Name: Corani mine.

Location: The Corani mine project is located in the districts of Corani, Macusani and Nuñoa, in the provinces of Carabaya and Melgar, department of Puno, in Peru, and covers an aggregate extent of 5 180 ha.

Controlling Company: Bear Creek Mining (BCM).

Brief History: On March 15, 2007, BCM and Rio Tinto Mining executed a definitive option and shareholders’ agreement in respect of the Corani property. The option agreement formally defined and confirmed the terms as set out in the letter of understanding, signed by the parties in January 2005.

On January 15, 2008, BCM made the final payment to Rio Tinto under the option agreement, resulting in the company owning 70% of the Corani property, subject to certain success payments, purchase rights provisions and clawback rights.

On March 6, 2008, BCM entered into an agreement with Rio Tinto to buy Rio Tinto’s remaining 30% interest in the Corani project and extinguish all BCM’s future payment obligations and royalties, as well as Rio Tinto’s back-in rights under the option agreement.

Brief Description: Corani represents a rare asset class, containing 270-million ounces of silver and 4.8-billion pounds of combined lead and zinc, which is forecast to produce more than 13-million ounces a year of silver at a negative cost of $0.45/oz of silver, net of by-product credits, for the first five years of a 22-year mine life.

Mining Method: Conventional openpit.

Products: Silver, lead and zinc.

Major Infrastructure and Equipment: Mining will be performed using conventional openpit methods, using 135 t trucks and 15 m3 hydraulic shovels mining on 8-m-high benches.

The project processing facility is designed to treat 22 500 t/d of silver/lead/zinc ore at an operational availability of 92%.

The ore is further processed in a flotation circuit consisting of lead flotation, followed by zinc flotation. The majority of the silver will be recovered in the lead flotation circuit and some silver will be collected in the zinc flotation circuit. Lead sulphide will be recovered in a one-pass rougher flotation bank, producing a concentrate that will be upgraded to smelter specifications in three stages of cleaning.

Tails from the lead flotation section will be conditioned for zinc sulphide flotation. The process scheme for zinc flotation also includes a rougher bank and three stages of cleaning to produce smelter-grade zinc concentrates. For the lead and zinc sections, the rougher flotation concentrates will be reground to 80% finer than 25 µ prior to cleaner flotation to liberate the values for further upgrading.

Tailings from the zinc flotation circuit will be thickened and pumped to a conventional tailing storage facility. In the final half of the mine life, a pyrite flotation circuit will be added to separate the pyrite from the zinc flotation tailing. The pyrite concentrate will be placed in the central part of the tailing storage facility, where it will remain submerged and unoxidised after the closure of the mine.

Lead and zinc concentrates will be thickened, filtered and stockpiled separately, and loaded into sealed-top trucks and trucked to the Port of Matarani for shipment to smelters.

Geology/Mineralisation: Mineralisation in the Corani project area comprises freibergite (silver-bearing tetrahedrite), galena (not argentiferous), sphalerite (white to dark coloured), pyrite, marcasite, other silver sulphosalts (myrargyrite, pyrargyrite-proustite (ruby silver)), boulangerite, acanthite and minor native silver.

The orebody can be divided into three principal metallurgical types: a mixed sulphide group that comprises relatively coarse to very fine sulphide mineralisation; a transitional mineralisation, where the sulphide minerals have been partly oxidised, with some of the lead having been remobilised into a lead-phosphate mineral and much of the zinc removed from the ore; and an oxide zone. This metallurgical zonation mimics the south-west dipping nature of the listric faults and, as such, forms a tilted layer cake, with the oxides occurring on the far west of the project, the transitional ores in the middle west and the sulfides in the centre of the deposit and to the east.

Reserves: Total proven and probable reserves as at November 8, 2011, were 156.13-million tonnes, grading 53.8 g/t silver, 0.90% lead and 0.49% zinc.

Resources: Total measured and indicated resources, as at November 8, 2011, were 134.46-million tonnes, grading 20.5 g/t silver, 0.38% lead and 0.29% zinc. Inferred resources were estimated at 49.79-million tonnes, grading 30 g/t silver, 0.46% lead and 0.28% zinc.

Prospects: In September this year, the Peruvian Ministry of Energy and Mines approved the environmental- and social-impact assessment (ESIA) for the Corani project. Subsequent steps in the advancement of the Corani project are intended to include detailed engineering followed by construction permits as a result of the ESIA.

Contact Person: Investor relations, Lisa May.

Contact Details:
BCM,
tel +1 604 685 6269, fax +1 604 685 6268, email info@bearcreekmining.com, and
website http://www.bearcreekmining.com.