Location

The Property is centered near geographic co-ordinates 105º45’W and 23º12’ N (1:50 000 map sheets F13A47 and F13A48) in Southern Sinaloa State, Mexico. It consist of four mining concessions that overlap a combined surface area of 3954 hectares.

Local resources, climate, access, infrastructure and physiogaphy   

The Project is located in the municipio of Rosario. The municipio has a surface area of 2642 km2, or 4.6 % of the surface area of the state of Sinaloa. The eastern 62% overlaps the physiographic Sierra Madre Occidental province, the western 29% overlaps the Pacific plains and the remaining 9% overlaps coastal lakes. To the east, the municipio of Rosario borders Durango and Nayarit States, to the northwest the municipio of Mazatlán, to the north the municipio of Concordia, and to the south, the municipio of Escuinapa. The western boundary is on the Pacific Ocean. The Pan-American highway, railway and major power lines roughly follow the coastline. The closest major city is the port of Mazatlán, and the nearest industrial cities are Culiacan, Sinaloa and Tepic, Nayarit. In 2015, the last census indicated that the population of Rosario consisted of 52,345 inhabitants. Principal towns are the municipal capital of El Rosario, the mining towns of La Rastra and Maloya, fishing villages Agua Verde, Potrerillos and Chametla, and farming towns of Matatán and Cacalotán on the south and north side of the Río Baluarte floodplains, respectively. Urban land occupies less than 1% of the surface area of Rosario. About 27% of the Municipio is used for farming, 6% for aquaculture, 4% for pasture, 44% is jungle and 24% is forested.

The rainy season is from July to September, with intermittent winter storms. Average annual precipitation in Rosario is 1453 millimeters. Temperatures range from 0.5°C at higher elevations in the winter, to more than 40ºC in the valleys in summer with an average annual temperature of 22°C. The operating season is year-round with temporary interruptions related to storms and flooding events.

The location currently occupied by the municipal capital was founded in 1532 by Cristóbal de Barrios under the name Villa del Espíritu Santo under the jurisdiction of the kingdom of Nueva Galacia. The village was abandoned in 1536 then re-conquered by Francisco de Ibarra 1564 to become part of Nueva Vizcaya. In 1655 the Tajo gold-silver mine was discovered, and Real de Minas de Nuestra Señora de El Rosario was founded. In 1932 part of the town collapsed into a glory hole created by subsidence from underground mining. In 1945 mining activities under El Rosario were suspended indefinitely.

In 2016, Sinaloa was the 6th largest gold producer in Mexico with a total production of 4491.49 kg of gold as well as 128,092 kg of silver (Panorama Minero del Estado de Sinaloa 2020). By 2019, gold production collapsed to 853 kg and silver to 7889 kg despite a strong improvement in metal prices. In Rosario, there were mineral processing plants at the Trinidad heap leach mine in Maloya and at Goyo in El Tablón (Minera del Pacifico). Active metallic mineral Projects in the municipio include Plomosas in La Rastra and San Marcial, both operated by GR Silver Mining.

Access to the Picachos Property is via a paved road between Rosario and Cacalotán, then by country road to the village of Los Sitios del Picacho. From there, there are several old mine roads that lead to the larger mine workings. Camp is currently located at the San Agustín mine portal. Permanent buildings house the kitchen, office, and core processing lab. Power is from a 2 KW solar plant behind the office, and a 25 KW diesel generator. Water for the camp is from a 4-kilometer-long gravity-fed waterline that draws fresh high-quality water from mountain springs under La Gloria

Elevations range from 300 meters in the pueblo of Los Sitios de Picacho to 1300 meters at the top of Cerro San Cristobál. At lower elevations (below 500 meters), the vegetation is mainly “selva baja caducifolia”, which is characterized mainly by trees less than 15 meters tall. Typical plant species include tepemezquite, ébano, tepehuaje, huanacaxtle, berraco, amapa, apomo, cedro, nacario and garabato. At higher elevations, the temperatures are cooler, and vegetation is characterized as “bosque templado” (temperate forest). Plants typical of the higher areas are encino, madroño, chicle, palo cuate, arrancillo, vainillo, maguey and guasima. Animals in the Project area include squirrels, rabbits, coyotes, rats, foxes, deer, bats, tejónes, guacamayas, rattlesnakes and iguanas.