
Geological boundaries treated as hard boundaries for all dykes with the exception of the Late
Quartz Diorite dykes in the Supergene zone which was combined with the other lithologies during
kriging, otherwise soft boundaries were used between the other lithologies within the grade
envelopes
Geographical boundaries were used as hard boundaries for copper grades between the western
and eastern blocks for the main geological units but not for the dykes
*Note: a kriging boundary is hard when the data either side of the boundary is segregated during estimation, for
example, the boundary between the Leached cap and Supergene zone is a sharp boundary for assays as Cu grades
typically change from a background value of 0.001% in leached cap to +0.2% in Supergene.
During kriging this
boundary will be hard indicating that only Supergene data is used to estimate supergene blocks and vice versa for
Leached cap data and Leached cap blocks
17.8.3
Search Strategy & Kriging Neighbourhood
A kriging neighbourhood analysis was completed on a range of blocks located in diverse areas of
the deposit in the Supergene and Hypogene zones to test the effect of estimation parameter values
on the quality of the estimate
The kriging estimation was completed in two passes. The 1st pass kriging was completed using the
optimum search parameters defined by the kriging neighbourhood analysis. In order to fully
estimate grades within the project area, 2nd kriging passes were completed using less restrictive
parameters, i.e. a reduced minimum of composites and larger search ellipses. The parameters
chosen for the estimation are detailed in Table 17-6 with the search ellipse directions corresponding
to the directions of best continuity defined by the variography.
Table 17-6
Kriging Neighbourhood Parametres
Grade Element & Domain
Search Ellipse
Min/Max No of
Max. No of
Dimensions along
Composites
Composites per
Kriging Directions
Cu all species
Supergene, Leached cap, Oxide,
130x100x17
Drillhole
1st pass: 15/30
2nd pass: 2/30
Transition
inside Cu envelope
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Grade Element & Domain
Search Ellipse
Min/Max No of
Max. No of
Dimensions along
Composites
Composites per
Kriging Directions
Western
Cu all species
Drillhole
160x135x17
st
1 pass: 15/30
nd
pass: 2/30
Transition
inside Cu envelope
Eastern
Cu all species
Hypogene
Inside Cu envelope
Au
all domains
inside Au envelope
Cu all species
st
1 pass: 15/30
2nd pass: 2/30

250x200x130
225x200x60
st
1 pass: 15/30
2nd pass: 2/30

130x100x17
1st pass: 15/30
2nd pass: 2/30

Transition
outside Cu envelope
Western
Cu all species
160x135x17
st
1 pass: 15/30
nd
pass: 2/30
Transition
outside Cu envelope
Eastern
Cu all species
Hypogene
outside Cu envelope
Au
225x200x60
all domains
outside Au envelope
2nd pass: 2/30

250x200x130
1st pass: 15/30
1st pass: 15/30
2nd pass: 2/30
Note: for the 2nd kriging pass the search ellipse dimensions are taken equal to three times the 1st pass search ellipse
dimension
17.9
DENSITY ASSIGNMENT
AQM has completed an extensive bulk density measurement campaign and the database comprises
753 measurements within the estimated area. Details on the measurement procedure are given in
Section 12.6.
The density data was analysed by mineralogical zone and geological coding.
Figure 17-31 illustrates the variation of density measurement values according to the relative unfolded
elevation per mineralogical domain and lithology. It is clear from the graph that the density increases
with depth in the Hypogene zone.
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Average density data were applied to the model blocks based on mineralogy and geological coding of
each individual block. The average density values used are presented in Table 17-7. but, in the
Hypogene zone, the increase of density with depth observed was reproduced in the model for the
Zafranal diorite, microdiorite and volcanics using linear equations as illustrated in Figure 17-32 rather
than using average values.
Figure 17-31
Variation of Density Measurements with Relative Depth per Mineralogical Zone &
Lithology
200
100
topofSupergeneZone
LeachedcapZafDio
LeachedcapMDio
100
RelativeZ
LeachedcapVolc
OxideZafDio
OxideMDio
200
SupergeneZafDio
SupergeneMDio
SupergeneVolc
300
TransitionZafDio
TransitionMDio
TransitionVC
HypogeneMDio
400
HypogeneZafDio
HypogeneVolc
500
1.5
1.7
1.9
2.1
2.3
2.5
2.7
2.9
3.1
BulkDensityt/m3
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Table 17-7
Average Bulk Density
Lithology & Mineralogy
Leached cap
Oxide
Supergene
Transition
Hypogene
code
1000
2000
3000
4000
5000
100
2.36
2.39
2.50
2.59
f(Z)
Zafranal Diorite
Microdiorite
200
2.36
2.41
2.53
2.63
f(Z)
Late Quartz Diorite
300
2.22
2.26
2.67
2.67
2.74
Post Mine. Diorite
400
2.47
2.58
2.58
2.58
2.58
Volcanics
500
2.30
2.35
2.53
2.60
f(Z)
Gneiss
700
2.36
2.41
2.53
2.63
2.73
Dry Diorite
800
2.70
2.70
2.70
2.73
2.73
Monzodiorite dyke
900
2.14
2.43
2.72
2.72
2.72
Figure 17-32
Variation in Average Bulk Density Measurements with Elevation in Hypogene
2.9
y=0.0003x +3.4733
R=0.803
2.8
y=0.0004x +3.6721
R=0.7267
BulkDensityt/m3
2.7
2.6
2.5
2.4
HypogeneZafDio
HypogeneMDio
HypogeneVolc
AllHypogene
Linear(HypogeneZafDio)
Linear(HypogeneMDio)
Linear(HypogeneVolc)
y=0.0005x +3.8646
R=0.7428
2.3
2000
17.10
2100
2200
2300
2400
Elevationm
2500
2600
2700
MODEL VALIDATION
The grade models were extensively validated visually, comparing bench composites to block data on
sections and plans. Examples of sections are presented below.
Coherence between the various copper species was checked. Additionally, statistical checks on the
block model and comparison with the input data within the grade envelopes were completed. These
verifications indicate that the copper models and the gold model provide a good representation of the
Zafranal mineralisation, both in terms of grade averages and grade spatial distribution within the grade
envelopes. The grade trend plots presented in Figure 17-35 for the CuTotal model in the supergene
and hypogene zones confirm that grade models were interpolated correctly from the input drillholes,
and that no systematic bias is present in the models.
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Figure 17-33
December 2010 CuTotal Resource Model Long Sections with Drillhole Data & Block
Model
Section 8224200N
Section 8224300N
Section 8224350N
Section 8224400N
Legend CuTotal
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Figure 17-34
December 2010 CuTotal Resource Model Sections with Drillhole Data & Block Model
Section 793300E
Section 793400E
Section 793500E
Section 793600E
Legend CuTotal
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Figure 17-35
Grade Trends Input Drilling Data & Output Grade CuTotal Model Average Grade
per Easting
1.20
Supergene Data
Supergene Model
Hypogene Data
Hypogene Model
1.00
CuTotal %
0.80
0.60
0.40
0.20
0.00
792 900 793 100 793 300 793 500 793 700 793 900 794 100 794 300 794 500 794 700 794 900 795 100 795 300
Easting
17.11
RESOURCE CLASSIFICATION
The Zafranal resource was classified within the context of the Canadian Securities Administrators
National Instrument 43-101 (NI 43-101), with consideration of the following criteria:
Quality and reliability of the drilling data (sampling, surveying & assaying)
Drillhole spacing
Confidence in the geological interpretation
Grade continuity observed within the deposit and quantified by the variography
Number of samples and drillholes used to interpolate blocks within the estimation searches
Overall quality of the grade estimate
Amenability of the material to be economically treatable under proven techniques.
Extensive visual validation of the resource estimate, results of the kriging neighbourhood analysis
based on the spatial characteristics of the mineralisation and a drillhole spacing study supports a
classification of the resource based on drilling density and the mineralogy of the material. The current
100 m drill fences allows defining an Indicated resource where the resource is interpolated with a
minimum of 3 drillholes within the search ellipse defined from the variography (1st pass kriging). Material
extrapolated, i.e. on the periphery of the mineralised body and/or from less than 3 drillholes and/or
estimated during the second kriging pass is coded as Inferred. Three limited areas within the
Supergene zone where drilling is oriented in the east-west direction and infills the 100m spaced northsouth drill fences allowing for close-spaced information has been classified in the Measured category.
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Visual review of estimated blocks showed that while some isolated pockets of mineralisation occurred
outside of the CuTotal envelope, they were generally isolated and at depth, and unlikely to be mineable.
Accordingly, only mineralisation estimated within the CuTotal envelope has been classified and
reported.
The classification criteria chosen result in the following for the resource reported at a 0.2% CuTotal cutoff grade:
the Measured category is limited to 5% of the total resource and occurs in the
mineralisation
Supergene
81% of the Zafranal resource has been classified in the Indicated category
the Inferred material mostly corresponds to Hypogene mineralisation along the border of the Cu
envelopes and within deep extensions defined by limited drilling
Three long sections presented in Figure 17-36 illustrate the classification coding for grade estimates.
Figure 17-36
Resource Classification Long Sections
Section 8224250N 50m red=measured, green=indicated, purple=inferred
Section 8224350N 50m - red=measured, green=indicated, purple=inferred
Section 8224450N 50m - red=measured, green=indicated, purple=inferred
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17.12
RESOURCE REPORTING
The December 2010 Zafranal resource model is reported below by resource category for various
CuTotal cut-off grades and mineralogical categories.
Mine planning work by AMEC Minproc indicates that using a copper price of $2.00/lb and gold price of
$800/oz, the resource would define a pit shell suitable for open pit mining. This work resource
demonstrates reasonable prospects for economic extraction. The work suggests that the 0.2% total
copper cut-off grade is reasonable.
Table 17-8

Resource Category
Measured
Indicated
Measured+Indicated
% Total
Tonnage
CuTotal
%
CuCN
%
CuS
%
Au
g/t
17
5%
0.93
0.71
0.12
0.09
284
81%
0.44
0.19
0.05
0.08
301
86%
0.47
0.22
0.05
0.08
Tonnage
Mt
14%
51
0.32
0.06
0.02
0.06
Inferred
Note:
Table 17-9
Cut-off Grade by Resource Category & Mineralogical Domain

Resource Category
Tonnage
Mt
CuTotal
%
CuCN
%
CuS
%
Au
g/t
17
0.93
0.71
0.12
0.09
Measured
Supergene
Indicated
Leached cap
0.25
0.06
0.05
0.13
Oxide
0.39
0.02
0.23
0.15
Supergene
95
0.68
0.50
0.10
0.08
Transition
15
0.43
0.14
0.03
0.09
Hypogene
158
0.31
0.03
0.01
0.08
Inferred
Leached cap
Oxide
0.23
0.04
0.05
0.13
0.7
0.35
0.02
0.20
0.12
Supergene
0.45
0.31
0.07
0.04
Transition
0.9
0.36
0.12
0.03
0.06
Hypogene
42
0.30
0.02
0.01
0.06
Resource reports at different cut-off grades for Measured+Indicated, and Inferred material are
presented in Table 17-10 and Table 17-11 with the grade-tonnage diagrams for the
Measured+Indicated material in Figure 17-37.
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Table 17-10
December 2010 Model Resource Report within the Cu Envelope Measured+Indicated
CuTotal
Cut-off Grade %
Tonnage
Mt
CuTotal
%
CuCN
%
CuS
%
Au
g/t
1.0
19
1.30
0.99
0.19
0.12
0.9
27
1.20
0.91
0.17
0.11
0.8
37
1.11
0.84
0.15
0.11
0.7
49
1.02
0.76
0.14
0.11
0.6
67
0.92
0.67
0.13
0.10
0.5
89
0.82
0.58
0.11
0.10
0.4
122
0.72
0.47
0.10
0.10
0.3
200
0.57
0.32
0.07
0.09
0.2
301
0.47
0.22
0.05
0.08
0.1
313
0.46
0.21
0.05
0.09
Table 17-11
December 2010 Model Resource Report within the Cu Envelope Inferred
CuTotal
Cut-off Grade %
Tonnage
Mt
CuTotal
%
CuCN
%
CuS
%
Au
g/t
1.0
0.1
1.08
0.69
0.10
0.06
0.9
0.2
1.02
0.60
0.09
0.05
0.8
0.4
0.92
0.49
0.08
0.05
0.7
0.7
0.83
0.48
0.09
0.05
0.6
1.5
0.73
0.44
0.09
0.05
0.5
0.63
0.33
0.08
0.07
0.4
0.52
0.21
0.06
0.07
0.3
21
0.41
0.12
0.04
0.07
0.2
51
0.32
0.06
0.02
0.06
0.1
53
0.31
0.06
0.02
0.06
Figure 17-37
Grade Tonnage Diagrams December 2010 Resource Model Measured+Indicated
Resource
1.6
350
1.4
1.3
300
1.3
1.2
0.7%cutoffgrade
49Mt@1.02%
250
1.0
0.9
0.4%cutoffgrade
122Mt@0.72%CuTotal
0.8
0.7
0.4%cutoffgrade
122Mt@0.72%
CuTotal
150
100
0.2%cutoffgrade
301Mt@0.47%CuTotal
0.6
200
0.7%cutoffgrade
49MT@1.02%
CuTotal
0.7
CuTotal%
1.0
TonnageMt
CuTotal%
1.1
0.4
0.2%cutoffgrade
301Mt@0.47%
CuTotal
0.1
50
0.5
0
0.4
0
50
100
150
200
250
300
350
0.2
0.2
TonnageMt
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1.0
CuTotalcutoff grade%
Note that reporting is constrained within the 0.2% CuTotal envelope
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17.13
MINERAL RESERVES
No mineral reserves were prepared from the December 2010 resource model.
18
OTHER RELEVANT DATA AND INFORMATION
No other information is required at this time.
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19
INTERPRETATION & CONCLUSIONS
The Zafranal property currently holds a Measured plus Indicated resource of 301 Mt @ 0.47% total
copper at a 0.2% total copper cut-off grade in the Zafranal Main Zone. It was optioned by
AQM Copper Per SAC in May of 2009 from Teck. The option agreement was modified in July
2010 whereby AQM Copper Per SAC vested a 50% interest by making additional expenditures
totalling US$10.7 million and issuing Teck an additional 5 million shares. These commitments have
now been fulfilled and the Project is run as a 50/50 corporate Joint Venture between TRL and
AQM Copper Per SAC.
The Zafranal Property is made up of six copper-gold prospects, namely the Zafranal Main Zone,
Sicera South, Sicera North, Campanero, Ganchos and Rosario. AQM has focused its exploration
on the Zafranal Main Zone
The Property was assembled by Teck between 2003 and 2007, during which time it drilled 36
drillholes on the Zafranal Main Zone and several exploratory drillholes on the other prospects. This
programme identified significant supergene copper mineralisation on the Zafranal Main Zone
The geology of the Zafranal Main Zone is dominated by a sequence of Jurassic age volcanic and
sedimentary rocks intruded by porphyritic diorite and microdiorite stocks and plugs. Later dioritic
and aphanitic intermediate composition dykes and sills cross-cut the area. A complex set of EW
and NW-SE reactivated faults appear to control hypogene mineralisation. Supergene copper
mineralisation is only affected by late normal movements along these same faults
Copper mineralisation occurs as oxides, a laterally continuous 50-180m thick blanket of secondary
enrichment and a large zone of primary mineralisation that remains open in all directions.
Porphyry-style copper-gold mineralisation has been identified over a 3.3 km strike length, up to 600
metres in width and up to 400 metres in thickness
AQM has completed a first phase, 67,283.50 metre drill programme at the Zafranal Main Zone and
a 5,529 metre RC exploratory drilling programme at its Sicera South and Sicera North targets
Scout drilling at the Sicera South and Sicera North targets has identified potentially significant
hypogene copper mineralisation that could significantly increase the overall mineral inventory at
Zafranal
The metallurgical testwork completed to date on individual and composite samples indicate that the
Zafranal material has the following characteristics:
Bond abrasion indices varied from 0.09 to 0.22, increasing with depth, indicating a moderately
abrasive material
Morell crusher work indices varied from 4.56 kWh/t to 10.9 kWh/t. The wide distribution
indicates the coarse material varies from moderately soft to very hard at depth
Bond ball mill work indices fell in a narrow range between 9.86 kWh/t and 12.29 kWh/t
indicating a moderately hard material for ball milling
From a SAG mill grinding perspective, the material varied from soft (3.81 kWh/m3) to
moderately hard (9.37 kWh/m3) at depth
Copper recovery varied from 87.6% for supergene material to 91.4% for hypogene material
Gold recovery varied from 60.6% for supergene material to 74.5% for hypogene material
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Concentrate grade varied from 41.0% Cu for supergene material to 33.0% Cu for hypogene
material, with no penalty elements above smelter limits
AMEC Minproc considers that AQMs assay, drillhole survey, drillhole collar and geological data
provide a reasonable representation of the geology and mineralisation of the Zafranal Project at the
current drillhole spacing and study level
AMEC Minproc has completed a resource estimate of the Zafranal Main zone using a domaincontrolled ordinary kriging. Three-dimensional solid modelling of mineralogical and lithological
domains have been combined with a 0.2% total copper grade envelope to define, from the
statistical analysis of the data, a domain model to control the variography and the estimation
process
The resource model has been validated statistically and visually and AMEC Minproc considers that
the December 2010 model provide a good representation of the Zafranal mineralisation, both in
terms of grade averages and grade spatial distribution within the grade envelopes
The resource classification has been undertaken in compliance with the NI 43-101 and AMEC
Minproc considers that the data is of sufficient quality to support an Indicated Resource
classification in the most densely drilled portions of the deposit with limited infilled areas of
Measured Resource
The resource at the Zafranal Main Zone, as of January 13th 2011 is as follows:
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Table 19-1

Resource Category
Tonnage
Mt
% Total
Tonnage
CuTotal
%
CuCN
%
CuS
%
Au
g/t
Measured
17
5%
0.93
0.71
0.12
0.09
Indicated
284
81%
0.44
0.19
0.05
0.08
Measured+Indicated
301
86%
0.47
0.22
0.05
0.08
51
14%
0.32
0.06
0.02
0.06
Inferred
Note:
20
RECOMMENDATIONS
AQM has commissioned AMEC Minproc to complete a Scoping Study for the Zafranal Copper Project
by end of 2011; it is planned that the study will include the following:
Geology & Exploration
An additional 30 000 metres of diamond drilling for the Zafranal Main Zone in order to upgrade the
classification status of resource and increase the Measured and Indicated component of the
Zafranal Main Zone resource
An additional 30 000 metres of Reverse Circulation and Diamond drilling between the various
satellite porphyry targets, in particular the Sicera North area, where exploratory drilling during 2010
identified a potentially significant hypogene copper target with a large alteration area
A complementary geophysical campaign on the satellite targets
Further detailed mapping of the Zafranal Main Zone and all of the satellite targets
Additional analytical QAQC independent laboratory checks assays
The proposed budget for the geology and exploration activities is planned as follows:
Table 20-1
Geology & Exploration Proposed 2011 Budget
Item
Estimated Cost (US$)
Main Zone Drilling (28 500 m all cost)
$6 000 000
Sicera North Diamond Drilling (30 000m all in cost)
$6 300 000
RC Drilling on Satellites and Gravel Covered Areas (22 000m all in cost)
$2 900 000
Geophysics on Satellite targets
$200 000
Mapping & other Geological Studies
$200 000
Total
$15 600 000
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Metallurgical & Process

It is recommended that the 2011 test programme be designed to more fully determine leach, flotation
and comminution variability throughout the mineralisation - dependent on ore type and oxidation levels,
quantify the extent of recovery variability- in order to generate a better understanding of the impact of
mineralogy on recovery and evaluate the impact of copper mineralogy and ore variability with respect to
hardness, competency and throughput, in alignment with the preliminary mine plan.
It is planned that locked cycle flotation test work will be conducted, with both site bore water and sea
water.
It is recommended that the test programme be conducted on a mine plan weighted basis. It is
anticipated that ore will be grouped into early mine life, mid-mine life and late mine life for detailed
evaluation. The test work programme will be weighted towards the earlier mine life samples.
Base conditions as developed in the 2010 test programme will be used for the flotation programme. A
leach plan will be developed to evaluate sulphuric acid, and bacteria assisted leach options for oxide,
leached cap and supergene ore types.
Resource Modelling
Following the completion of the additional drilling, the resource estimate of the Zafranal Main Zone will
be updated for the 2011 Scoping Study. Additional resource analysis and estimation will include the
following:
Update of the copper and gold estimates with the added 2011 drilling information
Estimation of the accessory elements S, Fe, As and Zn
Analysis and estimation of the CRU-31 test data to develop a relative hardness model for mine
planning purposes
The satellite deposits will also be interpreted and modelled to arrive at a comprehensive total project
resource encompassing the Zafranal Main Zone and the satellite deposits.
Mining, Geotechnical, Hydrological/Hydrogeological, Environmental & Engineering
Project work for these disciplines will continue over the course of 2011 to produce reliable information
to scoping study level for the Zafranal Main Zone and the satellite deposits.
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21
REFERENCES
Clark, A.H., Farrar, E., Kontak, D.J., Langbridge, R.J., Arenas, M., France, L.J., McBride, S.L.,
Woodman, P.I., Wasteney, H.A., Sandeman, H.A., and Archibald, D.A., 1990, Geologic and
geochronologic constraints on the metallogenic evolution of the Andes of southeastern Peru, Economic
Geology, v. 85, p. 1520-1583
Panteleyev, A., 1995, Porphyry Cu-Mo-Au in selected British Columbia Mineral Deposit Profiles,
Volume 1 Metallics and Coal, Lefebure, D.V., and Ray, G.E. Editors, British Columbia Ministry of
Energy and Mines, Open File 1995-20, p 87-92
Quang, C.X., Clark, A.H., Lee, J.K.W. and Guilln, B.J., 2003, 40Ar/39Ar ages of hypogene and
supergene mineralisation in the Cerro Verde-Santa Rosa porphyry Cu-Mo cluster, Arequipa, Per,
Economic Geology, v. 98, p. 1683-1696
Quang, C.X., Clark, A.H., Lee, J.K.W. and Hawkes, N., 2005, Response of supergene processes to
episodic Cenozoic uplift, pediment erosion, and ignimbrite eruption in the porphyry copper province of
Southern Per, Economic Geology v. 100 (1), p. 87-114
Rivera, F., Len, J., Cano, O. and Huamn, M., 2010, Controles de mineralizacion en el prfido de
Cu Zafranal, en el sur del Per, Congreso Peruano de Geologa
Scarbrough, J., 2009, Informe Final Estudio de Magneto-Telrica en el Proyecto Zafranal, Per,
unpublished Internal Report for Minera Koritambo S.A.C. (AQM Copper), prepared by Zonge
Geophysics, Antofagasta, Chile
Smith, Russell, February 2010, Zafranal Porphyry Copper-Gold Deposit Geologic Report, Southern
Peru, Internal Report prepared for AQM Copper Inc.
Smith, Moira and Tejada, Walter, March 2004, Report On Geology And Geochemistry Of The
Zafranal Copper Porphyry Project, Southern Peru, Internal Report prepared for Teck Cominco Per
S.A.
Tejada, Walter, September 1st, 2005, Final Report on the 2004 Zafranal and Sicera Drilling
Programs, Internal Report prepared for Teck Cominco Per S.A.
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DATE AND SIGNATURE PAGES
This report titled Technical Report for the Zafranal Copper Project prepared by AMEC Minproc Limited
for AQM Copper Incorporated was prepared and signed by the following contributors:
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ILLUSTRATIONS
A list of illustrations and tables is included in the Table of Contents at the start of the report.
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Zafranal Copper Project Peru

Zafranal Copper Project Peru

Issued for Client use

* Use after Rev. 0

Zafranal Copper Project Peru

Zafranal Copper Project Peru

Zafranal Copper Project

Effective Date of Technical Report:

25th February 2011

Zafranal Copper Project Peru

RELIANCE ON OTHER EXPERTS ........................................................................... 20

PROPERTY DESCRIPTION & LOCATION ............................................................... 20

ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE &

Zafranal Copper Project Peru

GEOLOGICAL SETTING .......................................................................................... 47

DEPOSIT TYPES ..................................................................................................... 58

SAMPLING METHOD & APPROACH ....................................................................... 93

Zafranal Copper Project Peru

DIAMOND CORE SAMPLING & LOGGING ................................................................................... 93

SAMPLE PREPARATION, ANALYSES & SECURITY ............................................... 96

DATA VERIFICATION ............................................................................................. 97

ADJACENT PROPERTIES ..................................................................................... 114

MINERAL PROCESSING & METALLURGICAL TESTING ...................................... 114

Zafranal Copper Project Peru

FLOTATION TESTWORK ............................................................................................................118

MINERAL RESOURCE & MINERAL RESERVE ESTIMATES ................................. 118

OTHER RELEVANT DATA AND INFORMATION ................................................... 158

INTERPRETATION & CONCLUSIONS .................................................................. 159

RECOMMENDATIONS ........................................................................................... 161

DATE AND SIGNATURE PAGES ........................................................................... 164

ILLUSTRATIONS ................................................................................................... 172

Zafranal Copper Project Peru

Zafranal Copper Project Peru

Zafranal Location Map .......................................................................................................... 21

Zafranal Copper Project Peru

3D Views Zafranal Lithological Units Dykes .................................................................. 122

Zafranal Copper Project Peru

Zafranal Copper Project Peru

SCOPE, BACKGROUND & LAND OWNERSHIP

Zafranal Copper Project Peru

GEOLOGY, MINERALISATION & EXPLORATION

METALLURGICAL & PROCESS STUDIES

The metallurgical testwork completed to date is as follows:

Zafranal Copper Project Peru

DATABASE & MINERAL RESOURCE

Cut-off Grade by Resource Category

Zafranal Copper Project Peru

December 2010 Model Resource Report within the Cu Envelope Measured+Indicated

Copper mineralisation occurs as oxides, a laterally continuous 50 m to 180 m thick blanket of

Zafranal Copper Project Peru

A complementary geophysical campaign on the satellite targets

Additional analytical QAQC independent laboratory checks assays

Geology & Exploration Proposed 2011 Budget

Estimated Cost (US$)

Main Zone Drilling (28 500 m all cost)

Sicera North Diamond Drilling (30 000m all in cost)

Metallurgical & Process

Zafranal Copper Project Peru

Estimation of the accessory elements S, Fe, As and Zn

SCOPE OF THE REPORT

QUALIFICATIONS & PERSONNAL SITE INSPECTIONS