Los Chinos

Status: Under Option to Centerra Gold

Target

The primary targets at Los Chinos are Herradura-type orogenic gold deposits.

Location and Setting

The project is located 104 km north of Hermosillo, Sonora, Mexico immediately adjacent to Highway 15. A network of ranch roads providing excellent access for exploration work.

Land Status

The property consists of two claims, totaling 5,809 hectares controlled 100% by Recursos Millrock, subject to production royalties of 1.5% on gold and 1% on other metals. Title pending on extension.

Geology and Mineralization

Los Chinos is favorably located with respect to the major, bulk tonnage orogenic gold deposits in western Sonora, only 35 km south of Timmins Gold’s San Francisco Mine. San Francisco is a successful open pit/heap leach operation with total gold endowment in excess of three million ounces and projected 2014 production of approximately 120,000 ounces (Timmins Gold website). Los Chinos shares several elements in common with San Francisco in terms of host rocks, structural setting, character of mineralization, and geochemistry.

Bedrock within the claim area comprises a sequence of folded and faulted, Mesozoic volcano-sedimentary rocks juxtaposed against meta-granite and pegmatite of probable Proterozoic age. Younger, undeformed, equigranular intrusive rocks of likely Cretaceous / Tertiary age have been mapped.

Limited mapping and prospecting have defined three mineralized areas with grade controlled by quartz veins and fault breccia zones; the Camino Zone, La Tinaja, and Albercas.

The Camino Zone contains numerous samples grading up to 8.6 gpt Au in quartz veins, stockwork and breccia zones. Mineralization has been traced for over 1,300 m on surface with gold values in a corridor up to 150 m wide. The Camino veins have a Au-Te-Pb-Bi signature. The mineralization at Camino occurs in an area of low topographic relief, and consists largely of subcrop exposures which are open under thin cover to the north and northeast. Preliminary prospecting to the south has indicated another 600 m of altered Proterozoic granite, with quartz vein samples assaying up to 0.17 gpt Au.

The historic La Tinaja workings were developed on quartz veins which assay 5 gpt Au over 1 m. Two select samples of iron oxide-bearing breccia within 400 m of this showing assayed 0.4 and 2 gpt Au. The La Tinaja veins as well as the veins on the Don Fito internal claim area are anomalous in Au-Ag-Pb-Zn +/-As.

In the north-central portion of the claim block (Albercas Zone), red matrix breccias developed on the upper contact of Proterozoic basement rocks contain anomalous copper and gold mineralization.

Measured vein and fault orientations define three main structural orientations within the project area, all of which are variably mineralized: 360°/ sub vertical; 030 ° / moderate east dip; and 060°/ sub vertical.

Recommendations

After only limited exploration work three areas of mineralization have been discovered to date, with grades of up to 8.6 gpt Au. Oxidized quartz veins and breccias associated with shear / fault zones and their immediate host rocks are the main hosts of gold mineralization. The Los Chinos property is prime for further discovery.

Specific recommendations for the next exploration phase includes:

  1. Completion of property-wide reconnaissance mapping, prospecting and soil sampling
  2. Mechanized trenching followed by detailed lithological and structural geologic mapping over the Camino zone and Tinaja targets
  3. Contingent ground geophysical surveys and drilling

This recommended exploration program will likely lead to drilling of the Camino and Tinaja Zones, as well as other targets that may emerge.

Agreement and Terms

Millrock controls 100% of the Los Chinos claims, subject to production royalties of 1.5% on gold and 1% on other metals. The project is currently under an option to joint venture with Centerra Gold.

“THE TECHNICAL INFORMATION WITHIN THIS DOCUMENT HAS BEEN REVIEWED AND APPROVED BY GREGORY A. BEISCHER, PRESIDENT & CEO OF MILLROCK RESOURCES INC. MR. BEISCHER IS A QUALIFIED PERSON AS DEFINED IN NI 43-101.”