04 10 22 Zaruma Project

ZARUMA PROJECT, ECUADOR
TECHNICAL REPORT
PREPARED FOR
DYNASTY METALS & MINING Inc.
BY
Miroslav Kalinaj
Consulting Geologist
22 October 2004
TABLE OF CONTENTS
1.0 SUMMARY
2.0 INTRODUCTION AND TERMS OF REFERENCE

2.1 General
2.2 Terms and Definitions
2.3 Units
2.4 Terms of Reference
3.0 DISCLAIMER
4.0 PROPERTY DESCRIPTION AND LOCATION

4.1 Location and Access
4.2 Project Ownership
4.3 Land Tenure
4.4 Permitting
4.5 Environmental Permitting
4.6 Environmental Liabilities
5.0 ACCESSIBILITY, CLIMATE, LOCAL RESOURCES,

INFRASTRUCTURE and PHYSIOGRAPHY
5.1 Location
5.2 Access
5.3 Climate and Physiography
5.4 Local Resources
6.0 HISTORY
7.0 GEOLOGICAL SETTING

7.1 Regional Geological Setting
7.2 Zaruma Project Geological Setting
7.2.1 Geological Setting
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7.2.2 Structural Setting
7.2.3 Alteration
7.2.4 Mineralisation
7.2.5 Mineral Assemblage Studies
8.0 GOLD AND SILVER DISTRIBUTION
9.0 EXPLORATION
9.1 Exploration History
9.2 Sample Preparation, Assaying and Security
9.3 Data Verification
10.0 MINERAL RESOURCES

10.1 Historic Resource Estimations
10.2 Definitions and Parameters
10.3 Methodology of Mineral Resource Calculation
11.0 MINERAL RESOURCE ESTIMATES

11.1 Available Data
11.2 Unit Conversions
11.3 Data Statistics
11.4 Summary of Mineral Resources
12.0 OTHER RELEVANT DATA AND INFORMATION
13.0 CONCLUSIONS AND RECOMMENDATIONS
14.0 REFERENCES
15.0 APPENDICIES
16.0 DATE
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LIST OF TABLES
Table 1 List of Agreements reached between Dynasty Metals & Mining Corporation and
remaining small-scale operating mines.
Table 2 List of Concessions owned, optioned and/or controlled by Dynasty Metals & Mining
Corporation
Table 3 Zaruma Project Land Tenure
Table 4 Gold / Silver ratios, Zaruma Portovelo District
Table 5 Elements assayed by IAMGOLD and detection limits for ICP method applied for
The Zaruma Project sample analyses.
Table 6 Mineral Resources Contained in Zaruma Project Area at 22 October 2004. Mineral
Resources calculated from SADCO Data.
Table 7 Mineral Resources Contained in Zaruma Project Area at 22 October 2004. Mineral
Resources calculated and added from IAMGOLD, TVX GOLD Corp., MINERA
AUSTRALIANA and DYNASTY METALS AND MINING CORP. Data
Table 8 Mineral Resources Contained in Portovelo area at 22 October 2004. Mineral

Resource calculated from SADCO data.
Table 9 Total Mineral Resources Contained in Zaruma Project including the Portovelo Area.
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LIST OF FIGURES
Fig. 1 The Zaruma Project Location Map.

Fig. 2 Land tenements owned or controlled by Dynasty Metals and Mining Corporation
Fig. 3 IAMGOLD ground and underground survey control point locations
Fig. 4 Small scale cyanide-process plant, channel system for gravity extraction and final hand
panning.
Fig. 5 View of the old SADCO vertical shaft in Portovelo
Fig. 6 Simplified Geological Map of Ecuador
Fig. 7 Regional Geological Map of the Zaruma Portovelo District
Fig. 8 Schematic cross-section showing a model for the development of the Portovelo Unit
Volcanics associated with normal faulting
Fig. 9 The Zaruma Project Geological Map
Fig. 10 Northwest striking thrusts control the en-echelon set formations and sigmoidal
geometry of the veins.
Fig. 11 Alteration mineral zonation within the Project area.
Fig. 12 Minable vein width up to 6m, Jane Vein, Zaruma
Fig. 13 Banded textures with symmetric geometry. Cristina Vein, Zaruma
Fig. 14 Banded, laminated, hydrothermal breccia and drusy textures. Cristina Vein, Zaruma.
Fig. 15 Mineralisation Zonation in the Zaruma Portovelo Mining District
Fig. 16 Gold Distribution in the Zaruma Portovelo Mining District
Fig. 17 Longitudinal Section along Sesmo Vein showing gold and polymetalic mineralisation
Fig. 18 Early stage gold intergrowth with dark-grey chlorite. Jane Vein, Zaruma.
Fig. 19 Late stage coarse and partially crystallised gold (shown by arrow) in association with
calcite and quartz. Abundancia Vein, Portovelo area.
Fig. 20 Gold / Silver Ratio Variations Cristina Vein
Fig. 21 IAMGOLD Drilling Programme and Zaruma Project Tenements.
Fig. 22 KH 1 standard behaviour, IAMGOLD database
Fig. 23 OX-4 standard behaviour, IAMGOLD database
Fig. 24 OX-8 standard behaviour, IAMGOLD database.
Fig. 25 Longitudinal Section of the Jane Vein, Zaruma. Mineral Resource calculation based on
2245 underground channel samples
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Fig. 26 High grade RM-11 drill hole intersection in projection of ore shoot on Tamayo Vein.
Fig. 27 Gold distribution log/probability plot and summary statistics.
Fig. 28 Silver distribution log/probability plot and summary statistics.
Fig. 29 Lead distribution log/probability plot and summary statistics.
Fig. 30 Zinc distribution log/probability plot and summary statistics.
Fig. 31 Copper distribution log/probability plot and summary statistics.
Fig. 32 Triplot analysis of Au-Pb-Zn showing very poor correlation of Au with Pb-Zn
Fig. 33 Triplot analysis of Ag-Pb-Zn showing slightly better correlation of Ag with Pb-Zn in
comparison with Au
Fig. 34 Underground channel sampling assay result correlations (IAMGOLD data base)
Fig. 35 Longitudinal profile of the Abundancia Vein. Colour shaded plot of gold distribution is
Based on 15,542 sample data points
Fig. 36 Longitudinal profile of the Cristina Vein. Colour shaded plot of gold distribution is based
on 9,501 sample data points
Fig. 37 Surface Rock Geochemistry colour shaded plot with individual sample locations
(1,413 samples) and a plot of the traces of the veins and major thrusts
Fig. 38 Zaruma Project Soil Sampling Programme - Gold distribution colour shaded plot
APPENDICES
Appendix A . Certificate of Author M. Kalinaj
Appendix B . Letter of Agreement between Minera Australiana S.A. and IAMGOLD
Corporation (the IAMGOLD Agreement)
Appendix C . Assignment Agreement between Minera Australiana S.A. and Elipe S.A. and
Dynasty Metals and Mining Corporation
Appendix D .. Dynasty Metals and Mining Press Release on July 7, 2004
Dynasty Advances its Zaruma Gold Project
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1.0 SUMMARY
The Zaruma Property is located within the well-known Portovelo-Zaruma District of southwest
Ecuador approximately 160 km south of Guayaquil, Ecuadors main seaport, and 55 km
southeast of the city of Machala. The Zaruma-Portovelo gold mining camp has been worked
since at least the Incan period, and is estimated to have produced five million ounces of gold
and more than 20 million ounces of silver during the past one hundred years. The vein district
extends over a strike distance of approximately 16 km and has a width of up to 4 km. The most
important gold producer in the camp was the South American Development Company
(SADCO) which produced 3.5 million oz of gold and 12 million oz of silver from 1904 to 1950.
Mining in the former SADCO area has continued since that date with one Ecuadorian company
and other smaller groups estimated to have produced a further 1.5 million oz of gold.
Following 45 years of small-scale mining a limited exploration programme was carried out by
TVX Gold Inc. during 1995. The programme was focused on district exploration and mining
potential estimation, re-sampling of underground workings and surface sampling with a purpose
of SADCOs historic assay data verification, underground mapping and deposit modelling.
Following TVX Gold Inc. retreat from Ecuador an aggressive gold exploration programme was
conducted by IAMGOLD during the period 1999 to 2003 in the search for vein-hosted gold-silver
and polymetalic mineralisation. The programme consisted of district scale geological mapping,
evaluation of old mine workings, wide sampling and re-sampling of old workings, detail
underground surveying and geological mapping, and 39 surface and underground diamond
drillholes, totalling 15,357.44 m. A valuable IAMGOLD data package on the Concessions has
also been acquired by Dynasty.
The property covers a total area of 8,846.07 Ha (88.4607 km2) of which 8,175 Ha (81.75 km2)
was initially acquired by Minera Australiana in an agreement (the IAMGOLD Agreement) with
IAMGOLD Ecuador S.A. (IAMGOLD) in August 2003 (Appendix B). Minera Australiana, an
Ecuadorian company in which Rob Washer, the President of Dynasty is the controlling
shareholder, has assigned all of its rights in the IAMGOLD Agreement to Dynasty Metals and
Mining Corporation, a Vancouver-based company for no additional consideration, other than the
reimbursement of its transaction costs (Appendix C). Under the IAMGOLD Agreement, the
Concessions are subject to a 3% NSR royalty in favour of IAMGOLD. Dynasty will have no other
obligations with respect to the property, provided that any of the concessions which are part of
the property it may subsequently determine to release must be offered to IAMGOLD.
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Additionally, Dynasty Metals & Mining Corporation successfully negotiated agreements with
remaining local small-scale operators and concession holders within the Project area. Terms
and conditions of agreements are listed in Table 1.
2.0 INTRODUCTION AND TERMS OF REFERENCE
2.1 General
In February 2004 Miroslav Kalinaj as an Independent Qualified Person was required by Dynasty
Metals & Mining Inc. to write a technical report conforming to National Instrument 43-101 for the
Zaruma Project in southern Ecuador.
Subsequently Miroslav Kalinaj reviewed resource estimation for the Zaruma Project and on July
2004 carried out revision of historic geochemical data and update of existing Companys
databases with assay results from ongoing sampling and re-sampling programmes including
sampling and laboratory quality control charts.
This report conforms to National Instrument 43-101 (Standards of Disclosure for Mineral
Projects) and Companion Policy Form 43-101CP to National Instrument 43-101 Standards of
Disclosure for Mineral Projects. The author reviewed Companys reports and the independent
technical reports and other available independent data, studies, reports, published scientific
papers and press releases which are listed in Section 14.0. Author, Miroslav Kalinaj visited the
Zaruma Project area between 4th-8th February 2004.
.
2.2 Terms and Definitions
Company refers to Dynasty Metals & Mining Corporation, IAMGOLD refers to IAMGOLD
Ecuador S.A., and Zaruma Project refers to Dynasty Metals & Mining Corporation owned,
controlled and/or optioned tenements covering areas in vicinity of cities of Zaruma and
Portovelo. Concessions refers to area within which Dynasty Metals & Mining Corporation owns
and/or control exploration and mining rights, DDH means diamond drilled hole, NAA means
neutron activation analytical method, and ICP means Inductively coupled plasma analytical
method.
Terms Inferred Mineral Resource and Indicated Mineral Resource refers to part of Mineral
Resource as defined by CIM Standards on Mineral Resources and Reserves Definitions and
Guidelines prepared by The CIM Standing Committee On Reserve Definitions adopted by CIM
Council on August 20, 2000 and published by Canadian Institute of Mining Metallurgy and
Petroleum.
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Author refers to Independent Qualified Person Miroslav Kalinaj.
2.3 Units
All weight units are metric tones (t) and grams/tone (g/t) or parts per million (ppm) or parts per
billion (ppb) for precious metal grades. As a referential unit is used Troy ounce (oz) however, all
original data which used Troy ounce as a weight unit have been recalculated to metric units
applying conversion factor 1oz = 31.1 grams. All units are metric kilometer (km), square
kilometer (km2), meter (m) square meter (m2) and hectare (Ha) for distance and area
calculations. All monetary values are in United States dollars ($ US) as stated.
2.4 Terms of Reference

The terms of reference were for the author, Miroslav Kalinaj, to write an updated technical report
and to include a mineral resource estimate as an Independent Qualified person.
3.0 DISCLAIMER
This Technical report was prepared by Miroslav Kalinaj an Independent Qualified person
contracted by Dynasty Metals & Mining Corp. on February 2004 and authored by Independent
Qualified Person Miroslav Kalinaj on July 23, 2004.
The report is based in part on reports prepared by IAMGOLD Corporation, historic data and
reports of South American Development Company (SADCO), Ecuamining S.A. and TVX Gold
Corp. Many of these reports were written prior to implementation of the standards in National
Instrument 43-101, however, they were written by professionals and are considered accurate.
The author was previously involved with the current property while conducting underground
geological mapping for TVX Gold Corp. during May 1995 March, 1996 in the Zaruma Project,
Muluncay and Minas Nuevas areas. The author is fully independent of Dynasty Metals and
Mining Corporation, and has no direct or indirect interest in the properties covered, or the
company referenced, in this report. Dynasty Metals and Mining Corporation has been informed
by the author, that he had previously been employed to conduct geological mapping of areas
which are currently the Company property.
The author has not personally reviewed the registered ownership, nor actual option agreements,
covering the property and claims of Dynasty Metals and Mining, known as Zaruma Project. The
reader is therefore cautioned that the ownership has not been verified by the author.
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4.0 PROPERTY DESCRIPTION AND LOCATION
4.1 Location and Access

The Zaruma Project is located in the cantons of Zaruma and Portovelo, Province of El Oro,
southern Ecuador. The centre of the project area is located on 654,500 East and 9,592,000
North (UTM PSAD-56, zone 17S) or longitude 79 36 31 West and latitude 3 41 20 South
(Provisional South American 1956 projection). The Zaruma Project location is shown in Figure 1.
ESMERALDAS
IBARRA
QUITO
CHONE
MANTA
ECUADOR
RIOBAMBA
GUAYAQUIL
CUENCA
MACHALA
ZARUMA Ex p l o i t e d
M ap p e d v ei n s
ve i ns
Un de r gr o un d w or k i n g s
ZARUMA PROJECT
P o r t o v el o m i n e s y st e m
b y l e v el s
I AM G O LD dr i l l i ng
DY NAS T Y c on c es s i o n s
LOJA
MACARA
ZAMORA
Figure 1.
The Zaruma Project Location Map.
4.2 Project Ownership

The property totals 8,846.07 hectares (88.4607 km2) and is 100% controlled by Dynasty Metals
& Mining Corporation and includes an area of 8,175 hectares (81.75 km2) that has been initially
acquired by Minera Australiana in an agreement with IAMGOLD Ecuador S.A. in August 2003
(Appendix B, the IAMGOLD Agreement). Minera Australiana, an Ecuadorian company in which
Rob Washer, the President of Dynasty is the controlling shareholder, has assigned all of its
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rights in the IAMGOLD Agreement to Dynasty, for no additional consideration, other than the
reimbursement of its transaction costs (Appendix C). Under the IAMGOLD Agreement, the
Concessions are subject to a 3% NSR royalty in favour of IAMGOLD. Dynasty will have no other
obligations with respect to the property, provided that any of the concessions which become part
of the property it may subsequently determine to release must be offered to IAMGOLD
(Appendix B). A valuable IAMGOLD data package on the Concessions has also been acquired
by Dynasty.
Additionally, Dynasty Metals & Mining Corporation successfully negotiated agreements with
remaining local small-scale operators and concession holders within the Project area. Terms
and conditions of agreements are listed in Table 1.
Title to mineral properties involves certain inherent risks due to the difficulties of determining the
validity of certain claims as well as the potential for problems arising from the frequently
ambiguous conveyancing history characteristic of many properties. The Company has
investigated title to all of its mineral properties and, to the best of its knowledge, title to all of its
properties is in good standing.
- 11 -
Table 1
List of Agreements reached between Dynasty Metals & Mining Corporation and remaining small-
scale operating mines.
Concession
Current Concession Holder Agreement reached
Number
Galo Romoleroux 2% NSR up to US$1,000,000 on commencement of
33, 32
exploitation
December 2004 US$50,000 (3)
Galo Ortiz Penafiel and
June 2005 US$150,000
35 others
(the title holder retains exploration and exploitation rights
from 710m a.s.l. to surface)
2% NSR (the title holder retains exploration and exploitation
34 La Ponderosa Society,
rights from 1.103m a.s.l. to surface)
US$5,000 upon transfer of rights from IAMGOLD to Minera
Australiana(1)
September 30, 2003 US$5,000(1)
36,37,38,39
Jose Valerezo Rivera March 26, 2004 US$15,000(2)
and 40
Additionally: US$65,000 at production indication + 2% NPI
(the title holder retains exploration and exploitation rights
from 710m a.s.l. to surface)
US$5,000 upon transfer of rights from IAMGOLD to Minera(1)
April 1, 2004, US$5,000(2)
Segundo Loaisa Dias
41 August 21, 2004 US$13,000 (the title holder retains
exploration and exploitation rights from 620 m.a.s.l. to
surface)
(1) Payment was made by Minera Australiana and reimbursed by the Dynasty Metals and Mining Corp.
(2) Payment was made by Dynasty Metals and Mining Corp.
(3) Payment to be effectuated by Dynasty Metals and Mining Corp.
4.3 Land Tenure

The Zaruma Project area comprises 41 concessions totalling 8,846.07 hectares from which all
concessions are defined within graticular system using UTM PSAD 56 (Provisional South
American 1956) projection as defined by Ecuadorian Government regulations. The list of
concessions owned and/or controlled by the Company is listed in Table 2. and shown in Fig.2.
The property has not been legally surveyed, however 465 points with precision better than 0.1m
have been surveyed by IAMGOLD employing differential GPS instruments including mine
entrances, starting and ending points of major trenches, drilling platforms and collars which can
be considered and used as appropriate geographical control points. Additionally, 2126 points
with precision equal or better than 0.1m have been surveyed by IAMGOLD in underground as
shown on Fig. 3.
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Table 2
List of Concessions owned, optioned and/or controlled by Dynasty Metals & Mining Corporation
No. Concession Name Code Area (Ha) Property Registration date
1 ROMA 300216 661.92 6-Ago-01

2 P. BAJO 189 9.00 6-Ago-01
3 AGUILA DE ORO 3059 10.00 10-Jul-01
4 ANA MICHELLE 300445 20.00 01-Dec-01
5 ARCAPAMBA 2 300273 15.00 1-Oct-01
6 BETHZABETH 300350 1280.00 16-Aug-01
7 EL BOSQUE 300392 24.30 9-Jul-01
8 EL REGALOFRANK 300587 102.00 1-Oct-01
9 EL RETAZO 300366 46.85 1-Oct-01
10 EL RETAZO 3 300391 32.25 1-Oct-01
11 EL SALVADOR X-3 5012 15.00 24-Oct-01
12 EL TABLN 300861 42.00 2-Sep-02
13 EL TABLN 1 300862 8.00 22-Oct-02
14 IAM ZARUMA 300477 2.50 9-Jul-01
15 LA DURA 300101 129.55 9-Jul-01
16 LA ENVIDIA 300630 1346.00 2-Oct-01
17 LOMA RICA 1 300559 19.58 1-Oct-01
18 LORO 300604 9.60 1-Oct-01
19 LOS CIPRECES 300302 2394.00 5-Oct-01
20 LOS LAURELES 2 300558 100.00 24-Oct-01
21 MARA 1 300529 45.00 22-Oct-01
22 MARA 8 300537 5.00 22-Oct-01
23 NICOLE 300444 8.48 16-May-03
24 RESUC 4 300579 3.50 22-Oct-01
25 RUTH 300580 2.00 1-Oct-01
26 SAICHUMA 1 300274 466.00 25-Sep-01
27 SAN ANTONIO DE PADUA 300210 67.00 10-Jul-01
28 SINSAO 300393 20.44 1-Oct-01
29 SOLEMARA 300545 23.81 18-Apr-02
30 SUCA 300519 3.80 22-Oct-01
31 SUCA 4 300523 1.00 30-Oct-01
32 ZUDOS 1 5200 323.47 9-Jul-01
33 MACHAY 300320 1273.00 1-Oct-01
34 LILLY RAI 473 7.76 24-Oct-01
35 EL SOROCHE UNIFICADO 506 32.80 10-Jul-01
36 NUEVA ESPERANZA 152 5.00 9-Jul-01
37 NUEVA ESPERANZA 2 300085 42.00 10-Jul-01
41 SAN JOS 2 385 5.00 9-Jul-01
TOTAL 8846.07
LEGEND
Concession transferred to Company from Elipe S.A.
Concessions ransferred to Company from IAMGOLD
Concessions transferred to Company from third parts with options payments already paid
Concessions transferred to Company from third parts with options payments pending
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N
W E
9600000
33
2
9595000
39
34
36
35
9590000 37
40
38 41
650000
655000
Fig.2
Land tenements owned or controlled by Dynasty Metals and Mining Corporation
Colour legend identical as in Table 2, dark grey polygons represents areas of exclusion.
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Table 3. Zaruma Project Land Tenure
Concession Easting Northing

Code Area Ha Authorisation Registration Expiry date Concession UTM UTM PSAD
Name
date date Limits PSAD56 56
initial point 654,535 9,591,878
point 1 654,735 9,591,878
AGUILA DE 10 July, 10 July, point 2 654,735 9,591,978
3059 10.00 09 July, 2001
ORO 2001 2031 point 3 654,935 9,591,978
point 4 654,935 9,591,678
point 5 654,535 9,591,678
initial point 653,600 9,590,100
06 November 01 Dec, 01 Dec, point 1 653,600 9,590,500
ANA MICHELLE 300445
20.00 2001 2001 2031 point 2 654,100 9,590,500
point 3 654,100 9,590,100
initial point 653,000 9,600,000
12
01 October 01 October point 1 653,500 9,600,000
ARCAPAMBA 2 300273 September
15.00
2001
2001 2031 point 2 653,500 9,599,700
point 3 653,000 9,599,700
initial point 649,000 9,603,000
point 1 649,000 9,600,000
point 2 646,000 9,600,000
06 August 16 August 16 August point 3 646,000 9,604,000
BETHZABETH 300350
1,280.00 2001 2001 2031 point 4 649,000 9,604,000
point 5 649,000 9,604,600
point 6 649,500 9,604,600
point 7 649,500 9,603,000
initial point 656,700 9,597,000
09 July point 1 656,700 9,595,500
EL BOSQUE 300392 04 April 2002 09 July 2001
24.30 2031 point 2 656,538 9,595,500
point 3 656,538 9,597,000
initial point 656,700 9,598,000
18
EL REGALO 01 October 01 October point 1 657,000 9,598,000
300587 September
FRANK 102.00
2001
2001 2031 point 2 657,000 9,594,600
point 3 656,700 9,594,600
initial point 656,700 9,597,000
point 1 656,538 9,597,000
point 2 656,538 9,597,223
EL RETAZO 300366 04 April 2002
46.85 2001 2031 point 4 655,500 9,597,500
point 5 656,500 9,597,500
point 6 656,500 9,598,000
point 7 656,700 9,598,000
initial point 653,700 9,597,500
point 1 654,000 9,597,500
point 2 654,000 9,597,223
18 September 01 October 01 October point 3 653,238 9,597,223
EL RETAZO 3 300391
32.25 2001 2001 2031 point 4 653,238 9,595,823
point 5 653,100 9,595,823
point 6 653,100 9,597,300
point 7 653,700 9,597,300
initial point 649,500 9,599,800
EL SALVADOR 17 October 24 October 24 October point 1 649,500 9,599,700
5012
X-3 15.00 2001 2001 2031 point 2 648,000 9,599,700
point 3 648,000 9,599,800
initial point 656,000 9,588,000
02 02
21 August point 1 656,000 9,588,600
EL TABLON 300861 September September
42.00 2002
2002 2032 point 2 656,700 9,588,600
point 3 656,700 9,588,000
initial point 655,250 9,589,000
14 October 22 October 22 October point 1 655,450 9,589,000
EL TABLON 1 300862
8.00 2002 2002 2032 point 2 655,450 9,588,600
point 3 655,250 9,588,600
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Table # 3 continuation
Concession Area Authorisation Easting Northing UTM

Code Registration Expiry date Concession UTM
Name Ha date PSAD 56
date Limits PSAD56
initial point 655,400 9,589,500
09 July 09 July point 1 655,450 9,589,500
IAM ZARUMA 300477 05 July 2001
2.50 2001 2001 point 2 655,450 9,589,000
point 3 655,400 9,589,000
initial point 654,000 9,597,500
point 1 655,500 9,597,500
point 2 655,500 9,597,223
09 July 09 July point 3 655,538 9,597,223
LA DURA 300101 10 July 1998
129.55 2001 2031 point 4 655,538 9,596,423
point 5 654,438 9,596,423
point 6 654,438 9,597,223
point 7 654,000 9,597,223
initial point 652,700 9,585,400
point 1 652,700 9,589,000
LA ENVIDIA 300630
1,346.00 2001 2001 2031 point 3 655,000 9,588,000
point 4 657,000 9,588,000
point 5 657,000 9,585,400
initial point 654,600 9,591,225
point 1 654,800 9,591,225
point 2 654,800 9,591,450
point 3 655,000 9,591,450
LOMA RICA 1 300559
19.58 2001 2001 2031 point 5 654,900 9,590,907
point 6 654,900 9,590,707
point 7 654,782 9,590,707
point 8 654,782 9,590,907
point 9 654,600 9,590,907
initial point 649,000 9,603,000
point 1 654,000 9,603,000
point 2 654,000 9,602,000
point 3 656,000 9,602,000
point 4 656,000 9,599,500
point 5 656,500 9,599,500
point 6 656,500 9,597,500
point 7 653,700 9,597,500
point 8 653,700 9,599,700
point 9 653,500 9,599,700
point 10 653,500 9,600,000
point 11 652,500 9,600,000
LOS CIPRECES 300302 04 April 2002
2,394.00 2001 2031 point 13 652,600 9,601,000
point 14 652,600 9,600,700
point 15 653,100 9,600,700
point 16 653,100 9,601,200
point 17 652,500 9,601,200
point 18 652,500 9,601,300
point 19 652,100 9,601,300
point 20 652,100 9,601,100
point 21 652,200 9,601,100
point 22 652,200 9,601,000
point 23 651,100 9,601,000
point 24 651,100 9,600,000
point 25 649,000 9,600,000
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Concession Authorisation Registration Easting UTM Northing UTM

Code Area Ha Expiry date Concession
Name date date PSAD56 PSAD 56
Limits
initial point 650,000 9,600,000
point 1 650,000 9,599,700
point 2 649,500 9,599,700
point 3 649,500 9,599,800
LOS LAURELES 23 October 24 October 24 October point 4 648,000 9,599,800
300558
2 100.00 2001 2001 2031 point 5 648,000 9,599,700
point 6 646,500 9,599,700
point 7 646,500 9,599,800
point 8 646,000 9,599,800
point 9 646,000 9,600,000
initial point 655,240 9,594,000
LORO 300604 04 April 2002
9.60 2001 2031 point 2 655,000 9,593,600
point 3 655,000 9,594,000
initial point 653,100 9,590,000
MARA 1 300529
45.00 2001 2001 2031 point 2 653,400 9,591,500
point 3 653,400 9,590,000
initial point 653,600 9,589,300
point 1 653,600 9,589,000
MARA 8 300537
5.00 2001 2001 2031 point 3 653,300 9,589,100
point 4 653,500 9,589,100
point 5 653,500 9,589,300
initial point 655,100 9,591,650
16 May. point 1 655,100 9,591,500
NICOLE 300444 07 May. 2003 16 May. 2003
8.48 2033 point 2 654,535 9,591,500
point 3 654,535 9,591,650
initial point 654,100 9,589,700
RESUC 4 300579
3.50 2004 2001 2031 point 2 654,450 9,589,800
point 3 654,450 9,589,700
initial point 645,000 9,595,000
point 1 645,600 9,595,000
point 2 645,600 9,597,400
point 3 645,800 9,597,400
25 25
12 September point 4 645,800 9,598,100
SAICHUMA 1 300274 September September
466.00 2001
2001 2031 point 5 645,600 9,598,100
point 6 645,600 9,599,000
point 7 646,600 9,599,000
point 8 646,600 9,594,500
point 9 645,000 9,594,500
initial point 652,700 9,589,800
point 1 653,600 9,589,800
point 2 653,600 9,589,300
SAN ANTONIO 10 July point 3 653,500 9,589,300
300210 09 July 2001 10 July 2001
DE PAUDA 67.00 2001 point 4 653,500 9,589,100
point 5 653,300 9,589,100
point 6 653,300 9,589,000
point 7 652,700 9,589,000
initial point 656,700 9,594,000
point 1 656,600 9,594,000
SINSAO 300393 04 April 2002
20.44 2001 2031 point 3 656,538 9,594,623
point 4 656,538 9,595,500
point 5 656,700 9,595,500
- 17 -
Concession Authorisation Registration Expiry Easting Northing UTM

Code Area Ha Concession UTM
Name date date date PSAD 56
Limits PSAD56
initial point 654,554 9,588,481
RUTH 300580
2.00 2001 2001 2031 point 2 654,754 9,588,381
point 3 654,554 9,588,381
initial point 655,300 9,592,585
point 1 655,300 9,591,550
point 2 655,100 9,591,550
point 3 655,100 9,591,650
18 April point 4 655,000 9,591,650
SOLEMARIA 300545 04 April 2002 18 April 2002
23.81 2032 point 5 655,000 9,591,678
point 6 654,935 9,591,678
point 7 654,935 9,591,978
point 8 655,135 9,591,978
point 9 655,135 9,592,585
initial point 654,100 9,589,200
SUCA 300519
3.80 2001 2001 2031 point 2 654,290 9,589,000
point 3 654,100 9,589,000
initial point 653,100 9,591,500
point 1 653,100 9,595,823
point 2 653,938 9,595,823
point 3 653,938 9,595,000
point 4 653,900 9,595,000
point 5 653,900 9,594,700
point 6 653,600 9,594,700
09 July point 7 653,600 9,594,500
ZUDOS 1 5200 05 July 2001 09 July 2001
323.47 2031 point 8 653,350 9,594,500
point 9 653,350 9,594,200
point 10 653,600 9,594,200
point 11 653,600 9,593,700
point 12 653,900 9,593,700
point 13 653,900 9,592,700
point 14 654,000 9,592,700
point 15 654,000 9,591,500
initial point 656,538 9,594,623
point 1 654,400 9,594,623
point 2 654,400 9,595,000
point 3 654,000 9,595,000
point 4 654,000 9,594,623
point 5 653,938 9,594,623
point 6 653,938 9,595,823
point 7 653,238 9,595,823
06 August 06 August point 8 653,238 9,597,223
ROMA 300216 10 Jun. 2003
661.92 2001 2031 point 9 654,438 9,597,223
point 10 654,438 9,596,423
point 11 655,538 9,596,423
point 12 655,538 9,597,223
point 13 656,538 9,597,223
point 14 655,038 9,595,423
point 15 655,038 9,595,123
point 16 654,738 9,595,123
point 17 654,738 9,595,423
- 18 -
Authorisation Registration Concession Easting UTM Northing UTM

Concession Name Code Area Ha Expiry date
date date Limits PSAD56 PSAD 56
initial point 654,450 9,590,000

SUCA 4 300523 19 October 2001
1.00 2001 2031 point 2 654,550 9,589,900
point 3 654,450 9,589,900
initial point 655,038 9,595,423
PACAYURCO 06 August 06 August point 1 655,038 9,595,123
189 11 Jun. 2003
BAJO 9.00 2001 2031 point 2 654,738 9,595,123
point 3 654,738 9,595,423
initial point 653,600 9,589,900
point 1 654,100 9,589,900
point 2 654,100 9,589,700
NUEVA point 3 653,800 9,589,700
300089 06 July 2001 09 July 2001 09 July 2031
ESPERANZA 3 30.00 point 4 653,800 9,589,200
point 5 654,100 9,589,200
point 6 654,100 9,589,000
point 7 653,600 9,589,000
initial point 654,490 9,589,000
point 1 654,490 9,589,200
point 2 654,500 9,589,200
point 3 654,500 9,589,500
point 4 654,650 9,589,500
point 5 654,650 9,589,900
point 6 654,550 9,589,900
point 7 654,550 9,590,000
point 8 655,100 9,590,000
point 9 655,100 9,590,130
point 10 655,300 9,590,130
point 11 655,300 9,590,200
point 12 655,450 9,590,200
point 13 655,450 9,589,500
point 14 655,400 9,589,500
NUEVA point 15 655,400 9,589,000
300195 06 July 2001 09 July 2001 09 July 2031
ESPERANZA 6 77.80 point 16 655,015 9,589,824
point 17 655,215 9,589,824
point 18 655,215 9,589,524
point 19 655,115 9,589,524
point 20 655,115 9,589,424
point 21 655,015 9,589,424
point 22 654,915 9,589,524
point 23 655,015 9,589,524
point 24 655,015 9,589,324
point 25 654,915 9,589,324
point 26 654,800 9,589,400
point 27 654,900 9,589,400
point 28 654,900 9,589,300
point 29 655,000 9,589,300
point 30 655,000 9,589,100
point 31 654,800 9,589,100
- 19 -
Easting
Concession Authorisation Registration Northing UTM
Code Area Ha Expiry date Concession UTM
Name date date PSAD 56
Limits PSAD56
initial point 654,700 9,593,980

point 1 654,700 9,594,200
point 2 654,000 9,594,200
point 3 654,000 9,594,300
NUEVA 09 July point 4 654,400 9,594,300
300086 05 July 2001 09 July 2001
ESPERANZA 4 135.66 2031 point 5 654,400 9,594,623
point 6 656,600 9,594,623
point 7 656,600 9,594,000
point 8 655,000 9,594,000
point 9 655,000 9,593,980
initial point 654,135 9,590,910
point 1 653,835 9,590,910
NUEVA 09 July point 2 653,835 9,591,010
152 06 July 2001 09 July 2001
ESPERANZA 5.00 2031 point 3 653,935 9,591,010
point 4 653,935 9,591,110
point 5 654,135 9,591,110
initial point 653,600 9,590,100
point 1 654,100 9,590,100
NUEVA 10 July point 2 654,100 9,589,900
300085 09 July 2001 10 July 2001
ESPERANZA 2 42.00 2031 point 3 653,400 9,589,900
point 4 653,400 9,591,500
point 5 653,600 9,591,500
initial point 654,290 9,589,300
point 1 654,390 9,589,300
09 July point 2 654,390 9,589,200
SAN JOSE 2 385 06 July 2001 09 July 2001
5.00 2031 point 3 654,490 9,589,200
point 4 654,490 9,589,000
point 5 654,290 9,589,000
initial point 654,100 9,594,130
point 1 654,300 9,594,130
LILLY RAY 473 7.76
2001 2001 2031 point 3 654,290 9,593,784
point 4 654,290 9,593,740
point 5 654,100 9,593,740
initial point 654,100 9,590,500
point 1 653,600 9,590,500
point 2 653,600 9,591,500
point 3 653,700 9,591,500
point 4 653,700 9,591,200
EL SOROCHE 10 July point 5 654,000 9,591,200
506 06 July 2001 10 July 2001
UNIFICADO 32.80 2031 point 6 654,000 9,591,110
point 7 653,935 9,591,110
point 8 653,935 9,591,010
point 9 653,835 9,591,010
point 10 653,835 9,590,910
point 11 654,100 9,590,910
- 20 -
Concession Authorisation Registration Expiry Easting Northing UTM

Code Area Ha Concession UTM
Name date date date PSAD 56
Limits PSAD56
initial point 651,600 9,599,000
point 1 651,600 9,593,500
point 2 650,400 9,593,500
point 3 650,400 9,599,000
point 4 645,600 9,599,000
point 5 645,600 9,599,700
point 6 651,700 9,599,700
MACHAY 300320
1,273.00 2001 2001 2031 point 8 651,900 9,599,100
point 9 651,900 9,599,700
point 10 653,700 9,599,700
point 11 653,700 9,597,300
point 12 653,100 9,597,300
point 13 653,100 9,599,400
point 14 652,000 9,599,400
point 15 652,000 9,599,000
- 21 -
646.000E
648.000E
650.000E
652.000E
654.000E
656.000E
Company Concessions
9'604.000N 9'604.000N
9'602.000N 9'602.000N
9'600.000N 9'600.000N
9'598.000N 9'598.000N
9'596.000N 9'596.000N
9'594.000N 9'594.000N
9'592.000N 9'592.000N
9'590.000N 9'590.000N
9'588.000N 9'588.000N
9'586.000N 9'586.000N
646.000E
648.000E
650.000E
652.000E
654.000E
656.000E
Fig. 3
IAMGOLD ground and underground survey control point locations
(A total of 2,591 points are plotted on the map)
- 22 -
4.4 Permitting
All information used in this report was provided to the author by Dynasty Metals and Mining
Corporation. Source information included internal Companys reports, information provided by
IAMGOLD within terms and conditions of Letter Agreement (Appendix B) which usage has been
authorized by Company and information publicly accessible and listed in 21.0 and properly cited
in the respective context. The original information and data is unchanged, listed in original form
as provided by Mr. Franklin Guauna, the Companys Geological Administrator, and a qualified
person as defined by National Instrument 43-101 during authors visit to the Project area.
13 Environmental Permitting
According to Mining Law, Title V, Chapter II, Article 79, and others The holders of mining
concessions and plants for processing, smelting and refining must make environmental impact
studies and environmental management plans to prevent, mitigate, control, rehabilitate and
compensate environmental and social impacts derived from their activities; such studies shall be
approved by the Environmental Sub-secretariat of the Ministry of Energy and Mines.
Environmental management plans are to contain the following elements:
1. Description of the project and the environmental means to be applied, including:
Protection of natural elements and native communities
Prevention and control of contamination, deforestation, erosion and sedimentation
Follow-up and monitoring
Rehabilitation and restoration of natural elements
Maintenance of infrastructure
Emergency and contingency plans
Mitigation of any negative impacts
Compensation to persons or communities negatively affected by the project
2. Chronogram of Activities
3. Maps of Activities and Infrastructure
4. Waste Treatment
5. Evaluation of Compliance with the stated program
6. Declaration of the environmental effect for the exploration stage,
7. Environmental Impact Studies for the stages of exploitation, design, construction, operation
and dismantling
8. Permanent programs of environmental training and education for employees
- 23 -
Mining Law provides further details concerning the element itemized above.
4.6. Environmental Liabilities

The agreement by which IAMGOLD transferred the Zaruma project areas to Minera Australiana
(Appendix B) does contain a declaration by IAMGOLD that its work on the concession was done
in such a manner as not to result in any damages that would require restitution to the state or to
third parties.
The small scale mining activities within the project area are limited to rustic hand mining using
explosives, milling of the mineralized material in a small mechanized Chilean Mill, gravity
concentration of the milled material in concrete settling channels and final concentration by hand
panning. Gold is extracted from the resultant gravity concentrate by mercury amalgamation (Fig.
4). Several plants on the site where gold is extracted from mineralized material use a cyanide
process. Both the mercury amalgamation process and the cyanide extraction process have the
potential to release harmful chemicals into the environment.
Fig. 4
Small scale cyanide-process plant, channel system for gravity extraction and final hand-panning.
Muluncay zone north of the Zaruma Project boundary.
- 24 -
5.0 ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE and
PHYSIOGRAPHY
5.1 Location
The Zaruma Project is situated in El Oro Province of southern Ecuador, about 175 kilometres
south and 60 kilometres southeast of the major port cities of Guayaquil and Machala
respectively (Figure 4). The centre of the property is located on 654,500 East and 9,592,000
North (UTM PSAD-56, zone 17S) or longitude 79 36 31 West and latitude 3 41 20 South
(Provisional South American 1956 projection).
5.2 Access
Good asphalted roads provide access to the mining towns of Zaruma and Portovelo about 2
hours drive from the city of Machala. Access on the project area is facilitated by a relatively
dense network of secondary roads. The project area is also traversed by a main highway to the
city of Loja.
5.3 Climate and Physiography

The property lies on the western flank of the Cordillera Occidental of Andes mountain range. Hill
slopes are moderately steep to very steep with elevations ranging from the 1040 to 1600m a.s.l.
Being traditionally a mining district, areas which are not disturbed by mining activity are used for
farmlands, grazing and local minor secondary forestry. The climate is subtropical and humid with
temperatures ranging from 18o to 30o C. Yealy rainfall averages 1,341mm (1985 to 1994 in
Clavijo, 1998), with heaviest rainfalls occurring in the months of January to June.
5.4 Local Resources

The location of two medium-sized cities namely Zaruma with population of 29,000 and Portovelo
with population of 14,000 within the Project area would provide both the labour force and all
other facilities a mining operation needs e.g. hotels, food supply, material supply,
communication resources, public security and government institution representatives. A strong
mining background for the district guarantees skilled workers for underground mining and the
availability of basic mining-related material in the Project area. High-tension power lines
providing electricity are connected to both Zaruma and Portovelo and the Rio Amarillo and Rio
Calera rivers are able to supply adequate water for large scale mining operations throughout the
year.
- 25 -
6.0 HISTORY
The hills of Zaruma and Portovelo have been mined for gold and silver for centuries. The Incas
were already extracting gold and silver in the area with hydraulic mining of the oxidized parts of
veins when Mercadillo, one of Pizzarros force, followed the Rio Amarillo River upstream and
encountered the Inca mine and founded the town of Zaruma in 1549 (Billingsley, 1926).
Exploitation of the Zaruma and Portovelo districts continued during the time of Spanish
colonization until 1870 when an Ecuadorian-Chilean company was established.
In 1880, Grant Zaruma Company, from England, bought controlling shares of a newly-formed
Ecuadorian-Chilean mining company. Operational rights were immediately endorsed to
Southern American Development Company (SADCO), an American company, who operated the
mine from 1897 to 1950 by gaining control of the districts main gold deposits in 1897.
Exploration programmes of SADCO commenced in 1896 and brought the mine into production
at 108t/day in 1905 (Fig. 5). The mine was subsequently deepened to 13 level located at an
elevation of 270m above sea level, 800m below the uppermost workings (PRODEMINCA, 2000
in Spencer, R.M. et al., 2002). In the 53 years that followed, SADCO recovered some 3.5 million
ounces of gold and 12 million ounces of silver from 7.6 million tones of ore at a cut-off grade of
14.4 g/t Au and 48.9 g/t Ag (Van Thournout et al., 1996).
After the lower levels of the Portovelo mine were flooded in 1944 and facing increasing costs,
taxes and a complicated political situation, SADCO finally withdrew from the country in 1950 and
the Ecuadorian government took over the mine. A state-owned company, CIMA, took over the
mining operations in the area until 1980 and it is estimated to have produced a further 375,000
oz of gold by 1965. In 1984, thousands of poverty-stricken miners invaded the old SADCO pits
and small-scale and artisan mining has been going on in the area ever since. An additional
35,000 to 50,000 oz of gold has been produced each year since then by informal miners, small-
scale operating mining societies and principally from the family-owned BIRA. In the 1990s
statistical information, mining from the Zaruma and Portovelo areas totalled 3 million tonnes
(INEMIN CODIGEM, 1990, in Jemielita and Bolaos, 1993).
In the mid-90s several overseas companies attempted to consolidate the area and carried out
systematic exploration programmes. In 1995, the Canadian-based TVX Corporation reached
agreement with most of the Zaruma area mining societies and informal miners and started with
underground and surface mapping particularly within the Zaruma and Muluncay areas from
March 1995 until February 1996 in which the author of this report was involved. A resource
estimate was carried out by M.Alfaro and is listed in section 10.1.
- 26 -
After TVX Corp. withdrew from Ecuador in 1998 all information was acquired by IAMGOLD.
IAMGOLD continued with more extensive exploration programmes including surface trenching,
surface and underground sampling, surveying and diamond drilling. IAMGOLD significantly
improved the Zaruma Project area with legal consolidation of titles, adding valuable information
to the project database, employing systematic geochemical data quality control and undertaking
geological modelling.
In August 2003, all the IAMGOLD properties and the project database were transferred to
Dynasty Metals and Mining Corporation which continued the exploration up to date of this report.
Fig. 5
View of the old SADCO vertical shaft in Portovelo
- 27 -
7.0 GEOLOGICAL SETTING
7.1 Regional Geological Setting

The general geological setting is described in Billingsly (1926), Van Thournout et al. (1996), and
Spencer et al. (2002). Original sources are cited in section 18.0.
Zaruma
Portovelo
Fig. 6
Simplified Geological Map of Ecuador
The Project area consists of a 15 km long vein system that lies immediately north of the Pias
Fault, a major regional structure that separates a metamorphic terrain to the south from a
- 28 -
Tertiary volcanic sequence to the north (Fig. 6). The metamorphic rocks, subparallel to the Pias
Fault, show that this structure represents a suture dated as Jurassic to early Cretaceous
(Aspden et al., 1995). Tertiary volcanic rocks preserved on the northern side of the Pias Fault
(Fig. 7) unconformably overlie metamorphic rocks facies of continental origin, implying that the
suture marks a site of continent-continent collision in the late Jurassic to early Cretaceous.
Puna Formation, siltite
Quaternary volcanics
Pinon Formation diabase, pyroclastics
Undiferentiated Quaternary sediments
Metamorphic rocks
Sandstone, conglomerates
Precambrian metamorphic basement
Intrusive rocks undiferentiated
25 km
Fig. 7
Regional Geological Map of the Zaruma Portovelo District
(Segment of Geological Map of Ecuador, Governmental Geological Service, 1969)
Preserved volcanic units show southward-thickening that define growth sequences formed in a
half graben during normal movement on the Pias Fault (Coward, 2001 in Spencer, R.M. et al.,
2002) and as a consequence of deceleration in the rate of subduction of the Nasca plate
beneath the South American plate at 37 Ma. North-south-directed compression increased the
rate of the plate convergence at 20 Ma and caused the hanging wall of the Pias Fault to bulge
into an open, regional-scale antiform.
- 29 -
Host rocks of the Zaruma Portovelo vein system are late Oligocene to early Miocene (28.4
21.5 Ma) in age (Dunkley and Geybor, 1997 in Spencer, R.M. et al., 2002) and range in
composition from calc-alkaline to alkaline, compatible with their emplacement in an extensional
cordillera setting. Four porphyry intrusions of dioritic to granodioritic composition have intruded
the hinge of the Cangrejos antiform; one has been dated at 16 Ma (Pratt et al., 1997). On one
of these, the Fierro Urcu porphyry, drilling revealed a mass of coalescing sills which is
compatible with intrusion into a compressive stress field (PRODEMINCA, 2002 in Spencer, R.M.
et al., 2002).
7.2 Zaruma Project Geological Setting
7.2.1 Geological Setting

The Zaruma Project area is underlain by intrusions and mafic to intermediate volcanic rocks that
constitute the Portovelo Unit of the Saraguro Group. Aerial photography has revealed a distinct
10km in diameter ring-type structure which has been tentatively interpreted as a caldera
structure (Quiroga, J.G., 1995).
The monotonous volcanic sequence in the Zaruma Portovelo area has been subdivided
(Billingsley, 1926) into three units:
The lowest part of the sequence has been nominated the Muluncay Series and is
dominantly volcanic breccias, tuffs, lava flows and minor ignimbrites. Breccias include
autobreccias, flow breccias, pyroclastic breccias and matrix-supported conglomerates
which have been interpreted as mud-flow deposits
The middle part of the local stratigraphy consists of medium-grained andesitic sills of the
Portovelo Unit which constitutes the concordant limb of a lapolithic intrusion of
melanodioritic composition which is similar in composition to the enclosing andesitic
volcanic rocks
The uppermost unit, the Faique Series, consists of volcanic rocks which are similar to the
Muluncay Series except that the breccias tend to be coarser grained.
- 30 -
Lopolithic intrusives
at onset of Miocene inversion?
Pias normal fault

Oligocene
growth sequences
Fig. 8
Schematic cross-section showing a model for the development of the Portovelo Unit volcanics
associated with normal faulting. (After R. Spencer,2002)
Considering similarities between the Muluncay Series and the Faique Series it was suggested
that both units may form part of an upward-coarsening sequence that was intruded along flat-
lying fractures by a melanodioritic lopolith (Fig. 8) which has an eastern limb that constitutes the
Portovelo Unit (Spencer, R.M. et al., 2002).
Numerous, mostly fine-grained intrusions varying in composition from melanocratic diorite to

quartz monzonite are known in the project area and are interpreted as high-level, subvolcanic
intrusive bodies. Sigmoidal shapes of the intrusive bodies in plan view are suggesting an
asymmetry which is compatible with intrusion into a right-lateral stress field. In some cases, it
was observed that melanocratic diorite dykes run parallel to the main veins (Fig. 9) suggesting a
close spatial relationship between dykes and mineralising fluids that are suspected to be related
to a late stage of melanocratic diorite intrusive activity (Quiroga, J.G., 1995).
- 31 -
The main host rocks to mineralisation are the volcanic units described above, however,
immediately to the NW of Zaruma city a strongly altered porphyry was also observed as a host
rock (Quiroga, J.G.., 1995).
9606000
Dynasty Concessions N
W E
9604000
9602000
LEGEND
Alluvial deposits
SEC: 9'600.000
SEC: 9'600.000
9600000 SEC:
SEC:
SEC: 9'600.000
9'600.000
Colluvial deposits
Crystal-clast tuff
150/50
SEC: 9'599.500
SEC:
SEC:
SEC:
SEC:
SEC: 9'599.500
9'599.500
9'599.500
9'599.500
9'599.500
Pumice tuff
Dacite tuff (green)
9598000 Volcanic sediments (red)

SEC:
SEC:
SEC:
SEC:
SEC: 9'598.000
9'598.000
SEC: 9'598.000
9'598.000
9'598.000
9'598.000
Volcanic sediments and lava flows (red to violet)

155/60
155/60
155/60
155/60
155/60
155/60
155/60
155/60
155/60
120/57
120/57
120/57
120/57
120/57
120/57
120/57
120/57
120/57
SEC:
SEC:
SEC:
SEC: 9'597.500
9'597.500
9'597.500
SEC: 9'597.500
9'597.500
120/50
120/50
120/50
Andesitic volcanics (breccia, lava flows)

120/50
120/50
120/50
120/50
120/50
120/50
135/45
135/45
135/45
135/45
135/45
135/45
135/45
135/45
135/45
Andesitic lava flows

152/38
152/38
152/38
152/38
152/38
152/38
130/47
130/47
130/47 152/38
152/38
152/38
130/47
130/47
130/47
130/47
130/47
130/47
9596000
Andesite porphyry (dark green)
Intrusive rocks
Dacite porphyry stocks

SEC: 9'595.000
SEC:
SEC: 9'595.000
9'595.000
Melanocratic diorite. magnetite-rich
Quartz-diorite stocks and dykes

SEC:
SEC:
SEC:
SEC:
SEC: 9'594.500
9'594.500
SEC: 9'594.500
9'594.500
9'594.500
9'594.500
9594000
Quartz-monzonite porphyry dykes
SEC:
SEC:
SEC:
SEC: 9'594.000
9'594.000
9'594.000
SEC: 9'594.000
9'594.000
Quartz-diorite porphyry
SEC:
SEC:
SEC:
SEC: 9'593.000
9'593.000
SEC: 9'593.000
9'593.000
9'593.000 Diorite
140/55
140/55
140/55
140/55
140/55
140/55
140/55
140/55
140/55
140/60
140/60
140/60
140/60
140/60
140/60
140/60
140/60
140/60
ZARUMA
134/40
134/40
134/40
134/40
134/40
134/40
134/40
134/40
134/40
Metamorphic basement rocks
9592000 140/50
140/50
140/50
140/50
140/50
140/50
140/50
140/50
140/50
Metamorphic basement - amphibolite

140/40
140/40
140/40
140/40
140/40
140/40
140/40
140/40
140/40
130/47
130/47
130/47
130/47
130/47
130/47
130/47
130/47
130/47
Metamorphic basement - gabbro

SEC: 9'591.500
SEC:
SEC:
SEC:
SEC:
SEC: 9'591.500
9'591.500
9'591.500
9'591.500
9'591.500
140/30
140/30
140/30
140/30
140/30
140/30
140/30
140/30
140/30
SEC:
SEC:
SEC:
SEC: 9'591.000
9'591.000
9'591.000
SEC: 9'591.000
9'591.000
Metamorphic basement - gneiss
SEC:
SEC:
SEC:
SEC: 9'590.755
9'590.755
9'590.755
SEC: 9'590.755
9'590.755 130/35
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130/35
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SEC: 9'590.655
SEC:
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SEC: 9'590.655
9'590.655
9'590.655
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SEC:
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9'590.255
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9'590.255 160/40
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Miscelanoeous
9590000
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SEC:
SEC:
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SEC: 9'590.155
9'590.155
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9'590.155
155/50
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155/50
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Major structures (mapped)

145/30
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SEC:
SEC:
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SEC: 9'589.555
9'589.555
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SEC: 9'589.555
9'589.555
130/0
130/0
130/0
Major structures (inferred)

130/0
130/0
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PORTOVELO Geological Seccion Location

SEC : 9'593.000
123/60
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9588000
))
000)))
0004444400
111000
559999911
,9555
,9,9
000,9,9
5550000000
555666666555
;6;6555
;6
111000000;6;6
;6
888000000111
55555888888888
5
,9,9,9
000000000,9,9,9
333000000000
(6 555555333
(6
(6
(6(6
CC:::::
EEECCC
SSSSSE
9586000
646000
648000
650000
652000
654000
656000
658000
Fig. 9
The Zaruma Project Geological Map and Dynasty Metals and Mining Corporation controlled
and/or owned claims plotted as a red outline.
(After IAMGOLD original map at 1 : 10,000 scale, modified and updated by author)
- 32 -
7.2.2 Structural Setting
Veins in the Zaruma Portovelo District are arranged in four principal en-echelon sets controlled
by NW-SE striking oblique faults parallel to the Pias Fault (Fig. 10). The majority of the veins
strike north and some show a sigmoidal geometry in which southeast-striking tails rotate into the
north-striking central portions of the veins (Spencer, R.M. et al., 2002).
Faults that control the en-echelon sets formation strikes NW and dip to the southwest at 40o to
60o. The oblique right-lateral thrust movement on the north-west-striking thrust ramps have been
defined. It is suggested that Zaruma, Sesmo-Colorada, Muluncay and R-level Thrust root on the
Pias Fault.
Fig. 10
Northwest striking thrusts control the en-echelon set formations
and the sigmoidal geometry of the veins.
- 33 -
7.2.3 Alteration
Alteration styles within the Zaruma Portovelo area show a transition from high temperature
assemblages in the NE portion of the area centred on El Poglio porphyry to low temperature
assemblages towards the southwest and south (Fig. 11).
While veins are exposed up to 900m
below a secondary biotite-
tourmaline-magnetite altered El
Poglio porphyry, still further north
and at higher elevations, K silicate
altered dioritic porphyries passes
COOLING
upward into a high-temperature
advance argillic altered zone with a
pyrophyllite-diaspore-topaz-
tourmaline assemblage defined as a
lithocap (Sillitoe, R., 2000). Advance
argillic alteration comprising vuggy
silica, dickite, pyrophyllite and minor
alunite caps high-relief hills in the
southwestern part of the project area
near Zaruma Urcu and Santa
Barbara and are interpreted as
relicts of a SW dipping advance
argillic-altered volcanic sequence
that formed part of the lithocap
related to the El Poglio porphyry
cluster (Sillitoe, R., 2000). Veins
closest to the El Poglio porphyry lie
adjacent to the area of secondary
biotite and the vein infill consists of
Fig. 11 dog-tooth quartz intergrown with
Alteration mineral zonation within the Project area. banded Fe-rich chlorite, epidote,
(After R. Spencer, 2002) tourmaline, magnetite and in some
cases, coarse-grained muscovite.
- 34 -
From north to south through vein outcrops a gradual decrease in temperature was observed in
wall-rock alteration, culminating in illite-smectite mix-layered clay in proximity to the Pias Fault
(Reyes, 1990 in Spencer, R., 2002).
7.2.4 Mineralisation
The Zaruma Portovelo Mining District consists of a 15km-long vein system developed
immediately north of the Pias Fault and is arranged in four principal en-echelon sets from
south to north: the Portovelo en-echelon system the Sesmo-Colorada en-echelon system
the Muluncay en-echelon system the R-nivel en-echelon system (Fig.9). The best
development of veins was observed in the immediate footwall of the northwest striking thrust
faults where they are wider (Fig. 12) and continuous along strike when hosted by competent
rocks. Most veins throughout the strike length of the Zaruma Portovelo vein system dip to the
east at an average of 60o.
Fig.12 Fig.13
Minable vein width up to 6m. Banded textures with symmetric geometry.
Jane Vein, Zaruma Cristina Vein, Zaruma
Vein textures in the Zaruma project area do not significantly change along 10km of vein trend.
Typical textures for low-sulphidation veins have been observed including rhythmically banded
textures (Fig. 13) with dominantly symmetric geometry, drusy textures, hydrothermal breccia
textures, dissolution and replacement textures (Fig. 14).
Fig.14
Banded, laminated, hydrothermal breccia and drusy textures. Cristina Vein, Zaruma.
In contrast, veins in the Portovelo system in the southern part of the trend change composition
gradually along strike southward from quartz through quartz-calcite, to calcite-dominated
compositions over a strike of 2 km. A vertical zonation in composition from quartz dominated
deeper portions of veins to calcite dominated assemblages near surface was observed, in
particular, within the Portovelo en-echelon block.
Mineral assemblages within veins showing a zonation is a function of cooling direction (Fig.11).
While northern portions of veins are dominated by relatively higher temperature assemblages
with disseminated chalcopyrite-pyrite-magnetite in K-silicate altered El Poglio porphyry and
banded quartz-chalcopyrite-pyrite-magnetite-dark-green chlorite within veins in R-nivel en-
echelon set. Going south, the mineral group progresses into the quartz-chalcopyrite-pyrite
dominated Muluncay en-echelon set then into quartz-chalcopyrite-sphalerite-galena in the
Sesmo-Colorada en-echelon up to the sphalerite-dominant, quartz-carbonates-sphalerite-pyrite-
galena chalcopyrite assemblage in the Portovelo en-echelon system. Similar zonation can be
observed in an EW section with higher temperature assemblages in eastern and central part of
the district dominated by chalcopyrite changing into sphalerite-dominated to galena-dominated
assemblages in the easternmost part of the district as shown on Fig.15.
Fig. 15
Mineralisation Zonation in the Zaruma Portovelo Mining District (After R. Spencer, 2002)
- 37 -
7.2.5 Mineral Assemblage Studies
On a request from TVX Gold Corp., the author of this report carried out in 1995 petrographic and
mineral assemblage microscopic studies. The results from these studies are summarized below.
A total of 9 petrographic sections were used for transcurrent light studies and 5 polished
sections were used in reflected light studies.
Rock Types:
1. Quartz Andesite a crystalline rock with phenocrysts and a vitreous groundmass. The
rock belongs to group of rocks with a low presence of quartz and without K-feldspars.
The dominant mineral is idiomorphic phenocrysts of Na-Ca feldspars (andesine) with
poikilitic inclusions of quartz and mafic minerals. Strong albitisation and carbonitisation
was observed. Mafic minerals, mainly biotite and amphibole, are strongly chloritised.
Irregularly-shaped quartz crystals are present in less than 5% of the rock. The
groundmass is vitreous and consists of strongly altered clay (kaolinite) with undefined
opaque minerals. Pseudomorphs of chlorite and carbonate after mafic minerals are
common (Botoneros labour, 10m north from BT-009 survey point, Zaruma).
2. Pyroxene Andesite this rock is characterized by a holocrystalline texture with a

dominance of groundmass over phenocrysts. The presence of K-feldspars was detected.
Dominant minerals are Na-Ca feldspars (andesine to labradorite) and a monoclinic
pyroxene (35 - 48o) which is relatively fresh, frequently twinned in a 100 axes and
determined as probably augite. Chlorite and carbonate are present as pseudomorphs
after pyroxene and/or other mafic minerals. The groundmass texture is finely-crystallised
and is composed by quartz and feldspar (Naranjitos labour, reference point N-032).
3. Dacite Porphyry two types of porphyries have been detected:

A porphyritic type with mega-crystals of feldspars and quartz in a microcrystalline
groundmass of similar composition
A less porphyritic variety with only medium-size laminar and randomly-oriented
feldspar phenocrysts which were apparently xenoliths from an older intrusive
phase
Only Na-Ca feldspars of andesine composition have been observed in both types of
porphyry with frequently pronounced albitisation and carbonitisation alteration. Mega-
crystals of quartz are common and with the crystals size, liquid > gas fluid inclusions
have been detected. Mafic minerals have been observed only as pseudomorphs of
- 38 -
chlorite, epidote / zoisite and carbonate without relict textures which make the primary
mineral identification difficult, although amphibole is possible (Pacayurco area, 655.875E
/ 9597.050 N).
4. Granodiorite Porphyry this rock is characterised by intensively albitised Na-Ca

feldspars with minor K-feldspars. Interstitial spaces between the feldspars phenocrysts
are infilled with quartz. Mafic minerals are totally replaced by carbonates and chlorite,
and only pseudomorphs have been observed. (San Antonio labour, Muluncay are,
reference point SA-017)
5. Dacite this rock has a significant amount of quartz, very low to absent K-feldspars and
hemicrystalline to porphyritic textures. Vesicular textures observed are different in size
and mineral infill. Small vesicules are oval-shaped and usually filled with finely laminated
and radial-crystallised chlorite; while the larger vesicules are infilled with quartz, albite,
chlorite, epidote / zoisite, actinolite and carbonate. Albitisation is the whole rock
alteration style and is replacing mainly the feldspars. (La Chonta labour, Muluncay area,
Zaruma. Reference: 5m east from CH-008 underground survey point)
6. Amphibole-biotite Granodiorite this rock is characterised by feldspar twinning of

Carlsbad-type in euhedral crystals with poikilitic inclusions of plagioclase (andesine),
quartz and mafic minerals. Potassic feldspars, frequently in paragenetic association with
quartz and biotite, show a lower crystalline grade as Na-Ca feldspars are present. In
some mega-crystals of Na-Ca feldspars, potassic feldspars have been observed as
poikilitic inclusions. Monoclinic amphiboles form one dominant mineral (20o). Anhedral
quartz fills the interstitial space between plagioclase crystals and finely laminated biotite
with Fe-Ti oxides and ilmenite. (Muluncay zone north from the Zaruma project boundary)
Ore mineralisation assemblages:

1. Quartz forms the common and dominant mineral in all ore-samples studied. At least
two generations of quartz have been identified:
An older generation of coarsely-granulated quartz with interstitial space
infilled with sulphides (mainly chalcopyrite and pyrite), native gold and
hematite. Gold impregnations, up to 50 m in size, are abundant in this
- 39 -
quartz generation (La Chonta labour, reference point CH-045, Jane
vein)
A younger generation of crystallised, euhedral quartz and micro-drusy
quartz frequently with sulphides inclusions. Quartz crystal surface
corrosion by sulphides is common
2. Pyrite occurs in the main as single, disseminated hexahedral crystals in the older
generation quartz. Pyrite aggregates infill with chalcopyrite and native gold have been
observed (La Chonta labour, CH-045, Jane vein and Las Caas labour, 5m south of SC-
43, Cristina vein). Pyrite crystal surface corrosion textures by gold have been observed.
3. Chalcopyrite forms commonly as infill of drusy-quartz, in pyrite aggregates and in

cataclased pyrite grains. Isometric inclusions of native gold are frequent. Chalcopyrite is
defined as an older mineral in comparison with galena and sphalerite due to the
corrosion textures of chalcopyrite on contact with younger galena and sphalerite.
4. Sphalerite is a common mineral in studied assemblages and corrodes chalcopyrite

grain surfaces togetherwith or slightly before galena. Evidence of the sphalerite-
chalcopyrite solid solution segregations are usually observed as > 5 m grains of
chalcopyrite in sphalerite. Textures of sphalerite surface corrosion by native gold and
polybasite have been observed. Concentration of chalcopyrite inclusions in sphalerite
decrease from early stage-formed sphalerite to younger stage-formed sphalerite were
observed in zoned sphalerite crystals. Based on colour changes seen in zoned
sphalerite crystals, two varieties of the mineral are present iron-rich marmatite as a
older sphalerite generation and an iron-poor sphalerite, honey coloured cleophane, as a
younger generation.
5. Galena occurs less abundantly than sphalerite and is apparently slightly younger.
Togetherwith sphalerite, galena has been observed corroding chalcopyrite surfaces and
in turn the galena surface has shown corrosion by native gold and polybasite (Pacay
Blanco labour, Cristina Vein)
- 40 -
6. Polybasite forms a frequent silver mineral in association with gold and exhibits
corrosion textures on sphalerite and galena grain surfaces.
7. Acanthite a common silver mineral in association with gold and polybasite; infilling
micro-fractures in galena crystals.
8. Gold a ubiquitous mineral in all samples. With silver minerals (polybasite and
acanthite) native gold forms inclusions in chalcopyrite, sphalerite and galena. Gold also
shows corrosion textures on sphalerite and galena grains, infilling exfoliation fractures in
galena crystals and infilling micro-fractures within pyrite crystals. Gold is frequently
observed in association with dark-green chlorite in the northern part of the Zaruma
District (Fig. 18). Spectacular native gold specimens are well-known from the Zaruma
area in the form of hairy-gold in drusy-quartz and coarse gold, including cubic gold
crystals, occurs as a carbonate vein infill in the Portovelo area (Fig. 19). The author of
this report had an opportunity to see up to 0.5 kg native gold specimens in the form of
thick plates with typical triangular-shaped crystals (corners of cubic crystals of gold) on
the surface similar to the well-known European deposits like Baja Mare and Capnic in
Romania. Free-gold specimens vary in colour from bright yellow to dark yellow-greenish
which suggest a gold purity in the range of 600/1000 to 850/1000. At the time of this
study, the author did not have access to either EDA or microprobe facilities.
9. Carbonates form coarsely-crystallised minerals which are in the main calcite and occur
as the youngest drusy-infill with quartz.
- 41 -
8.0 GOLD AND SILVER DISTRIBUTION
The gold and silver distribution differs from that of base metals. Major concentrations of gold and
silver were observed closely related to the footwall of southerly dipping thrust faults which lie
parallel to the Pias Fault especially in the northern en-echelon sets of R-nivel, Muluncay and
Sesmo-Colorada. While in the Portovelo en-echelon set, almost 90% of precious metal
production was from the central part of the veins (Figs 16 and 17).
?
?
Fig. 16
Gold Distribution in Zaruma Portovelo Mining District
(After R. Spencer, 2002)
- 42 -
The decrease of gold and silver in proximity to the Pias Fault is probably a result of alteration
zonation where this part of the District is well within the illite-smectite wall-rock alteration zone
(Spencer, R.M. et al., 2002) as shown in Figs 11 and 16. This alteration mineral assemblage
represents relatively cool hydrothermal conditions with temperatures ranging from 100o to 200o
C and mineral deposition in subsurface levels (Hedenquist, J.W. et al., 2000).
AU/AG
SPH CP PY
Fig. 17
Longitudinal Section along Sesmo Vein showing gold and polymetallic mineralisation
(After R. Spencer, 2002)
Two stages of gold and silver mineralisation have been detected in the Zaruma Portovelo
Mining District and their distribution is shown in Fig 15.
Stage 1 Quartz-adularia-base metals-gold-silver veins are considered as the earliest

stage of mineralisation (Fig. 18). Vein assemblages contain pyrite, chalcopyrite,
sphalerite, Ag-bearing galena and minor bornite and silver-poor tetrahedrite. In near
surface levels also chalcocite and covellite can be present as well as copper-oxides
(Quiroga, J., 1995). Mineral assemblages vary according to NS and EW zonations
described in Section 7.2.3.
- 43 -
1 mm
Fig. 18
Early stage gold intergrowth with dark-grey chlorite. Jane Vein, Zaruma.
(Photo from authors archive)
Stage 2 Quartz-calcite-chlorite-electrum-Ag sulphosalts are considered to be a

younger mineralisation event and characterised by low to zero sulphides and free coarse
gold (Fig.18). This sulphide-poor stage contains a wide spectrum of sulphosalts including
tetrahedrite, tennantite, Ag-tetrahedrite (freibergite), safflorite; Ag-sulphosalts as
pyrargyrite, proustite, stephanite and including gold-telluride like nagyagite. Free,
colloidal gold is reported from the dark, banded botryoidal quartz with disseminated fine-
grained pyrite in the Sucre Vein (Marikovsky, 1958 in Spencer, R.M. et al., 2000) and
similar to the Sleeper low sulphidation deposit in Nevada (authors comment).
- 44 -
5 mm
Fig. 19
Late stage coarse and partially crystallised gold (shown by arrow) in association
with calcite and quartz. Abundancia Vein, Portovelo area. (Photo from authors archive)
The total sulphide content in veins varies in a north-south direction from 10 to 15 % in the R-
nivel and Muluncay en-echelon systems with dominated chalcopyrite and pyrite through to 5-10
% in the central part of the Sesmo-Colorada en-echelon set dominated by sphalerite-pyrite-
galena to >5% to nil sulphides in Portovelo en-echelon set. A similar distribution can be
observed in an east-west direction with low, >5% to nil sulphides in eastern part of the district
increasing gradually to west with 20-50% sulphides and mainly sphalerite-galena dominated
assemblages (Sillitoe, R.H., 2000).
Literature on gold/silver ratios within the Zaruma Project and on the Zaruma-Portovelo District
are scarce. From SADCOs historic production data, a ratio of Au:Ag = 1:3.25 is suggested.
However, SADCOs production output was mainly from the Portovelo zone. A ratio Au:Ag = 1:8
was calculated by TVX based dominantly on historic data and limited sampling. The gold/silver
ratio calculated from TVX, IAMGOLD and Dynasty Metals and Mining Corporation data totalling
3,447 samples, carried out by the author, is suggesting a higher ratio (Au:Ag = 1:11). Studies
- 45 -
indicate wide ratio variations occur within the same vein (Table 4) including samples collected
on the same level (Fig.20).
Table 4. Gold / Silver ratios, Zaruma Portovelo District
Ratio from Ratio to Proportion

1:1 1:5 33%
1:5 1 : 10 14%
1: 10 1: 20 18%
1 : 20 1 : 50 22%
1 : 50 1 : 100 8%
1 : 100 1 : >100 5%
CRISTINA VE
CRISTIN
Gold / Silver Ratio - Zaruma Project

over 100
50 to 100
20 to 50
10 to 20
5 to 10
1-5
250m
CR
IST
IN
A
VE
IN
250m
Fig. 20
Gold / Silver Ratio Variations Cristina Vein
- 46 -
9.0 EXPLORATION
9.1 Exploration History

Systematic exploration activity closely related to mining advance was carried out by SADCO
from 1897 to 1950, however, only limited information is available from that period. Detailed
underground maps and 103,657 assay result records which have been rescued from local
miners and from local archives by TVX Gold Corp. and IAMGOLD are now in the possession of
Dynasty Metals and Mining Corporation.
Modern exploration activity within the Zaruma Portovelo Mining District begun in 1995 when a
first attempt of property area consolidation and district-scale exploration was made by TVX
Gold Corporation, a Canadian-based company. For over one year, a crew of more than 10
geologists, GIS and support staff studied the property. During this period, over 40km of
underground workings were correctly surveyed and mapped on 1:500 scale. The author was
actively involved in this work. Valuable historic information, mostly SADCOs maps and assay
results were rescued from local miners in this time. Total amount of samples which were
collected by TVX is difficult to estimate, however, the author estimates over 4,000 underground
channel samples were taken based on daily reports of mapping geologists where the author
participated. Sampling databases submitted to Dynasty Metals and Minerals Corp. by IAMGOLD
do contain 733 samples, however, several hundred sample locations and assay results were
digitised from original maps by the Companys GIS staff.
Following TVXs withdrawal from Ecuador in 1998, all information was acquired by IAMGOLD
which continued exploration including surface trenching, surface and underground sampling,
surveying and diamond drilling (Fig. 21). IAMGOLD significantly improved the Zaruma Project
area legal consolidation, added valuable information to project databases and was the first
company working within the area to employ geochemical data quality control and geological
modelling. IAMGOLD databases available to the author contained:
1. 680 surface rocks channel and chip samples

2. 2,126 underground channel samples
3. 5,415 soil samples
4. 37 diamond drill hole results including sample assay results
5. 1,114 DDH core samples
6. 2,591 topographical control points survey (Fig. 3)
- 47 -
7. 39 stream sediments samples
8. 369 channel samples form surface trenching
646.000E
648.000E
650.000E
652.000E
654.000E
656.000E
N
Dynasty Concessions
W E
9'604.000N 9'604.000N
9'602.000N 9'602.000N
Hu
er
ta
s
RM-1
Fa
RM-9
ul
9'600.000N
t 9'600.000N
RM-8
RM-7
RM-5
RM-6
RM-10 RM-4
RM-2
9'598.000N 9'598.000N
RS-11
RS-6
9'596.000N 9'596.000N
RS-8
RS-10
RS-7
RS-1
RS-3
RS-15
Pu
RS-14 en
RS-9 te
RS-13
Bu
9'594.000N
RS-17
za
9'594.000N
RS-16 Fa
RS-4
RS-12 ult
RS-2
RS-5
RS-23
Pi
9'592.000N as T RS-22 9'592.000N
hru
st RS-21
RM-13
RM-12
RM-11
RM-14
9'590.000N 9'590.000N
RM-16
RM-15
RS-20
RS-19
RS-18
9'588.000N 9'588.000N
9'586.000N 9'586.000N
646.000E
648.000E
650.000E
652.000E
654.000E
656.000E
Fig. 21
IAMGOLD Drilling Programme and Zaruma Project Tenements
- 48 -
In August 2003, all the IAMGOLD properties and project databases were transferred to Dynasty
Metals and Mining Corporation which continued with exploration programmes up to date of this
report. The Company had 3 geologists re-sampling selected IAMGOLD and TVX original
sampling channels with the purpose of data verification and repeatability of the original assay
results. New sampling programmes carried out by the Company in the zones of Sucre and
Pacayurco mines resulted in the discovery of additional resources of high-grade mineralisation
and were stated in the Companys Press Release on July 7, 2004 (Appendix D).
9.2 Sample Preparation, Assaying and Security

Limited information about sample preparation, analyses and security is available from SADCOs
times, however, details of registers from production and plant are confirming companys assay
records in which the entire database totalling 103,657 assay results is in the possession of
Dynasty Metals and Mining Corp. SADCOs on-site laboratory used a 3-acid digestion and
gravity and/or fire-assay analysis for gold and silver determinations while base metal were
determined by quantitative spectral assaying. The quality control data has not preserved and it
is likely that SADCO did not use systematic analysis control.
TVX Gold Corp. sample databases available to author were missing quality control samples,
however, the author of this report, being one of the TVX Gold Corp. Zaruma project geologists,
would confirm that systematic procedures were controlled by standard and duplicate samples
inserted with a frequency of 2 standards, 2 field duplicates and 2 laboratory duplicates samples
per hundred samples sent for assay.
Samples from surface, underground and drilling core collected by IAMGOLD were bagged on
site, sealed and sent to an external recognized laboratory (Chemex Labs) for assaying. Blanks
and standards were routinely submitted with these samples with an interval of 1 standard per 20
samples, while blank insertion was random but not less than 2 blanks per 100 samples. The
standard procedure included sample homogenization under -80# and -150#, Au and Ag content
was determined by fire assay method from 50g pulps. For the multi-element analysis of 35
elements, Induced Coupled Plasma (ICP) and/or Neutron Activation (NAA) methods were
employed. Procedures for these methods are known and descriptions can be found in the
literature. A total of US$ 887,929.31 was spent on laboratory costs by IAMGOLD. Detection
limits for the ICP method of analyses are listed in Table 5.
- 49 -
Table 5.
Elements assayed by IAMGOLD and detection limits for the ICP method applied for the Zaruma
Project sample analyses.
Element Method Units Low limit High Limit
Au50 FA-50 PPB 5 10000
Au Rew 1 PPB 5 10000
Au Rew 2 PPB 5 10000
Au Gra v FA PPM 0.17 999999
Au Wt 1 FA-AA GM 0.01 999.99
Ag ICP PPM 0.2 200
Cu ICP PPM 1 10000
Pb ICP PPM 2 10000
Zn ICP PPM 1 10000
Mo ICP PPM 1 10000
Ni ICP PPM 1 20000
Co ICP PPM 1 20000
Cd ICP PPM 0.2 2000
Bi ICP PPM 5 2000
As ICP PPM 5 10000
Sb ICP PPM 5 2000
Hg CV AA PPM 0.01 50
Fe ICP PCT 0.01 10
Mn ICP PPM 1 20000
Te ICP PPM 10 2000
Ba ICP PPM 1 2000
Cr ICP PPM 1 20000
V ICP PPM 1 20000
Sn ICP PPM 20 2000
W ICP PPM 20 2000
La ICP PPM 1 2000
Al ICP PCT 0.01 10
Mg ICP PCT 0.01 10
Ca ICP PCT 0.01 10
Na ICP PCT 0.01 10
K ICP PCT 0.01 10
Sr ICP PPM 1 2000
Y ICP PPM 1 2000
Ga ICP PPM 2 10000
Li ICP PPM 1 20000
Nb ICP PPM 1 10000
Sc ICP PPM 5 2000
Ta ICP PPM 10 1000
Ti ICP PCT 0.01 5
Zr ICP PPM 1 5000
- 50 -
9.3 Data Verification
As mentioned in section 8.1 there is no data available on sampling and assay control in both the
103,657 SADCOs sample database or in the 733 samples from TVX Gold Corp. database. The
Companys ongoing sampling programme within the Zaruma Project area included original
channel re-sampling with the purpose of data verification and repeatability of the original assay
results, in particular for high-grade samples. Assay result comparison data charts of original and
re-sampled channels will be released after the programme has been completed.
Recent sample assay results reported by IAMGOLD do have an appropriate QA/QC quality
control similar to that by the majority of mining companies. IAMGOLD used basically 3
standards and their behaviour was followed-up on a total of 17,448 samples. However, only
9,335 samples were from the Zaruma Project area. The frequency of 1 standard per 20 samples
was established with random selection of different standards types, with a total of 213 standard
samples being used. Blank samples were inserted randomly but not less than 2 blanks per 100
samples.
1000
985:516030800;422570
950
928:6190200;99426160
924:436580100;423340
912:6200200;99426160
900 900:6141400;99426170
G old values (ppb)
850
800
750
733:466015600;420960
700
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26
Number of assay
KH1-STANDAR MEAN+20 MEAN-20 AU_STD1 AU_STD2 AU_STD3 AU_STD4
Fig. 22
KH 1 standard behaviour, IAMGOLD database
- 51 -
The behaviour of the standards show acceptable levels of dispersion with a stable performance
for standard KH-1 with all results falling within the range of 15% and are considered good
(Fig.22). Standard OX-4 gave higher dispersion values reaching in sample Au_STD33 up to a
80% higher value than expected and in the case of sample Au_STD20 almost 60% less. Despite
these 2 extremely out-of-range samples, the performance of standard OX-4 can be considered
satisfactory (Fig. 23). The author has no relevant information regarding procedures used
190
177: 514562000; 422900

170
150
145; 464156600: 464156600
V A LO R E S D E O R O (ppb)
139: 514367200; 422870
130 129: 514278000; 421680
120: 494416400; 9942565

117:494413200; 9942506
110
90
70
60: 464087000: A0012761
50
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26
DETERMINACIONES
OX4-SAMPLE1 OX4-SAMPLE2 OX4-MEAN MEAN MEAN +3 MEAN -3 AU_STD1
AU_STD2 AU_STD3 AU_STD4 AU_STD5 AU_STD6 AU_STD7 AU_STD8


AU_STD30 AU_STD31 AU_STD32 AU_STD33 AU_STD34
Fig. 23
OX-4 standard behaviour, IAMGOLD database
with sample batches that contained the standards Au_STD33 and Au_STD20 and these should
be re-assayed. The performance of standard OX-8 is considered very good, particularly in
sample batches submitted to the laboratory in late 1999 and before June, 2000 when the
QA/QC charts above were completed (Fig. 24).
- 52 -
240
220
200
180
160
140
120
0 5 10 15 20 25 30
OX 8_SA M P LE 1 OX 8_SA M P LE 2 N umb er o fOXassay
8_M E A N OX 8_ST D M E A N+8
M E A N-8 A U_ST D1 A U_ST D2 A U_ST D3 A U_ST D4
Fig. 24
OX-8 standard behaviour, IAMGOLD database.
Original laboratory certificates for IAMGOLD and TVX are not among the material available to
the author of this report. Sources of data used for mineral resource calculations were
spreadsheet files on four compact discs given to the author by Dynasty Metals and Mining
Corporation. However, the fidelity of the data was confirmed by the second copy of the data the
author obtained personally from the IAMGOLD office directly off the IAMGOLD GIS professional
Glenda Mantilla. Files originated with TVX Gold Corp. date from April 1995 to March 1996.
The IAMGOLD drill hole data contains complete results and was confirmed directly in the
IAMGOLD offices in Quito by the author of this report. In the case of data from tunnel samples, I
have included data listings from all veins in the Zaruma-Portovelo District which are within the
land tenements held and/or controlled by Dynasty Metals and Mining Corporation.
- 53 -
10.0 MINERAL RESOURCES
10.1 Historic Resource Estimations

The first attempt at a district precious metals resource estimation was made by TVX Gold Corp.
geologists in 1995. The author at the time of writing this report has no knowledge of earlier
Zaruma-Portovelo District potential resource estimations.
In March 1995, Quiroga, G., Regional Exploration Manager of TVX Gold Corp., estimated a
resource of 9.1 MT with average grade of 8 g/t totalling 2.3 Moz of gold in whole Zaruma-
Portovelo district (Ambrus, J., 1995) without considering silver and polymetalic credits. Mario
Alfaro, a TVX Gold Corp. consulting geologist, estimated on June, 1995 a total district potential
of 10 Moz from which up to 2.5 Moz should be contained in the northern, under-explored sectors
of Muluncay and Minas Nuevas (Alfaro, M., 1995). It is considered that the above calculations
refer to historic potential resource estimates in the project area and would be similar in broad
terms to an Inferred Mineral Resource category. It is also believed by the author that the
reliability of the potential resource estimate is fair reasonable.
Resource calculations made by IAMGOLD were not available to author, but an attempt was
carried out by IAMGOLD GIS expert Glenda Mantilla by applying the polygonal method and 3-
dimensional blocks using Gemcom software (personal information) in which each sample was
considered as a drill hole intersection. Apparently IAMGOLD did not conclude this task before
properties were transferred to Minera Australiana, however; a statement by IAMGOLD regarding
gold potential of the Zaruma Project is available on the IAMGOLD web site
http://www.iamgold.com/public-relations/press-releases/releases/pr_0401.htm#section7 :
A revised geological model of the Zaruma-Portovelo vein system, based on IAMGOLD drill
results and old mine data, indicates that major (+ 1 million ounce) pay-shoots are unlikely to
exist in areas along strike and down-dip of old workings although smaller pay-shoots may be
present.
10.2 Definitions and Parameters

The definitions and parameters employed in this report are identical to that defined by
Companion Policy 43-101.CP to National Instrument 43-101 Standards of Disclosure for Mineral
Projects, Section 1.4 Mineral Resources and Mineral Reserves Definitions (Canadian Institute of
Mining, Metallurgy and Petroleum; CIM Standards on Mineral Resources and Reserves;
Definitions and Guidelines, January 28, 2004):
- 54 -
1. Indicated Mineral Resource An Indicated Mineral Resource is that part of a Mineral
Resource for which quantity, grade or quality, densities, shape and physical
characteristics, can be estimated with a level of confidence sufficient to allow the
appropriate application of technical and economic parameters, to support mine planning
and evaluation of the economic viability of the deposit. The estimate is based on detailed
and reliable exploration and testing information gathered through appropriate techniques
from locations such as outcrops, trenches, pits, workings and drill holes that are spaced
closely enough for geological and grade continuity to be reasonably assumed.
2. Inferred Mineral Resource That part of a Mineral Resource for which quantity and
grade or quality can be estimated on the basis of geological evidence and limited
sampling and reasonably assumed, but not verified, geological and grade continuity. The
estimate is based on limited information and sampling gathered through appropriate
techniques from locations such as outcrops, trenches, pits, workings and drill holes.
10.3 Methodology of the Mineral Resource Calculation

The outcome of the mineral resource calculation was based on dimensions and grades of
individual veins determined from outcrops, trenches, tunnels and drill holes. A classic block
method has been applied using all available data at the time of writing this report. No resource
blocks that are dependent entirely on surface data have been considered in the indicated
resource calculation.
Indicated Resource blocks are assumed to extend for 1/5th part of the known strike extension
but not more than 75 meters up-dip and down-dip along the vein above and below the tunnel.
The plunge of mineralized ore shoots is taken into account in estimating the geometry of the
block, but that no more than 75 meters are measured in the dip direction of the structure. Blocks
included in Indicated Resource calculations are not extended laterally along strike beyond the
tunnel or outcrop in which they were defined.
Inferred Resource blocks are assumed to extend for 1/3 part of the known extension but not
more than 125 meters up-dip and down-dip along the vein, above and below the tunnel or below
the outcrop. As in the case of Indicated Resource, the plunge of mineralized ore shoots was
taken into account in estimating the geometry of the block, but that no more than 125 meters are
measured in the dip direction of the ore shoot. An application of these parameters is illustrated
on Fig. 25. Blocks included in Inferred Resource calculations as in the case of the Inferred
Resource do not extended laterally along strike beyond the tunnel or outcrop in which they were
- 55 -
defined. As mentioned previously, ore shoot geometry is determined by oblique, strike slip left
lateral faults and result in ore shoots plunging 65o-75o south.
800
600
10000
10200
9600
9800
LEGEND
Jane Vein - Gold distribution
Au [g/t]
> 10 g/t resource
over 100 g/t (13)
25 to 100 g/t (85)
10 to 25 g/t (185) 7 - 10 g/t resource
5 to 10 g/t (218)
2 to 5 g/t (564)
< 7 g/t resource
< 1 g/t (1159)
Fig. 25
Longitudinal Section of the Jane Vein, Zaruma. Mineral Resource calculation based on 2245
underground channel samples.
Only limited Mineral Resource calculations were based on drill holes due to the wide spacing of
the IAMGOLD drilling programme. In the case where a drill hole intersection was included into
the mineral resource calculations, this resource was considered only in the Inferred Resource
calculation. Exceptionally, as in the case of the Tamayo Vein resource calculation, the drill hole
RM-11 intersection was included in the Indicated Resource calculation as this particular drill hole
intersected an obvious extension of the mineralized ore shoot as shown on Fig. 26.
Inferred Resource blocks may be based on a single drill hole intercept. It is assumed to extend
for 50 meters up-dip and down-dip from the drill hole intercept, taking into account the plunge of
- 56 -
mineralization. It is also assumed to extend for 50 meters laterally along strike in both directions
from a drill hole intercept.
Fig. 26
High-grade RM-11 drill hole intersection in projection of ore shoot on Tamayo Vein.
- 57 -
11.0 MINERAL RESOURCE ESTIMATES
11.1. Available Data

Data available at the date of report writing provided by both Dynasty metals and Mining Corp.
and IAMGOLD totalled:
1. 680 surface rocks channel and chip samples
2. 2,126 underground channel samples (IAMGOLD)
3. 733 underground channel samples (TVX Gold Corporation)
4. 103,657 underground channel samples (SADCO)
5. 5,415 soil samples
6. 37 diamond drillholes results including sample assay results
7. 1,114 DDH core samples
8. 2,591 topographical control points survey
9. 39 stream sediments samples
10. 369 channel samples form surface trenching
Apart from sample databases IAMGOLD provided GIS information including topographical
survey with 10m vertical resolution, geological mapping at the scale 1:10,000 and 12 geological
sections. A total of 43.26km of underground survey and geological mapping at 1:2,000 scale
was provided by IAMGOLD and additionally original TVX Gold Corp. underground survey and
geological mapping totalling 27.56km at the scale 1 : 1000 was available in Dynasty Metals and
Mining office in Quito.
11.2. Units conversions

Ore grades which have been in ounces have been converted to grams per ton (ppm = parts per
million) with purposes of statistics and grade estimation. This conversion prevented rounding
errors during computation. All distance units which have not been in the metric system have
been converted to meters, millimetres and kilometres respectively.
11.3. Data statistics

Approximately 49% of the 103,657 underground channel sample from SADCO database were in
the interval 0 to 5 g/t Au, 35% in the interval 5-15 g/t Au; 15% in the interval 15-100 g/t Au and
2% in the interval over 100 g/t Au. It was assumed that gold values exceeding the 98th percentile
were erratic highs and these were cut to the 98th percentile value. Thus in the case of gold
- 58 -
values, those exceeding 82.73 g/t Au were cut to 82.73 g/t Au (Fig.27). The 98th percentile
values for other metals were: 132.3 g/t for silver (Fig.28); 0.93% for lead (Fig.29); 1.3 % for zinc
(Fig.30) and 1.2% for copper (Fig. 31). The original data for silver and base metals 98th
percentile values calculations
Sampling width interval distribution calculated on SADCO database returned 12% of the
samples in less than 0.5m sample length; 23% in the interval of 0.5-1.0m; 50% in the interval
1.0-2.0m and 15% in the interval 2.0 - <4.0m.
Fig. 27
Gold values distribution log/probability plot and summary statistics.
The 98th percentile indicated by red line
- 59 -
Fig. 28
Silver values distribution log/probability plot and summary statistics.
Fig. 29
Lead values distribution log/probability plot and summary statistics.
- 60 -
Fig. 30
Zinc values distribution log/probability plot and summary statistics.
Fig. 31
Copper values distribution log/probability plot and summary statistics.
- 61 -
The summary geochemical correlations statistics calculated from IAMGOLD underground
channel samples assay results is suggesting surprisingly poor correlation between silver and
gold ( 0.55) and very weak, if any correlation of gold with zinc (0.25), lead (0.37) and copper
(0.29) respectively (Fig. 32 and 34). Silver (Fig. 32 and 33) shows strong correlation with
copper (0.76) and moderate correlation with lead (0.60), zinc (0.51) and bismuth suggesting Ag-
Cu-Bi sulphosalts (benjaminite, matildite?) presence in mineral assemblages supported by
moderate correlation of Bi with Cu (0.58). Very strong correlation between Zn and Cd (0.96) is
suggesting cadmium bearing sphalerite and thus correlation between Ag and Cd (0.55) could be
explained by previously mentioned moderate correlation of Ag with Zn. Strong correlation of Cd
and Pb (0.73) is suggesting very close genetic relationship between and almost simultaneous
crystallization of galena and sphalerite from hydrothermal solutions confirmed by microscopic
study as described in section 7.2.5. Remaining correlations which can be observed in
correlations diagram (Fig. 34) can be attributed to classic mineral pairs and assemblages (Fe-
Mn-V-Co-Ni).
Fig. 32 Fig. 33
Triplot analysis of Au-Pb-Zn showing very poor Triplot analysis of Ag-Pb-Zn showing slightly
correlation of Au with Pb-Zn better correlation of Ag with Pb-Zn in

comparison with Au
- 62 -
Fig. 34
Underground channel sampling assay results correlations.
(IAMGOLD data base)
- 63 -
11.4. Summary of Mineral Resources
The summary of Mineral Resources of gold both Inferred Mineral Resource and Indicated
Mineral Resource calculated from the SADCO sample database is presented in Table 6. Silver
equivalence has not been taken into consideration as the silver assay results were missing in
the 103,657 SADCO samples available to the author at the time of writing this report. Only
estimated silver equivalence can be considered which is based on the Au : Ag ratios as listed in
Table 4 and calculated from the IAMGOLD and TVX data ( Au : Ag = 1 : 11).
Table 6.
MINERAL RESOURCES CONTAINED IN ZARUMA PROJECT AREA AT

22 OCTOBER 2004
MINERAL RESOURCES CALCULATED FROM SADCO DATA
MINERAL RESOURCE INDICATED INFERRED

STRUCTURE TONNES G/T Au ozs TONNES G/T Au ozs
25 20,613 9.52 6,309 32,750 6.17 6,497
29 10,249 15.17 4,999 20,010 9.68 6,228
ABUNDANCIA 233,087 17.03 127,635 369,170 5.83 69,204
AROSEMA 5,483 24.43 4,307 15,312 15.17 7,468
BARBASCO 34,126 14.17 15,548 88,646 8.07 23,002
CAD 21,989 32.02 22,639 37,696 22.24 26,956
CANTABRIA WEST 8,432 61.03 16,546 15,991 49.31 25,354
CRISTINA 28,067 37.22 33,590 74,783 18.01 43,306
FORTUNA 29,294 20.09 18923 71,370 11.57 26,551
JANE 49,063 17.22 27,166 93,145 7.90 23,660
MATALANGA 2,404 24.43 1,888 11,420 16.67 6,121
NUDO and NUDO WEST 47,476 13.88 21,188 80,071 12.31 31,693
QUEBRADA 7,62 23.55 5,770 11,500 10.91 4,034
SUCRE 14,766 14.87 7,060 30,289 9.31 9,067
TAMAYO 29,636 15.51 14,779 62,534 10.17 20,449
TRES REYES 14,369 16.99 7,849 22,314 10.91 7,827
MINERAL RESOURCES 556,676 18.78 336,196 1,036,999 10.12 337,417
- 64 -
The mineral resources stated in Table 6 were entirely calculated from the original SADCO data
which, despite a lack of QA/QC control were confirmed by outgoing mine production and so the
author considers the data credible. Original data with coordinates in local SADCOs grid have
been converted to UTM PSAD 56, zone 17S grid based on underground surveys carried out by
IAMGOLD. Data was converted from original ounces to grams per ton = parts per million (g/t =
ppm) and plotted on longitudinal sections in MapInfo v.7.0 as points. MapInfos thematic mapper
utility and its built-in Ranges Natural Break algorithm have been applied for individual plotted
samples and were plotted on the sections.
Average width and grade for each block was then calculated from samples within the block limits
+ up-dip and down-dip extensions as defined in Section 10.3. The block extensions were strictly
defined and limited by ore shoot geometry. For the purpose of ore shoot geometry definition the
dataset for each vein were converted to CVS files and imported to Geosoft v.5.1.7 assay
databases. Data was then processed by a Minimum Curvature gridding utility with grid cell size
set on of sample to sample distance with logarithmic algorithm. Blanking distance of 50m has
been set in order to avoid geochemical anomalies distortion or false anomaly extensions due to
missing data. Internal tension has been set to 0.6 in order to avoid a false anomaly extensions
when high grade samples were within the edge of the area covered by the data. In some cases,
a slight colour range adjustment was required of the final colour-shaded plots in order to fit
individual ranges to scale defined by dataset statistic parameters (mean mean + 1STD
mean + 2STD).
The colour-shaded vein profile results were extremely useful for correct definition of ore shoot
geometry which could be difficult if not impossible to determine from range value point plot
profiles produced by MapInfo as shown on some typical vein profiles after data have been
processed by gridding in Geosoft (Figs 35 and 36).
400
200
-200
1000
1200
1400
-800
-600
-400
-200
200
400
600
800
0
Fig. 35
Longitudinal profile of the Abundancia Vein. Colour shaded plot of gold distribution is based on
15,542 sample data points
800
600
400
10000
10200
9200
9400
9600
9800
Fig. 36
Longitudinal profile of the Cristina Vein. Colour shaded plot of gold distribution is based on 9,501
sample data points
- 66 -
The Mineral Resources calculated from the SADCO data and listed in Table 6 was added to by
Mineral Resources in both the Indicated and Inferred category from recent data acquired by TVX
Gold Corp., IAMGOLD, Minera Australiana and Dynasty Metals and Mining Corp. and are listed
in Table 7. The dataset used for this calculation includes underground channel sample data,
drilling intersections and surface trenching data. However, Mineral Resources calculated from
surface trenching results and surface vein outcrops channel sampling (Fig. 38) were added
exclusively to the Inferred Mineral Resource.
- 67 -
Table 7.
MINERAL RESOURCES CONTAINED IN ZARUMA PROJECT AREA AT

22 OCTOBER 2004
MINERAL RESOURCES CALCULATED AND ADDED FROM IAMGOLD, TVX GOLD

Corp., MINERA AUSTRALIANA and DYNASTY METALS AND MINING CORP. DATA
MINERAL RESOURCE INDICATED INFERRED
BARBASCO EAST 15,432 19.60 9,725 46,136 11.23 16,659
BARBASCO SOUTH 12,577 7.80 3,154 27,527 6.30 5,576
QUEBRADA SW 0 0.00 0 21,300 10.91 7,472
FORTUNA SOUTH 8,945 24.60 7,075 62,766 5.20 10,494
MATALANGA WEST 0 0.00 0 76,468 8.40 20,653
MATALANGA 2 0 0.00 0 11,355 8.40 3,066
PACAYURCO 14,400 32.03 14,830 18,976 30.34 18,512
SUCRE 22,500 10.00 7,234 109,500 9.50 33,448
SUCRE EAST 6,600 21.20 4,499 10,650 20.10 6,883
SUCRE WEST 22,800 11.78 8,636 37,075 11.05 13,172
TAMAYO NORTH 0 0.00 0 88,148 7.84 22,221
TAMAYO EAST 46,454 14.80 22,106 74,602 10.34 24,803
TRES DIABLOS 1,600 4.30 221 2,300 4.10 303
ELENA 11,436 8.40 3,088 64,327 5.83 12,058
ELENA SOUTH 0 0.00 0 53,221 6.43 11,003
TRES REYES EAST 13,872 14.20 6,333 32,012 10.20 10,499
MINERAL RESOURCES 176,616 15.30 86,901 736,363 9.16 216,822
- 68 -
646.000E
648.000E
650.000E
652.000E
654.000E
656.000E
N
Dynasty Concessions
W E
S
9'604.000N 9'604.000N
9'602.000N 9'602.000N
Hu
er
ta
s
Fa
ul
9'600.000N t 9'600.000N
9'598.000N 9'598.000N
9'596.000N 9'596.000N
Pu
en
te
Bu
9'594.000N za
9'594.000N
Fa
ult
Pi
9'592.000N as T 9'592.000N
hru
st
Mapped veins
9'590.000N 9'590.000N
Inferred veins
Exploited veins
9'588.000N 9'588.000N
DYNASTY METALS & MINING INC.
ZARUMA PROJECT
Rock Geochemical Programme
- Au distribution color shaded plot
(log distribution, 800m blanking distance)
9'586.000N 9'586.000N
Date : 04-01-2004 Update : Figure # :
Author : M.Kalinaj By:
Scale : 1 : 25,0000
Projection :PSAD 1956, UTM 17S
646.000E
648.000E
650.000E
652.000E
654.000E
656.000E
Fig. 37
Surface Rock Geochemistry colour shaded plot with individual sample locations (1,413 samples)
and a plot of the traces of veins and major thrusts
- 69 -
Taking into consideration the land tenement situation as shown in Fig. 2, the Mineral Resource
calculated on structures within the Portovelo area and on the property owned and/or controlled
by Dynasty Metals and Mining Corp. is listed separately in Table 8. If Dynasty Metals and Mining
Corporation negotiations with the remaining small producer associations is successful and the
Company reaches an entire district tenement consolidation this Mineral Resource should
considerably increase the total Mineral Resource over and above the 1461,525 oz of gold as
stated in Table 9.
Table 8.
MINERAL RESOURCES CONTAINED IN PORTOVELO AREA AT

22 OCTOBER 2004
MINERAL RESOURCES CALCULATED FROM SADCO DATA
MINERAL
INDICATED INFERRED
RESOURCE
ABUNDANCIA
124,307 17.32 69,228 188,441 10.45 63,318
EAST
CENTENARIO 65,625 9.60 20,257 93,750 9.00 27,130
COLORADA 33,750 9.60 10,418 60,000 9.10 17,556
CURIPAMPA 42,660 26.27 36,034 79,377 12.12 30,934
JORUPE 48,769 13.50 21,169 64,786 8.77 18,269
PALACIOS 14,063 38.15 17,250 42,188 36.20 49,106
POBRE 17,500 13.60 7,652 52,500 12.90 21,776
PORTOVELO 44,409 23.12 33,014 69,176 13.24 29,449
SALVADORA 981 65.08 2,052 2,390 33.20 2,551
VIZCAYA 6,533 21.22 4,457 18,096 4.97 2,891
MINERAL
398,597 17.33 221,531 670,704 12.19 262,980
RESOURCES
- 70 -
Table 9.
TOTAL MINERAL RESOURCES CONTAINED IN ZARUMA PROJECT INCLUDING THE

PORTOVELO AREA
RESOURCE INDICATED INFERRED
AREA TONNES G/T Au ozs TONNES G/T Au ozs
ZARUMA
733,292 17.94 423,097 1,773,362 9.72 554,239
PROJECT
PORTOVELO
398,597 17.33 221,531 670,704 12.19 262,980
DISTRICT
ZARUMA AND
1,131,889 17.73 644,628 2,444,066 10.40 817,219
PROTOVELO
In the Total Mineral resource calculation listed in Table 9 has not been included the potential of
the northern areas of Muluncay and Minas Nuevas sectors which can be another significant
additional source for an increase in the Mineral Resource. As mentioned previously, the author
of this report had no available digital information from these sectors, however; hardcopies of the
TVX information have been revised in the Companys office. It is the authors opinion that these
sectors could increase significantly the Mineral Resource potential if Dynasty Metals and Mining
Corp. did consolidate the land tenements covering the Muluncay and Minas Nuevas areas and
negotiate reasonable option terms with the tenement holders.
- 71 -
12.0 OTHER RELEVANT DATA and INFORMATION
As have been mentioned in previously in this report, there is information concerning the Zaruma
Project that was not available to me in digital form at the time this report was written, TVX Gold
Corp. underground sampling databases in particular. Much of the material that was not available
consists of sampling results from veins outside of the Dynasty Metals and Mining Corporation
owned and/or controlled properties (Muluncay and Minas Nuevas areas) and thus irrelevant to
this report.
The author is confident that sufficient information is available to support the statements and
conclusions reached in this report. I do not believe that missing information would substantially
change the statements and conclusions made herein.
13.0 CONCLUSIONS AND RECOMMENDATIONS
The gold mineralisation distribution in the Zaruma Portovelo area is today well understood
particularly thanks to IAMGOLDs systematic research during the last couple of years. The gold
mineralisation concentration has been proved to be confined to the footwall of NW-SE thrusts
along the 15 km strike length of the vein system. Two generations of gold mineralisation have
been determined on an extensive data and research base:
1. Gold associated with strong base metals mineralisation encapsulated in sulphides and
probably closely genetically related to base metal deposition
2. Gold associated with dark, botryoidal quartz and silver sulphosalts (Section 7.2.5)
Such botryoidal quartz associated with bonanza-grade gold mineralisation was intersected by
IAMGOLD in drill hole RM-11 in the southern part of the Tamayo Vein (Fig. 26) with an
intersection of 0.75m @ 49.32 g/t Au. The Tamayo Vein occurs almost entirely within the
Dynasty Metals and Mining Corporation controlled area and is one of the most promising
exploration targets defined by the Company.
Another gold concentration controlling factor was the defined competent wall-rocks, in particular,
melanocratic diorite, however, high-grade mineralisation has also been encountered in welded
ignimbrites, diorites and quartz diorites.
One of the most important factors controlling high-grade gold concentrations was determined by
the zone immediately beneath the change in wall-rock alteration from illite to illite-smectite mixed
- 72 -
layer clays (Fig. 11). This suggests that the most prospective ground for exploration lies within
the northwest striking trend of the transition from the southernmost part in vicinity of the old
Portovelo mine to the more western located veins (e.g. Sucre area). This transition trend, as
defined by IAMGOLD, is almost entirely controlled by Company. Another feature controlling the
gold mineralisation is despite the generally northward dipping ore shoots these are arranged in
band-like clusters which plunge to the south (Billingsley, 1926 in Spencer, R., 2002). This can
have a crucial significance to the Company because it means that the already exploited
bonanza-grade veins in the old Portovelo area may extend into the southern part of the district
beneath illite-smectite alteration. This area is once again entirely under the control of Dynasty
Metals and Mining Corporation.
Applying all the above mentioned high-grade gold mineralisation controls to the Company
controlled areas in the Zaruma Portovelo area it is obvious that Dynasty Metals and Mining
Corporation is controlling all exploration targets within the district as shown on Fig. 38. Each
exploration target is based on the proximity to the footwall of major thrust ramps or within the
transition from Iillite-smectite to illite zone or in the continuation of southerly plunging ore shoot
clusters in the Portovelo area. The abundance of untested drill targets almost exclusively within
the property controlled by the Company and the consolidated land tenement potential thanks to
ongoing negotiations with the remaining small miners are all factors which makes the Zaruma
Project one of the promising high-grade gold targets in Ecuador in the present day.
From this point of view, the calculated Mineral Resource of the Zaruma Project presented in this
report can be considered as conservative.
- 73 -
646.000E
648.000E
650.000E
652.000E
654.000E
656.000E
N Dynasty Concessions
W E
S
9'604.000N 9'604.000N
B
Caa
Biioott
C
Chhll
llccii
iittee
oorriitt
A
ttee
Acc
9'602.000N 9'602.000N
iinn
ttiinnoo
EEpp
ee
0.8
0.8
0.8 g/t
0.8
0.8
0.8 g/t
g/t
g/t
g/t
iiddoo
lliittee
ttee
iinn
IIllll
HHuu
iittee
9'600.000N 9'600.000N
err
ttaa
IIllllii
ss
Faa
ttee
0.7
0.7
0.7g/t
0.7
0.7
0.7 g/t
g/t
g/t
g/t ullt
--ss
0.8
0.8
0.8g/t
0.8
0.8
0.8 g/t
g/t
g/t
g/t
t
mm
4.4
4.4
4.4 g/t
g/t
g/t
eecc
4.2
4.2
4.2 g/t
4.2
4.2
4.2 g/t
g/t
g/t
g/t
TToouurrm
ttiitt
maalliinn 9'598.000N
ee
9'598.000N
0.5
0.5g/t
0.5 g/t
g/t
ee IInn
M
Maaggnn
9'596.000N
eettiittee 9'596.000N
iinn
PPu
eenn
tee
1.2
1.2
1.2g/t
1.2
1.2
1.2 g/t
g/t
g/t
g/t
Buu
Chlorite in
9'594.000N 9'594.000N
4.5
4.5
4.5g/t
4.5
4.5
4.5 g/t
g/t
g/t
g/t
zaa
FFa
AA uullt
cctt t
iinn
ooll
P
Piiaa iittee
ss TThh
9'592.000N rruuss 9'592.000N
tt
EEpp
iiddo
ott
ee
iinn
9'590.000N 9'590.000N
CCaa
llcc
9'588.000N
iittee 9'588.000N
iinn
9'586.000N 9'586.000N
646.000E
648.000E
650.000E
652.000E
654.000E
656.000E
Fig. 38
Zaruma Project Soil Sampling Programme - Gold distribution colour shaded plot.
A yellow circle represents exploration targets. A total of 5,415 samples are plotted on the map.
- 74 -
14.0 REFERENCES
- Spencer, R.M., et al, 2002, The Portovelo-Zaruma Mining Camp, Southwest Ecuador.
Porphyry and Epithermal Ebvironments. SEG Newsletter, Society of Economic Geologists,
April 2002, Number 49, 14 p.
- Mapa Geolgico de La Repblica del ECUADOR, 1969. National Service of Geology and
Mining of Ecuador and Bureau dEtudes Industrielles et de Cooperation de Institut Franais du
Petrole
- Billingsley, P.,1926, Geology of the Zaruma gold district of Ecuador. American Institute of
Mining and Metallurgical Engineering, v. 74, p.255-275
- Sillitoe, R.H., 2000, Comments on the Portovelo-Zaruma vein gold district and environs,
Ecuador. Unpublished report, IAMGOLD Corp., 6 p.
- Corbett, G.J. and Leach T.M., 1988, Southwest Pacific Rim Gold-Copper system, structure,
alteration and Mineralisation. Society of Economic Geologist, Special Publication, number 6.
236 p.
- Hagemann, S.G. and Brown, P.E., 2000, Gold in 2000, Reviews in Economic Geology, volume
13, 559 p.
- Goossens, P.J., 1972, Metallogeny in Ecuadorian Andes, Economic Geology, vol. 67, 458-468
p.
- Australian Code for Reporting of Mineral Resources and Ore Reserves (The JORC Code).
Prepared by the Joint Ore Reserves Committee of The Australasian Institute of Mining and
Metallurgy, Australian Institute of Geoscientists and Minerals Council of Australia (JORC).
September 1999, 25 p.
- Kalinaj,M., 1995, Resultados de estudio microscopico de laminas transparentes y secciones
pulidas. Unpublished Internal report for TVX Gold Corpration, 1995, 7 p.
- Quiroga,G. J., 1995, Visit to Portovelo Minino District, El Oro Province Southern Ecuador.
Unpublished Internal report for TVX Gold Corporation, March 7, 1995, 8 p.
- Allen, D.G., 2003, Summary Geological Report on the Pacayurco Property (Roma &
Pacayurco bajo Concessions), El Oro Province Southwestern Ecuador. Unpublished Internal
report for Minera Australiana S.A., January 2003, 9 p.
- Alfaro, M., 1995, Informe Preliminar Proyecto Portovelo. Unpublished Internal report for TVX
Gold Corporation, June 29, 1995, 19 p.
- 75 -
15.0 APPENDIXES
APPENDIX A
Miroslav Kalinaj
Los Cedros 420, La Molina
Lima 012, PERU
Telephone: 0051-1-3654840
Fax: 0051-1-3654840
Email: mirkal@terra.com.pe
CERTIFICATE of AUTHOR
I, Miroslav Kalinaj, MSc. do hereby certify that:
1. I am Consulting Geologist of:
Dynasty Metals & Mining Inc.
Ultimas Noticias N37-81 y Joaqun Auz,
Quito, ECUADOR
2. Im the graduate of the University of Komensky, Bratislava, Czechoslovakia having received
an Hon. B.Sc. in Earth Sciences in 1987, and have practiced my profession as a geologist
continuously since. I also hold the degree of MSc. granted by Komensky University in Bratislava,
Czechoslovakia, in 1989.
3. I am a member of the Association of Mining Engineers and Geoscientists of Peru License #
1599 and a Fellow of the Society of Economic Geologist in USA.
4. I have read the definition of "qualified person" set out in National Instrument 43-101 ("NI 43-
101") and certify that by reason of my education, affiliation with a professional association (as
defined in NI 43-101) and past relevant work experience, I fulfil the requirements to be a
"qualified person" for the purposes of NI 43-101.
5. I am responsible for the preparation of section sections 1, 2, 3, 4, 5, 6, 7, 8, 9, 10,11,12,13,
14, 15, 16, 17 and 18 of the technical report titled ZARUMA PROPERTY (the "Technical
Report").
6. I visited the Zaruma Project on the 4th and 8th of February 2004. During the visit I examined
several underground workings and outcrops mentioned in this report.
7. I have had prior experience with the property within the period of 8 months during 1995 and
1996 carrying out underground mapping and geochemical sampling as a staff geologist of TVX
Gold Inc.
- 76 -
8. I am not aware of any material fact or material change with respect to the subject matter of
the Technical Report that is not reflected in the Technical Report, the omission to disclose which
makes the Technical Report misleading.
9. I am independent of the issuer applying all of the tests in section 1.5 of National Instrument
43-101. I am not an employee of Dynasty Metals & Mining Inc.
10. I have read National Instrument 43-101 and Form 43-101 F1 and the Technical Report has
been prepared in compliance with that instrument and form.
11. I consent to the filing of the Technical Report with any stock exchange and other regulatory
authority and any publication by them for regulatory purposes, including electronic publication in
the public company files on their websites accessible by the public, of Technical Report
12. A copy of this report is submitted as a computer readable file in Adobe Acrobat PDF format.
The requirements of electronic filing necessitate submitting the report as an unlocked, editable
file. I accept no responsibility for any changes made to the computer file after it leaves my
control.
Dated this 22 day of October, 2004
Miroslav Kalinaj
Miroslav Kalinaj
Miroslav Kalinaj
Lima 012, PERU
Telephone: 0051-1-3654840
Fax: 0051-1-3654840
- 77 -
APPENDIX B
Letter Agreement dated August 08 ,2003
between Minera Australiana S.A. and IAMGOLD Ecuador S.A.
MINERA AUSTRALIANA S.A.
Avenida Ultimas Noticias N37-81

Y Joaquin Auz
Quito, Ecuador
fax number 593 (2) 225-4138
August 08, 2003
IAMGOLD Ecuador S.A.
Avenida El Tiempo N37-67 y El Comercio, Quito, Ecuador
Fax number 593 (2) 246-8673
Attention: Richard Spencer, Exploration Manager South America, IAMGOLD Corp.
Dear Sirs:
Re: Retazos Project, Ecuador (the Property)
We provide this letter to confirm the terms and conditions upon which we will acquire the Property. By
signing this letter the parties hereto have entered into a binding agreement (the Agreement) on the
terms and conditions contained herein.
1. For the purposes of this Agreement, the following terms shall be defined as follows:
(a) Australiana means Minera Australiana, an Ecuadorian corporation;
(b) Closing Date means September 15th, 2003;
(c) Effective Date means the date of this Agreement;
(d) Iamgold means IAMGOLD Ecuador S.A.;
(e) NSR Royalty means the royalty to be granted by Australiana to Iamgold pursuant to
Section 5 of this Agreement, in the form attached to this Agreement as Schedule C;
(f) Property means the property represented by the concessions described on Schedules
A1 and A2 and shown on the map attached as Schedule B;
(g) Reporting Issuer means a party which acquires an interest in the NSR Royalty as
described in Section 6 of this Agreement; and
(h) Underlying Agreements means all agreements relating in any manner to the Property.
2. Australiana has entered into this Agreement based upon the following representations
and warranties made by Iamgold:
(a) Iamgold is the registered and beneficial owner of the concessions that constitute part of
the Property as described in Schedule A1. Applications have been filed for all of the
concessions listed in Schedule A1, such applications having been made in the ordinary
course and in accordance with prevailing laws, and such concessions have been
- 78 -
registered in the ordinary course in accordance with prevailing laws. All such
concessions are in all respects in good standing in the offices of the applicable mining
authorities to the respective dates specified in Schedule A1; Concessions listed in
Schedule A2 constitute the remainder of the Property and are held by Iamgold through
third party agreements. No warranty is given by Iamgold as to the status of these
concessions: this will be verified by Australiana in its due diligence of the concessions
described in Schedule A2.
(b) Iamgold has the rights to the concessions listed in Schedule A2 through its rights and
privileges under third party agreements, copies of which are included in Schedule D.
(c) Iamgold is a valid and subsisting corporation duly incorporated and in good standing
under the laws of Ecuador.
(d) Iamgold has not taken steps to encumber or alienate the Property;
(e) Iamgold has provided to Australiana complete copies of all of the Underlying Agreements;
(f) except as reflected in the Underlying Agreements, to the best of Iamgolds knowledge, no
other person claims any mineral title to any area covered by the Property nor any interest
in the Property itself;
(g) Iamgold has the necessary corporate capacity and authority to execute and deliver this
Agreement and to observe and perform its covenants and obligations hereunder and has
taken all necessary corporate action in respect thereof, and this Agreement will constitute
a legal, valid and binding contract of Iamgold enforceable against Iamgold in accordance
with its terms. Neither this Agreement nor the completion of the transactions
contemplated hereby conflicts, or will conflict, or will result, in a breach or violation of any
law or regulation of any kind whatsoever applicable to Iamgold, any constating
documents of Iamgold or any agreement of any kind whatsoever to which Iamgold is a
party or by which Iamgold is bound.
These representations and warranties shall survive the completion of this Agreement for a period of one
year from the Effective Date.
3. Iamgold has entered into this Agreement based upon the following representations and
warranties made by Australiana:
(a) Australiana is a valid and subsisting corporation duly incorporated and in good standing
under the laws of the jurisdiction of Ecuador.
(b) Australiana has the necessary corporate capacity and authority to execute and deliver this
Agreement and to observe and perform its covenants and obligations hereunder and has
taken all necessary corporate action in respect thereof, and this Agreement will constitute
a legal, valid and binding contract of Australiana enforceable against Australiana in
accordance with its terms. Neither this Agreement nor the completion of the transactions
contemplated hereby conflicts, or will conflict, or will result, in a breach or violation of any
laws or regulation of any kind whatsoever applicable to Australiana, any constating
documents of Australiana or any agreement of any kind whatsoever to which Australiana
is a party or by which Australiana is bound.
These representations and warranties shall survive the completion of this Agreement for a period of one
year from the Effective Date.
4. Iamgold hereby agrees to assign, transfer and convey to Australiana the full title to, or
application for, the Properties listed in Schedule A1 and Iamgold's interest in the third party agreements
relating to the Properties listed in Schedule A2, free and clear of any liens, claims, charges or
- 79 -
encumbrances other than the NSR Royalty defined in Schedule C, on the Closing Date or such other date
as mutually agreed to by the Parties.
5. In consideration of the transfer described in Section 4, Australiana will grant in favour of

Iamgold the 3% NSR Royalty on the Closing Date.
6. On the Closing Date:
(a) Iamgold will deliver to Australiana such bills of sale and other documents as may be
necessary or appropriate to transfer title to the Property into the name of Australiana, free
and clear of any encumbrances other than the NSR Royalty, such bills of sale to be in
registrable form; and
(b) Australiana will grant the 3% NSR Royalty in favour of Iamgold.
7. From and after the Effective Date:
(a) Australiana shall have the sole and exclusive right and authority to explore and develop
the Property in accordance with the laws of Ecuador.
(b) Australiana shall hold Iamgold harmless for environmental damages resulting from
Australianas exploration, development and production activities on the Property.
8. The Parties further agree that:
(a) any disputes hereunder shall be submitted to a single arbitrator for arbitration pursuant to
the Commercial Arbitration Act of British Columbia;
(b) any notice, demand, payment or other communication (collectively the Correspondence)
to be given hereunder shall be in writing and shall be delivered to the address or fax
number of the party appearing herein;
(c) they shall do all such things and execute all such written materials as may be required to
carry out the full intent and meaning of this Agreement;
(d) Australiana shall be entitled to assign this Agreement (or the Property or any part of or
interest in the Property) to any person without the consent of and with notice to the other,
provided that the assignee agrees to be bound in writing to Iamgold by the terms and
conditions of this Agreement and the NSR Royalty; on transferring 100% of its interest on
this agreement Australiana will cease to have any obligations or liabilities under this
agreement provided that the assignee has agreed to be bound in writing to Iamgold by
the terms and conditions of this Agreement and the NSR Royalty.
(e) this Agreement shall enure to the benefit of and be binding upon the parties hereto and
their respective successors and permitted assigns;
(f) this is the entire Agreement between the parties in respect of the matter referred to herein
and no amendment or interpretation of this Agreement will be binding on the parties
unless same is in writing executed by the parties hereto;
(g) this Agreement shall be construed and governed with respect to property title matters and
status of the parties as participants in a joint venture by the laws in force in Ecuador and,
with respect to all other matters, by the laws in force in British Columbia; and
- 80 -
(h) Australiana has no obligation to maintain the concessions or agreements related to the
concessions and may discontinue them without the consent of and without notice to
Iamgold.
(i) the Parties agree that they shall take from time to time such action and shall sign or
execute such additional instruments to fully register this Agreement and/or the NSR
Royalty at the applicable mining registries in Ecuador or as may be reasonably necessary
or convenient to implement and carry out the intent and purpose of this Agreement. The
Parties acknowledge that such registration shall require the translation of this Agreement
and/or the NSR Royalty into Spanish, and agree that the English version of this
Agreement shall prevail in the event of any inconsistency.
9. Each of Iamgold and Australiana and their respective affiliates undertakes and agrees
that all data, records and other information of any kind developed or acquired by any party in connection
with this Agreement (Confidential Information), shall be treated as confidential, provided that the
Confidential Information may be disclosed to affiliates, to the public or to government agencies as
required by pertinent law, or to a stock exchange as required by its rules, or to any contractors, sub-
contractors or consultants a party may engage who agree to keep it confidential. Australiana may release
information to a third party provided that they sign a confidentiality agreement.
10. The obligations of Australiana in pursuance of this Agreement are subject to the fulfilment
of a Due Diligence period for 30 days after the Effective Date, or within such other time as may be
mutually agreed upon by the Parties, of the following conditions precedent for the exclusive benefit of
Australiana:
(a) completion of a review by Australiana of title to the Property to the satisfaction of

Australiana;
(b) Iamgold furnishing to Australiana all technical data with respect to the Property, and
Australiana completing a review of such data to its satisfaction;
(c) Australiana will take posession of the bore hole core from the Property. Costs associated
with moving the core to another location other than that in which it is presently located in
Zaruma will be for Australianas account.
(d) Iamgold furnishing to Australiana complete copies of all of the Underlying Agreements
and Australiana completing a review of the Underlying Agreements to its satisfaction; and
(e) all requisite regulatory approvals.
11. On completion of the Due Diligence, Australiana will have no recourse to Iamgold regarding the
completeness and accuracy of data provided.
Please sign and return the enclosed copy of this Agreement to us to indicate your agreement to the terms
and conditions set forth herein. The parties acknowledge that this Agreement may be signed in
counterpart and by facsimile, if necessary.
- 81 -
Yours truly,
Minera Australiana S.A.
Per:
Signature of Signatory
Name and Title of Signatory:
Robert Washer, General Manager
This Agreement has been signed and delivered by:

IAMGOLD Ecuador S.A Address:
Per: Avenida El Tiempo N37-67 y El Comercio
Quito, Ecuador
Signature of Signatory Fax No. (593) 2 246-8673

Name and Title of Signatory:
Richard Spencer,
Exploration Manager South America
IAMGOLD Corporation
- 82 -
SCHEDULE C
Schedule C to the Letter Agreement dated August 08 ,2003
NET SMELTER RETURN ROYALTY
1. Grant of Royalty: Australiana, or its Affiliate which holds the Property (in this Schedule,
Australiana) shall pay to IAMGOLD a net smelter return royalty (the Royalty) on all ores,
minerals, metals or other products mined and sold (or deemed sold) by Australiana arising from
the exploitation of the Property calculated at a rate of 3.0% of Net Smelter Returns.
2. Definitions: For the purpose of this Schedule, the following words and phrases shall have the
following meanings:
(a) Affiliate means, as to any party, any person, partnership, joint venture, corporation or
other form of enterprise which directly or indirectly controls, is controlled by or is under
common control with that party, and for the purposes of this definition control means
possession, directly or indirectly, of the power to direct or cause the direction of
management and policies through ownership of voting securities, contract, voting trust
or otherwise;
(b) Average Spot Price means, with respect to any particular calendar quarter, the
average Spot Price of gold per troy ounce for such calendar quarter;
(c) business day means any day which is not a Saturday, Sunday or banking holiday in
the City of Toronto, Canada or in the city of Quito, Ecuador;
(d) control means, with respect to any person, voting securities carrying more than 50%
of the votes for the election of directors of such person which, if exercised, are
sufficient to elect a majority of the board of directors of such person, or any other
person who has the power to direct or cause the direction of the management and
policies of such person, whether through the ownership of shares or by contract or
otherwise;
(e) Encumbrance means any mortgage, hypothec, title retention, pledge, lien, right of
set-off, charge, security interest or other encumbrance whatsoever, whether fixed or
floating and howsoever created or arising;
(f) Expenses means, with respect to any particular period, the following expenses to the
extent incurred by Australiana during such period:
(i) sales and production taxes, payable by Australiana or the operator of the
Property that are based directly upon, and actually assessed against, the value
or quantity of Minerals sold or otherwise disposed of from the Property; but
excluding any and all taxes based upon the net or gross income of Australiana
or the operator of the Property, the value of the Property or the privilege of
doing business, and other taxes assessed on a similar basis;
(ii) charges and costs, if any, for transportation and security costs (including, but not
limited to, direct insurance costs while in transit) of Minerals from the Property
to places where such Minerals are smelted, refined and/or sold or otherwise
disposed of; and
- 83 -
(iii) charges, costs (including assaying, sampling and sales costs) and all penalties, if
any, charged by any off-site arms length smelter or refiner of the Minerals; but,
if smelting and/or refining are carried out in facilities owned or controlled, in
whole or in part, by Australiana, then the charges and costs for such smelting
or refining of such Minerals shall be the lesser of: (A) the charges and costs
Australiana would have incurred if such smelting or refining was carried out at
facilities that are not owned or controlled by Australiana and that are offering
comparable services for comparable products; and (B) the actual charges and
costs incurred by Australiana with respect to such smelting and refining.
(g) Gold Bullion means gold bullion meeting the standards of London Good Delivery
Gold Bars as defined by The London Bullion Market Association;
(h) Gross Proceeds means, without duplication, with respect to any particular period, the
value of all consideration, monetary or otherwise (including insurance proceeds) paid to
any person, including Australiana in respect of the sale or other disposition of Minerals
during such period; and, the value of the consideration received by Australiana shall be
deemed to be the Spot Prices of the applicable Minerals, and for purposes of
determining the Gross Proceeds received or deemed to be received by Australiana in
respect of gold or silver contained in Minerals processed by a Refinery, the amount that
is equal to the number of ounces of gold or silver contained in Minerals that is credited
to Australiana by the Refinery during such period, multiplied by the Average Spot Price
for such period;
(i) Letter Agreement means the Letter Agreement to which this Schedule is attached;
(j) Minerals means all naturally occurring metallic and non-metallic minerals that are
mined or otherwise recovered from the Property, whether in the form of dor,
concentrates, tailings or otherwise, including, without limitation, gold, silver, lead,
nickel, zinc, copper, limestone, precious gems, coal, salt and all beneficiated or
derivative products thereof;
(k) Net Smelter Return means, with respect to any particular period, the amount that is
equal to Gross Proceeds for such period minus Expenses for such period;
(l) Payment Date means, with respect to any particular Royalty payment owing in any
particular calendar year, the date that is 30 days after the Quarter in respect of which
such Royalty payment is due;
(m) Prime Rate means, at any particular time of determination, the reference rate of
interest, expressed as a rate per annum, that the Bank of Nova Scotia establishes as
its prime rate of interest in order to determine interest rates that it will charge for
demand loans in U.S. dollars to its Canadian customers;
(n) Property means the property represented by the concessions described on

Schedules A1 and A2 to the Letter Agreement to which this Schedule is attached;
(o) Quarter means, with respect to any particular calendar year, the three month period
ending on March 31, June 30, September 30 or December 31, as applicable, in such
calendar year;
(p) Refinery means any smelter, refiner or other processor, purchaser or other user of
the Minerals;
(q) Royalty means a net smelter return royalty granted to IAMGOLD by Australiana in
the percentage described in Section 1 of this Schedule;
- 84 -
(r) Spot Price means, with respect to a particular Mineral, the price determined for such
Mineral on the date on which payment for such Mineral is delivered or credited to the
account of Australiana and, for such purposes, the spot price of gold shall be
determined using the price of gold in U.S. dollars on the London Bullion Market
Afternoon Fix on such day, the spot price of silver shall be determined using the price
of silver in U.S. dollars on the London Bullion Market Afternoon Fix on such day and
the spot price of any other Mineral shall be determined using the price of such Mineral
quoted at the close of business on such day by the New York Commodity Exchange;
and if for any reason the London Bullion Market or the New York Commodity Exchange
is no longer in operation or the spot price of a particular Mineral is not quoted on the
London Bullion Market or the New York Commodity Exchange, the spot price of such
Mineral shall be determined by reference to the price of such Mineral on another similar
commercial exchange entity having the largest volume of trading in such Mineral on
such day; and the exchange rate used to convert a spot price to U. S. Dollars from
any other currency on a particular date shall be the exchange rate for such other
currency on such date published by the Globe & Mail newspaper, Toronto;
(s) Surrounding Property means any property or permit held by Australiana that lies
within two kilometers of the boundary of the existing Property or from the boundaries of
a reduced Property should such reduction occur; and
(t) Other capitalized terms shall except where otherwise defined in this Schedule have the
meaning assigned to them in the Letter Agreement.
3. Currency: For the purpose of determining Net Smelter Returns, all receipts and
disbursements in currency other than United States currency shall be converted into United
States currency on the day of receipt or disbursement, as the case may be.
4. Time and Manner of Royalty Payments:
(a) The Royalty shall be calculated using the Spot Price and paid to IAMGOLD by Australiana in
U.S. dollars on each Payment Date in respect of Net Smelter Returns for each Quarter ending
after the date hereof. Any portion of any Royalty payment that relates to the sale or other
disposition of gold shall be paid to IAMGOLD, at IAMGOLDs option, in gold bullion and shall be
satisfied by the provision of appropriate gold credits in respect thereof in favour of IAMGOLD at
the applicable Refinery. IAMGOLD shall provide written notice of IAMGOLDs election to
receive payment of the Royalty in gold bullion or in cash not less than 10 business days prior
to the commencement of the Quarter to which the Royalty payment relates, provided that
IAMGOLD shall not deliver more than two notices to Australiana during any 12 month period.
Each Royalty payment paid in gold bullion shall be converted to gold bullion at the Average
Spot Price. Any Royalty payment, or portion thereof, that is not payable in gold bullion shall be
paid in immediately available U.S. dollars, in cash or by certified cheque, bank draft or wire
transfer. All Royalty payments that are not payable in gold bullion shall be delivered to
IAMGOLD at its principal place of business as provided in the Letter Agreement or in such
other manner or at such other place as specified in writing by IAMGOLD.
(b) Concurrently with each Royalty payment, Australiana shall prepare and deliver to
IAMGOLD a detailed statement of the manner in which such Royalty payment was
calculated, including: (i) the quantity of Minerals to which such Royalty payment is
- 85 -
applicable; (ii) the calculation of the applicable Net Smelter Returns; and (iii) the calculation
of the Average Spot Price applicable in respect of such Quarter.
(c) IAMGOLD may object in writing to any statement and payment amount within 12
months after receipt of the relevant statement or payment. If any Royalty payment has
not been paid in full as provided herein, IAMGOLD may dispute the payment by serving
notice to Australiana in writing of such default. Australiana shall have fifteen days (15)
to resolve the matter and make payment to IAMGOLD unless Australiana objects to the
dispute. All unresolved disputes shall be referred to a third party (accountant) of
mutual choice where both parties shall accept the verdict of such an audit. If the
audited adjustment to the Royalty payment is less than 5% of such payment,
IAMGOLD shall pay all reasonable audit costs, if any, and if the adjustment to the
Royalty payment is greater than 5% of such payment, Australiana shall pay all
reasonable audit costs, if any. An interest charge of Prime Rate plus 2% per annum
shall apply to both IAMGOLD and Australiana upon failing to pay the resolved amount
within 30 days of the date the dispute was received in writing.
(d) All Royalty payments, including interest, if any, shall be made without
withholding of or deduction for, or on account of, any present or future taxes, duties,
assessments, repatriation obligations or governmental charges of whatever nature (collectively,
Withholdings), unless such Withholdings are imposed or levied, and are required, by or on
behalf of the Government of Ecuador or any political subdivision thereof, or any department,
authority or agency therein or thereof having power to tax.
5. Commingling: If the Property is brought into commercial production, it may be operated as a

single operation with other mining properties owned by third parties or in which Australiana has
an interest, in which event, the parties agree that (notwithstanding separate ownership thereof)
ores mined from the mining properties (including the Property) may be blended at the time of
mining or at any time thereafter. Before any Minerals are commingled with minerals from any
other properties, the Minerals shall be measured and sampled in accordance with accepted
mining and metallurgical practices for moisture, metal, and other appropriate content.
Representative samples of the Minerals shall be retained by Australiana and assays (including
penalty substances) and other appropriate analyses of these samples shall be made before
commingling to determine metal, mineral and other appropriate content and penalty substances
of the Minerals. From this information, Australiana shall determine the quantity of the Minerals
subject to the Royalty notwithstanding that the Minerals have been commingled with minerals
from other properties. Following the expiration of the period for objections described in Section
4(c) of this Schedule, and absent timely objection, if any, made by IAMGOLD within this period,
Australiana may dispose of the materials and data required to be kept and produced by this
Section 5.
6. Hedging Transactions: Australiana ay, but shall not be under any duty to, engage in hedging
transactions (hereinafter defined) in its sole discretion covering all or part of production from the
Property. All profits and losses resulting from Australiana or the operator engaging in any
commodity futures trading, option trading, metals trading, gold loans or any combination
thereof, and any other hedging transactions (collectively, hedging transactions) are
specifically excluded from calculations of Royalty payments pursuant to this Schedule. All
hedging transactions by Australiana or the operator and all profits or losses associated
therewith, if any, shall be solely for Australiana or the operators account.
7. Books, Records and Inspections:
(a) Australiana shall keep true and accurate books and records showing the amount of
Minerals shipped, sold or processed, the Expenses and the amount of money received
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for the Minerals, prepared on an accrual basis in accordance with Canadian generally
accepted accounting principles, consistently applied.
(b) Within one hundred and twenty (120) days following the end of each calendar year,
Australiana shall provide IAMGOLD with an annual report of the amount of Minerals
shipped, sold or processed, the amount of money received for Minerals, the Expenses
and the Net Smelter Returns payable.
(c) Upon not less than 15 business days notice to Australiana, IAMGOLD, or its
authorized agents or representatives, may, under the direction and control of Australiana, enter
upon all surface and subsurface portions of the Property for the purpose of inspecting the
Property, all improvements thereto and operations thereon, and all books and records
described in Section 7(a) of this Schedule, including without limitation such records that are
electronically maintained, provided that:
(i) IAMGOLD and its authorized agents and representatives shall enter the
Property at the risk and expense of IAMGOLD and may not hinder operations
on or pertaining to the Property;
(ii) IAMGOLD and its authorized agents and representatives shall only be
permitted to enter the Property for the purpose of inspecting the Property and
all improvements thereto and operations thereon once in any 12 month period;
and
(ii) IAMGOLD shall indemnify and hold Australiana and its Affiliates and their
respective directors, officers, employees, agents, representatives,
shareholders, contractors and subcontractors harmless from any damage,
claim or demand by reason of injury to IAMGOLD or any of its agents or
representatives, caused by IAMGOLDs exercise of rights pursuant to this
Section 7(c).
8. Sale or Encumbrance of Property: Australiana shall not sell or transfer all or any part of the
Property, or permit any Encumbrance on all or any part of the Property or the Minerals unless
the purchaser or transferee agrees in writing with IAMGOLD prior to such transfer to be bound
by the terms of this Schedule.
9. No Management Right: None of the provisions of this Schedule shall give IAMGOLD any
right to management of the Property or any mine established thereupon, nor shall the
provisions be interpreted to do so. In particular, but without limiting the generality of the
preceding statement, Australiana will plan, manage, control, conduct and supervise mining and
processing operations and any decision relating to the type, dimensions and location of the
mine, its facilities, pits and service and ancillary establishments, as well as any decision
pertaining to the rate of work, production processes, expansion of the mine and to temporary or
final stoppage of commercial exploitation and mining operations on the Property, provided that
Australiana shall conduct all operations on the Property in a good and workmanlike manner and
in accordance with accepted mining practice.
10. No Obligation to Maintain Property: The parties acknowledge that Australiana is not
obligated to maintain in good standing, renew or otherwise retain any interest in the Property,
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or make application or reapplication therefor, and that Australiana may, in its sole discretion,
without penalty, relinquish, drop, abandon or allow to lapse any or all of the Property (the
Abandoned Claims) and/or the Surrounding Property, or the applications or reapplications
therefor, without further obligation to IAMGOLD pursuant to this Schedule, provided that
Australiana provides IAMGOLD with prior written notice of Australianas intention to abandon,
surrender, or allow the expiry or lapse of, such Abandoned Claims, provided that the claims
were in good standing at the Closing Date, and if IAMGOLD within 30 days of such notice so
requests in writing, Australiana shall transfer the Abandoned Claims to IAMGOLD, all costs of
such transfer to be borne by IAMGOLD, and further provided that Australiana shall not
abandon or surrender, or allow to lapse or expire, any part or parts of mining claims or leases
relating to or comprising the Property for the purpose of permitting any third party to acquire
such Abandoned Claims or to otherwise avoid the Royalty; and if Australiana, or any associate,
Affiliate or related party of Australiana, acquires any such Abandoned Claims, the calculation of
the Royalty pursuant to Section 1 of this Schedule shall include all Minerals relating to such
Abandoned Claims.
11. Binding Effect: All covenants, conditions, and terms of this agreement shall, to the extent
permitted by the laws of Ecuador, be of benefit to and run as a covenant with the Property and
shall bind and inure to the benefit of the parties hereto, their respective successors and
assigns, including, without limitation, partners, joint venture partners, lessees and mortgagees.
The right to receive the Royalty as and when due shall not be construed to create expressly or
by implication, a joint venture, mining partnership, commercial partnership or other partnership
relationship between Australiana and IAMGOLD, or be deemed to constitute Australiana the
agent or legal representative of IAMGOLD or to create any fiduciary relationship between them
for any purpose whatsoever.
12. Further Assurances; Registration of Interest: Each party shall execute all such further
instruments and documents and do all such further actions as may be necessary to effectuate
the documents and transactions contemplated in this agreement, in each case at the sole cost
and expense of the party requesting such further instrument, document or action. IAMGOLD
shall have the right, from time to time, to the extent permitted by law, to register or record notice
of this agreement, any other instruments relating to this agreement, a notice of the Royalty, and
a caution or other title document against the title to the Property and Australiana shall
cooperate with such registration or recording and provide its written consent or signature to any
documents or things necessary to accomplish such registration or recording. Any successor or
assignee or other acquirer of the Property, or any interest therein, shall be subject to this
agreement and shall be obligated to comply with the terms hereof, including the obligations to
cooperate in respect of the registration of this agreement.
13. Time of the Essence: Time shall be of the essence hereof.
14. Severability: If any provision of this Schedule is wholly or partially invalid, this Schedule shall
be interpreted as if the invalid provision had not been a part hereof so that the invalidity shall
not affect the validity of the remainder of this Schedule which shall be construed as if the Letter
Agreement had been executed without the invalid portion. It is hereby declared to be the
intention of the parties that the Letter Agreement would have been executed without reference
to any portion of this Schedule which may, for any reason, hereafter be declared or held invalid.
15. Assignment: Australiana confirms that any or all rights and obligations of IAMGOLD pursuant
to this Schedule may be assigned to any Affiliate of IAMGOLD and to any financial institution
without the prior consent of Australiana, provided that IAMGOLD provides Australiana with
written notice thereof and the assignee agrees to be bound by the provisions of this agreement.
Australiana may assign its rights and obligations hereunder without the prior written consent of
IAMGOLD, provided that the assignee agrees in writing to IAMGOLD to be bound by the terms
of this Schedule.
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Schedule D to the Letter Agreement dated August 08 ,2003
- 89 -
APPENDIX C
- 90 -
- 91 -
- 92 -
- 93 -
- 94 -
APPENDIX D
DYNASTY ADVANCES ITS ZARUMA GOLD PROJECT

Vancouver, BC, July 7, 2004 - Dynasty Metals & Mining Inc. (TSXV:DMM;
the Company) is pleased to announce more encouraging results from
recent rock channel sampling conducted at two old mine sites situated
within the Companys 100% owned Zaruma Gold Project, and the signing of
a cooperative agreement with the national, provincial and local chambers of
mines to work together to develop the region.
The Company has identified 5 vein targets at the old Sucre and Pacayurco
mines, which are located 12 kilometres north west and 1 kilometre north
east, respectively, from the town of Zaruma. Rock channel samples from
these veins produced high-grade assays ranging in value from 0.01
grams/tonne (g/t) to 99.57 g/t gold and from 0.8 g/t to 278.7g/t silver.
Sample widths varied from 0.2 to 1.5 metres.
President and CEO Robert Washer comments: These latest results confirm
our expectation that significant gold and silver mineralization exists within
the trend we previously identified that includes the historical mining area of
Portovelo-Zaruma.
Mr. Washer further comments: The agreement with the chambers of mines
is significant to the future development of the region. It is intended to
promote cooperation amongst local government agencies, concession
holders and other interested parties.
Geology
The geology of Zaruma consists of a 15 km x 5 km base metal-rich, gold-

silver vein system that lies adjacent to a cluster of porphyry intrusions. The
vein trend strikes north-northwest and consists of over 90 kilometres of
veins.
Twenty seven gold-silver veins hosted in lithologies ranging from andesites

to basaltic andesites have been identified by the Company. Four large
under-explored target areas (Sucre, Pacayurco, Tamayo and Tablon) have
been selected for the next phase of exploration, which will determine any
down-plunge and strike extensions to existing bonanza pay shoots.
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Sucre
At Sucre, the vein has been historically mined for a length of 250 metres,
with widths varying from 0.2 to 2.1 metres and to an approximate vertical
depth of 50 metres. Recently, the Company completed approximately 350
metres of underground vein mapping at the lowest level and collected 56
rock channel samples. Assay results ranged from 0.01 g/t to 55.62 g/t gold
and from 0.8 g/t to 278.7g/t silver. The most significant channel sample
locations and results from Sucre are summarized below.
Total
Sample Sample Sample Gold Silver
Equivalent
Number Location Length (m) (g/t) (g/t)
(g/t)*
67148.17E
ZG002 0.20 55.62 266.40 59.72
9600555.32N
647149.87E
ZG003 0.20 16.72 42.00 17.37
9600567.02N
647114.04E
ZG013 0.30 26.92 169.00 29.52
9600545.00N
647104.48E
ZG014 1.20 11.74 119.00 13.57
9600578.24N
647095.89E
ZG015 0.64 16.80 117.00 18.60
9600568.82N
648741.00E
ZG033 0.72 18.96 18.00 19.24
9600821.00N
647050.04E 1.5 x 1.5
ZG043 45.60 10.70 45.76
9600798.82N bulk sample
647244.87E 1.5 x 1.5
ZG203 3.50 278.70 7.79
9601706.36N bulk sample
* A silver-gold ratio of 65 to 1 was used for gold equivalent calculation.
Pacayurco
Past mining at Pacayurco exposed a vein of approximately 200 metres in

length with varying widths from 0.3 to 2.4 metres. Recent exploration
completed at Pacayurco included 150 meters of underground mapping and
the collection of 36 rock channel samples. Assay results ranged from 0.02
g/t to 99.57 g/t gold. Sampling widths varied from 0.3 to 1.5 metres. The
Company is still awaiting the results of silver assays.
The Company is highly encouraged with the results from its work to date,
which will add to the Zaruma Gold Projects resource base. Underground
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and surface mapping and channel sampling is continuing in the Tamayo and
Tablon areas. More information will be released as results become available.
Exploration of the Companys properties is under the supervision of Greg

Whitfield, the Companys Exploration Manager and a qualified person, as
defined by National Instrument 43-101. Mr. Whitfield is responsible for the
preparation of technical information in this News Release. Samples are
sealed on the property and shipped to the BSI Inspectorate laboratory in
Lima, Peru for preparation and gold fire assay. Sample pulps are shipped by
BSI Inspectorate to its laboratory in Reno, Nevada for silver fire assay and
multi-element ICP analysis.
About Dynasty
Dynasty Metals & Mining Inc. is a Canadian based mining company involved
in the exploration and development of mineral properties in Ecuador. For
further information about the Company, please contact Murray Oliver at
(604) 687-0888 Ext. 3 or info@pemcorp.com or visit the Company's web-
site at www.dynastymining.com
Dynasty Metals & Mining Inc.

Robert Washer, President and CEO
The TSX Venture Exchange does not accept responsibility for the adequacy
or accuracy of this release.
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16.0 DATE
The effective date of this report is 22 October 2004
Miroslav Kalinaj
Miroslav Kalinaj
Consulting Geologist
Miroslav Kalinaj
Lima 012, PERU
Telephone: 0051-1-3654840
Fax: 0051-1-3654840
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ZARUMA PROJECT, ECUADOR

DYNASTY METALS & MINING Inc.

2.0 INTRODUCTION AND TERMS OF REFERENCE

4.0 PROPERTY DESCRIPTION AND LOCATION

5.0 ACCESSIBILITY, CLIMATE, LOCAL RESOURCES,

7.0 GEOLOGICAL SETTING

8.0 GOLD AND SILVER DISTRIBUTION

10.0 MINERAL RESOURCES

11.0 MINERAL RESOURCE ESTIMATES

12.0 OTHER RELEVANT DATA AND INFORMATION

13.0 CONCLUSIONS AND RECOMMENDATIONS

Table 3 Zaruma Project Land Tenure

Table 4 Gold / Silver ratios, Zaruma Portovelo District

Table 8 Mineral Resources Contained in Portovelo area at 22 October 2004. Mineral

Fig. 1 The Zaruma Project Location Map.

2.0 INTRODUCTION AND TERMS OF REFERENCE

2.4 Terms of Reference

4.1 Location and Access

4.2 Project Ownership

4.3 Land Tenure

No. Concession Name Code Area (Ha) Property Registration date

1 ROMA 300216 661.92 6-Ago-01

Concessions ransferred to Company from IAMGOLD

Concession Easting Northing

Concession Area Authorisation Easting Northing UTM

Concession Authorisation Registration Easting UTM Northing UTM

Concession Authorisation Registration Expiry Easting Northing UTM

Authorisation Registration Concession Easting UTM Northing UTM

initial point 654,450 9,590,000

initial point 654,700 9,593,980

Concession Authorisation Registration Expiry Easting Northing UTM

4.6. Environmental Liabilities

5.3 Climate and Physiography

5.4 Local Resources

7.1 Regional Geological Setting

Puna Formation, siltite

Pinon Formation diabase, pyroclastics

Undiferentiated Quaternary sediments

Precambrian metamorphic basement

Intrusive rocks undiferentiated

7.2 Zaruma Project Geological Setting

7.2.1 Geological Setting

Pias normal fault

Numerous, mostly fine-grained intrusions varying in composition from melanocratic diorite to

Dacite tuff (green)

9598000 Volcanic sediments (red)

Volcanic sediments and lava flows (red to violet)

Andesitic volcanics (breccia, lava flows)

Andesitic lava flows

Dacite porphyry stocks

Quartz-diorite stocks and dykes

Metamorphic basement - amphibolite

Metamorphic basement - gabbro

Major structures (mapped)

Major structures (inferred)

PORTOVELO Geological Seccion Location

2. Pyroxene Andesite this rock is characterized by a holocrystalline texture with a

3. Dacite Porphyry two types of porphyries have been detected:

4. Granodiorite Porphyry this rock is characterised by intensively albitised Na-Ca

6. Amphibole-biotite Granodiorite this rock is characterised by feldspar twinning of

Ore mineralisation assemblages:

3. Chalcopyrite forms commonly as infill of drusy-quartz, in pyrite aggregates and in