Property

The Colosio-Los Letreros Property ("Colosio") comprises 8 mineral exploration concessions totalling 2992.55 hectares located in the west-central part of Chihuahua State in northern Mexico. All concessions in the Property are subject to an Option Agreement between Amato and Francisco Cabrera. The Property is accessible by road and lies less than 20 km from Highway 16 that runs from Chihuahua to Hermosillo.

The Property lies within the prolific Sierra Madre Occidental ("SMO"), a northwest-southeast trending belt of volcanic rocks extending for 1100 km on the western flank of Mexico. The SMO has seen widespread gold and silver production for over 500 years and hosts numerous significant precious metal deposits including the Pinos Altos, Ocampo, Moris and Dolores mines. The Pinos Altos Mine of Agnico-Eagle Mines Ltd. is scheduled to begin production in mid-2009 and is located 23 km southwest of Colosio in a similar geological environment. As of Dec. 31, 2008, Pinos Altos contained Probable Reserves of 41.7 million tonnes grading 2.7 g/t gold and 74.6 g/t silver 1. At present numerous Canadian companies have active mining and exploration projects in the area.

2008 Exploration

Recent exploration programs conducted at the Property by Amato in June and September 2008 included surface geological mapping and prospecting over a 30 km2 area; surface and underground rock sampling of variably altered and mineralized host rocks and vein material; orientation soil geochemical surveys and a preliminary stream sediment survey.
In summary, the 2008 exploration program:

• Confirmed the presence and type of mineralization that was mined from historic operators at the Los Letreros Mine,
• Identified potential for finding more mineralization along strike and parallel to the Los Letreros Mine workings,
• Demonstrated that the clay-altered zones adjacent to the high-grade veins contain disseminated polymetallic sulphides and provide a wider exploration target, and
• Identified seven target areas for follow-up exploration

Taken together, the geological information collected in the 2008 exploration program leads to the conclusion that the mineralization types found on the Property are of the "intermediate sulphidation" type. The setting and level in the volcanic stratigraphy indicates that the mineralization observed is at relatively high levels in an epithermal mineralizing system. The high intensity, long strike length and width of the alteration zones, faulting and silver-base metal mineralization of the known occurrences, suggest that a strong, aerially extensive mineralizing event is present on the Property, and exploration is warranted to target additional near surface vein targets and to define drilling targets at depth below the known mineralized structures. It should be noted that, to date, the Property has seen no comprehensive modern exploration programs or diamond drilling.

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