El Rayo Project

Bulk Tonnage Silver-Gold
10,036 hectares - 100% title interest
3D image of the Las Bolas Deposit

Click here for PDF: Updated NI 43-101 EL RAYO PROJECT REPORT

Click here for PDF on Location, History and Geology

The El Rayo Project, located south of the town of Guachinango in Jalisco, Mexico is the site of some of the earliest silver mining in Mexico.  The Project hosts numerous mineralized structures where silver, gold and lead have been extracted from 16 known underground mines, beginning in the mid-1500’s.

Since Soltoro acquired the Project in 2005, exploration has focused primarily on two mineralized structures where silver-gold mineralization has been traced over an aggregate distance of five kilometres: the Las Bolas structure, which strikes to the northeast and dips to the northwest, and the El Rayo structure, which strikes to the northwest and dips to the northeast. In 2011, Soltoro focused much of its effort toward defining a resource on the recently discovered high-grade La Soledad structure. Soltoro is also working towards defining a resource on thehigh-grade structures in the historic Catarina mine area.

In December of 2011, Soltoro released an updated NI 43-101-compliant resource estimate, completed by Roscoe Postle Associates Inc. (“RPA”). The resource estimate includes an updated estimate of the Las Bolas structure and the Highway Zone as well as the initial resource for the La Soledad structure. No work was done in the El Rayo gold zone so the El Rayo gold resource remains unchanged from the resource completed in June of 2011. The 2011 drilling, coupled with higher metallurgical recoveries for La Soledad, resulted in roughly a 25% increase in the measured and indicated silver resource at El Rayo. The results of the current resource are reported below. The NI 43-101 Technical Report will beavailable on SEDAR in the 1st Quarter of 2012.

Las Bolas & Highway Zone primary silver resources: The Las Bolas deposit consists of a tabular body of a silver-bearing hematite-quartz vein breccia striking to the northeast and dipping to the northwest at 40 degrees. The mineralized vein breccia is approximately 40 metres thick with silver-bearing hematite-quartz stockwork occurring in the hanging wall. The vein breccia has been drill-tested for more than 300 metres down dip from the surface and for over 1,000 metres along strike. The Highway Zone may be the faulted extension of the Las Bolas mineralized zone, which has been offset to the east along a west-northwest-trending fault.

Las Bolas & Highway Zone & Soledad Deposit Silver Resources
Deposit Area Cut-off grade (g/t Ag) Tonnes
(millions)		 Average Grade
(g/t Ag) 		Contained ounces of Silver
Measured Mineral Resources
Las Bolas 20 6.10 63.44 12,400,000
Indicated Mineral Resources
Las Bolas 20 29.30 49.49 46,600,000
Highway Zone 20 2.90 57.39 5,400,000
La Soledad 20 3.90 104.20 13,000,000
Total Measured and Indicated Resources
Las Bolas, Highway Zone & La Soledad 20 42.20 57.11 77,400,000
Inferred Mineral Resources
Highway Zone 20 0.21 36.34 245,000
La Soledad 20 0.37 82.15 935,000
Total Inferred Mineral Resources
Highway Zone & La Soledad 20 0.58 65.51 1,180,000

Notes:
1. CIM definitions were followed for Mineral Resources.Mineral Resources were estimated using prices of US$27/oz Ag.
No credits are assigned for other metals.
2. Metallurgical recovery is assumed to be 72% of the contained silver for the Las Bolas deposit and Highway Zone, and 80% for Soledad.
3. High silver values are cut to 400 g/t Ag.
4. Mineral Resources were estimated using a pit discard cut-off grade of 20.8 g/t Ag for the Bolas and Highway deposits,
and 18.72 g/t Ag for La Soledad deposit.
5. The numbers for tonnage, average grade and contained ounces of silver are rounded figures.
6. The Las Bolas, La Soleded and Highway Zone deposits are modeled at a minimum of 5 m vertical thickness of mineralization.
7. The above resources are in-pit resources and constitute 87% of total resources within a conceptual open pit for the
8. The above resources are constrained by a Whittle optimized pit shell and constitute 87% of total resources within a conceptual open pit for the Bolas Structure, 89% of total resources for La Soledad Structure, and 64% for the Highway Zone.

La Soledad Area: In early 2011, Soltoro completed a surface trenching and sampling program followed by an initial four hole diamond drilling program to test the La Soledad structure. The results of this drilling were extremely encouraging and an additional drill rig was added to the program. Soltoro completed 50 diamond drill holes totaling 8,968 metres on the La Soledad structure in 2011. With this drilling, Soltoro defined two mineralized zones: the Central Zone measuring 225 metres in length and and the Western Zone measuring 150 m in length. The Central Zone has been drill tested to a depth of 250 metres below the surface.The Western Zone has been drill tested to a depth of approximately 100 metres below the surface and is open at depth.

At La Soledad, mineralization is hosted within a sequence of intermediate to mafic volcanic rocks consisting of massive flows and interbedded fragmental units. The mineralization is associated with hematite-altered structures in association with fine-grained silica as part of wider intervals of highly sheared and brecciated volcanic wall rocks. The hematite occurs as fine pigment throughout and also as compact particles and crystal aggregates. Sulphides occur less frequently than the hematite and are usually intergrown with each other and/or with the other constituents. The sulphides consist of pyrite, sphalerite, galena with minor amounts of chalcopyrite and tetrahedrite-tennantite and traces of bornite, covellite and chalcocite.

Soltoro continues to explore the La Soledad Structure both to the east and the west through a combination of diamond drilling, geologic mapping, soil sampling and ground geophysics. For the remainder of 2011, Soltoro will continue its intensive diamond drilling program intended to develop high-grade mineralization at the La Soledad structure.

Catarina Mine Area: The southernportion of the  El Rayo structure hosts the Catarina mine, where high-grade silver ore shoots were mined by the Spaniards beginning in 1546. Mineralization at the Catarina mine was developed on several levels over approximately 500 metres of strike.  In 2010, Soltoro completed detailed mapping and along the surface portion of the Catarina vein. Results can be viewed at the link: Click here for PDF: July 2010 Catarina mine trench location map with assay results

Soltoro recently completed seven diamond drill holes in the Catarina Mine area to test mineralization at depth. Results are expected in early 2012.

Ongoing Exploration Programs: Soltoro completed a ground magnetics orientation survey over the Las Bolas, Highway Zone, La Soledad and Catarina mine areas to determine the effectiveness of this geophysical method as an exploration tool at El Rayo.  Structures related to the mineralization at Las Bolas and La Soledad exhibit well-developed signatures, manifested as magnetic lows, and Soltoro has expanded the ground magnetic coverage to locate these structures along strike from known mineralization.  Results are expected early in 2012.

Approximately 2,806 soil samples have been collected to date from the area south and east of the Las Bolas deposit and north of the historic Catarina mine.  Several anomalies have been identified including three parallel soils anomalies in the Piedras Amarillas area approximately 1,500 metres east of the Las Bolas deposit.  The anomalies range from 300 metres to 800 metres in length and 50 metres to 150 metres in width with values ranging up to 34 ppm silver. Similar to the Las Bolas deposit area, the Piedras Amarillas area is located northeast of a strong magnetic low feature.

Follow-up sampling of the eastern anomaly identified a northeast-trending zone of quartz stockwork with associated hematite staining in Lower Cretaceous basaltic wallrocks.   At Piedras Amarillas there are a few small prospect pits but no evidence of historic mining activity as the zone sits primarily under cultivated fields and is covered by overburden. The stockwork zone is presently known to extend for nearly 500 m along strike.  The width of the stockwork zone is not presently known because the area is largely covered by soil and outcrops are scattered.   Selected results from the first 75 rock samples are as follows:

Channel Number Sample
Type 		Length (m) Silver Grade (g/t)
1 Chip-channel 2.9 20
2 Chip-channel 3.1 18
5 Chip-channel 2.6 23
6 Chip-channel 3.3 33
7 Chip-channel 7.8 25
13 Chip-channel 3.4 21
15 Chip-channel 1.4 27
22 Chip-channel 1.0 30
23 Chip-channel 1.2 87
24 Chip-channel 2.4 50
30 Chip-channel 1.0 20

El Rayo Structure Gold Potential: The Company has also been investigating the gold potential at the north end of the El Rayo structure. Previous drilling identified a gold zone one kilometre in strike length. At a pit discard cut-off grade of 0.35 g/t Au, the resource estimate for the northernmost 250 metres of the gold structure is reported by Roscoe Postle Associates Inc. as follows:

El Rayo Nothern Zone Gold Resource
Deposit Area Cut-off grade (g/t Au) Tonnes
(millions)		 Average Grade
(g/t Au) 		Contained ounces of Gold
Indicated Mineral Resources
El Rayo North 0.35 380 1.85 22,600
Inferred Mineral Resources
El Rayo North 0.35 365 1.61 18,900

Notes:
1. CIM definitions were followed for mineral resources.
2. Mineral Resources were estimated using prices of US$1,300/oz Au. No credits were assigned for other metals.
3. Metallurgical recovery is assumed to be 90% of the contained gold.
4. The Rayo Extension deposit is modeled at a minimum of 5 m vertical thickness of mineralization.
5. The numbers for tonnage, average grade and contained ounces of gold are rounded figures.
6. The above resources are constrained by a Whittle optimized pit shell.

Regional mapping and sampling: Several additional targets were identified in 2011 and these targets will be selectively explored in 2012. Two diamond drills continue to test the know mineralized structures at EL Rayo to define more silver resources.