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The Project is located in southeastern Paraguay, approximately 150km east of Asuncion, the capital of Paraguay. Paso Yobai is an emerging gold camp discovered by local prospectors in 1996. The Company has the right to earn 70% interest in the Project which covers a total of 15,332ha.
The regional geology consists of horizontal Permian sandstones intruded by NW trending mafic dykes related to a Cretaceous mafic alkaline complex located 20km east of Paso Yobai. The mafic dykes extend for several hundred kilometers and vary from a few meters to tens of meters wide. The extensive nature of the dykes is directly related to the rifting which occurred during the separation of the African and South American continents.
Mineralization consists of bonanza style carbonate and quartz veinlets and stockwork hosted in a mafic dyke intruding sandstones. Mineralization extends from the hanging wall to the footwall of the mafic dyke and frequently encompasses the sandstone of the wall rock. The width of individual veins rarely surpass a few millimeters, but the mineralized stockwork range from 50cm to 10m and frequently encompasses several shoots of stockwork within one dyke. Gold can be traced continuously on surface for 3.7km in artisanal pits that range from 1 to 20m deep. Chip samples from the mineralized veins exposed in the pits assayed up to 99gpt gold across 0.6m. Visible gold is very common in those pits and lure the attention of informal workers that have been known to find individual hand specimens of gold weighing one ounce. Detailed chemical and petrographic analysis shows that the size of the gold varies from very fine (<200 microns) to very coarse (>1 cm) even across the same sample. A detailed alteration study was carried on the veins to understand the control factors of mineralization. The study shows that the gold bearing shoots plunge NW and the epithermal system was emplaced very close to the surface, suggesting further potential at depth. An 11,000 samples soil survey carried out on the project identified a gold anomaly with 0.075 to 1gpt Au extending for 7km in length and 2 km in width along the main mafic dyke system. Alteration in the high grade mineralized zones is predominantly smectite, adularia and kaolinite, indicating that the epithermal system is intact and the mineralization found on surface could extend at depth because the system has minimal erosion. Paso Yobai can be geologically defined as high-level low-sulfidation epithermal system related to alkalic rocks. The closest analog is Cripple Creek (USA), an 8MOz gold deposit.
A 3546.2 line-kilometer helicopter-borne VTEM (electromagnetic) and MAG (magnetic) survey determined the response parameters over the known gold bearing zone defined by the pits and the soil anomalies. The airborn magnetic data defines an anomaly that extends for at least 9x2Km. The company is currently carrying out a detailed surface magnetic program. This is oriented to map the precise location of the dykes under the saprolite in the areas covered by dense vegetation.
Thirty-five (35) holes, totaling 5,163.8m were drilled on sections established at 200m intervals along a 6km portion of the 7km long gold soil geochemical anomaly. The holes were drilled to intersect the gold bearing vein system at a depth of 100m below the surface. Nine (9) holes intersected economically significant gold values, including several holes reporting coarse visible gold. The remaining holes intersected the gold bearing zone and returned geochemically anomalous gold values. The significant mineralized intervals are:
 All of the holes (except 34 and 29) define what is referred to as the "Discovery Zone", a 2km portion of the 7km long gold soil anomaly. Prospect pits along the Discovery Zone have been excavated to a maximum depth of 30m and have exposed gold mineralization grading from 1gpt to 99gpt across a true width of 1 to 3m. Currently, the company is excavating new prospect pits to further define the Discovery Zone and to take bulk samples of the gold bearing zone to determine the estimated mine grade and open pit potential. A second phase of diamond drilling is planned to outline an inferred resource for the Discovery Zone and by extension provide an estimate for the resource potential for the 7km long Paso Yobai gold tend
Preliminary metallurgical results confirm the presence of coarse gold, which is easily recoverable by simple gravity separation and concentration. The metallurgical test work and flow sheet design is being carried out by Alex Stewart Laboratories in Peru.
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