XOCHIPALA PROJECT

The Xochipala Project, Guerrero State

Oroco holds a 100% interest in two contiguous mineral concessions in Guerrero, Mexico; Celia Generosa and Celia Gene, totaling 193 hectares and together called the Xochipala Project.

“The Xochipala claims cover ground in the Guerrero Gold Belt sufficient to potentially generate reserves greater than 1 million ounces gold in ore bodies similar to the productive high-grade ore bodies that have been discovered in the past within the region.” (Report on the Xochipala Property “Morelos” National Reserve District, Guerrero, Mexico, Prepared by Tawn Albinson F., M.Sc., for Britannia Gold Corporation, 1997, the “Albinson Report”)

Oroco’s Xochipala Project is located in the southeast extreme of the original Morelos National Mining Reserve, a 49,400 ha federal mineral reserve which includes the most promising and expanding gold reserves in Mexico. This region encompasses a northwest trend of intrusions with associated gold bearing iron skarn deposits and is part of a wider area which has come to be known as the Guerrero Gold Belt (the “GGB”). The GGB is currently the focus of aggressive exploration, delineation, development, and mining by a number of mining companies. Goldcorp, Torex Gold Resources and Newstrike Capital are exploring and delineating gold reserves in the GGB and to date have discovered in excess of 15 million ounces of gold with significant recent discoveries likely to increase the defined gold resource in the region.

Regionally, several multi million ounce gold deposits related to skarns along the peripheries of felsic to intermediate intrusions have recently been identified. These include the El Limon deposit as well as the Nukay and Todos Santos deposits, and approximately two kilometres from the Xochipala Project boundary, Goldcorp’s Los Filos-El Bermejal mine, forecast to produce 335,000 ounces of gold in 2011.

Oroco’s Celia Generosa and Celia Gene concessions contain mineralization in very well defined structures that outcrop for over one kilometre and were the site of some of the earliest gold mining in the region from a number of small underground workings. These concessions host intrusives of similar age and composition and several areas of skarn mineralization with significant associated gold assays.

The intrusion contained within the boundaries of Oroco’s Xochipala remains as among the last in the region as yet untested by exploration drilling.

Past work, including exploration and artisanal mining, has focused on the high grade showings on the properties. Future exploration at Xochipala will focus on the high grade showings on the properties and potential for medium to lower grade deposits amenable to open pit mining. The project area is well served by a network of local roads and the principal centers of population are Xochipala just one kilometre from the property boundary, and the State capital of Chilpancingo approximately 30 kilometres away by good paved road.

The district is served by hydroelectric power from the Caracol dam and water is locally available. A large trained labour pool is locally available.