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Oriental Peninsula Resources Group IncREPORT ON THE MINERAL RESOURCE VALIDATION OFCITINICKEL MINES AND DEVELOPMENT CORPORATIONNARRA AND ESPAÑOLA, PALAWAN

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Page 1: Oriental Peninsula Resources Group Inc
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Mines and Geosciences Bureau Department of Environment and Natural Resources

REPORT ON THE MINERAL RESOURCE VALIDATION OF CITINICKEL MINES AND DEVELOPMENT CORPORATION

NARRA AND ESPAÑOLA, PALAWAN

1. INTRODUCTION On a letter dated September 11, 2007, the Mines and Geosciences Bureau (MGB) was requested by Citinickel Mining Corporation to undertake a validation of the mineral resource for the Toronto and Pulot Nickel Mining Projects located in Narra and Española, Palawan. In response to the said request, the undersigned technical personnel conducted the fieldwork in the subject property from October 5-8, 2007.

The objective of the fieldwork was to validate the declared mineral resource identified and delineated by previous exploration programs in the Citinickel Project under Mineral Production Sharing Agreement No. 229-2007-IVB There were three (3) general areas of concerns verified during the field validation to assess the acceptability of the declared mineral resources, namely: a) basic exploration data and integrity of database; b) parameters used in the resource estimation; and c) procedures of sampling, assaying, handling of assay results and resource models.

2. PROJECT BACKGROUND 2.1 Property Legal Rights The two (2) claim blocks in the Toronto Nickel Project were applied by Toronto Exploration in June 1970 and were registered in the Office of the Mining Recorder in Puerto Princesa on July 30, 1970. Thru an Operating Agreement with subsequent amendments, the Olympic Mines and Development Corporation (OMDC) acquired the rights to explore, develop and exploit these claim blocks which are both covered by Mineral Lease Contacts Nos. V-549 and V-550. The technical description of which were as follows:

Block Latitude Longitude Area Lease Contracts

North Block 9°14’30” to 9°15’00” 118°14’30” to 118°14’30” 192 PLC-V-550 South Block 9°12’30” to 9°14’00” 118°15’00” to 118°17’00” 576 PLC-V-550 The Pulot claims were applied for by two mining companies namely, Mondo Exploration Corporation covering the southern area and Atlantic City Exploration Corporation for the northern portion on June 2-13, 1970 and were registered on June 22, 1970.

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OMDC acquired the rights over the area through an Operating Agreement with subsequent amendments, to explore, develop, and exploit the mineral properties bounded by the following geographical coordinates:

Block Latitude Longitude Area Lease Contracts

Area* 9°03’00” to 9°06’30” 117°56’30” to 117°58’30” 1,408 PLC-V-554, MLC MRD 127-130

Prior to the exploration of the Mining Lease Contracts (MLCs), the Toronto and Pulot Nickel Projects, OMDC applied for a Mineral Production sharing Agreement (MPSA) with this Office on August 21, 1996 denominated as AMA-IVB-40 pursuant to the provisions of the Philippine Mining Act of 1995 (R.A. No. 7942). On July 18, 2003, OMDC entered into an operating agreement with Platinum Group Metals Corporation (PGMC) for the Toronto and Pulot claims. Subsequently on November 4, 2004, OMDC/PGMC applied for four (4) Small Scale Mining Permits (SSMPs) denominated as follows SSMP for Toronto : Nos. 37 and 39 SSMP for Pulot : Nos. 38 and 40

PGMC, as the Mine Operator, started development and extraction of nickel ore from SSMP Nos. 37 and 39 in 2005 while the SSMP Nos. 38 and 40 were under development. However, PGMC was able to extract and ship more that 300,000 DMT of nickel ore to Japan and Australia. Over extraction and violation of the Environmental Compliance Certificate (ECC) prompted OMDC to apply for the revocation of the Operating Agreement with PGMC. OMDC then signed an Operating Agreement with Rockworks Resources Corporation on April 18, 2006. On June 9 2006, a Deed of Assignment of the areas covered by AA-IVB-040 was executed in favor of Citinickel. MPSA No. 229-2007-IVB was granted to Citinickel by the DENR Secretary on January 3, 2007. 2.2 Exploration History

In 1970, OMDC entered into a Joint Venture Agreement with Marubeni Corporation and Pacific Metals Co. of Japan for the direct shipping of nickel silicate ore for Japanese smelter plants. A feasibility study was likewise completed which include the establishment of nickel reserves, the design of mine and shipping facilities and exploration works by geochemical soil sampling using manual auger drills, test pitting and core drilling by vibro drilling machines.

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3. LOCATION AND ACCESSIBILITY

3.1 Location and Accessibility

3.1.1 Pulot Nickel Project

The Pulot Nickel Project is located in the municipality of Sofronio, Espanola

with an aggregate area of approximately 1,408 hectares. It is specifically situated in Barangay Pulot with some portions lying within barangays Labog and Punang. It is bounded by the following geographical coordinates:

Parcel 3: Espanola Area 1,408 hectares Corner Latitude Longitude

1 9º06’30.05” 117º58’18.21” 2 9º06’30.05” 117º56’59.62” 3 9º04’19.85” 117º56’59.62” 4 9º04’19.85” 117º56’33.42” 5 9º03’27.27” 117º56’33.42” 6 9º03’27.27” 117º57’52.01” 7 9º03’53.81” 117º57’52.01” 8 9º03’53.81” 117º58’18.21”

Sitio Olympic in Espanola which is 148 km from Puerto Princesa can be reached through the national Highway via Narra Town. Pulot Nickel Project is about 12 km north of Sitio Olympic (Highway, km 148).

3.1.2 Toronto Nickel Project

The Toronto Nickel Project is situated in Barangay San Isidro, Narra

consisting of 2 parcels with a combined area of 768 hectares more or less, which are bounded by the following geographical coordinates:

Parcel 1 : Narra Area = 192 hectares Corner Latitude Longitude

1 9º14’50.09” 118º15’44.01” 2 9º14’50.09” 118º14’51.59” 3 9º13’58.01” 118º14’51.59” 4 9º13’58.01” 118º15’17.80” 5 9º14’24.05” 118º15’17.80” 6 9º14’24.05” 118º15’44.01”

Parcel 2 : Narra Area = 576 hectares Corner Latitude Longitude

1 9º13’40.97” 118º16’36.43” 2 9º13’40.97” 118º14’51.59” 3 9º12’48.89” 118º14’51.59” 4 9º12’48.89” 118º15’44.01” 5 9º12’22.85” 118º15’44.01” 6 9º12’22.85” 118º16’10.22” 7 9º12’48.89” 118º16’10.22” 8 9º12’48.89” 118º16’36.43”

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Puerto Princesa City is a 55-minute flight distance from Manila by

commercial flights. From Puerto Princesa, the Toronto Nickel project is 110 km. south along the National Highway. The project is reached from the national Highway, km-110 through an old access road and alter improved by previous operation.

Figure 1. Map of the Province of Palawan showing Es pañola and Narra and the Citinickel Project area

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4 GEOLOGY AND MINERALIZATION

4.1 Palawan – Geologic Setting

Palawan is an island province of the Philippines located west of the Visayas Region consisting of three island groups namely, the Calamian, Palawan mainland and the Balabac groups. These islands generally trend along the southwest axis. The island of Palawan measures roughly 430 km long with varying widths along its length. The maximum width of 50 kilometers can be found in the municipality of Brooke’s Point. Four geological regions can be distinguished on Palawan mainland, namely north of St. Paul’s, between St Paul’s and the Quezon-Aboabo gap, south of the Quezon Aboabo gap, and the lowland fringe within the first three regions. The region north of Mount St Paul is dominated by metamorphic rocks of the basement complex, with volcanics around Cleopatra’s Needle and the sedimentary Bangley Formation in the west. Slightly metamorphosed limestone forms the impressive karst landscape around Mount St.Paul and El Nido Cliffs. Central Palawan is mainly underlain by ultramafic rocks giving rise to poor soils and vegetation cover. South of the Quezon-Aboabo gap, the ultrmafic outcrops are mixed with undifferentiated volcanic and tertiary limestone. Tertiary sandstones and shales occur along the south-west coast. The lowland fringe of alluvial plains and terraces are extensive along the south-eastern half of the mainland such as the plains of Narra, Aborlan and Brookes Pont. These are virtually absent in the north except around Abongan (HTS, 1983)

The Sabang thrust or Ulugan Bay Fault divides structurally the province into Northern and Southern Palawan.

Northern Palawan is composed of pre-cretaceous sedimentary and metasedimentary rock formations. Exposed in the north-central portion of this structural unit is the basement which is made up of phyllitic rocks and mica schist, overlain by Tertiary sedimentary formation. These rock units exhibit widespread deformation which is believed to have resulted from the collision of the western Palawan terrain/structural unit with the proto-Philippine are during the Miocene period.

The Southern Palawan structural unit consists of basal formations found southwest of the Ulugan bay Fault and is composed of Cretaceous to Oligocene sediments and ultramafics. An ophiolite suite believed to be eocence overlies the basal formations. Basalt and ultramafics abundantly occur in the central apart of the terrain and form the Victoria Mountain. The proposed nickel mining project is situated in this structural group.

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Figure 2. Geology of Palawan

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Table 1. Brief Geology of Palawan Island

Age Rock Type Geological Symbol

Descriptions

Paleogene-Cretaceous

Basalt/Green Schist Kpgb Show increasing metamorphism to greenschist facies towards the contact with the ultramafics.

- do - Sandstone & Shale/Quartz Sericite Schist

Kpgs Show increased metamorphism to quartz-sericite schist towards the ultramatic contact.

- do - Harzburgite Khz Dark green color resulting from pervasive serpentization. This rock unit occupies the lower apart of the ophiolite. Parent rock of nickel mineralization through tropical weathering process.

- do - Dunite Kdu Occurs as distinct differentiate bodies in the harzburgite. The rock unit is strongly serpentized and is primary host to massive or disseminated chromite deposits. Parent rock of good nickel mineralization through weathering process.

- do - Gabbro Dyke Kgbd Fine to medium grained and equi-granular. To duke margins are chilled to a diabasic texture.

- do - Gabbro Kgb Medium to coarse grained, massive. - do - Diabase Kdb Dark green to dark gray occurring as dykes

between basalts and gabbros. - do - Basalt Kba Dark gray and massive, in places exhibiting

pillow structure. Miocene Limestone N1 Massive and calcareous siltstone interbeds,

fossiliferous and karsted. - do - Sandstone &

Mudstone N2 Calcareous matrix with intra-formational

conglomerate with clasts of sandstone, mudstone and basalt.

Quaternary Alluvial Qal Unconsolidated deposits including organic debris along major and coastal area.

4.2 Brief Profile of Palawan Nickel Resources

Ore Deposits: Nickel mineralization consists of (1) nickel laterite and (2) nickel silicate or garnierite/saprolite ores, both of which were formed through tropical chemical weathering of ultramafic rocks. Comparative chemical analysis of these type types of nickel ores are presented below:

Table 2. Comparative chemical analysis for nickel o res

Element Nickel Silicate (%) Nickel Late rite (%) Ni 2.39 1.36 Co 0.04 0.14 Fe 17.00 46.00

SiO2 35.80 7.70 Mg0 20.90 2.40 Al003 1.98 5.43 Cr 0.75 2.81 Mn 0.31 0.81

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5. EXPLORATION WORKS AND DATA SUBMITTED BY CITINI CKEL

5.1 Mineral Exploration Data

Main Data Source : Test pits Total Number of Test Pits : 1,762 Total Aggregate Depth : 16,609 meters Average Depth Per Test Pit: 9.23 meters Sampling Intervals : 1 meter Average Specific Gravity : 1.175

5.2 Topographic Map

The topographic map submitted by Citinickel based on its survey data tied to local and national grids was used in the estimation of the mineral resource. The survey points are in Philippine Trans Mercator system units.

5.3 Test Pit Location

Test pits were surveyed for their location and elevation based on local grid coordinates tied to local and national grid. Test pits were marked with wooden stacks placed over the test pit collar. Spot checking and verification of locations and positions of randomly selected test pits was conducted by the validating team using Global Positioning System (GPS) receiver. Test pit surveys have been provided to the undersigned inclusive of test pits database.

5.4 Sample Preparation Procedures and Methodology

Test pit samples are placed in sample bags, marked and logged in a sample book as to their location and description. The marked and logged samples are transported to a storage area for inventory and logging. The samples are dried prior to manual crushing. The crushed samples are then mixed and quartered and sent to an assay laboratory.

5.5 Methodology Used In Mineral Resources Estimat ion

Citinickel generated three dimensional block models. Exploration, geologic and assay data of each sample were recorded in a conventional spreadsheet and used as input in the generation of the block model. The test pits were analyzed in both horizontal and vertical sections to determine the geometry of the mineralization using geological analysis. Statistical and variogram analysis were also conducted to determine the numerical character and average range of influence of the sample grades. The appropriate resource classification based on the amount of geological knowledge was applied in the overall analysis to

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delineate the various types of resources within the identified mineralization envelope.

Selective mining units (SMU) of 25 meters x 25 meters horizontal dimensions and 3 meters high were fitted into the mineralization geometry. The average nickel and iron grade in each block or SMU were interpolated using Inverse Distance Squared. The volume of mineralization was then estimated using the volumes of blocks whose average grade are within the selected cutoff grade.

5.6 Results Of Mineral Resource Estimation by Cit inickel

Citinickel submitted a mineral resource estimation report together with all available exploration database including a total of 1,762 test pits with an aggregate depth of 16, 609 meters and an average depth of 9.23 meters test pit. Citinickel estimated a resource for the Pulot, Española and Toronto, Narra area using a resource classification of measured, indicated and inferred resources. The total resource estimate for the Pulot, Española area is 10.3 million metric tons @ 1.51% Ni and 27.72% Fe. The total resource estimate for the Toronto, Narra area is 50.2 million metric tons @ 1.55% Ni and 15.28% Fe. The average specific gravity used for both areas ranges from 1.22 to 1.32.

6. MGB VALIDATION OF THE SUBMITTED RESOURCE ESTIMA TE The undersigned validated Citinickel declared mineral resources through field verification of test pits, storage inspection, check sampling, laboratory analysis of check samples, review of geological interpretation and re-estimation of the volume and average grade of the delineated mineralization. 6.1 Confirmation of Test Pit Locations

Using the digitized map submitted by Citinickel, sixteen (16) test pits were randomly selected and verified during the fieldwork (Appendix 2). Their collar positions were checked using a Geographic Positioning System (GPS) receiver. While differences were noted in some GPS readings, the overall location of the sixteen test pits were generally accurate as reported.

6.2 Inspection of Test Pit Samples

Sample of randomly selected test pits in the storage warehouse were inspected and compared with the descriptions in the submitted data. The written descriptions generally agree with the physical characteristics observed in the split cores and surface samples.

6.3 Collection And Laboratory Analysis Of Check Samples

Gathering of check samples from randomly selected test pits was conducted during the course of the fieldwork. These samples are intended for

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laboratory analysis by the MGB to confirm the veracity of the submitted assay report as well as the declared grade of the deposit.

A total of fifteen (15) check samples were collected from randomly selected test pits by channel and grab sampling using sample pick. The samples collected were placed in a sample bag, properly tagged and sent to the MGB assay laboratory for nickel, iron, and cobalt content analysis.

6.4 Review of Geological Interpretation

The mineralization outline delineated by Citinickel was reviewed and compared with available geological report and assay information. The MGB interpretation which consist of four geological mineralization zones, namely: overburden, limonite, saprolite and bedrock, relatively agrees with the mineralization outline generated by Citinickel in both horizontal and vertical sections.

6.5 Estimation Parameters:

Where deemed appropriate by standard practice and as used in similar deposits elsewhere in the Philippines, most of the parameters used by Citinickel were adopted and employed in the estimation of tonnage and grade of the nickel deposit. These parameters are as follows:

6.6 Cut-Off Grade

Citinickel’s estimate shows the grade tonnage using different grade ranges to show the maximum potential resource of the project area. Grade range for resource classification is 1.51% to 1.55% Nickel.

6.7 Specific Gravity

The specific gravity used in the resource estimation for limonite and saprolite are S.G. 1.1 and 1.35 respectively.

6.8 Block Model Dimension

In modeling the blocks, the dimensions of the selective mining unit (SMU) used to estimate the tonnage and grade of the Citinickel deposit was 25 meters x 25 meters in the horizontal plane and 3 meters in the vertical plane.

6.9 Resource Estimation Methodology

The following procedure was generally employed in the estimation of the deposit:

a. Construction and validation of the integrity of the exploration database b. Construction and validation of the topographic map c. Statistical and geostatistical analysis of the sample assays

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d. Generation of vertical and horizontal sections using geological and assay data and a cut-off grade.

e. Generation of 3-D blocks and estimation of block volumes. f. Interpolation of block grades

6.10 Construction And Validation of Exploration Da tabase

The drill and assay database which were submitted by the company in MS Excel format were compiled and converted into CSV format. Internal consistency and possible errors were checked against the entries in the spreadsheet. There were a total of 16,995 assays values recorded in the spreadsheet. Nickel assays were composited in three (3) meter fixed length interval to harmonize with the vertical thickness of the blocks.

The database used the following table formats for the drillhole information (Tables 3, 4 and 5).

Table 3. Drillhole Information - Header Hole ID North East Level Depth 195A-05 1003900 385660.9 274 9.0 195A10 1003900 385810.9 300 7.0

Table 4. Drillhole Information - Survey Hole ID From To Depth Azimuth Dip 195A-05 0 9.0 9.0 0 -90 195A10 0 7.0 7.0 0 -90

Table 5. Drillhole Information - Assay Hole ID From To % Ni % Fe % Co 195A-05 0 4 1.28 43.04 0.11

5 7 1.93 14.4 0.03 195A10 0 5 1.64 33.24 0.09

6 9 1.40 12.60 0.06

6.11 Construction And Validation Of Topographic M ap

The topographic map used in the estimation was based on a topographic map submitted by Citinickel in Autocad (DWG) format digitized at 20.0 meter contour interval and converted to DXF format to create topography triangulations of the project area.

The topographic map of the project area showing test pit locations is shown in Appendix 2 and 3.

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6.12 Generation of Vertical And Horizontal Section s Using a Cut-off Grade

A total of four (4) geologic zones based entirely on the grade ranges of nickel and iron was used in the resource model. Boundaries were delineated based on the interpretation of mineralization envelope per section with the following specifications:

Table 6. Geologic Zones

Geologic Zones Ni Fe Overburden < 0.8 > = 20%

Limonite > 0.8 > = 20% Saprolite > 0.8 < 20% Bedrock < 0.8 < 20%

6.13 Creating A Solid Representation of Interpret ed Mineralization

The outline of the mineralization envelope for each section was generated by connecting (or wiring) the mineralization intercepts in each test pit to provide a comprehensive and interactive 3D view-profile of the deposit. By wire framing a solid wire model is formed representing the lateral and vertical extent of the deposit. The non-intersecting surfaces were stitched together to create a solid representing the Citinickel deposit. The solid mass generated was validated to make sure no solid problems are encountered later in the block modeling.

6.14 Block Model Generation And Estimation Of Volu me

Employing a 25 meter x 25 meter x 3 meter selective mining unit, three-dimensional block models within the mineralization envelope were generated. Each whole block corresponds to a volume of 1,875.00 cubic meters. Once the block model is populated with rock type, density, percentage and grade data, tonnages were reported through volumetric procedure.

6.15 Interpolation Of Block Grades

Using the results of the variogram analysis on the assay database, interpolation of the nickel grades in each of the blocks was made using Inverse Distance Squared (IDS) Method employing an appropriate search radius.

6.17 Results of Mineral Resources Estimate by MG B

The parameters used for resource classification for the measured, indicated and inferred resources utilized an area of influence for both the limonite and saprolite zones as shown in tables 7 and 8. The summations for both zones

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represent the total of the resource inventory by classification shown in tables 9 and 10.

Table 7. Parameters used in resource classification for limonite

PARAMETERS USED IN LIMONITE AREA OF INFLUENCE

RESOURCE CLASSIFICATION NORTH SOUTH LEVEL

MEASURED 50.00 50.00 3.00 INDICATED 100.00 100.00 3.00 INFERRED 200.00 200.00 3.00

Table 8. Parameters used in resource classification for saprolite

PARAMETERS USED IN SAPROLITE AREA OF INFLUENCE

RESOURCE CLASSIFICATION NORTH SOUTH LEVEL

MEASURED 25.00 25.00 3.00 INDICATED 50.00 50.00 3.00 INFERRED 100.00 100.00 3.00

The volumetric run conducted by the MGB using the above parameters gave an estimate of 9.65 million metric tons @ 1.51% Ni and and 44.8 million metric tons @ 1.55% Ni for the Pulot and Toronto deposit respectively. The specific gravity used was adapted from the one used by Citinickel in their estimation. Tables 9 and 10 below shows the details of the estimate.

Table 9. MGB Resource Inventory by Classification o f Pulot,

Española

RESOURCE INVENTORY BY CLASSIFICATION RESOURCE

DMT %Ni %Fe %Co SG CLASSIFICATION

MEASURED 4,642,286 1.43 34.30 0.08 1.16

INDICATED 3,123,499 1.58 21.86 0.06 1.27

INFERRED 1,894,040 1.59 19.75 0.06 1.28

TOTAL 9,659,826 1.51 27.34 0.08 1.22

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Table 10. MGB Resource Inventory by Classification of Toronto, Narra

RESOURCE INVENTORY BY CLASSIFICATION RESOURCE

DMT %Ni %Fe %Co SG CLASSIFICATION

MEASURED 11,217,919 1.60 21.26 0.06 1.26

INDICATED 14,439,300 1.57 13.62 0.04 1.34

INFERRED 19,232,123 1.51 13.11 0.03 1.34

TOTAL 44,889,341 1.55 15.31 0.04 1.32

7. RESULT OF CHECK SAMPLES ANALYSIS

Check samples taken during the fieldwork were sent to the MGB laboratory for analysis of nickel, iron and cobalt contents. The results of the analysis gave an average variance of 0.095 for Ni in the Pulot, Española area and 0.327 for Ni between the assay results of MGB and that of Citinickel (Appendix 4 and 5).

A statistical t-Test, was performed to evaluate the significance between the variance of the nickel assays of MGB and that of Citinickel. Computation of the statistical t-Test on the nickel assays showed that they do not differ significantly (Appendix 4 and 5). 8. CONCLUSIONS

The general methodology applied by Citinickel in the estimation of its mineral resources in Narra and Española appear to follow the general standards as observed in similar mining projects in the country. The integrity of the exploration database was duly validated by checking for possible errors using software tools. Test pit samples taken during the course of the fieldwork were sent to the MGB Laboratory for testing. A Report on Analysis of the said samples was completed and provided to the undersigned. From the foregoing discussions, it may be concluded that the declaration of the mineral resources of Citinickel in the Narra and Española Project is deemed acceptable.

MARCELO M. ALILIO ALLAN E. TALAG

Engineer IV Engineer II

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REFERENCES

Questionnaires and Checklist on Mineral Resource and Ore Reserve Validation, MGB, October 2007. Resource Study, Palawan Properties-Resource Estimation, Appendix A, September 1996. Independent Consulting Geologist’s Report, Citinickel Mines and Development Corporation, July 2007

Waldpole, R.E., Introduction to Statistics, 3rd Edition,

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APPENDIX 1

LIST OF TEST PITS

VERIFIED BY THE MGB

Pulot, S. Española

Samples Easting Northing

P001 605249 1002128

P002 605303 1002135

P003 605353 1002143

P004 605398 1002153

P005 605448 1002132

P006 605413 1002231

P007 605458 1002274

P008 605560 1002782

P009 605607 1002797

P010 605655 1002811

Toronto, Narra

Samples Latitude Longitude

TP-1 9.222388889 118.27425

TP-2 9.222166667 118.2735

TP-3 9.222027778 118.2726667

TP-4 9.221416667 118.2716389

TP-5 9.221333333 118.2698889

TP-6 9.22125 118.2709444

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APPENDIX 2

TOPOGRAPHIC MAP OF THE PULOT PROJECT SHOWING TEST P ITS

LOCATIONS

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APPENDIX 3

TOPOGRAPHIC MAP OF TORONTO PROJECT

SHOWING TEST PITS LOCATIONS

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APPENDIX 4

COMPARISON OF THE NICKEL ANALYSIS REPORT BETWEEN CI TINICKEL

AND MGB PULOT AREA

MGB SAMPLES CITINICKLE SAMPLES VARIANCE (d) MGB-CITINICKLE DIFFERENCE SQUARED

SAMPLES %Fe %Ni %Co HoleID %Fe %Ni %Co Fe Ni Co Fe Ni Co

P002 41.64 1.28 0.089 TP6A-4.5 50.50 1.14 0.08 8.86 -0.14 -0.01 78.4996 0.0196 8.1E-05

P003 49.77 1.13 0.069 TP6A-3.5 49.40 1.04 0.11 -0.37 -0.09 0.04 0.1369 0.0081 0.001681

P004 48.24 1.11 0.1 TP6A-3 51.30 0.97 0.10 3.06 -0.14 0.00 9.3636 0.0196 0

P005 49.77 1.12 0.032 TP6A-2.5 50.10 0.73 0.07 0.33 -0.39 0.04 0.1089 0.1521 0.001444

P006 46.21 1.14 0.056 TP7A-3 50.60 1.04 0.09 4.39 -0.10 0.03 19.2721 0.01 0.001156

P007 44.18 1.08 0.069 TP7.5A-2.5 48.70 1.01 0.12 4.52 -0.07 0.05 20.4304 0.0049 0.002601

P009 33.01 1.51 0.067 TP13A-1.5 27.50 2.18 0.06 -5.51 0.67 -0.01 30.3601 0.4489 4.9E-05

P010 37.07 1.7 0.071 TP13A-0.5 10.40 1.20 0.02 -26.67 -0.50 -0.05 711.2889 0.25 0.002601

Count 8 8 8

SUM -11.39 -0.76 0.10 869.46 0.91 0.01

MEAN -1.42 -0.10 0.01

SD 11.04047 0.346616 0.034717

t-Test 0.726071 0.463594 0.35614

t -Test Analysis for Nickel

* Using the Formula of t-Test involving Paired Observation:

d__ t (calculated) = Sd ; Sd = ∑d2 — [ (∑d )2 / n ] ; d = ∑d

√n n-1 n Where :

d is the mean difference between paired observations Sd is the standard deviation of the difference between paired observations

n is the number of paired observation

Solution: d = -0.70 Sd = 0.346616 t(calculated) = 0.463594

at 95% Level of Confidence: t(tabular) = 1.721

Conclusion: since t (calculated) < t(tabular) , the difference between the analysis of Nickel for CNMDC and MGB is not significant

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APPENDIX 5

COMPARISON OF THE NICKLE ANALYSIS REPORT BETWEEN CI TINICKEL

AND MGB TORONTO AREA

MGB SAMPLES CITINICKLE SAMPLES VARIANCE (d) MGB-CITINICKLE DIFFERENCE SQUARED

SAMPLES Depth (m) %Fe %Ni %Co HOLE ID %Fe %Ni %Co Fe Ni Co Fe Ni Co

TP-1 1 27.93 1.14 0.049 19-R-4 50.1 0.75 0.1 22.17 -0.39 0.051 491.5089 0.1521 0.002601

TP-3 3 20.56 1.5 0.052 18.5R-6.0 17.2 1.32 0.04 -3.36 -0.18 -0.012 11.2896 0.0324 0.000144

TP-4 3 14.9 1.11 0.025 17.75R-7.25 25.2 1.67 0.11 10.3 0.56 0.085 106.09 0.3136 0.007225

TP-4 4 11.17 1.42 0.024 17.75R-7.25 10.5 2.21 0.03 -0.67 0.79 0.006 0.4489 0.6241 0.000036

TP-5 3 49.26 1.01 0.12 17.75R-9.25 17.2 2.69 0.04 -32.06 1.68 -0.08 1027.844 2.8224 0.0064

TP-5 4 39.15 1.48 0.17 17.75R-9.25 10.2 2.23 0.02 -28.95 0.75 -0.15 838.1025 0.5625 0.0225

TP-5 5 10.83 2.68 0.1 17.75R-9.25 10.5 1.76 0.02 -0.33 -0.92 -0.08 0.1089 0.8464 0.0064

SUM -32.9 2.29 -0.18 2475.392 5.3535 0.045306

MEAN -4.7 0.327143 -0.02571

SD 19.66707 0.876008 0.082338

t-Test 0.550524 0.361283 0.440263

t -Test Analysis for Nickel

* Using the Formula of t-Test involving Paired Observation:

d__ t (calculated) = Sd ; Sd = ∑d2 — [ (∑d )2 / n ] ; d = ∑d

√n n-1 n Where :

d is the mean difference between paired observations Sd is the standard deviation of the difference between paired observations

n is the number of paired observation

Solution: d = 0.327143 Sd = 0.876008 t(calculated) = 0.361283

at 95% Level of Confidence: t(tabular) = 1.721

Conclusion: since t (calculated) < t(tabular) , the difference between the analysis of Nickel for CNMDC and MGB is not significant

* Critical Values of the t Distribution, R.E. Waldpole, Introduction to Statistics, 3rd Edition

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Mines and Geosciences Bureau Department of Environment and Natural Resources

APPENDIX 6

MGB Report of Analysis for Samples taken during the fie ldwork at the Project Area (See attachment)

APPENDIX 7

PICTURES FROM FIELDWORK

Engr. Vicente Pulvenar and M. Alilio supervising the retrieval of test pit sample

M. Alilio instructing laborer how to retrieve samples.

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Mines and Geosciences Bureau Department of Environment and Natural Resources

Garnierite / Saprolite outcrop

Test Pit sampling

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