TECHNICAL REPORT ON THE AGUAS BLANCAS PROPERTY, CHILE Chief Operations Officer, Sirocco Mining Inc...

TECHNICAL REPORT ON THE AGUAS BLANCAS PROPERTY,

CHILE

By

Kevin Ross, C.Eng., Eur.Ing.

Chief Operations Officer, Sirocco Mining Inc

Hugh Stuart, C.Geol FGS Vice President Exploration, Sirocco Mining Inc

Adam Wheeler, C.Eng., Eur.Ing.

Consulting Mining Engineer

19th December 2013

Sirocco Mining Inc 885 W Georgia St Vancouver, V6C 3E8

Sirocco Mining Inc Aguas Blancas Property Technical Report

2 19 December 2013

TABLE OF CONTENTS Page

LIST OF TABLES ................................................................................................................................................ 4 LIST OF FIGURES .............................................................................................................................................. 5 1 SUMMARY ................................................................................................................................................... 6

1.1 Introduction and Overview ................................................................................................................... 6 1.2 Ownership ............................................................................................................................................. 6 1.3 Geology and Mineralization .................................................................................................................. 7 1.4 Database and Resource Estimation ....................................................................................................... 7 1.5 Mine and Plant Operation ..................................................................................................................... 7

1.5.1 Mining Operations ............................................................................................................................ 8 1.5.2 Processing Operations....................................................................................................................... 8 1.5.3 Chemical Plant .................................................................................................................................. 8

1.6 Conclusions ........................................................................................................................................... 8 2 INTRODUCTION ........................................................................................................................................ 11

2.1 Introduction ......................................................................................................................................... 11 2.2 Terms of Reference ............................................................................................................................. 11 2.3 Sources of Information ........................................................................................................................ 11 2.4 Units and Currency ............................................................................................................................. 11

3 RELIANCE ON OTHER EXPERTS ........................................................................................................... 12 4 PROPERTY DESCRIPTION AND LOCATION ........................................................................................ 13

4.1 Property Ownership ............................................................................................................................ 13 4.2 Property Location ................................................................................................................................ 13 4.3 Mineral Tenure .................................................................................................................................... 14 4.4 Water ................................................................................................................................................... 16 4.5 Environmental and Socio-Economic Issues ........................................................................................ 16 4.6 Other Factors and Risks ...................................................................................................................... 17

5 ACCESSIBILITY, CLIMATE, INFRASTRUCTURE, PHYSIOGRAPHY ............................................... 18 5.1 Accessibility ........................................................................................................................................ 18 5.2 Climate ................................................................................................................................................ 18 5.3 Physiography ....................................................................................................................................... 18 5.4 Local Resources and Infrastructure ..................................................................................................... 18 5.5 Surface rights ...................................................................................................................................... 18

6 HISTORY ..................................................................................................................................................... 19 6.1 Project History .................................................................................................................................... 19

6.1.1 Historic Mineral Resource Estimates .............................................................................................. 19 6.1.2 Historic Production ......................................................................................................................... 20

7 GEOLOGICAL SETTING AND MINERALISATION .............................................................................. 21 7.1 Regional Geology ............................................................................................................................... 21 7.2 Property Geology and Mineralisation ................................................................................................. 21

8 DEPOSIT TYPES ......................................................................................................................................... 26 9 EXPLORATION .......................................................................................................................................... 27

9.1 Topography ......................................................................................................................................... 27 10 DRILLING ............................................................................................................................................... 28

10.1 Reverse Circulation Drilling ............................................................................................................... 30 10.2 Drill Hole Surveying ........................................................................................................................... 31 10.3 Sampling method ................................................................................................................................ 32

10.3.1 Drill Sample Quality .................................................................................................................. 32 11 SAMPLE PREPARATION, ANALYSES AND SECURITY ................................................................. 33

11.1 Sample Preparation and Analysis Methodology ................................................................................. 33 11.1.1 Samples from drilling 2005-2011 ............................................................................................... 33 11.1.2 Samples from drilling in 2012 (iodine only) .............................................................................. 34

11.2 Sample Submission Procedures .......................................................................................................... 34 11.3 Quality Control and Quality Assurance .............................................................................................. 35

11.3.1 2005 to 2011 Drill Program ........................................................................................................ 35 11.3.2 2012 Drill Program ..................................................................................................................... 38

11.4 Summary ............................................................................................................................................. 44 12 DATA VERIFICATION .......................................................................................................................... 45 13 MINERAL PROCESSING AND METALLURGICAL TESTING ......................................................... 46


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13.1 Historic Processing.............................................................................................................................. 46 13.2 Metallurgical Testwork ....................................................................................................................... 46 13.3 Current Processing .............................................................................................................................. 46

13.3.1 Mining Operations ...................................................................................................................... 46 13.3.2 Processing Operations ................................................................................................................ 46 13.3.3 Chemical Plant ........................................................................................................................... 46 13.3.4 Nitrate Pilot Plant ....................................................................................................................... 47

14 MINERAL RESOURCE ESTIMATES ................................................................................................... 48 14.1 Material/Area Coding.......................................................................................................................... 48 14.2 Sample Processing .............................................................................................................................. 49 14.3 Density Measurements ........................................................................................................................ 51 14.4 Modelling Methodology ...................................................................................................................... 52 14.5 Geostatistics and Grade Interpolation ................................................................................................. 52 14.6 Model Validation ................................................................................................................................ 60

14.6.1 Overview .................................................................................................................................... 60 14.6.2 Plans of Grades and Weightings ................................................................................................. 60 14.6.3 Global Comparison of Grades .................................................................................................... 60 14.6.4 Local Comparison of Grades ...................................................................................................... 62 14.6.5 Comparison with Historical Estimates ....................................................................................... 63 14.6.6 Reconciliation ............................................................................................................................. 63

14.7 Mineral Resource Estimate ................................................................................................................. 64 15 MINERAL RESERVE ESTIMATE ......................................................................................................... 66

15.1 Mining Costs ....................................................................................................................................... 66 15.2 Processing Costs ................................................................................................................................. 66 15.3 Reserve Parameters ............................................................................................................................. 66 15.4 Mineral Reserve Estimate ................................................................................................................... 67

16 MINING METHOD ................................................................................................................................. 71 16.1 Mining Operations .............................................................................................................................. 71 16.2 Geotechnical Studies ........................................................................................................................... 73 16.3 Hydrogeology ...................................................................................................................................... 73

17 PROCESS RECOVERY .......................................................................................................................... 74 17.1 Heap Leach ......................................................................................................................................... 74 17.2 ALP ..................................................................................................................................................... 74 17.3 Chemical Plant .................................................................................................................................... 76

18 PROJECT INFRASTUCTURE ................................................................................................................ 77 18.1 Mine Site ............................................................................................................................................. 77 18.2 Waste and Tailings Disposal ............................................................................................................... 77

19 MARKETS AND CONTRACTS ............................................................................................................. 78 19.1 Market ................................................................................................................................................. 78 19.2 Contracts ............................................................................................................................................. 78

20 ENVIRONMENTAL STUDIES AND PERMITTING ............................................................................ 79 20.1 Environment Studies and Permits ....................................................................................................... 79 20.2 Community Relations.......................................................................................................................... 80 20.3 Mine Closure ....................................................................................................................................... 80

21 CAPITAL AND OPERATING COSTS ................................................................................................... 81 21.1 Operating Cost Estimates .................................................................................................................... 81 21.2 Capital Cost Estimates ........................................................................................................................ 81

22 ECONOMIC ANALYSIS ........................................................................................................................ 82 22.1 Operating Statistics ............................................................................................................................. 82 22.2 Cash Flow Forecasts ........................................................................................................................... 82 22.3 Taxes and Royalties ............................................................................................................................ 83 22.4 Sensitivity Analysis ............................................................................................................................. 83

23 ADJACENT PROPERTIES ..................................................................................................................... 84 24 OTHER RELEVANT DATA AND INFORMATION ............................................................................ 85 25 INTERPRETATION AND CONCLUSIONS .......................................................................................... 86 26 RECOMMENDATIONS .......................................................................................................................... 88 27 REFERENCES ......................................................................................................................................... 89 28 QUALIFIED PERSONS CERTIFICATES .............................................................................................. 90 Appendix A: MINERAL PROPERTY ................................................................................................................. 93 Appendix B: STATISTICAL PLOTS .................................................................................................................. 99


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LIST OF TABLES Table 1-1: Iodine Mineral Resource Estimate ....................................................................................................... 9 Table 1-2: Sulphate and Nitrate Mineral Resource Estimate ................................................................................. 9 Table 1-3: Mineral Reserve Estimate .................................................................................................................... 9 Table 4-1: Mineral Property ................................................................................................................................. 14 Table 4-2: Water Rights ....................................................................................................................................... 16 Table 6-1: Historic Resource Estimates ................................................................................................................ 20 Table 6-2: Historic Mine Production .................................................................................................................... 20 Table 7-1: Exploration Geological units mapped ................................................................................................. 22 Table 7-2: XRD Analysis of Caliche .................................................................................................................... 25 Table 9-1: Exploration Campaigns ....................................................................................................................... 27 Table 10-1: Drilling Summary ............................................................................................................................. 28 Table 10-2: Lithological Coding Systems used at Aguas Blancas ...................................................................... 32 Table 11-1: Internal and external pulp duplicate samples analysed ..................................................................... 35 Table 12-1: Database Validation Records ............................................................................................................ 45 Table 14-1: Caliche Material Codes .................................................................................................................... 48 Table 14-2: Sample Summary ............................................................................................................................. 49 Table 14-3: Iodine Top-Cut Summary ................................................................................................................. 50 Table 14-4: Composite Statistics ......................................................................................................................... 51 Table 14-5: Applied Caliche Densities ................................................................................................................ 51 Table 14-6: Model Variogram Parameters ........................................................................................................... 53 Table 14-7: Model Estimation Parameters ........................................................................................................... 53 Table 14-8: Resource Classification Parameters .................................................................................................. 54 Table 14-9: Historical Iodine Resource Estimates ............................................................................................... 63 Table 14-10: Reconciliation Results ..................................................................................................................... 63 Table 14-11: Iodine Resource Estimate ................................................................................................................ 64 Table 14-12: Iodine Resource Grade-Tonnage Table ........................................................................................... 64 Table 14-13: Iodine Resource Estimate By Material Type ................................................................................... 65 Table 14-14: Nitrate/Sulphate Resource Estimate ................................................................................................ 65 Table 15-1: Unit Mining Costs ............................................................................................................................. 66 Table 15-2: Processing Costs................................................................................................................................ 66 Table 15-3: Mining Factors .................................................................................................................................. 66 Table 15-4: Economic Parameter Summary ......................................................................................................... 67 Table 15-5: Mineral Reserve Estimate ................................................................................................................. 68 Table 15-6: Inferred Resource Above 250ppm .................................................................................................... 68 Table 19-1: Chilean Iodine Export Prices ............................................................................................................. 78 Table 21-1: Operating Costs ................................................................................................................................. 81 Table 21-2: Capital Costs ..................................................................................................................................... 81 Table 22-1: Mining and Processing Statistics ....................................................................................................... 82 Table 22-2: Project Valuation ............................................................................................................................... 83 Table 22-3: NPV Sensitivity ................................................................................................................................. 83 Table 25-1: Iodine Mineral Resource Estimate .................................................................................................... 86 Table 25-2: Sulphate and Nitrate Mineral Resource Estimate .............................................................................. 86 Table 25-3: Mineral Reserve Estimate ................................................................................................................. 87


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LIST OF FIGURES

Figure 4-1: Location Map .................................................................................................................................... 13 Figure 4-2: Mineral Tenure: Current permits ....................................................................................................... 15 Figure 7-1: Geology of the Aguas Blancas Project area ....................................................................................... 21 Figure 7-2: Iodine Distribution ............................................................................................................................. 23 Figure 7-3: Caliche profile in mined cut ............................................................................................................... 24 Figure 10-1: Distribution of RC Drill holes as at 31st December 2012................................................................. 29 Figure 10-2: RC rig used for all drilling from 2005 to early 2012 ....................................................................... 30 Figure 10-3: Schramm T450 RC drill rig ............................................................................................................. 31 Figure 10-4: Drilling Terrain ................................................................................................................................ 31 Figure 11-1: Samples laid out and checked at the sample preparation facility. .................................................... 33 Figure 11-2: External Pulp check samples for 2007 ............................................................................................. 35 Figure 11-3: Internal Pulp check samples for 2008 .............................................................................................. 36 Figure 11-4: External Pulp check samples for 2008 ............................................................................................. 36 Figure 11-5: Internal Pulp check samples for 2009 .............................................................................................. 37 Figure 11-6: External Pulp check samples for 2009 ............................................................................................. 37 Figure 11-7: External Pulp check samples for 2010 ............................................................................................. 38 Figure 11-8: Standard 1 ........................................................................................................................................ 39 Figure 11-9: Standard 2 ........................................................................................................................................ 39 Figure 11-10: Standard 3 ...................................................................................................................................... 39 Figure 11-11: Standard 4 ...................................................................................................................................... 40 Figure 11-12: Standard 5 ...................................................................................................................................... 40 Figure 11-13: Standard 6 ...................................................................................................................................... 40 Figure 11-14: Standard 7 ...................................................................................................................................... 41 Figure 11-15: Standard 8 ...................................................................................................................................... 41 Figure 11-16: Standard 9 ...................................................................................................................................... 41 Figure 11-17: Standard 10 .................................................................................................................................... 42 Figure 11-18: HARD plot of duplicate samples ................................................................................................... 43 Figure 11-19: Blank Samples ............................................................................................................................... 43 Figure 14-1: Available Resources By Material Type .......................................................................................... 48 Figure 14-2: Compositing Method. ..................................................................................................................... 50 Figure 14-3: Modelling Methodology .................................................................................................................. 52 Figure 14-4: Iodine Resource Classification......................................................................................................... 54 Figure 14-5: Sulphate/Nitrate Resource Classification ......................................................................................... 55 Figure 14-6: Caliche Thickness ............................................................................................................................ 56 Figure 14-7: Iodine Grade Distribution ................................................................................................................ 57 Figure 14-8: Nitrate Grade Distribution .............................................................................................................. 58 Figure 14-9: Sulphate Grade Distribution ........................................................................................................... 59 Table 14-10: Global Comparison of Composites and Block Model ..................................................................... 60 Figure 14-11: Composites and Block Model Comparison.................................................................................... 61 Figure 14-12: Local 500m Grid Comparison of Iodine Grades ............................................................................ 62 Figure 15-1: Mineral Reserve and Additional Inferred Resources ....................................................................... 69 Figure 16-1: Continuous Miner in operation ........................................................................................................ 71 Figure 16-2: Komatsu 65 tonne truck ................................................................................................................... 72 Figure 16-3: Heap Leach Pad in Construction ...................................................................................................... 72 Figure 16-4: Heap Leach Pads in operation .......................................................................................................... 73 Figure 17-1: ALP Flowsheet ................................................................................................................................ 74 Figure 17-2: ALP Leach Section .......................................................................................................................... 75 Figure 17-3: Chemical Plant Flow Sheet .............................................................................................................. 76 Figure 18-1: Layout of Mine Infrastructure .......................................................................................................... 77 Figure 23-1: SQM Concessions in the area of Aguas Blancas ............................................................................ 84


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1 SUMMARY

1.1 Introduction and Overview This updated Technical Report on the Aguas Blancas Property (“Aguas Blancas”), located in the II Region in northern Chile, was prepared by Sirocco Mining Inc following the announcement made in November 2013 to delay the commissioning of the SAG mill in the Agitated Leach Plant and to only operate heap leach pads. This will reduce annual production to approximately 1,000t of iodine in 2014.

This work was completed by Kevin Ross, Chief Operating Officer of Sirocco, a qualified mining engineer and Hugh Stuart, Vice President of Exploration of Sirocco and a qualified geologist. Adam Wheeler, an independent qualified mining engineer, has continued to provide the resource and reserve estimate for the Aguas Blancas Property.

A site visit in connection with this work was completed by Kevin Ross between 12th and 15th November 2013 by Hugh Stuart between 17th June and 24th June 2013 and by Adam Wheeler from 15th to 19th October, 2012. Estimates in this report relate to 31st December, 2012.

The scope of work entailed review of all pertinent geological and mining data, allowing the preparation of an updated mineral resource and reserve estimate and to update the operational aspects of the Aguas Blancas Mine.

1.2 Ownership Aguas Blancas mining property comprises 35 “estacas salitreras” covering 7,478 ha and 247 registered mining concessions, covering 45,627 ha. The estacas salitreras are irregularly shaped concessions granted before 1907. In addition there are 6 exploitation concessions covering 906 ha in the application process, and 49 exploration concessions covering 13,900 ha. There are 11 disputed mining concessions covering 950 ha, which are being reviewed by the courts for resolution. The Aguas Blancas iodine deposit is located near the centre of the Property.

The Property is legally registered in the name of Atacama Minerals Chile S.C.M. (“AMC”), and is free of mortgages, encumbrances, prohibitions, injunctions and litigation. The mining patents are paid and up to date.

AMC has 14 boreholes located in two aquifers (Rosario and Aguas Blancas) covering 320km2 and is permitted to extract 165.7 l/s. AMC leases an additional eight bores from Universidad de Atacama and Xstrata, which are permitted to extract 40.0 l/s. The current extraction rates are 53 l/s from Rosario and 44 l/s from Aguas Blancas aquifers.

AMC is the titleholder of three easements for the use of surface lands required for the adequate development, operation and exploitation of the Aguas Blancas project. The surface rights include 5,566 ha in the plant and mining areas, as well as a 70 km x 25 m easement for water pipeline, a 1,260 m x 36 m easement for an airport and a 26.5 km x 15m easement for a power line. An application to expand the operational area is currently being developed.

In 1997, Atacama prepared and presented an Environmental Impact Study for the Aguas Blancas project to the Regional Commission of the Environment (COREMA), which issued the Exempt Resolution Nr.012 of August 7, 1997 in favour of Atacama. Atacama subsequently submitted various applications for amendments (“DIA”) to their existing environmental permit (“EIA”) to COREMA. The first was submitted on June 20th, 2000, which was approved through Exempt Resolution Nr. 151 of August 28, 2000. The second was presented on October 12th, 2006, and was approved through Exempt Resolution Nº 054/2007 of February 19th 2007. Finally, the third DIA was filed on August 27, 2007, which was approved through Exempt Resolution Nº 014/2008 of January 9, 2008.

AMC submitted a DIA for a new power line to access the CDEC-SING grid. This DIA was approved through Exempt Resolution No. 0308/2007 on September 28th, 2007.

No towns or populated areas fall within the boundaries of the Property. In general the local communities in northern Chile have a favourable attitude towards mining.


7 19 December 2013

1.3 Geology and Mineralization The property is located 95km south-east of Antofagasta, Chile, on the western side of Atacama Desert, at an elevation between 970 and 1,230 masl. The deposit occurs on the upper slopes of large alluvial fans and consists of primarily of hard salt-cemented beds, typically up to 3m thick, referred to locally as caliche. These caliche beds were formed as distinct layers after the deposition of the host alluvial fan sediments, and through the leaching of windblown salts by infrequent rainwater, deliquescence and reworking to re-accumulate in enriched zones. The caliche deposits belonging to Atacama cover 67,911 Ha, extending approximately 23km in length (NW-SE) and 4km wide (SW-NE), occupying mostly flat areas and some hill slopes. They are commonly overlain by 0.2m to 1m of weakly consolidated sand and gravel, known locally as chusca, which is stripped prior to mining of the caliche. Atacama’s deposit also includes large areas which were previously worked, known locally as Antiguos. These areas were worked by hand in the 1900s for nitrates, but which still contain significant iodine, both in the material which was previously worked, as well as in virgin caliche material lying underneath. 1.4 Database and Resource Estimation The principal means of exploration of the deposit in recent times has been by reverse circulation drilling. Various drilling campaigns have been completed by different companies according to their ownership of the property. The current database also includes data from 18,716 drill holes for 64,801m, which were drilled by Atacama between 2005 and the end of 2012. Additional work completed by Atacama or by their consultants includes a hydrogeological study, an environmental study (EIA), reserve estimation updates, basic engineering reviews and feasibility studies. The current mineral resource estimate was prepared by Adam Wheeler using industry standard methodologies, conforming to the requirements set out in National Instrument 43-101. The geological modelling work and corresponding resource estimation was carried out using Datamine software. The updated resource model contains estimated grades of in-situ iodine (I2), nitrate (NO3) and sulphate (SO4). As well as the principal ‘Virgin’ area, which has been the main source of caliche for recent production, the reworked ‘Antiguos’ area has also been modelled, along with other outlying caliche areas. For each of these zones, the same modelling methodology was applied. Drill hole composites were created for intersections which in general cover intersections containing above 200ppm I2. For each composite, accumulations were calculated of grade x thickness. These accumulation values were subsequently interpolated into the block model, along with caliche thickness, and the final grades of iodine were determined for each block. The resource estimation was based on a 200ppm I2 cut-off grade. Updated property boundaries were applied to the model and the limit of mining as at 31st December 2012. Density measurements which have been derived from mine reconciliation studies have been applied. It should also be noted that the deposit has not been totally drilled off. Additional exploration drilling may add to the geologic resource and subsequent reserves. 1.5 Mine and Plant Operation The general process consists of:

• Surface mining by continuous miner of caliche ores • Processing by Heap Leach or Agitated Leach Plant (ALP) to produce iodate rich brines • Chemical concentration of brines • Electrochemical reduction • Crystallisation – fusion to produce iodine prills


8 19 December 2013

1.5.1 Mining Operations Stripping of the overburden (approximately 0.5m thick) is carried out using a bulldozer, and accumulated at the sides of the mining block. The continuous miner takes a 0.4m cut of the caliche. Material which is destined for the ALP is screened to provide -6mm fines and +6mm coarse material. The material is loaded using front end loaders into 60t trucks, which haul the material to the heap leach pads (coarse) or the ALP (fines).

1.5.2 Processing Operations The three most significant components of the caliche are iodine, sodium sulphate and sodium nitrate. These salts are soluble in water at ambient temperature. In the heap leaching process the iodine recovery is estimated as being 60% and in the ALP as 88%. The iodine plant recovery is estimated at 91%, producing an overall iodine recovery of 55% for heaps and 80% for ALP.

The heap leach pads are built on an impermeable geo-membrane, covering an area between 25,000 to 30,000m2, with heights averaging 10m containing approximately 450,000t. Drainage pipes are laid on the membrane and covered by the mined ore. The heaps are irrigated initially with bore water and at the end of the heap life with a mixture of bore water and feble (a residual solution from the chemical plant) at a rate of approximately 1.75 l/m2/hr.

The ALP has been placed on care and maintenance and is scheduled to restart in mid 2015. The ALP comprises a slurry plant and screen to produce -3.5mm, with the oversize being returned to the heap leach pads. The -3.5mm material is leached in 4 leach tanks and the brine clarified through 4 thickeners operating as a countercurrent circuit. The throughput of the slurry plant is limited to approximately 150 tonnes per hour. A SAG mill is due to be installed which will enable processing of the full size range of mined product to produce -1mm feed for the leach section. The throughput of the leach section is designed to be 400 tonnes per hour. An Improheat heater enables the temperature of the brine to be raised to assist in dissolution of the salts.

1.5.3 Chemical Plant The brine solution from the heaps and ALP is accumulated in lined ponds for feed to the iodine recovery plant. The brine is mixed with SO2 to reduce the iodate in solution to iodine gas in the “acid” leg of the Blow-Out Tower. The iodine gas is blown over to the “caustic” tower where it is adsorbed in NaOH solution. The solution is concentrated by recirculation until reaching a concentration of 80g/l of iodine.

The concentrated caustic solution is pumped to a crystallizer in the Fusion Plant. Iodine crystallization is an exothermic chemical reaction from the interaction of sulphuric acid with the concentrated solution of iodine (which is contained in a caustic solution). The crystallized iodine is heated to 114°C where the iodine changes from a solid to a liquid state during the 12 hours of melt. The molten iodine is dripped through a water-cooled column, producing prills of an average size of 2mm to 3mm.

The solid iodine is fed to a rotary dryer, where a vacuum line recovers the sublimated iodine for re-processing. The dryer discharge is sent to a storage silo, from which the material is screened and packed as prills in 25 or 50kg containers for shipment by 20' containers to the customers.

1.6 Conclusions The evaluation work was carried out and prepared in compliance with NI43-101, as well as according to the guidelines of the Council of the Canadian Institute of Mining, Metallurgy and Petroleum. The updated resource estimation of all modelled zones, for iodine resources, is shown in Table 1-1. The resource incorporates all of the available drill hole data, for a cut-off grade of 200ppm I2 as of 31st December 2012. No mining factors, such as dilution or mining recovery have been applied to these resource figures, but they are based on a minimum thickness of 0.5m.


9 19 December 2013

Table 1-1: Iodine Mineral Resource Estimate At 31st December, 2012

Resource Class Tonnes Iodine

‘000t ppm I2

Measured 16,798 474

Indicated 88,205 417

Measured & Indicated 105,003 426

Inferred 67,392 338

N.B. Mineral resources evaluated using a block cut-off of 200ppm I2. Measured and Indicated resources shown are inclusive of Reserves.

Owing to different sample coverage and geostatistical characteristics, NO3 and SO4 resources are reported separately, as shown in Table 1-2.

Table 1-2: Sulphate and Nitrate Mineral Resource Estimate Cut-Off 200ppm I2, at 31st December, 2012

Resource Class Tonnes Nitrate Sulphate

‘000t % NO3 %SO4

Measured 1,166 3.1 24.6

Indicated 12,407 2.8 19.3

Measured & Indicated 13,573 2.8 19.7

Inferred 93,637 3.2 14.5

Reconciliation data was collected for production from the continuous miners in use from 2009 to 2012. This enabled updated mining factors to be calculated, which were then applied in subsequent reserve calculations. The reserves were derived by blocking out those areas of measured and indicated resources at a cut-off of 250ppm I2. This breakeven cut-off was derived from budgeted cost levels for 2013, for both heap leach and agitated leach processing operations.

The Mineral Reserve Estimate for the Aguas Blancas Project is shown in Table 1-3.

Table 1-3: Mineral Reserve Estimate At 31st December, 2012

Reserve Class Tonnes Iodine

‘000t ppm I2

Proven 14,558 492

Probable 68,386 457

Proven and Probable 82,944 463

N.B. Reserves blocked out cut-off of 250ppm I2. This cut-off was derived from parameters which included:

• Iodine price $36/kg and Exchange Rate CHP to US$ 500 • Owner mining, HL & ALP processing

Mining Factors applied: • 0% dilution, 95% mining recovery • Maximum caliche thickness 3m


10 19 December 2013

An additional 40Mt of Inferred material at economic grades is also modelled In the authors’ opinion, given that the Aguas Blancas mine has been operating since 2001 and that the operating factors are well established, the Mineral Resource and Mineral Reserve Estimate are well supported. The authors recommend:

• Continuation of conversion of inferred resources is completed to enable determination of the full life of mine. A budget of US$ 5.2m has been included in the current Life of Mine plan.

• Investigations are continued to determine the viability of nitrate production.


11 19 December 2013

2 INTRODUCTION

2.1 Introduction This is a technical report on the Aguas Blancas. Aguas Blancas is owned and operated by Atacama Minerals Chile SCM (“AMC”) a wholly owned subsidiary of Sirocco Mining Inc (TSX: SIM).

The property is located in the II Region in northern Chile The scope of work entailed review of all pertinent geological and mining data, allowing the preparation of updated mineral resource and reserve estimates. The primary recoverable product associated this study is iodine.

This work was completed by Adam Wheeler, a qualified mining engineer, Hugh Stuart, a qualified geologist and Kevin Ross, a qualified mining engineer. A site visit in connection with this work was completed by Adam Wheeler from October 15th – 19th, 2012, by Hugh Stuart between 17th June and 24th June 2013 and by Kevin Ross between 12th and 15th November 2013. Estimates in this report refer to 31st December, 2012.

2.2 Terms of Reference The Mineral Resource and Mineral Reserve estimates detailed in this report were commissioned by AMC in order to update the Resource and Reserve estimates for 31st December 2012. The Resource and Reserve estimates were completed by Adam Wheeler, an independent mining consultant, with assistance from Atacama geologists and engineers. The majority of the computational work utilised the Datamine mining software system.

2.3 Sources of Information In conducting this study, the authors relied on reports and information prepared by and for AMC.

The information on which this report is based includes: • Various studies on Aguas Blancas by Pincock, Allen, Holt (PAH) 1997 and 1999. • AMEC: Technical Report of the Aguas Blancas Property, May 2005. • Previous evaluation reports made by Adam Wheeler from 2006-2010 including NI 43-101 compliant

technical reports compiled by Adam Wheeler in January 2007 and in December 2010. 2.4 Units and Currency All measurement units used in this report are metric, and currency is expressed in US Dollars, unless stated otherwise. The currency used in Chile is the Chilean Peso. The exchange rate used in this report is 500 Chilean Pesos to US$1.00.


12 19 December 2013

3 RELIANCE ON OTHER EXPERTS

The Authors have followed professional standards in the preparation of the content of this report and this report is intended to be read in its entirety. AMC has supplied data relating to its exploration and mining activities for the Aguas Blancas property which the Authors have used as the basis for this report. All data used in the report has been verified and validated where practical and is based on information believed to be accurate at the time of completion. The Authors have made all reasonable endeavours, including several site visits to confirm the authenticity and completeness of the technical data on which this report is based. Adam Wheeler has reviewed and analysed exploration and mining data provided by AMC and its consultants and has drawn his own conclusions therefrom. Adam Wheeler has not performed any independent exploration work, drilled any holes or carried out any check sampling and assaying. The authors have relied on information provided by Atacama on the mineral and water rights described in sections 1.2, 4.1, 4.3 and 4.4 as provided in the report prepared for AMC: Aguas Blancas Project, Property and Permits Summary Report. Nov 2013 by Bofill, Mir and Alvarez Jana, Abogados, Santiago Chile.


13 19 December 2013

4 PROPERTY DESCRIPTION AND LOCATION

4.1 Property Ownership Chile’s mining policy is based on legal provisions that were enacted as part of the 1980 constitution. These were established to stimulate the development of mining and to guarantee the property rights of both local and foreign investors. The Chilean state owns all mineral resources, but exploration and exploitation of these resources by private parties is permitted through mining concessions, which are granted by the courts. The concessions have both rights and obligations, as defined by the Mining Code enacted in 1983. Concessions can be freely mortgaged or transferred, and the holder has full ownership rights and is entitled to obtain the rights of way for exploration and exploitation. In addition, the concession holder has the right to defend their ownership against state and third parties. A concession is obtained by a claim application and includes all minerals that may exist within its area.

AMC is the titleholder of three easements for the use of surface lands that were constituted in accordance with the provisions of the Chilean Mining Code, comprising the lands required for the adequate development, operation and exploitation of the Aguas Blancas mine. The surface rights include 5,566 ha in the plant and mining areas, as well as a 70 km x 25 m strip for water pipeline, a 1.26 km x 36 m strip for an airport and a 26.5 km x 15m strip for power lines.

4.2 Property Location Aguas Blancas is located approximately 1,600 km north of Santiago, Chile, and 75 km southeast of the port city of Antofagasta (Figure 4-1). The Property lies within the Antofagasta Province, II Region, at a latitude of approximately 24°8'S and longitude 69°53'W.The elevation at the Property varies between 970 and 1,230 masl.

Figure 4-1: Location Map

Source: Sirocco Mining Inc


14 19 December 2013

4.3 Mineral Tenure Aguas Blancas has 337 estacas, concessions and licences covering 67,911 Ha which are detailed in Table 4-1. There are 11 disputed mining concessions covering 2,500 ha, which are being reviewed by the courts for resolution.

Table 4-1: Mineral Property

No Ha

Estacas 35 7,478

Registered Mining Concessions 247 45,627

Exploitation Licences 6 906

Exploration Licences 49 13,900

Total 337 67,911

A full listing of AMC’s mineral concessions is provided in Appendix A and is shown in Figure 4-2.

The Properties are legally registered in the name of AMC, and are free of mortgages, encumbrances, prohibitions, injunctions and litigation. The mining patents are paid and up to date.


15 19 December 2013

Figure 4-2: Mineral Tenure: Current permits

Source: AMC (Worldview imagery acquired by Sirocco in Feb 2012)


16 19 December 2013

4.4 Water AMC has 14 boreholes located in two aquifers (Rosario and Aguas Blancas) covering 320km2. 136.7 l/s has been approved for extraction with a further 29.0 l/s provisionally approved for extraction. AMC leases an additional seven bores from Universidad de Atacama and Xstrata. 34.0 l/s has been approved for extraction with a further 6.0 l/s provisionally approved for extraction. In total AMC has access to 205.7 l/s from the two aquifers. The current extraction rates are 53 l/s from Rosario and 44 l/s from Aguas Blancas aquifers

The AMC water rights are legally registered in the name of AMC and are free of mortgages, encumbrances, prohibitions, injunctions and litigation, and have been paid up to date. A summary is shown in Table 4-2 below.

Table 4-2: Water Rights

Approved Provisional Total

Aquifer Rights Owner

l/s l/s l/s

Aguas Blancas AMC 52.0 29.0 81.0

UA 15.0 15.0

Xstrata 9.5 9.5

Sub Total 76.5 29.0 105.5

Rosario AMC 84.7 84.7

Xstrata 9.5 6.0 15.5

Sub Total 94.2 6.0 100.2

Total AMC 136.7 29.0 165.7

UA 15.0 15.0

Xstrata 19.0 6.0 25.0

Total 170.7 35.0 205.7

4.5 Environmental and Socio-Economic Issues Chile’s primary Environmental Law Nº 19.300 regulates environmental activities covering environment, air and water quality and emission standards. The law was amended in 2010 by Law 20.417, creating a new statutory framework.

Law N° 19.300 requires an Environmental Impact Assessment System (EIAS) prior to the execution or modification of a public or private project or activity and is complemented by Decree 40/2013 (“Decree”), which provides the new regulatory framework applicable to the EIAS.

Under the Chilean environmental regulation depending on the extension or magnitude of the environmental impact, there are two types of environmental reviews:

• Environmental Impact Assessment (Evaluación de Impacto Ambiental, “EIA”). • Environmental Impact Statement (Declaración de Impacto Ambiental, “DIA”)

Exploration for minerals is exempted from the filing of either a DIA or an EIA. An EIA is required when the proposed activities has an impact greater than the criteria defined by law and regulation. The EIA report includes a detailed description of the upcoming exploration program or study, a program for compliance with the environmental legislation, a baseline study, a detailed description of the possible impacts and an assessment of how they would be mitigated, a plan for compensation (if required), details of a follow-up program, a description of the EIA presentation, and an appendix with all of the supporting documentation.

A DIA is prepared in cases when the proposed activities have a low environmental impact according to the criteria defined by law and regulation. The DIA includes a statement from the applicant declaring that the project will comply with the current environmental legislation, a detailed description of the type of planned


17 19 December 2013

activities, including any voluntary environmental commitments that might be completed during the project, and an indication of the sectoral environmental permits applicable.

Once an application is made, the Commission or the Executive Director of the Servicio de Evaluación de Impacto Ambiental (“SEA”), depending on the case, will take a maximum of 120 days to conclude the review. The evaluation process considers the opinion of various government agencies and the public.

Law 20.417 as revised in 2010, requires citizen participation and indigenous consultation as described in ILO Convention 169, where any person can present observations to the EIA in the first 60 days of the 120 day legal term. If explanations, rectifications or extensions are suggested by the Commission, citizens have an additional 30 day period to present observations, in which case the legal term will be suspended. The indigenous participation requires the incorporation of exclusive participation aspects for indigenous people to ensure the cultural pertinence of their participation.

If the activity or project complies with all the environmental requirements, SEA grants the environmental authorization (RCA), which means that the project or activity is authorized to be executed and acquire all necessary permits required to conduct the mining operation. The project has to be initiate within five years of the granting of the RCA.

4.6 Other Factors and Risks By public deed dated March 14, 2002, AMC acquired from Inversiones Vasa Limitada the totality of the rights in a royalty that encumbered the Properties. As a consequence of this purchase, the aforementioned royalty was extinguished.


18 19 December 2013

5 ACCESSIBILITY, CLIMATE, INFRASTRUCTURE, PHYSIOGRAPHY

5.1 Accessibility

The Property is located in the intermediary depression of the Chilean Atacama Desert. Access to the mine is via 55km of paved and 36km of unpaved road from the northern Chilean port city of Antofagasta (estimated population 300,000). Antofagasta is currently serviced from Santiago by regular daily domestic flights.

5.2 Climate The normal desert climate is characterized by a very low relative humidity, virtual lack of precipitation, practically no oceanic influence and clear skies during the whole year. The average annual precipitation does not exceed 10 mm.

The Atacama Desert has an average air temperature of 16.5°C. Typical maximum air temperature is 40°C, and minimum temperature of 5°C. Freezing temperatures are rare, but large temperature differences between day and night are common.

5.3 Physiography The Property is a relatively flat area, located at the upper slopes of large alluvial fans on the western side of the Atacama Desert. Elevations on the Property range from 970 to 1,230 masl. No permanent water flows exist in the area, and only isolated, small dry ravines or quebradas are found near the surrounding hills.

Due to the extreme aridity, there is practically no natural vegetation or fauna in the area.

5.4 Local Resources and Infrastructure AMC maintains a permanent mining camp at the Property, at an elevation of 1,000 masl, with office and living accommodation, workshops and communications.

Antofagasta is the only permanent settlement located in the relative proximity to the mine. The city provides the basic goods, services and accommodations, as well as labour and technical requirements for the mine.

Power supply is from the national grid. Water is pumped from two aquifers, Rosario and Aguas Blancas, which determines the mining and processing rates. There is sufficient area for heap leach pads and tailings storage facilities for the projected life of the mine.

5.5 Surface rights The Company holds sufficient surface and water rights for the operation of the project and the requirements of project infrastructure including power, water and personnel.


19 19 December 2013

6 HISTORY

6.1 Project History The Cantón Aguas Blancas was discovered by José Santos Ossa as early as 1860, while exploring for silver veins in the desert east of Antofagasta. The cantón became one of the main Chilean nitrate producers from the late nineteenth century until the First World War.

The Cantón Aguas Blancas was mined by many well established oficinas, which were connected to the local railroad system, established in 1903 from Aguas Blancas to Caleta Coloso, with three main stations in the area (Aguas Blancas, Agua Buena and Lacalle). In 1923, all the local caliche railroads were linked by the Chilean government into a continuous system from Diego de Almagro, in the south, to Iquique, in the north.

The caliche mining in the Cantón Aguas Blancas had ceased by 1950.

AMAX acquired control of the deposit in 1988 and conducted an extensive drilling, trenching, sampling and testing program. A feasibility study was prepared by Bateman in 1989. In 1992 AMAX dropped the venture, after a corporate decision to move out of the fertilizer and inorganic chemical industry.

Minera Teslin Ltda. (“Teslin”), owned by the Canadian corporations Teslin Químicas de Chile Inc. and Atacama Minerals Chile Ltd., acquired control of the Petronila holdings in March 1993 and conducted additional drilling and test work. A reserve estimate was concluded in 1994.

Several studies were conducted for Teslin between 1997 and 1999, to assess the influence of geologic factors on the iodine-sulphate resources, to estimate the resources and reserves over virgin and repasos areas, to evaluate the mining method and to update the geologic model and mine schedule. A due diligence review was conducted in 1998.

In 2000, Atacama Minerals Company Ltd. sold 50% of the Aguas Blancas Property to ACF Minera S.A. (“ACF”), who built and operated a heap leach and iodine recovery circuit through to May 2005. In April 2005, Atacama Minerals Chile Ltd. agreed to purchase from ACF its 50% participation, which gave Atacama Minerals Chile Ltd. full ownership of the Aguas Blancas operation. The purchase was completed on May, 3rd 2005.

In January 2012 Atacama Minerals Corp. changed its name to Sirocco Mining Inc.

6.1.1 Historic Mineral Resource Estimates A number of resource and reserve estimates made by AMAX between 1988 and 1992 based on the initial drill programme by AMAX. Resource estimates were undertaken by Teslin in 1997 and 1999 as part of an overall project evaluation. In 1998, a feasibility report study was prepared using the 1997 resource estimate of 73 Mt at 310 ppm of Iodine. A subsequent resource estimate was completed in 1999.

In 2005 AMEC, on behalf of Atacama completed a twin RC drilling programme to validate previous drilling results obtained by AMAX and conducted a resource estimate on behalf of Atacama. Since December 2005 resources have been compiled by the current author. It should be noted that resource estimates after 2007 use only drilling data obtained by Atacama (May 2005 onwards). Table 6-1 shows a summary of historical resource estimates. It should be noted that the estimates prior to 2005 do not meet the criteria of NI 43-101 and are reported for historical purposes only.


20 19 December 2013

Table 6-1: Historic Resource Estimates

Date Company

Cut-Off

Grade ppm

Measured and Indicated

Inferred

Notes

Mt Iodine ppm

Mt Iodine ppm

Oct-97 Teslin/PAH 0 73.8 310 25.6 258 non NI43-101 compliant

Sep-99 Teslin/PAH 0 106.4 230 17.2 190 non NI43-101 compliant

May 2005 AMEC 220 34.5 483 35.2 384

Dec 2005 Atacama/AW 200 20.6 618 59.5 494

Jun 2006 Atacama/AW 200 27.5 543 51.6 451

Oct 2007 Atacama/AW 200 51.3 543 50.6 430

Dec 2010 Atacama/AW 200 54.9 494 68.2 391

Dec 2011 Atacama/AW 200 56.5 472 76.6 362

Dec 2012 Atacama/AW 200 105.0 426 67.4 338

Note: PAH = Pincock, Allen, Holt. AW = Adam Wheeler 6.1.2 Historic Production Iodine mining operations commenced in 2001. Historic production for the Aguas Blancas mine is shown in table 6.2 below:

Table 6-2: Historic Mine Production

Year Mined

Iodine Production

'000 tonnes ppm I2 tonnes

2002 3,220 711

2003 3,060 756

2004 2,770 726

2005 2,290 646

2006 3,210 891

2007 4,100 1,075

2008 2,592 659 844

2009 3,174 550 1,096

2010 3,804 623 1,256

2011 4,488 579 1,122

2012 4,526 510 1,202


21 19 December 2013

7 GEOLOGICAL SETTING AND MINERALISATION

7.1 Regional Geology Paleozoic basement and Meso-Cenozoic cover are exposed in the Cantón Aguas Blancas region (figure 7.1). The Paleozoic basement includes metasedimentary rocks in the Coastal Range and sedimentary to volcanic sequences, associated with coeval late Paleozoic intrusive complexes, in the eastern Cordillera Domeyko. The overlying Mesozoic-Cenozoic cover is represented by volcano-sedimentary, marine and volcanic sequences, intruded by a heterogeneous suite of plutonic bodies varying in size from huge composite batholiths in the Coastal Range to discrete, small-sized stocks in the Central Depression and the Cordillera Domeyko.

The nitrate and iodine deposits occur mostly along the eastern side of the Coastal Range from Zapiga in the north to Taltal in the south, a distance of 700 km. Commercial deposits in the Tarapaca and northern Antofagasta Provinces were confined to the Coastal Range, whereas to the south they spread out more widely into the Central Valley and lower slopes of the Cordillera Domeyko. Many deposits occur along the margins of salars and ancient playas.

Figure 7-1: Geology of the Aguas Blancas Project area

(After AMEC 2005)

7.2 Property Geology and Mineralisation Historic nitrate mining and the current iodine resources in the Aguas Blancas area occur on the slopes of large Miocene to Pleistocene age alluvial fans where saline minerals act as cement to sediments in unconsolidated alluvium.

The iodine-bearing caliche at Aguas Blancas (figure 7.2) extend for over 23 km (NW-SE) and are up to 4km in width (SW-NE), occupying flat to gently undulating areas and the mid to lower hill slopes on the margins of a large pampa.


22 19 December 2013

The caliche occurs in thicknesses up to 6m and is overlain by 0.2 to 1m of barren, weakly consolidated sand and gravel (chusca), which is commonly stripped prior to mining. In general the caliche is underlain by gravels or clays.

The caliche contains varying quantities of rock fragments in the form of sub-rounded to angular clasts up to 10cm in diameter. In places they clearly represent alluvial channels but in general their distribution within the deposit is irregular.

During the 2012 drill programme the geology and characteristics of the caliche were studied in more detail. The following lithology types were distinguished and also used in the logging of RC drill chips.

Table 7-1: Exploration Geological units mapped

Code Description

ARCI Clay layer normally brown to dark brown and has no salinity, can have iodine grades but generally low, when compressed in the hand forms compact “balls”

CALC Caliche with clay, variable salinity, normally beige as a ”heavy ultrafine powder”, variable iodine grades, when compassed in the hands behaves as a fluid.

CALH Caliche Hard, similar with CALC but reduced clay content and harder, normally good grade and has medium to high salinity.

CALS Caliche with sulphate, white clay powder, sulphate rich, with low salinity, differs from sulphate unit on texture, clay content and salinity. It has normally a “pepper” taste.

CHUS Chusca, upper layer is formed by sand, clay and some rock fragments, is fine, light (flows with the wind) and has no salinity.

GRAV Grava, is normally the bottom layer together with RIPI (ripios). It is formed by angular rock fragments with more or less sand and clay content, sometimes appears between other units, can have salinity.

RIPI Ripios, is a basal unit composed of clay and sand with rounded pebbles.

SULP Sulphate unit, “fibre” white powder very characteristic, no grades associated.


23 19 December 2013

Figure 7-2: Iodine Distribution



24 19 December 2013

From mapping work conducted in 2012 across the mined areas of the project and as can be seen in figure 7 -2 below (See table 7.1 for key), the geology of the caliche is complex and highly variable. The type of caliche, the quantities of clay, rock fragments and sulphates, as well as contained iodine can vary over short distances.

Figure 7-3: Caliche profile in mined cut

Source: AMC

XRD analysis carried out at the Universidad Catolica del Norte in 2012 on a variety of samples from the mining area (table 7-3) show both the large variety and variable distribution of minerals identified within the caliche.

Iodine is thought to occur in solid solution in nitrate double-salts, glauberite, halite, and potassium salts and as calcium iodate minerals lautarite, bruggenite, and dietzeite. The mineralogical composition of a caliche sample from Aguas Blancas shows that three salts (halite, glauberite and nitratina) represent 60% of the sample composition.

Iodine, usually above 150 ppm, has higher concentrations on the southeastern half of the deposit, where the block model shows large zones with iodine grades above 500 ppm, exceeding 1,000 ppm in some areas. For most of the area, the nitrate grades range between 1% and 5%, although grades above 10% are not infrequent along the NW-SE axis of the deposit. Sodium sulfate has a conspicuous distribution, being present only in the eastern half of the deposit with grades ranging from 20% to 40% Na2SO4, and rarely exceeding these values. The depth of the caliche layer in Aguas Blancas ranges from 0.5 m to 5 m.

Table 7-2: XRD Analysis of Caliche

Nombre/Compuesto Fórmula 3A 3B 4 5A 5B 5C 6A 6B 7A 7B 5_20 5_21 5_22 5_23 5_24 1 2A 2B 2C

(%) (%) (%) (%) (%) (%) (%) (%) (%) (%) (%) (%) (%) (%) (%) (%) (%) (%) (%) Thenardita Na2SO4 x x x x x 0.2 x x 0.9 x 73.4 55.0 25.3 2.2 x x x x x

Cuarzo SiO2 9.4 6.5 9.6 9.1 14.6 5.8 12.2 12.2 5.0 6.2 8.9 4.5 8.6 14.1 13.4 6.2 6.2 11.0 6.7 Glauberita Na2Ca(SO4)2 12.6 29.9 23.3 22.5 16.6 18.0 21.5 26.1 33.1 17.0 8.0 14.6 23.7 36.3 18.5 6.2 4.0 7.7 17.2 Cristobalita SiO2 0.4 x x x x x x x x 0.4 0.2 x x 0.6 0.1 0.4 x 0.6 x Anhidrita CaSO4 0.2 0.8 0.1 1.7 0.6 27.2 6.3 5.3 3.2 10.0 0.9 1.6 x 1.0 0.2 13.0 13.1 9.6 x

Halita NaCl 40.7 26.1 21.3 16.3 24.0 29.4 22.5 27.0 22.5 32.5 1.5 9.7 31.8 13.7 37.3 20.6 24.6 33.1 46.7 Kaliborita HKMg2B12O16(OH)10(H2O)4 x x x x x x x x x x 4.0 x x x x x x x x

Hidroclorborita Ca2B4O4(OH)7Cl·7H2O 0.2 0.2 x 1.4 x x 1.5 x 0.8 0.2 2.2 x x x x 0.2 0.2 0.2 0.2 Darapskita Na3(NO3)(SO4)·H2O 11.5 x 5.2 13.2 4.2 x x x x 3.7 1.0 2.9 3.7 x x x x 1.3 11.4 Astrakanita Na2Mg(SO4)2·4H2O 4.8 5.0 1.4 3.0 6.6 x x 1.4 3.4 1.9 x 4.4 2.6 3.6 6.9 1.2 0.6 x 1.7

Yeso CaSO4.2H2O x 2.4 x x x x x 0.6 x x x 1.7 x x 2.5 x x x x Probertita NaCaB5O7(OH)4.3H2O x x 0.1 3.0 x x 1.3 0.9 0.7 0.7 x 1.8 x x x x x x x

Albita NaAlSi3O8 11.5 11.4 5.0 15.1 6.0 x 21.3 9.3 10.3 10.1 x 3.8 x 9.7 9.2 12.3 14.3 18.5 4.3 Humberstonita K3Na7Mg2(SO4)6(NO3)2·6H2O 1.4 x 11.3 8.4 13.7 x x x x x x x 3.0 x 2.7 x x x x

Vermiculita-2M Mgx(Mg,Fe)3(Si,Al)4O10(OH)22·4H2O x x 2.3 0.7 x x 1.4 1.8 x x x x 1.4 x x x x x x Loeweita Na12Mg7(SO4)13·15H2O x 4.7 10.1 1.6 2.5 x x 8.4 4.4 x x x x 7.3 x x 0.6 x x Nitratina NaNO3 6.2 13.0 7.8 4.0 8.4 8.1 11.9 7.0 14.1 15.3 x x x x 7.6 38.2 35.3 13.8 11.8 Bassanita CaSO4·0,5H2O x x x x x x x x x x x x x 1.1 x x x x x Polihalita K2Ca2Mg(SO4)4·2H2O x x x x x 0.1 x x x 0.2 x x x x 0.5 0.2 0.1 0.2 0.1 Caolinita Al2Si2O5(OH)4 x x x x x x x x 1.2 x x x x x x 0.1 1.1 x x

Hexahidrita MgSO4·6H2O x x 2.4 x x x x x x x x x x x x x x x x Hydroboracita CaMg(B3O4(OH)3)2.3H2O x x x x 2.9 x x x x x x x x x x x x x x

Colemanita CaB3O4(OH)3H2O x x x x x x x x x x x x x 6.9 x x x x x Anortita Ca(Al2Si2O8) x x x x x 9.7 x x x x x x x x x x x x x

Moscovita-1M KAl2Si3AlO10(OH)2 x x x x x 1.1 x x x x x x x x x x x x x Moscovita-3T (K,Na)(Al,Mg,Fe)2(Si3,1Al0,9)O10(OH)2 x x x x x x x x x x x x x x x x x 3.4 x Sauconita-15Å Na0.3Zn3(Si,Al)4O10(OH)2·4H2O x x x x x 0.3 x x x x x x x 3.5 x x x x x

Gowerita CaB6O10·5H2O x x x x x x x x 0.4 x x x x x x x x x x Kieserita MgSO4.H2O x x x x x x x x x 1.4 x x x x x x x x x

Vermiculita-2M Mg3.41Si2.86Al1.14O10(OH)2(H2O)3.72 x x x x x x x x x 0.3 x x x x x x x x x Montmorillonita-18Å Na0.3(AlMg)2Si4O10OH2·6H2O 1.1 x x x x x x x x x x x x x x x x x x

Saponita-15Å (Mg2Al)(Si3Al)O10(OH)2·4H2O x x x x x x x x x x x x x x x x x x x Beidellita-12Å Na0,3Al2(Si,Al)4O10(OH)2·2H2O x x x x x x x x x x x x x x 1.2 x x 0.7 x

Aftitalita (Glaserita) K3Na(SO4)2 x x x x x x x x x x x x x x x 1.4 x x x Mirabilita Na2SO4.10H2O x x x x x x x x x x x x x x x 0.1 x x x


26 19 December 2013

8 DEPOSIT TYPES

The iodine-rich caliche deposits have been classified by Williams-Stroud (1991) as Deposit Model 35b.12 (Descriptive Model of Iodine-bearing Nitrate).

Very particular conditions allowed the formation of the caliche deposits in the Atacama Desert. Such deposits have been poorly studied, as compared with more ubiquitous deposit types. Soil development in the Atacama is almost unique on earth, because it is one of the few places where soils primarily contain large concentrations of nitrates, as well as significant concentrations of perchlorate, iodate, and phosphate salts. Only in the Antarctic have relatively similar soils been identified. The presence of the corresponding anions is mainly derived from photochemical reactions in the atmosphere, and their accumulation in the Atacama is the result of the nearby presence of a major volcanic chain, the extreme aridity and the stability of landscape surfaces.

Currently there is little agreement regarding the timing for the initiation of hyperarid climatic conditions in the Atacama Desert of northern Chile. Some argue that the Atacama became the current hyperarid desert around 15 million years ago, and that this desiccation is the result of Andean uplift to high elevations. However, others argue that the onset of hyperaridity in the Atacama commenced around 4 million years ago and is related to global climate cooling and not to Andean uplift.

The Chilean nitrate beds were formed due to the deposition of nitrates and other saline constituents in salars and ephemeral lakes in the present Atacama Desert. Windblown salts from these playa-type deposits were deposited in a belt along the western side of the Atacama Desert depression over the past 10 to 15 million years. Some iodine and saline constituents were also deposited from ocean fogs and rainfall from the west.

In spite of the fact that the average annual rainfall is nominally less than 1 mm, with as much as 20 years between rain showers, the dominant land-forms of the Atacama Desert resulted from water erosion. Infrequent rainwater leaching and shallow deposition in the alluvial fan sediments built up shallow concentrations of saline minerals. Recurrent deliquescence and leaching has continued to redistribute the iodine and saline minerals deeper and/or downslope with time. However, economic concentrations of iodine and nitrate minerals are probably restricted to areas that are either (1) capped with an impermeable layer or (2) raised and well-drained, so that there are little or no descending fluids to dissolve and disperse them. This could explain the lateral limitation of the commercial-grade iodine and saline mineralization.

With a surficial deposit such as the caliche, the exploration model is relatively straight forward, efficiently utilising shallow grid RC drilling to test the caliche profile within the project area using a wide initial spacing and then focussing down to more detailed grids for resource definition.


27 19 December 2013

9 EXPLORATION

The bulk of the exploration work carried out in the Aguas Blancas area has been conducted by Atacama Minerals since 2005. The main form of exploration has been shallow reverse circulation (RC) drilling.

Table 9-1: Exploration Campaigns

Year Company Holes metres Activity

Late 19th Century

Pitting, mining

1988-1992 AMAX 258 1,854 trenching, sampling, metallurgical testing

1991 SQM 95 261

1997 Teslin 241 1,071 trenching, PAH studies

1998-1999 Teslin 520 2,170 trenching, Bateman, PAH, Kvaerner, Geodatos studies

2005 AMEC 52 157.5 Drilling for data revalidation (58 RC twin holes)

2005 Atacama 569 1,878 RC drilling

2006 Atacama 2,183 5,592 RC drilling





2011 Atacama 715 2,720 RC drilling


Few records remain for the period prior to 2005 and drill data relating to this period is not included in the current Aguas Blancas database.

Although several phases of trenching have been carried out prior to 2005 records are also poor and this data has now also been removed from the current database. Some trenches known as calicatas were used to evaluate areas where historical mining had been undertaken but this data was superseded by later drilling and is not now used.

The bulk of the caliche is covered by up to a metre of soft, unconsolidated material (chusca) making surface sampling of the caliche impractical. Given that drilling is shallow and cost efficient, no other forms of exploration sampling have been utilised at Aguas Blancas.

9.1 Topography In addition to the detailed survey of exploration drill collars by differential GPS (DGPS) Atacama commissioned Pacific Geomatics Ltd (British Columbia, Canada) in February 2012 to produce a digital elevation model (DEM) over an area of 1,814km2 using stereo Worldview imagery. The resulting data, controlled by known survey points, provided accurate 1m contours over the entire project area.


28 19 December 2013

10 DRILLING

Table 10-1 shows a summary of all the drilling that has been completed up to the end of December 2012, which is utilised as the basis for the current resource estimate. Drilling completed by prior to 2005 (table 10.1) has not been used in the current resource estimate.

Table 10-1: Drilling Summary

Year Company Holes Metres

2005 Atacama 569 1,878

2006 Atacama 2,183 5,592

2007 Atacama 3,074 9,203

2008 Atacama 2,685 9,876

2009 Atacama 2,482 8,526

2010 Atacama 2,048 7,289

2011 Atacama 715 2,720

2012 Atacama 4,960 19,717

Total 18,716 64,801

RC drilling is based on an orthogonal grid system and varies from reconnaissance drilling at a spacing of 400m x 400m to final infill drilling prior to mining using a 50m x 50m spacing. The average depth of an RC hole is 3.55m with a maximum depth of 8.5m. Figure 10.1 shows a summary of drilling locations across the property.


29 19 December 2013

Figure 10-1: Distribution of RC Drill holes as at 31st December 2012.

Source: AMC.Worldview imagery acquired in February 2012.


30 19 December 2013

10.1 Reverse Circulation Drilling RC drilling for the period from 2005 to early 2012 (45,084m) was carried out in-house by a small trailer mounted rig using a separate truck mounted compressor as shown in figure10.2.

Figure 10-2: RC rig used for all drilling from 2005 to early 2012

Source: AMC

Ingenieria y Servicios Mineros (Ismin) mobilised a SCHRAMM T450 rig with on board compressor (850cfm/350psi) to Aguas Blancas in late May 2012 which completed 19,717m by year end (figure 10.3).

For all drilling a Senior geological technician or Company geologist is on site at all times and is responsible for all aspects of the drilling.

Drill holes are and collar coordinates marked out in the field using a DGPS with 1m tall wooden posts painted and flagged with location and hole number. At this time any access work required is also carried out using a grader (Figure 10.4).


31 19 December 2013

Figure 10-3: Schramm T450 RC drill rig

Source:AMC

Figure 10-4: Drilling Terrain

Source:AMC

Prior to drilling the geologist checks the post location against a map of planned holes and writes on a control collar sheet along with the coordinates taken by a hand held GPS (Trimble Juno 3B).

All drilling completed is vertical and the angle of the rig mast is checked by the geologist prior to drilling.

10.2 Drill Hole Surveying All drill collars are surveyed by DGPS after drilling is complete. Due to the short depth of the holes no down hole survey is required.


32 19 December 2013

10.3 Sampling method

Samples are collected in 0.5m intervals from the base of the cyclone in a large new plastic bag which is pre-numbered with hole and interval, secured to the base of the cyclone. Frequently little or no sample is collected in the first 0.5 to 1.0m representing the unconsolidated chusca.

The geologist takes a hand sample from each bag, and logs the sample based on geology, pebble content and type, sample colour, sample salinity, recording the information on a paper drill log sheet. The sample number is assigned from the sample tag books and checked against the sample control sheet. Two sample tags are placed in the bag and the drill hole and interval written in the tag book for future reference. The bags are then sealed and transported to Company’s sample preparation facility for splitting. The QAQC sample control sheet is filled in with the sample number. The sheet also indicates when standards, blanks and duplicates should be inserted For drilling prior to 2012, samples were geologically logged based on the code system detailed in table 11.1. The 2012 drill programme utilised a more detailed code system for the caliche.

Table 10-2: Lithological Coding Systems used at Aguas Blancas

Prior 2012 lithology code

Post 2012 lithology code

Description

AR ARCI Clay layer normally brown to dark brown and has no salinity, can have iodine grades but generally low, when compressed in the hand forms compact “balls”

CAL CALC Caliche with clay, low to high salinity, normally beige is a ”heavy ultrafine powder”, grades run from no to high grades, when compassed in the hands behaves as a fluid.

CAL CALH Caliche Hard, similar with CALC but it’s possible to find caliche fragments, run normally good grades and have medium to high salinity.

CAL CALS Caliche sulphate, white clay powder, sulphate rich, with low salinity, differs from sulphate unit on texture and clay content and salinity. It has normally a “pepper” taste.

CHU/PAN CHUS Chusca, upper layer is formed by sand, clay and some rock fragments, is fine, light (flows with the wind) and has no salinity. Occasional hard panqueque crust within.

GRA GRAV Grava, is normally the bottom layer together with RIPI (ripios). It is formed by angular rock fragments with more or less sand and clay content, sometimes appear between other units, can have salinity.

RIPI RIPI Ripios, is a basal unit composed by clay and sand with rounded rocks (river rocks). Sometimes difficult to differentiate from grava because the size of the fragments available from RC drilling.

SULF SULP Sulphate unit, “fibre” white powder very characteristic, no grades associated.

10.3.1 Drill Sample Quality All RC drilling was conducted in dry conditions and water was only encountered in one area where drilling was curtailed. No wet RC samples were collected. The recovery is calculated based on a 5.25” hole diameter and densities as detailed in section11.1.4 below.

RC samples collected prior to early 2012 were not weighed. All samples after this date were weighed at the sample preparation facility and the information entered into the drill database.

For the 2012 drilling where weights have been recorded, recovery averaged approximately 65%. Recovery in the upper 1m of the holes, which includes the poorly consolidated chusca averaged 38% for 0.5-1.0m and 47% for 0.5-1.0m. Below this and representing the main caliche horizon RC recoveries averages 71%. Given the nature of the caliche this is considered acceptable.


33 19 December 2013

11 SAMPLE PREPARATION, ANALYSES AND SECURITY

All samples collected from drilling at Aguas Blancas, were subject to quality control procedures that ensured industry best practice was utilised for the handling, sampling, transport, analysis, storage and documentation of sample materials and their analytical results. All samples from drilling prior to 2012 were prepared and assayed at the Company’s on site laboratory. Samples from drilling in 2012 were prepared and analysed at the SGS laboratory in Antofagasta in Chile. The Atacama Minerals site laboratory is certified to ISO 9000. SGS is a global independent provider of assaying and analytical testing services for the mining and mineral exploration industry with consistent quality standards implemented across all regions. The SGS laboratory is certified to ISO 9000, ISO 14000 and ISO 18000. The laboratory participates in group-wide round robin assay work to ensure internal quality performance. 11.1 Sample Preparation and Analysis Methodology Samples are transported from the rig to the sample preparation facility at the mine by company personnel and the control sheet is delivered to the responsible person. Samples are laid out in sequence and checked, figure 11.1. All tag books and sample control sheets are filed in a safe place for future reference.

Figure 11-1: Samples laid out and checked at the sample preparation facility.

Source:AMC

11.1.1 Samples from drilling 2005-2011 All samples were prepared and analysed using the following procedure:

• No sample weights were recorded for drilling prior to 2012. • The sample was passed through a jaw crusher, to reduce it to less than ¼”. • The crushed sample was then homogenised and quartered, using a riffle splitter. • ¾ of the original sample was rejected, leaving approximately 500g, which is then dried. • The sample was then passed through a roll crusher, sized at 2mm. A sizing check is made to ensure 90% is

passing #10 mesh (2mm).


34 19 December 2013

• The sample was then ground in a ring mill, and a sizing check made to ensure 95% passes through a #100 mesh (150um) screen. Any oversize was reground, until at least 95% passed through the screen.

• This final ground sample was then quartered, yielding potentially 4 samples (of approximately 150g each). One was sent for analysis. One is also retained as a record sample by Atacama.

• The other 2 samples were periodically used for check sampling purposes (this is done for all samples within 1 out of 20 drill holes). One check sample was sent for external analysis (University of Antofagasta), and the other was submitted to the Atacama laboratory with a different sample number.

• From July 2005, samples were prepared and subsequently analysed on site. Sulphates and nitrates were similarly analysed in the on-site laboratory, using volumetric techniques, since November 2005. From April 2006, sulphates were analysed using ICP equipment, and nitrates using Molecular Absorption (MA) Equipment.

• Iodine: 10g sample, leached with hot water and then filtered. Acid and chlorine added to the filtered solution. Heat applied on heating plate, then cooled. Starch added and then titration with sodium thiosulphate.

• Sulphates: 5g sample, leached with hot water, filtered. 2ml fraction taken, 1ml of acid added 1ml of standard Yttrium, before taking ICP reading.

• Nitrates: 5g sample, leached with hot water and filtered to 250ml. Solution out into quartz cell and then reading taken with MA instrument.

11.1.2 Samples from drilling in 2012 (iodine only) All samples were prepared and analysed using the following procedure: • Samples are weighed prior to splitting. This data is recorded and added to the database. • Samples are spilt using a 50:50 riffle splitter with a 0.5” aperture to produce a 3-5kg sample for

submission. • Field duplicate samples are taken at this time by taking a second split. • Standard and blank samples are added to the sample stream at this point with pre-assigned sample numbers

from the sample control sheet. • Samples are then laid out and checked before being packed in to crates (200 samples per crate) for

transport to SGS in sealed crates.. • On receipt by the lab samples are checked again and then packed in trays. Each tray is identified and is put

in an oven to dry for 4 hours in a temperature of 60 – 70°C. • Samples are then crushed first to 0.5” and then to 10mesh in 2 stages before being split in a rotary splitter

where approximately 1kg is separated to be pulverized. • After every thirty samples the system is cleaned with sterile quartz and a sizing test is carried out • The 1kg sample is pulveriser in an LM-2 ring mill to produce a final sample passing 95% -100#. • Two samples of 250g are taken, one for immediate analysis and a second for reference. • Iodine: 10g sample, leached in 300ml of deionized water. Hypochlorite of Sodium 10% and Sulphuric acid

10% added, heat applied on heating plate and then cooled. • Until sample 518,333 the acid attack used water of Brome and sulphuric acid, however this was modified

after this point to fall into line with AM protocols. • Iodine is measured by titration with sodium thiosulphate • Sulphate and nitrate analysis has continued to be carried out at the site laboratory. 11.2 Sample Submission Procedures When samples are dispatched to the laboratory, a completed sample submission form accompanies the samples. The submission form details the sample number sequences and also instructs the laboratory on the elements required for analysis and the analytical methods to be used. After analysis the assay results are received electronically by e-mail or by hard copy from the assay laboratory. For all batches the sample numbers were checked against the sample numbers on the sample submission forms to verify that all the submitted samples were analysed by the methods requested for the elements required.


35 19 December 2013

11.3 Quality Control and Quality Assurance 11.3.1 2005 to 2011 Drill Program Pulverised samples were periodically used for check sampling purposes for one in every twenty drill holes. One check sample was sent for external analysis (Cesmec Laboratory or Verilabs) and the other was submitted to the Atacama laboratory with a different sample number (table 11.1). HARD plots for all sets of duplicate samples are shown in figures 11.2 to 11.7. Quality assurance steps also included compilation of a QA/QC report every 3 months, collating all the relevant data for this time period and routine sizing checks in the sample preparation facility. No standard reference material or blank samples were submitted during this period.

Table 11-1: Internal and external pulp duplicate samples analysed

Year Internal

Duplicates External

duplicates External

Laboratory

2007 0 237 Cesmec

2008 632 1,148 Verilabs

2009 691 489 Verilabs

2010 564 0 n/a

These results demonstrate an acceptable level of precision, and low proportion of misclassifications.

Figure 11-2: External Pulp check samples for 2007


36 19 December 2013

Figure 11-3: Internal Pulp check samples for 2008



37 19 December 2013

Figure 11-5: Internal Pulp check samples for 2009



38 19 December 2013


11.3.2 2012 Drill Program During the 2012 drilling a standard was included every 40 samples, a blank every 50 samples and a duplicate every 25 samples. All QAQC samples were inserted sequentially into the sample stream.

Blanks: Blanks samples were produced at the mine site taken from river channels and clay areas known to be sterile. The material is mixed thoroughly and 3 to 5 kg placed in sample bags for use. To test the grade value for each blank, five samples were collected from the homogenized blank pile and analysed at the site laboratory.

Standards: As no certified reference material is available for iodine assaying, standards are prepared in house from material taken from the mining area and were not pulverised. The material (up to 2”) is mixed thoroughly and 3 to 5 kg placed in sample bags for use. Various standards have been used and are numbered (STD-1, STD-2, STD-3 etc.). To test the grade value for each standard, five samples were collected from each homogenized standard pile and analysed at the site lab.

Duplicates: The duplicate samples are produced during splitting from the original sample and inserted sequentially into the sample stream.

Quality Control data

Standards

Data for standards 1 to 10 used during the 2012 drill programme are shown below in figures 11.8 to 11.17.


39 19 December 2013

Figure 11-8: Standard 1




40 19 December 2013





41 19 December 2013





42 19 December 2013


Given the nature of the material used as standards (course run of mine material as opposed to crushed/pulverised material) the degree of variability shown by the standard assays is understandable. Several comments can be made:

1. There is evidence of mixing of standard samples inserted.

2. The grade of the standards utilised is biased towards the lower grade ranges with 6 of the 10 samples below the resource cut off of 200ppm.

3. In general most of the standards analysed have under-reported.

4. The analysis of the in house standards has also demonstrated that iodine can be irregularly distributed in the sample and as a result the procedures where changed at the end of 2012 to the use of standards made up from well homogenised pulverised material.

Duplicates

1,092 duplicate samples were produced and analysed. The chart below in Figure 11.18 shows the HARD (half absolute relative difference) values for the 2012 data set. For 90% of the data set, the relative difference is 36%.

Blanks

603 blank samples were inserted into the sample sequence and are shown in Figure 11.19. In general the blank samples performed reasonably with +/- 10% of samples falling outside acceptable limits, some of which were mix ups with standard samples. However, as the blank material was obtained from the area of the mine site and may be weakly mineralised in places, it is recommended that a more effective source of blank material is located away from the mine site.


43 19 December 2013

Figure 11-18: HARD plot of duplicate samples

Figure 11-19: Blank Samples


44 19 December 2013

11.4 Summary Whilst on the whole reasonable there are a number of issues that require attention and a number of recommendations are made:

1. The selection of blank material has been poor and a better source of blanks should be found. 2. Standards produced have shown considerable variation. Some of this may be due to error in insertion of

standards but a greater part is thought to be a result of the variability in iodine grades within the material, especially prior to pulverisation. A more effective standard needs to be developed from pulverised material.

3. Duplicate data is reasonable, likely reflecting the variability seen in other QAQC sampling. 4. More control is required of the sampling process and particularly the insertion of QAQC samples into

the sample stream.

Authors Statement On several occasions between 2005 and the end of 2012 (the most recent being October 15th – 19th, 2012) the author visited the Aguas Blancas site and witnessed all aspects of the collection, preparation and dispatch of samples carried out by the Company’s personnel. The sample collection, preparation, analytical techniques, security and QAQC protocols implemented by the Company are consistent with standard industry practice and are suitable for the reporting of exploration results and inclusion in the mineral resource estimate undertaken.


45 19 December 2013

12 DATA VERIFICATION

Historically the project data was held in a series of Excel spreadsheets. In early 2013 the Company integrated the Aguas Blancas drill database into a bespoke CAE Systems GDMS® database and all drill data is now held and managed within this database. As part of this transfer all drilling for the period from April 2005 to April 2012 was re-compiled and validated from the original sample tag books, log sheets and site laboratory sample preparation and analytical records. All data that could not be completely verified during this process was discarded. Original Database files were provided with 96,218 records in the assays file and 14,604 records in the collar file. Following correction and validation, these files have been reduced to 93,780 records (-2,438) and 14,221 records (-383) respectively. This reduction in records is due to the removal of erroneous and duplicated records. Following the re-merger of assay data to the sample file the I2 record statistics are tabulated in Table 12-1:

Table 12-1: Database Validation Records

Item Original I2 Records Updated (Merged) I2 Records

Blank or ‘0’ Records *1 8,263 0

“ND” Records *2 0 8,033

“#N/A” Records *3 0 2,076

Total Records with no Assay Result: 8,263 *4 10,109

Total Records with Assay Results: 85,517 83,671

Records below detection limit 16,976 16,644

Note:

1. Records containing either nothing, or a ‘0’; these values were misleading as they could either indicate no grade, that they were not assayed or that the assay result had been lost. These records were fixed during the merger of assay results from the lab certificates.

2. ‘ND’ indicates that there is No Data for these records. This means that the samples exist on Lab Certificates but that no assay result exists for them, instead a description of the assay failure is listed on the certificate.

3. ‘#N/A’ are where assay results were not found during the merge. Assay certificates either do not exist for these records or were not found during the validation process.

4. Of this total, 163 results have now been found and merged, 7,888 have been proven as ‘ND’ and therefore renamed and 238 consist of #N/A.

Data relating to drilling completed from April 2012 to the end of the 2012 was also entered into the GDMS database. Since that time all logging and sampling information relating to the drilling is entered into Micromine Field Marshall software where it is first verified before transfer, further validation and upload to the project database where assays are merged electronically. Author’s statement The authors have during visits to site and in subsequent discussions with Company personnel independently verified the drilling and assay data which has been used in the mineral resource estimate, which includes a review of report on the re-compilation and validation of the 2005-2011 drill database provided (2012 Drilling Report Final, Atacama Minerals 2013). In the authors’ opinion, the procedures used by the Company to compile and verify the drill database are of a high standard and represent industry best practice.


46 19 December 2013

13 MINERAL PROCESSING AND METALLURGICAL TESTING

The three most significant components of the caliche are iodine, sodium sulphate and sodium nitrate, which are soluble in water at ambient temperature. 13.1 Historic Processing Production commenced in January 2001, with first iodine production in April 2001. Mining consisted of drill and blast operations to provide broken ore (<24”) which was leached in pads to provide an iodate rich brine. All production arose form Heap Leach processing until the ALP was brought into commercial production in early 2012. 13.2 Metallurgical Testwork Extensive testwork and process development studies have been completed for Aguas Blancas, by Hazen Research (1995-97), Bateman/Parsons (1998) and Kvaerner Metals (1998). Recommendations from these studies suggested the agitation leach process. In March 2006, a pilot scale agitation leach plant was commissioned. The caliche feed was sent to a mobile crushing and screening plant, to reduce all feed to -1 inch, and then trucked to the pilot plant, where after initial ball milling the caliche was processed in a counter current decantation and agitated leach circuit. The feed rate was 6-7 tonnes/hour. The pilot plant demonstrated that iodine recoveries of 92% were possible by the agitated leach process. 13.3 Current Processing The current process route consists of:

• Surface mining by continuous miner of caliche ores • Production of iodate brines through Heap leaching or Agitated Leach Plant (“ALP”) • Electrochemical reduction • Crystallisation – fusion to produce iodine prills

13.3.1 Mining Operations Stripping of the overburden (approximately 0.5m thick) is carried out using a bulldozer, and accumulated at the sides of the mining block. The continuous miner takes 0.4m cut of the caliche. Material which is destined for the agitated leach plant (“ALP”) is screened to provide -6mm fines and +6mm coarse material. The material is then loaded using front end loaders into 60t trucks, which haul the material to the leach pads (coarse) or the ALP slurry plant (fines).

13.3.2 Processing Operations Prior to 2012 all caliche was processed by heap leaching. In 2012 the ALP was commissioned and since that time both Heap leach and ALP processing were carried out until December 2013 when the ALP slurry plant was placed on care and maintenance.

The heap leach pads are lined with an impermeable geo-membrane, covering an area between 25,000 to 30,000m2, with heights averaging 10m containing approximately 450,000t. Drainage pipes are laid on the membrane and covered by the mined ore. The heaps are irrigated initially with bore water and at the end of the heap life with a mixture of bore water and feble (a residual solution from the chemical plant) at a rate of approximately 1.75 l/m2/hr.

The ALP comprises a slurry plant with a screen to produce -3.5mm product, with the oversize being returned to the heap leach pads. The throughput of the slurry plant is limited to approximately 150 tonnes per hour. A SAG mill is due to be installed which will enable processing of the full size range of mined product to produce -1mm feed for the leach section.

The leach section comprises four tanks with agitators and four thickeners operating in a counter current circuit. An Improheat heater enables the temperature of the brine to be raised to assist in dissolution of the salts.

13.3.3 Chemical Plant The brine solution from the heaps and ALP is accumulated in lined ponds as feed to chemical plant. A portion of the brine is mixed with SO2 which is then mixed with the balance of the brine to reduce the iodate in solution to


47 19 December 2013

iodine gas in the “acid” leg of the Blow-Out Tower. The iodine gas is blown over to the “caustic” tower where it is adsorbed in NaOH solution. The solution is concentrated by recirculation until reaching a concentration of 80g/l of iodine.

The concentrated caustic solution is pumped to a crystallizer in the Fusion Plant. Iodine crystallization is an exothermic chemical reaction from the interaction of sulphuric acid with the concentrated solution of iodine (which is contained in a caustic solution). The crystallized iodine is heated to 114°C where the iodine changes from a solid to a liquid state during the 12 hours of melt. The molten iodine is dripped through a water-cooled column, producing prills of an average size of 3mm.

The solid iodine is fed to a rotary dryer, where a vacuum line recovers the sublimated iodine for re-processing. The dryer discharge is sent to a storage silo, from which the material is screened and packed as prills in 25 or 50kg containers for shipment by 20' containers to the customers.

The present installed capacity of the recovery plant is approximately 2,200 tonnes per year of saleable iodine. 13.3.4 Nitrate Pilot Plant AMC has completed a pre-feasibility study to recover sulphate and nitrates from the feble originating from the chemical plant. The study concluded that production of sulphate and nitrate was feasible. AMC initiated a pilot plant trial in 2013 to validate the parameters for potassium nitrate production for inclusion in a Feasibility Study.


48 19 December 2013

14 MINERAL RESOURCE ESTIMATES

14.1 Material/Area Coding In previous years, old mined areas had been described as ‘Repasos’. Following inspection by Atacama geologists and examination of satellite photos, a more detailed system of classification has now been applied to the Antiguos areas. The different types of historically worked potentially mineralized areas, are summarised below in table 14.1 and shown in figure 14-1.

Table 14-1: Caliche Material Codes CODE Description

ALLU Alluvial cover or sheet wash.

ANT1 Large amounts of trenches, piles and embankments - orginal topography completely erased.

ANT2 Manually explored with some trenches and reject piles - original topography still identifiable.

ANT3 Similar to ANT1 in NW sector, large amount of caliche blocks, eroded trenches and embankments.

EXTR All caliche removed.

VIRG Virgin material - no mining activity.

Figure 14-1: Available Resources By Material Type

49 19 December 2013

14.2 Sample Processing A summary of the updated sample database available is shown in Table 14-2. Although there have been various trenching campaigns in the past, this trench data was often not reliable for as a full intersection of the caliche, and has now been superseded by more recent drilling data.

Table 14-2: Sample Summary

Number of Samples

Material Type Holes Length I2 NO3 SO4

VIRG 17,231 59,369 104,148 7,547 7,615 ALLU 3 11 20

ANT1 149 548 1,006 13 13

ANT2 177 638 1,176 297 297

ANT3 121 460 869 55 56

EXTR 330 1,274 2,371 4 4

Total 18,011 62,300 109,590 7,916 7,985

The modelling methodology applied, and in particular the compositing method, is summarised below:

1. In those drill holes with a defined chusca depth, this depth was used to define the top of the caliche layer. For all other holes, the chusca depth was found testing for the location of the first +200ppm I2 sample. If no such sample occurred, a chusca depth of 0.5m was assumed.

2. For holes with samples above 200ppm, composites were defined from beneath the chusca down to the deepest +200pm I2 sample, limited to a maximum depth of 3m. If the resultant composite was greater than 2m, but less than 150ppm I2, then the first 1m was retested against a cut-off grade of 100ppm, in order to quality as a caliche intersection.

3. For holes with no samples above 200ppm, the first 1m was retested against a cut-off grade of 100ppm,

in order to quality as a caliche intersection.

4. After these steps, all holes were converted into some form of composite, flagged as being either caliche intersections or not. For each caliche composite, accumulations were calculated from iodine grade x thickness. It was these accumulation values which were subsequently interpolated into the block model.

5. In the block model, the final iodine grades were determined by back-dividing the accumulation values

by the modelled caliche thickness. NO3 and SO4 grades, along with other element values, were interpolated directly.

A flow sheet of the compositing method is depicted in Figure 14-2.

50 19 December 2013

Figure 14-2: Compositing Method.

Drillhole Data

Overburden defined?

Yes No

CHUSCA depth = defined

overburden

Test for first sample>200ppm

in each hole.

CHUSCA depth = 0, 0.5, 1 or

1.5m

otherwise CHUSCA set to 0.5m

Filter samples below defined

CHUSCA depth, down to

maximum thickness of 3m

Any samples > 200ppm?

Yes No

Composite down to deepest

+200ppm sample in each holeComposite down just 1m

Is composite

> 2m and I2< 150ppm?

Yes No

Recomposite first

1m

Accept

composite

Accept as caliche if

I2>100ppmAccept as caliche if I2>100ppm

ORE=3 ORE=4

Combine all composites

Determine ACCUMulation = I2 x

LENGTH

An iodine top-cut of 1,500ppm was also applied, during the compositing process. This level was determined by decile and coefficient of variation analysis. The effect of this applied top-cut is summarised in T

Table 14-3.

Table 14-3: Iodine Top-Cut Summary

Material Type

Total No Composites

Composites Affected

% of top cuts

affected

I2 mean un-cut

12 mean post top

cut

ANT1 82 - 0% 374 374 ANT2 130 3 2% 378 366 ANT3 64 4 6% 655 540 VIRG 9,019 259 3% 496 474 Notes: I2 top cut applied 1,500ppm

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A statistical summary of the I2, NO3, SO4 and derived accumulations in the composite data are shown in table 14.4. Corresponding log probability plots are shown in Appendix B.

Table 14-4: Composite Statistics

FIELD MATERIAL NUMBER MINIMUM MAXIMUM MEAN VARIANCE

STANDARD

DEVIATION

LOG

ESTIMATE OF

MEAN

COEFFICIENT

OF

VARIATION

I2 ANT1 82 102 1,339 374 57,412 240 374 0.64

I2 ANT2 130 101 1,500 366 72,672 270 361 0.74

I2 ANT3 64 168 1,500 540 153,892 392 529 0.73

I2 EXTR 202 103 1,500 571 107,859 328 578 0.58

I2 VIRG 9,019 63 1,500 474 113,319 337 473 0.71

NO3 ANT1 3 2.07 3.69 2.35 0.27 0.52 2.35 0.22

NO3 ANT2 70 1.31 11.51 3.87 4.75 2.18 3.87 0.56

NO3 ANT3 33 0.84 12.76 3.87 6.20 2.49 3.90 0.64

NO3 EXTR 1 8.08 8.08 8.08 0.00

NO3 VIRG 2,634 0.02 54.38 3.29 4.58 2.14 3.36 0.65

SO4 ANT1 3 13.38 18.15 16.55 2.95 1.72 16.55 0.10

SO4 ANT2 70 7.14 29.12 15.91 29.70 5.45 15.96 0.34

SO4 ANT3 34 2.80 21.87 12.41 17.58 4.19 12.69 0.34

SO4 EXTR 1 8.82 8.82 8.82 0.00

SO4 VIRG 2,638 0.18 53.64 19.73 74.09 8.61 20.09 0.44

ACCUM ANT1 82 102 4,018 516 355,966 597 501 1.16

ACCUM ANT2 130 101 3,000 558 276,504 526 562 0.94

ACCUM ANT3 64 102 3,000 388 233,560 483 357 1.24

ACCUM EXTR 202 103 4,500 888 643,331 802 927 0.90

ACCUM VIRG 9,019 51 4,500 699 485,109 696 708 1.00

CHUSCA ANT1 61 0 1.5 0.71 0.29 0.54 0.96 0.76

CHUSCA ANT2 96 0 1.5 0.78 0.34 0.58 1.07 0.75

CHUSCA ANT3 12 0 1.5 0.14 0.11 0.34 0.74 2.39

CHUSCA EXTR 78 0 1.5 0.36 0.27 0.52 0.94 1.45

CHUSCA VIRG 6,552 0 1.5 0.66 0.30 0.54 0.91 0.82

THICK ANT1 82 0.5 3.0 1.38 0.52 0.72 1.38 0.52

THICK ANT2 130 0.5 3.0 1.52 0.57 0.75 1.53 0.50

THICK ANT3 64 0.5 2.0 0.72 0.13 0.36 0.71 0.51

THICK EXTR 202 0.5 3.0 1.56 0.76 0.87 1.59 0.56

THICK VIRG 9,019 0.5 3.0 1.48 0.62 0.79 1.49 0.53 14.3 Density Measurements Current density estimates principally stem from reconciliation analyses made during 2012, related to the mining of approximately 3mt of caliche ore. The weights stemmed from weighed truck loads and volumes from surveys of individual cuts made by the continuous miners. The average densities resulting from this are summarised in Table 14-5. They were also supported by measurements of cut samples taken from cut caliche faces at the edges of mined blocks. These depth-related density variations were applied during the current resource estimation.

Table 14-5: Applied Caliche Densities

Depth to top of caliche Density t/m3

0 - 0.4m 1.83

0.4 - 0.8m 2.07

+0.80m 2.14

52 19 December 2013

14.4 Modelling Methodology This mineral resource estimation was completed using a block modelling approach, with the application of Datamine software. The general methodology applied is described in Figure 14.3 below.

Figure 14-3: Modelling Methodology

In the generation of the volumetric block model, 25m x 25m blocks were used throughout. Initially a fixed block height of 20m was applied, but blocks subsequently assigned the estimated depth of caliche. The various steps completed during generation of volumetric block model are summarised below:

- Limiting of blocks to Atacama property boundaries, as of end December 2012. - Stripping of blocks from non-Atacama properties. - Identification of those blocks which had been partially mined at the end of 2012. - Stripping of completely mined blocks, as of end December 2012. - Exclusion of any blocks within 10m of mined trenches in old antiguos areas.

Because the composite data represented complete caliche intersections of quite different thicknesses, subsequent iodine grade interpolation was based on grade accumulations. The interpolated accumulation values were then used with the modelled thickness values to back-calculate grade iodine values in the final 2D block model. In general the caliche being modelled was not extrapolated more than 50m beyond the limit of any exploration drilling.

14.5 Geostatistics and Grade Interpolation Log probability plots of accumulated composited grade are shown in Appendix B. Two perpendicular rows of closely spaced (10m) were drilled, to assist with variogram generation at spacings less than the general 50m grid used for short-term planning holes.

Variograms were generated for the iodine accumulation values within each zone. From these, model variograms were developed, again shown in Appendix A, with the model variogram parameters shown in Figure 14-6.. For iodine accumulations, ranges of approximately 150-200m north-south were found, with approximately 100m west-east.

53 19 December 2013

As well as I2 accumulations, NO3 and SO4 grades were handled in a similar way. However, for these fields, variograms of the direct grade values were determined.

Table 14-6: Model Variogram Parameters

GRADE FIELD NUGGET

X Y Z C1 X Y Z C2

ACCUM (I2x THICK) 0.06 221 50 183 0.12 202 119 366 0.19

THICK 0.01 204 98 205 0.03 247 140 366 0.15

NO3 0.034 72 72 72 0.25 - - - -

SO4 0.015 122 122 122 0.06 - - - -

1st Structure 2nd Structure

a1 (m) a2 (m)

These model variograms parameters were used to develop both interpolation parameters as well as resource classification criteria. The interpolation parameters used are summarised in Table 14-7.

Table 14-7: Model Estimation Parameters

Grade Interpolation

Field X Y Method

I2 accumulation 100 50 OK

and thickness

NO3 60 60 OK

SO4 60 60 OK

Notes:

. OK = ordinary kriging

. Ore type estimated by nearest neighbour (NN)

. Final block I2 = Accumulation/Thickness

. Maximum number of composites used = 15

. Progressive searches:

Search

Factor for

Search

Distances

Minimum No. of

Composites

1st 1 3

2nd 2 3

3rd 3 3

4th 4+ 1

. Density values used (t/m3):

0 - 0.4m 1.83

0.4 - 0.8m 2.07

+0.8m 2.14

Search Distance(m)

(1st ellipse)

Owing to the different variogram characteristics and sample coverage, different resource classification areas were demarcated between iodine resources, and those associated with nitrate and sulphate resources. For the measured iodine resource classification, a drilling grid size of approximately 50m was selected, as this generally represented 2/3 of the total variability (sill) for accumulation variograms. The grid size of 100m was selected for the indicated resource classification, as this was generally near to or less than the observed variogram range.

The resource classification criteria applied are summarised in Table 14-8, and the resultant resource classes set into the block model are displayed in figure 14.4 for iodine resources in figure 14.5 for NO3 and SO4 resources.

54 19 December 2013

Table 14-8: Resource Classification Parameters

Category Iodine Resources NO3/SO4 Resources

Measured Drilling grid 50m or less At least 3 composites within a 60m x 60m search

Indicated Drilling grid 100m in at least one direction At least 3 composites within a 120m x 120m search

Inferred Drilling grid up to 200m Extrapolation limited to 240m

Notes

. Material in/near old workngs classified as inferred

Figure 14-4: Iodine Resource Classification

55 19 December 2013

Figure 14-5: Sulphate/Nitrate Resource Classification

56 19 December 2013

Available resources by thickness, iodine grade, NO3 grade and SO4 grade are shown in Figure 14-6 to Figure 14-9, respectively.

Figure 14-6: Caliche Thickness

57 19 December 2013

Figure 14-7: Iodine Grade Distribution

58 19 December 2013

Figure 14-8: Nitrate Grade Distribution

59 19 December 2013

Figure 14-9: Sulphate Grade Distribution

60 19 December 2013

14.6 Model Validation 14.6.1 Overview A number of steps were completed in connection with model validation, which included:

• Visual comparison of interpolated and drill hole composite grades from printed plans. • Global comparison of kriged grades with composite data and nearest neighbour statistics. • Local comparison of kriged and nearest grades, on a series of parallel slices. • Comparison with historical estimates. • Reconciliation with production data.

14.6.2 Plans of Grades and Weightings The I2 grades determined in the measured and indicated parts of the resource block model, for an unmined area in the central west part of the deposit, is shown in figure 14.11. This figure also shows the average composite grades in the same areas. In general the patterns of grade variation in the composites were clearly reflected in the corresponding block model grades. 14.6.3 Global Comparison of Grades A comparison was made of the average model grades with the corresponding average grades from the composites sets. These comparative figures are summarised in table 14.10. The average grade values compare favourably. In addition to this, alternative block model grades, derived by nearest neighbour interpolation and inverse-distance weighting, were also calculated. These values are also shown in the same table, and compare favourably.

Table 14-10: Global Comparison of Composites and Block Model

MATERIAL

Composites OK NN ID Composites Model Composites Model

ANT1 374 352 348 342 2.35 2.18 16.6 16.7

ANT2 366 342 332 332 3.87 3.45 15.9 16.3

ANT3 540 530 501 491 3.87 4.10 12.4 12.8

VIRG 474 561 552 556 Meas 3.29 3.21 19.7 15.8

392 386 388 Indicated

437 430 432 Meas+Ind

Notes

. OK = ordinary kriging

. NN = nearest neighbour

. ID = inverse distance (^2)

. NO3 and SO4 model grades shown for meas+ind+inf resources

I2 NO3 SO4

Block Model

61 19 December 2013

Figure 14-11: Composites and Block Model Comparison

62 19 December 2013

14.6.4 Local Comparison of Grades Average model grades within 500m grid squares were calculated, stemming from both block model as well as composite grades. For iodine grades, these results are summarised in Figure 14-12. The grid blocks used pertain to measured and indicated resources only. In general the grades compare favourably.

Figure 14-12: Local 500m Grid Comparison of Iodine Grades

0

200

400

600

800

1,000

1,200

0 200 400 600 800 1,000 1,200

Composites v Block Model OK Grade

0

200

400

600

800

1,000

1,200

1,400

0 200 400 600 800 1,000 1,200

Block Model Ok v NN Grades

0

200

400

600

800

1,000

1,200

0 200 400 600 800 1,000 1,200

Block Model Ok v ID Grades

63 19 December 2013

14.6.5 Comparison with Historical Estimates Previous resource estimates have been compiled from PAH (1997 and 1999), AMEC (May 2005), and Wheeler from 2005 till the present time, as summarised in table 14-9. This also includes the results of the updated resource estimate in the current study. The total tonnages of all resource levels, including the inferred parts, have been added together for comparative purposes only, and are not of use for NI 43-101 reporting purposes in terms of total resources. These results show variation in quantities and grades. This is due to: - Different applied cut-offs. The only figures available from PAH have effectively a zero cut-off. - Different compositing methods. The PAH estimate used fixed length composites – hence the much

higher tonnages and lower grades. The AMEC estimate made a sort of pseudo-three-dimensional model, interpolating directly from the 0.5m length original samples.

- Evolution of mining methods from drill-and-blast to continuous miner. - Revision of density measurements. - Refinement of compositing methods as more and better reconciliation data has become available.

The results from the different estimates are similar when the total quantity of contained iodine is considered. The resource figures from the current study demonstrate a major increase in overall resources, due to the additional exploration drilling that has now been completed. They also display an elevation of resource levels, particularly for the northern and central areas.

Table 14-9: Historical Iodine Resource Estimates

Description

Tonnes I2 Tonnes I2 Tonnes I2 Tonnes I2 Tonnes I2kT ppm kT ppm kT ppm kT ppm kT ppm

PAH Oct-97 No Cut-off 6,097 334 67,678 308 73,775 310 23,581 258 97,356 298

PAH Sep-99 No Cut-off 10,867 304 95,585 304 106,452 304 17,186 190 123,638 288

AMEC May-05 220ppm I2 cut-off 34,515 483 34,515 483 35,208 384 69,723 433

Wheeler Dec-05 200ppm I2 cut-off 592 908 20,064 609 20,656 618 59,517 494 80,173 526

Wheeler Jun-06 200ppm I2 cut-off 3,898 613 23,635 532 27,533 543 51,636 451 79,169 483

Wheeler Oct-07 200ppm I2 cut-off 4,440 627 46,836 535 51,276 543 36,044 431 87,320 497

Wheeler Dec-10 200ppm I2 cut-off 7,931 478 47,018 497 54,948 494 68,227 391 123,175 437



N.B. These total 'All Resource figures have been prepared for comparative purposes only - they are not used or

applicable in terms of mineralised resource estimates.

Measured Indicated

Measured +

Indicated Inferred All Resources

14.6.6 Reconciliation For mining operations during 2012, data from 61 primary mining blocks were analysed, covering covered approximately 3Mt of caliche production. Results were obtained for production results and evaluation of the same mining block outlines with the current resource block model. An overall summary of these results is shown in Figure 14-10.

Table 14-10: Reconciliation Results

Description Tonnes I2 Grade I 2 Contained

Mt ppm t Production results 2.75 529 1,454Resource Block Model 3.10 481 1,492

Notes:

. Evaluation stems from 61 mining blocks completely mined during 2012

. Production records compiled from truck weights and grab samples

64 19 December 2013

The material remaining in the spent heap leach pads has not been considered a potential resource in the current study. 14.7 Mineral Resource Estimate The resultant geological block model was evaluated, giving the overall evaluation shown in Table 14-11.

Table 14-11: Iodine Resource Estimate As At 31st December, 2012

Cut-Off=200ppm I2

Resource Tonnes I2 Volume

Average

Density Area

Average

Thickness

Average

Chusca Depth

Class Kt ppm m3 x 1000 t/m

3m

2 x 1000 m m

Measured 16,798 474 8,304 2.02 6,577 1.26 0.64

Indicated 88,205 417 43,127 2.05 27,004 1.60 0.80

Meas+Ind 105,003 426 51,430 2.04 33,582 1.53 0.76

Resource Tonnes I2 Volume Density Area

Average

Thickness

Average

Chusca Depth

Class Kt ppm m3 x 1000 t/m

3m

2 x 1000 m m

Inferred 67,392 338 33,253 2.03 24,980 1.33 0.81

The mineral resource estimate is unlikely to be materially affected by other relevant factors. Necessary operating and environmental permits are in place. The mineral concessions which are subject to dispute host a minor component of the mineral resource estimate. A grade-tonnage table for measured and indicated portion of the iodine resources is shown in Table 14-12.

Table 14-12: Iodine Resource Grade-Tonnage Table

Measured and Indicated

I2 Cut-Off Tonnes I2

ppm Mt ppm

100 116 402

120 116 402

140 115 404

160 113 408

180 110 415

200 105 426

220 99 439

240 93 454

260 86 470

280 79 488

300 72 506

320 66 525

340 60 543

360 55 563

380 50 582

400 45 601

420 41 620

440 38 637

460 34 654

480 31 674

500 28 694

0

100

200

300

400

500

600

700

800

0

20

40

60

80

100

120

140

100 150 200 250 300 350 400 450 500

I2 A

bo

ve C

ut-

Off

TO

NN

ES

I2 Cut-Off

Measured +Indicated

65 19 December 2013

Table 14-13: Iodine Resource Estimate By Material Type As At 31st December, 2012

Cut-Off=200ppm I2

Zone /

Material Tonnes I2 Tonnes I2 Tonnes I2 Tonnes I2 Tonnes I2 Volume

Average

Density Area

Average

Thickness

Average

Chusca

Depth

Kt ppm Kt ppm Kt ppm Kt ppm Kt ppm m3 x 1000 t/m

3m

2 x 1000 m m

ANT1 3,423 365 3,423 365 1,689 2.03 1,261 1.34 0.63

ANT2 4,378 375 4,378 375 2,144 2.04 1,388 1.55 0.61

ANT3 1,547 533 1,547 533 805 1.92 1,190 0.68 0.13

VIRG 16,798 474 88,205 417 105,003 426 58,044 329 163,047 391 80,046 2.04 54,723 1.46 0.81

TOTAL 16,798 474 88,205 417 105,003 426 67,392 338 172,395 392 84,683 2.04 58,562 1.45 0.78

Measured Indicated

Measured +

Indicated Inferred Total

Nitrate and sulphate resource evaluation results are summarised in Table 14-14.

Table 14-14: Nitrate/Sulphate Resource Estimate As At 31st December, 2012 Block Cut-Off 200ppm I2

Resource Tonnes NO3 SO4 Volume

Average

Density Area

Average

Thickness

Average

Chusca

Depth

Class Kt % % m3 x 1000 t/m

3m

2 x 1000 m m

Measured 1,166 3.14 24.62 579 2.01 511 1.13 0.60

Indicated 12,407 2.81 19.26 6,093 2.04 4,202 1.45 0.68

Meas+Ind 13,573 2.84 19.73 6,672 2.03 4,713 1.42 0.67

Resource Tonnes NO3 SO4 Volume

Average

Density Area

Average

Thickness

Average

Chusca

Depth

Class Kt % % m3 x 1000 t/m

3m

2 x 1000 m m

Inferred 93,637 3.22 14.49 46,003 2.04 31,853 1.44 0.80

66 19 December 2013

15 MINERAL RESERVE ESTIMATE

15.1 Mining Costs

The mining costs involve the removal of the immediate layer of ‘chusca’ by bulldozer, followed by mining of the underlying caliche in layers of 0.4m,include delivery of material to the ALP ROM pad or heap leach pad. The costs used for current long term planning purposes in this study are based on the average 2013 budget costs, based on owner-operated mining and both heap leach and ALP processing. A summary of these mining costs is shown in Table 15-1: The Antiguos production, which is likely to consist of large blocks of caliche will be broken down with an impact hammer and processed on heap leach pads.

Table 15-1: Unit Mining Costs

Unit Mining Costs $/t

Mined

Labour

1.00

Fuel

0.79

Maintenance 0.75

Infill Drilling 0.07

Total

2.61

Costs based on typical year 2016.

15.2 Processing Costs For block value calculation purposes, mining costs incurred up to the point of entry into the process have been broken down per tonne of ore. Process costs have been determined per kg of iodine product. The processing-related costs have been derived from budget 2013 figures, and are summarised in Table 15-2. As the overall operation is limited by the amount of iodine production (approximately 2,250t/year from the blow-out towers), other fixed costs, such as indirect labour and office expenses, are costed per unit of iodine product.

Table 15-2: Processing Costs

ALP HL Chem $/kg I2 $/kg I2 $/kg I2

Labour 5.61 4.98 0.53

Process 2.31 1.44 3.85

Power 5.39 0.56 0.80

Water 0.71 1.11 0.00

Total 14.03 8.09 5.17

Note: unit cost per kg processed 15.3 Reserve Parameters Mining factors in the current reserve estimation study are summarised below in Table 15-3.

Table 15-3: Mining Factors

Dilution 0%

Dilutant grade, I2 ppm 65

Mining recovery 95% These figures are derived from 2012 reconciliation results, after comparison with the current resource model for equivalent mined-out areas. The resource model has dilution built into it, as part of the caliche compositing process. During reserve calculation, some resource blocks were also excluded due to the following reasons:

67 19 December 2013

• In areas where the topography is too steep to allow extraction with a continuous miner. Area perimeters have been defined to exclude ore from these steep regions.

• Where 25m x 25m resource blocks are completely isolated i.e. these areas do not have sufficient tonnage to warrant their own independent access and extraction.

The LOMP figures are derived from current operating cost levels, and are based on an owner-operated mining fleet, with mining of the caliche by use of continuous miners. Following the economic calculations derived in Section 16, the breakeven cut-off grade is shown below in Table 15-4.

Table 15-4: Economic Parameter Summary

Description Unit ALP HL

Process Cost $/Kg I2 3.02 2.55

Power $/Kg I2 5.39 0.56

Chem Plant $/Kg I2 5.17 5.17

Fixed and Admin costs $/Kg I2 9.47 9.06

Overall Processing Cost $/Kg I2 23.05 17.34 Total Mining Costs $/t mined 2.61 2.61 ALP Recovery 85.0% 63.0% Plant recovery

91.0% 91.0%

Overall I2 recovery 77.4% 57.3% I2 Assumed Price $/kg 36 36 Dilution 2.5% 2.5% I2 Cut-Off ppm 267 250

At the moment plans to produce nitrate salts are not incorporated into the current reserve calculations. The current reserves are associated with an iodine product only. Because of the similar levels of breakeven cut-off grade for ALP and HL material, it was decided to use a consistent cut-off of 250ppm I2, for reserve estimation purposes.

15.4 Mineral Reserve Estimate Based on the calculated cut-off grade and applied mining factors, the blocks which can be mined profitably were flagged as ore. The profitable regions blocked out in the measured and indicated resource areas, constitute the mining reserves. The resultant reserve estimate is shown below in Table 15-5. These reserves are depicted in

68 19 December 2013

Figure 15-1.

Table 15-5: Mineral Reserve Estimate As At 31st December, 2012

Class Tonnes I2 Volume

Average

Density Area

Average

Thickness

Average

Chusca

Depth

Kt ppm m3 x 1000 t/m

3m

2 x 1000 m m

Proven 14,558 492 7,191 2.02 5,928 1.21 0.63

Probable 68,386 457 33,433 2.05 21,990 1.52 0.78

Total 82,944 463 40,624 2.04 27,918 1.46 0.75

Notes

. Reserves blocked out based on a cut-off of 250ppm I2

. Mining factors applied of:

0% dilution, 95% mining recovery

Maximum caliche thickness 3m The Mineral Reserve Estimate is unlikely to be materially affected by other relevant factors. Necessary operating and environmental permits are in place. Infrastructure is in place for processing of the reserve. Processing parameters have been derived from current operations or metallurgical test work. Additional inferred material, blocked out within those portions of the in-situ inferred resources which could be potentially economic, is summarised in Table 15-6, and is depicted in Figure 15-3. These do not include any of the spent heap leach piles.

Table 15-6: Inferred Resource Above 250ppm

69 19 December 2013

Class Tonnes I2 Volume

Average

Density Area

Average

Thickness

Kt ppm m3 x 1000 t/m

3m

2 x 1000 m

Inferred 40,241 393 19,880 2.02 16,066 1.24

Notes

. Blocked out based on a cut-off of 250ppm I2

. Mining factors applied of:

0% dilution, 95% mining recovery

Maximum caliche thickness 3m

Figure 15-1: Mineral Reserve and Additional Inferred Resources

70 19 December 2013

71 19 December 2013

16 MINING METHOD

16.1 Mining Operations

Prior to 2006, the caliche was mined by drill and blasting operations. Since February 2006 the caliche has been mined by a continuous miner (figure 16.1). The principal difference is in the size of the product, with the continuous miner mostly producing less than 6 inch material. The current mining plan is to use the continuous miner for all virgin-type caliche material.

For a new mining block, which typically has a minimum width of 50m and is between 100 and 300m in length, stripping of the loose chusca material (approximately 0.5m thick) is first carried out using a bulldozer, and accumulated at the sides of the block.

The continuous miner mines the caliche material in 0.4m lifts. This material is trucked to heap leach pads, generally within 1km of the current mining areas. When the ALP is operational the ALP feed is screened using mobile screens prior to trucking fines (<6mm) to the ALP slurry plant and the coarse (>6mm) to the ALP fine ore stockpile for SAG milling.

The mined material is loaded using Komatsu front end loaders into Komatsu 65t trucks (Figure 16-2). These currently haul the mined material to the leach pads (figures 16.3 and 16.4) or ALP for processing.

The total number of cuts required in any block depends on the local thickness of the caliche. As the base of the caliche is approached, the bulldozer is used to rip lines at 15m spacing down the length of the cut which material is then sampled to determine the final depth of cut.

Current mine life is 15 years.

Figure 16-1: Continuous Miner in operation

72 19 December 2013

Figure 16-2: Komatsu 65 tonne truck

Figure 16-3: Heap Leach Pad in Construction

73 19 December 2013

Figure 16-4: Heap Leach Pads in operation

16.2 Geotechnical Studies There are no geotechnical studies available concerning the mining operations at Atacama. Owing to the very shallow cuts which are made in order to extract the caliche, typically 2-3m, no geotechnical problems are anticipated. 16.3 Hydrogeology The project is located in one of the driest deserts in the world, with average annual rainfall below 10 mm per year and very high evaporation rates. The potential for groundwater recharge from precipitation is, therefore, very low, but some recharge takes place due to deep percolation of groundwater from higher altitudes.

74 19 December 2013

17 PROCESS RECOVERY

17.1 Heap Leach The heap leach pads are lined with an impermeable geo-membrane, covering an area between 25,000 to 30,000m2, with heights averaging 10m containing approximately 350,000t. Drainage pipes are laid on the membrane and covered by the mined ore. The heaps are irrigated with a mixture of water or a mixture of water with feble (a residual solution from the chemical plant) at a rate of approximately 1.75 l/m2/hr. Recoveries are determined through measurement of brine flows from the pad and brine concentration over the life of the pad operation (up to 15 months). Irrigation is stopped the as soon as the brine concentration falls below 0.2g/l or the irrigation volume reaches 0.8m3/t of material placed. Typical recoveries range from 60% to 65%.

17.2 ALP Prior to 2012 all iodine was produced from heap leach processing. In 2012 the ALP was commissioned whereby production was produced from both heap leach and ALP processing. The company will process the mined caliche by both heap leach and ALP.

The ALP comprises a slurry plant with a screen to produce -3.5mm product, with the oversize being returned to the heap leach pads. The throughput of the slurry plant is limited to approximately 150 tonnes per hour. A SAG mill is due to be installed which enable processing of all continuous mined product to produce -1mm feed for the leach section.

The maximum throughput of the leach section is 400 tonnes per hour. The leach sections comprises 4 stage agitated tank leaching and counter-current decantation with associated pregnant brine handling and distribution, sediment discharge and containment, reclaim water system, reagent and utilities systems and plant wide control systems and control room. Brine concentrations range from 0.25 to 0.30 g/l with recoveries ranging from 87.5% to 91%.

In December 2013 the ALP slurry plant was placed on care and maintenance and is scheduled to restart in mid-2015. The ALP flow sheet is shown in Figure 17-1 and Leach Section layout in Figure 17-2.

Figure 17-1: ALP Flowsheet

75 19 December 2013

Figure 17-2: ALP Leach Section

76 19 December 2013

17.3 Chemical Plant

The brine solution from the heaps and the ALP plant is accumulated in lined ponds for feed to the iodine recovery plant. Iodine is produced by chemical reduction. The iodide solution is prepared in the Absorption Tower, where the iodate contained in an additional stream of brine solution is reduced to iodide with sulphur dioxide (SO2). The caustic solution is concentrated by recirculation until reaching a content close to 80g/l of iodine. The residual solution from the blow-out towers is either neutralised for use in the ALP or used in the final stage of heap leaching, with the balance sent to the solar evaporation ponds. The concentrated solution from the Absorption Towers is sent to an agitated reactor, where it is mixed with sulphuric acid, to enable crystallization. The crystallized iodine slurry is sent to a reactor, where it is melted at an approximate temperature of 135ºC and separated from the aqueous phase. Prilling then takes place by dripping the molten iodine into a water-cooled column, producing prills of an average size of 2 - 3mm. The solid iodine is fed to a rotary dryer, where a vacuum line recovers the sublimated iodine, sending it to be dissolved in NaOH solution which is reprocessed in the Concentration Reduction stage. The dryer discharge is sent to a storage silo, from which the material is screened into three different products: oversize and fines, which are reprocessed; and the intermediate sizes +1mm -4mm which is sold. The overall chemical plant recovery is 91%. The present installed capacity of the chemical plant is approximately 2,250 tonnes per year of saleable iodine. The Chemical Plant flow sheet is shown in Figure 17-3.

Figure 17-3: Chemical Plant Flow Sheet

77 19 December 2013

18 PROJECT INFRASTUCTURE

18.1 Mine Site The Aguas Blancas Mine has been in operation for 11 years and project infrastructure is well established. The project is linked by good quality roads to the nearby port city of Antofagasta, is supplied by grid power and is serviced by all the necessary mine infrastructure required for the efficient operation of mining and processing including office, workshops, lay down areas and water pipelines. The layout of the main areas of the project infrastructure are shown in Figure 18-1.

Figure 18-1: Layout of Mine Infrastructure


18.2 Waste and Tailings Disposal No waste is produced during the mining process other than the surficial chusca which is backfilled into completed cuts. Tailings from the ALP are deposited in the Tailings Storage Facility. Return water is collected for use in the ALP. Feble (acidic waste water from the chemical plant) is either neutralised for use in ALP, used in final stage of heap leaching or evaporated in the solar ponds.

Sirocco Mining Inc Technical report on the Aguas Blancas Property

78 19 December 2013

19 MARKETS AND CONTRACTS

19.1 Market The recent Chilean iodine export price is summarised in Table 19-1.

Table 19-1: Chilean Iodine Export Prices

2009 2010 2011 2012

Chile Export Price 26.92 26.21 41.21 52.52 Chilean exported 17,000 tonnes in 2012, of which AMC exported 7%.

World consumption is estimated at 30,000 to 32,000 tonnes per annum. World consumption is set to grow at 3 to 5% pa. Iodine has several main uses, predominantly in the x-ray and pharmaceutical markets, which consume ~1/3 of consumed iodine. Market growth is tied closely to household income growth linked to x-ray media and LCD consumption.

The authors have reviewed this data and the iodine pricing being used by in the current analysis $45 is acceptable.

19.2 Contracts The Company does not have a power contract as it purchases power in the spot market. The company purchases major consumables such as fuel, acid and lime under annual contracts. The authors have reviewed the information on current contracts, the terms of within industry norms.


79 19 December 2013

20 ENVIRONMENTAL STUDIES AND PERMITTING

20.1 Environment Studies and Permits

In 1997, Atacama prepared and presented an Environmental Impact Study for the Aguas Blancas project to the Regional Commission of the Environment (COREMA), which issued the Exempt Resolution Nr. 012 of August 7, 1997 in favour of Atacama (PAH, 1997b).

The main points of Atacama’s EIA study are summarized below (excerpts from Bateman/Parsons, 1998):

The area lacks the basic conditions for the existence of wildlife. The existing vegetation is associated with a few wells and almost all of it has been planted. Some animals were observed, all of them associated with the wells. There are no surface watercourses. The hydrologic potential of the Aguas Blancas sector lies basically on the exploitation of groundwater resources. Existing water rights for the area amount to a total 130 l/s.

Background data indicate that the sector’s water recharging rate ranges between 17 l/s and 180 l/s. Air quality in the project service area, expressed in terms of particulate matter and sulphur dioxide (S02) concentration levels, is considered as good. Concentration levels of both parameters lie under the regulated limits.

The ruins of eight former nitrate works rest in the outskirts of the facilities. None of the former works has been saved from looters and all wooden remains have been removed. A pre-Hispanic geoglyph was identified close to the former San Martín nitrate oficina, 8 km away from the plant.

Main adverse effects on the environment could show in the groundwater resource, in which case the alternative is the recharging theory, and on road infrastructure and vehicle traffic, in which case the transportation alternative would be truck haulage. Less important, due to its distance from inhabited places, are the impacts on air quality and noise levels.

No impacts are foreseen on the biological components or the cultural sites. As to the latter, the project should prepare an Environmental Management Plan to protect them. The Aguas Blancas project benefits the socio-economic component, especially in the region’s employment and income levels. Indeed, 275 new jobs would be generated, implying an economic input of at least US$3 M/year. Regional labour will be preferred to strengthen these effects.

Each impact identified for the Aguas Blancas project is associated with remedial measures that ensure the fulfillment of the environmental legislation in force. Similarly, the project considers a number of actions intended to prevent and control environmental risks.

The project considers an air, groundwater and noise component monitoring program. PM10 concentration levels in air, piezometric levels and water quality will be measured, and sound pressure levels will be recorded. Reports with the monitoring data shall be forwarded to Region II’s COREMA.

Atacama submitted an application for an amendment (DIA) to their existing environmental permit (EIA) to the Chilean Authorities (CONAMA) on October 12th, 2006. The main items in this application are:

• An increase in iodine production from 1,000 tonnes per year to 1,500 tonnes per year. • Sulphate production from 150,000 tonnes per year to 300,000 tonnes per year. • Nitrate production from 70,000 tonnes per year to 115,000 tonnes per year. • Use of water from 70 litres per second to 134 litres per second. • Expansion of pond area from 1.24 million square metres to 2.74 million square metres. • The use of electrical generator equipment using #5 fuel oil.

Region II COREMA approved this DIA through Resolución Exenta Nº 054/2007 on February 19th, 2007.

Atacama also submitted a DIA for a new power system to bring CDEC-SING power to the site. This DIA was approved through Resolución Extenta No. 0308/007 on September 28th, 2007

AMC are in possession of all necessary permits for the operation of the mine and processing facility.


80 19 December 2013

20.2 Community Relations

No towns or populated areas fall within the boundaries of the Property and there are therefore no potential social or community related requirements required as part of the ongoing operations. No agreements or negotiations have therefore been required for the operation of the project. In general the local communities in northern Chile have a favorable attitude towards mining.

20.3 Mine Closure

Atacama has prepared a reclamation plan, to be put in place at the end of the operation, and consisting of the following steps (excerpts from Bateman/Parsons, 1998):

• Buildings and structures above grade will be removed from the area. Concrete slabs and foundations at and below grade throughout the plant site area will be covered with 0.5 m of adjacent borrow waste.

• Earth piles of mine waste will be left untouched. Mine roads will be left untouched.

• The tailings pond and pile, the ponds, both lined and unlined, will be left untouched with the contained residue in place. Covers will be removed and commercially disposed.

• Water wells will be capped. Pumps and connecting pipe spools will be removed. Concrete foundations and surface pipelines will be buried in place with 0.5 m adjacent borrow fill or removed, at the company’s choice.

• Electrical distribution system will be taken down, the poles and copper cable removed from the site and commercially disposed. Trash landfills will be smoothed and buried with 0.5 m of adjacent borrow fill.

• Access roads will be untouched. In-plant roads will also be left untouched.

No bonds have been posted.


81 19 December 2013

21 CAPITAL AND OPERATING COSTS

The company announced the closure of the ALP slurry plant and deferral of the completion of the SAG mill in the ALP in December 2013 due to a softening of the iodine market price. In 2014 only heap leach processing will be carried out. The Company envisages that the mill installation will be completed by mid-2015. The mine schedule is based on the end 2012 reserves and economic inferred resources and incorporates heap leach and ALP processing from 2015. Inferred resources do not have demonstrated economic viability. As the Aguas Blancas Mine has been in operation for a number of years operating costs and capital requirements are based on detailed annual budgets. 21.1 Operating Cost Estimates The current estimate of operating costs over the planned depletion of reserves, is approximately $60M per year (following completion of SAG mill installation).

Table 21-1: Operating Costs

Units 2014 2015 2016 2017 2018 LOM

TOTAL

Operating Costs

Mining Costs $000's 10,547 16,827 18,455 18,884 19,208 295,754

Heap Leach $000's 4,317 4,945 4,705 5,007 5,037 83,214

ALP $000's 516 6,378 13,094 13,035 13,631 216,118

Chemical Plant $000's 4,657 5,586 9,046 8,804 8,407 130,006

Maintenance $000's 2,597 3,876 3,876 3,876 3,876 57,837

Water $000's 1,107 2,619 2,625 2,619 2,619 39,867

Laboratory $000's 561 1,083 1,083 1,083 1,083 16,081

G&A $000's 6,891 7,513 7,513 7,513 7,513 116,318

Total Operating Cost $000's 31,193 48,827 60,398 60,820 61,373 955,195

21.2 Capital Cost Estimates The capital costs are primarily associated with mining fleet renewals, completion of the SAG mill installation and the installation of a second dryer in the chemical plant. Annual sustaining costs are estimated to be $2m per annum.

Table 21-2: Capital Costs

Units 2014 2015 2016 2017 2018 LOM

TOTAL

Mining/Heap Leach $000's 0 0 3,820 3,010 2,835 32,815

ALP $000's 0 2,697 0 0 0 2,697

Chemical Plant $000's 0 1,500 0 0 0 1,500

Projects $000's 0 4,197 3,820 3,010 2,835 37,012

Sustaining $000's 1,224 2,000 2,000 2,000 2,000 23,224

Total Capital $000's 1,224 6,197 5,820 5,010 4,835 60,236


82 19 December 2013

22 ECONOMIC ANALYSIS

As the Aguas Mine has been in operation for a number of years operating costs and capital requirements are well established. 22.1 Operating Statistics The mining and processing details are tabulated in Table 22-1. The mine life is estimated at 15 years.

Table 22-1: Mining and Processing Statistics

Units 2014 2015 2016 2017 2018 LOM

TOTAL

PRODUCTION

Mining

Total - tonnes '000 t 4,027 4,886 5,907 6,176 6,378 103,542

- Iodine grade ppm 383 531 541 528 520 444

Heap Leach

Ore Placed - tonnes '000 t 2,307 3,386 3,158 3,445 3,473 53,794

- grade ppm 576 464 416 443 493 395

Recovery % 60.0% 60.0% 60.0% 60.0% 60.0% 60.0%

Iodine to Towers - tonnes t 1,196.6 942.4 788.5 916.1 1,028.1 14,654

ALP

Ore Leached - tonnes '000 t - 787 2,402 2,387 2,539 41,976

- grade ppm - 775 775 719 625 536

Recovery % 0.0% 87.8% 87.8% 87.2% 86.3% 85.5%

Iodine to Towers - tonnes t - 535.1 1,633.9 1,496.3 1,369.8 19,612

Chemical Plant

Iodine to Towers t 1,196.6 1,477.5 2,422.4 2,412.4 2,397.9 34,266

Recovery % 90.0% 91.0% 91.0% 91.0% 91.0% 91.0%

Recovered Iodine t 1,076.9 1,344.6 2,204.4 2,195.3 2,182.1 31,170.2

22.2 Cash Flow Forecasts Based on a iodine sales price of $45/kg, operating schedule, operating and capital costs estimated in section 21, the post-tax project NPV10% is estimated to be $156m.


83 19 December 2013

Table 22-2: Project Valuation

Units 2014 2015 2016 2017 2018 LOM

TOTAL

PROFIT AND LOSS

Iodine Sales t 1,382.4 1,598.4 2,203.2 2,181.6 2,181.6 32,076.5

Iodine Price $/kg 45.00 45.00 45.00 45.00 45.00 45.00

Iodine Revenue $000's 62,208 71,928 99,144 98,172 98,172 1,443,441

Total Operating Cost $000's 31,193 48,827 60,398 60,820 61,373 955,195

Inventory Movement $000's 15,412 8,762 (880) (116) 1,038 47,486

Exploration $000's 320 800 800 800 500 5,220

Other expenses $000's 735 918 1,144 1,269 1,393 22,997

EBITDA $000's 14,547 12,621 37,682 35,399 33,868 412,542

Less DD & A $000's 5,127 7,638 9,479 9,671 9,871 156,407

EBIT $000's 9,420 4,983 28,203 25,728 23,997 256,135

Taxes & Royalties $000's 0 0 4,136 3,661 3,327 42,573

Financial Expenses $000's 1,125 880 715 556 454 7,421

Net Income $000's 8,295 4,103 23,352 21,511 20,216 206,142

Total Capital $000's 1,224 6,197 5,820 5,010 4,835 60,236

Pre Tax NPV 10.0% 177,882

Post Tax NPV 10.0% 155,958

22.3 Taxes and Royalties

AMC is subject to the fiscal regime in Chile. In Chile, taxable profits are currently subject to tax at a rate of 20%. Ultimate future profit distributions by AMC to its Canadian parent company by way of dividends would increase the combined rate of tax on Chilean income to 35%. The government of Chile has established a specific tax on mining companies whereby AMC would be subject to a progressive tax on profit margins if it has annual sales of value equivalent to 12,000 metric tonnes of fine copper. To date, AMC has not exceeded this threshold. In case of mining operators whose sales exceed the equivalent of 12,000 tonnes of fine copper but do not surpass the equivalent of 50,000 tonnes of fine copper, the specific tax is applied progressively with rates of 0.5% to 4.5%.

22.4 Sensitivity Analysis

The primary cost groups which may impact the project valuation are iodine price, operating costs and capital costs. The sensitivity of the is shown in Table

Table 22-3: NPV Sensitivity

Sensitivity NPV10%

Base Case $156m

Iodine Price +/- $1/kg +/- $14m

Operating Cost +/- 2.5% +/- $10m

Discount Rate +/- 1.0% +/- $8m

Capital Cost +/- 5.0% +/- $2m


84 19 December 2013

23 ADJACENT PROPERTIES

There are no other iodine or caliche producers in the vicinity of the Aguas Blancas project. Several properties belonging to SQM are located within the group of concessions within the Aguas Blancas project area, but these have been excluded from resource and reserve calculations. The limits of these properties are also shown in Figure 23.1. There are no historical resource estimates for these properties.

Figure 23-1: SQM Concessions in the area of Aguas Blancas



85 19 December 2013

24 OTHER RELEVANT DATA AND INFORMATION

There is no other relevant data and information


86 19 December 2013

25 INTERPRETATION AND CONCLUSIONS

The evaluation work was carried out and prepared in compliance with NI43-101 and the guidelines of the Council of the Canadian Institute of Mining, Metallurgy and Petroleum. The updated resource estimations of all modelled zones are shown below in Table 25-1:, incorporating all of the available drill hole data and revised density measurements, for a cut-off grade of 200ppm I2. No mining factors have been applied to the resource figures, but they are based on minimum thickness of 0.5m.

Table 25-1: Iodine Mineral Resource Estimate At 31st December, 2012

Resource Class Tonnes Iodine

‘000t ppm I2

Measured 16,798 474

Indicated 88,205 417

Measured & Indicated 105,003 426

Inferred 67,392 338

N.B. Mineral resources evaluated using a block cut-off of 200ppm I2. Measured and Indicated resources shown are inclusive of Reserves.

Owing to different sample coverage and geostatistical characteristics, NO3 and SO4 resources are reported separately, as shown in Table 25-2.

Table 25-2: Sulphate and Nitrate Mineral Resource Estimate At 31st December, 2012

Blocks Above 200ppm I2 Cut Off

Resource Class Tonnes Nitrate Sulphate

‘000t % NO3 %SO4

Measured 1,166 3.1 24.6

Indicated 12,407 2.8 19.3

Measured & Indicated 13,573 2.8 19.7

Inferred 93,637 3.2 14.5

Reconciliation data was collected for production from the continuous miners in use from 2009 to 2012. This enabled updated mining factors to be calculated, which were then applied in subsequent reserve calculations. The reserves were derived by blocking out those areas of measured and indicated resources at a cut-off of 250ppm I2. This breakeven cut-off was derived from budgeted cost levels for 2013, for both heap leach and agitated leach processing operations.


87 19 December 2013

The Mineral Reserve Estimate for the Aguas Blancas Project is shown in Table 25-3.

Table 25-3: Mineral Reserve Estimate At 31st December, 2012

Reserve Class Tonnes Iodine

‘000t ppm I2

Proven 14,558 492

Probable 68,386 457

Proven and Probable 82,944 463

N.B. Reserves blocked out on a cut-off of 250ppm I2. This cut-off was derived from parameters which included:

• Iodine price $36/kg • Exchange Rate CHP to US$ 500 • Owner mining, HL & ALP processing

Mining Factors applied: • 0% dilution, 95% mining recovery • Maximum caliche thickness 3m

An additional 40Mt of Inferred material at economic grades is also modelled

In the authors’ opinion, given that the Aguas Blancas mine has been operating since 2001 and that the operating factors are well established, the Mineral Resource and Mineral Reserve Estimate are well supported.


88 19 December 2013

26 RECOMMENDATIONS

The Aguas Blancas mine has been operating for over 10 years and operating factors are well established. The authors recommend:

• the continued conversion of inferred resources is completed to enable determination of the full life of mine. A budget of US$ 5.2m has been included in the current Life of Mine plan.

• Investigations are continued to determine the viability of nitrate production.


89 19 December 2013

27 REFERENCES

AMEC (2005) Technical Report on the Aguas Blancas Project, Province of Antofagasta, Chile. Project No. 2072. PAH (1999) Aguas Blancas Project, Chile, Geologic Modelling and Mine Scheduling, Aguas Blancas Project, Antofagasta, Chile (Update). PAH Project no. 9167.05b. Mir, P., Nov 2013. Aguas Blancas Project, Property and Permits Summary Report. Bofill, Mir and Alvarez Jana, Abogados, Santiago Chile. Report prepared for AMC. Wheeler and Dowdell (Feb, 2006) Aguas Blancas Resource and Reserve Estimation. Prepared for Atacama Minerals Chile. Wheeler (January, 2007) Technical Report on the Aguas Blancas Property, Chile. Prepared for Atacama Minerals Chile. Wheeler (December, 2007) Technical Report on the Aguas Blancas Property, Chile. Prepared for Atacama Minerals Chile. 2012 Drilling Report Final, R. Alves, Atacama Minerals 2013. Atacama Minerals Internal Report Williams-Stroud, Sherilyn (1991): Descriptive model of iodine-bearing nitrate. In: Bliss, J.D. and Orris, G.J. (Eds.) (1991). Some Industrial Mineral Deposit Models: Descriptive Deposit Models. Open File Report 91-11A. US Geological Survey, 73 pp.


90 19 December 2013

28 QUALIFIED PERSONS CERTIFICATES

CERTIFICATE OF AUTHOR

I, Kevin Ross do hereby certify that:

1. I am a Mining Engineer based at 2000-885 West Georgia St, Vancouver, British Columbia, Canada, V6C

3E8

2. I am the author of this report “Technical Report on the Aguas Blancas Property, Chile” dated December 19, 2013.

3. I hold the following academic qualifications: B.Sc. (Mining) Royal School of Mines (UK) 1976 M.B.A. Cranfield School of Management (UK) 1988

4. I am a registered Chartered Engineer (C. Eng and Eur. Ing) with the Engineering Council (UK)

5. I am a member in good standing of Institute of Mining, Metallurgy and Materials (Member).

6. I have worked as a mining engineer in the minerals industry for over 37 years. 7. I have read NI 43-101 and the technical report, which is the subject of this certificate, has been prepared

in compliance with NI 43-101. By reason of my education, experience and professional registration, I fulfil the requirements of a “qualified person” as defined by NI 43-101. My work experience includes positions as General Manager South Crofty Mine, Group Mining Engineer TVX, Managing Director ARCON International Resources, COO of Ivernia West, New Gold Inc, Red Back Mining and Sirocco Mining.

8. I am responsible for sections 1.1, 1.2, 1.5, 1.6, 2, 3, 4, 13, 16, 17, 18, 19, 20, 21, 22, 23, 24 & 25 of the technical report entitled “Technical Report on the Aguas Blancas Property, Chile” and dated December 19, 2013, relating to the Aguas Blancas Property.

9. I visited the Aguas Blancas Site on numerous occasions, the most recent being12th and 15th November 2013.

10. As of the date hereof, to the best of the my knowledge, information and belief, the technical report, which is the subject of this certificate, contains all scientific and technical information that is required to be disclosed to make such technical report not misleading.

11. I am not independent, currently holding the position of Chief Operating Officer of Sirocco Mining Inc.

12. I have been involved with the property in my current role since October 2011. Dated this 19th day of December, 2013

K. Ross, Eur.Ing., MIMMM


91 19 December 2013

CERTIFICATE OF AUTHOR

I, Hugh Stuart do hereby certify that:

1. I am a Geologist based at Lower Farm Barns, Brandon Lane, Coventry, United Kingdom, CV23 8EW.

2. I am an author of this report “Technical Report on the Aguas Blancas Property, Chile” dated December

19, 2013.

3. I hold the following academic qualifications: B.Sc. Geology (1985) M.Sc. Mineral exploration and Mining Geology (1988)

4. I am a registered Chartered Geologist.

5. I am a member in good standing of the Geological Society of London.

6. I have worked as a geologist in the minerals industry for over 23 years.

7. I have read NI 43-101 and the technical report, which is the subject of this certificate, has been prepared in compliance with NI 43-101. By reason of my education, experience and professional registration, I fulfil the requirements of a “qualified person” as defined by NI 43-101. My work experience includes work in all areas of exploration and including resource definition at several operating mines and the management and compilation of exploration data in preparation for mineral resource estimates.

8. I am responsible for sections 1.3, 1.4, 5, 6, 7, 8, 9, 10, 11 and 12 of the technical report entitled “Technical Report on the Aguas Blancas Property, Chile” and dated December 19, 2013, relating to the Aguas Blancas Property.

9. I visited the Aguas Blancas Site on numerous occasions, the most recent being between 19th and 24th June 2013.

10. As of the date hereof, to the best of the my knowledge, information and belief, the technical report, which is the subject of this certificate, contains all scientific and technical information that is required to be disclosed to make such technical report not misleading.

11. I am not independent, currently holding the position of Vice President Exploration of Sirocco Mining Inc.

12. I have been involved with the property in my current role since October 2011. Dated this 19th day of December, 2013

Hugh Stuart, C Geol, FGS


92 19 December 2013

CERTIFICATE OF AUTHOR I, Adam Wheeler do hereby certify that: 1. I am an independent mining consultant, based at Cambrose Farm, Redruth, Cornwall, TR16 4HT,

England. 2. I hold the following academic qualifications:

B.Sc. (Mining) Camborne School of Mines (UK) 1981 M.Sc. (Mining Engineering) Queen’s University (Canada) 1982

3. I am a registered Chartered Engineer (C. Eng and Eur. Ing) with the Engineering Council (UK). Reg. no.

371572. 4. I am a member in good standing of the Institute of Mining, Metallurgy and Materials (Member). 5. I have worked as a mining engineer in the minerals industry for over 28 years. I have experience with a

wide variety of mineral deposits and reserve estimation techniques. 6. I have read NI 43-101 and the technical report, which is the subject of this certificate, has been prepared

in compliance with NI 43-101. By reason of my education, experience and professional registration, I fulfil the requirements of a “qualified person” as defined by NI 43-101. My work experience includes 5 years as a mining engineer in an underground gold mine, 7 years as a mining engineer in the development and application of mining and geological software, and 16 years as an independent mining consultant, involved with evaluation and planning projects for both open pit and underground mines.

7. I am responsible for sections 14 and 15 of the technical report entitled “Technical Report on the Aguas

Blancas Property, Chile” and dated December 19, 2013, relating to the Aguas Blancas Property.

8. I visited the Aguas Blancas Site on numerous occasions, the most recent being 15th to 19th October, 2012. 9. As of the date hereof, to the best of the my knowledge, information and belief, the technical report, which

is the subject of this certificate, contains all scientific and technical information that is required to be disclosed to make such technical report not misleading.

10. I am independent of Sirocco Mining Inc and its subsidiaries other than providing consulting services. 11. I consent to the filing of the report with any Canadian stock exchange or securities regulatory authority,

and any publication by them of the report.

12. I have previously prepared NI43-101 reports in connection with the Aguas Blancas property, as an independent mining consultant, in January 2007, December 2007 and December 2010.

Dated this 19th day of December, 2013

Adam Wheeler, C.Eng., MIMMM


93 19 December 2013

Appendix A: MINERAL PROPERTY

ESTACAS

Rol nacional Nombre Titular Situacion

1 02201-1807-K ESTACAS 146/149-V-79 SCM ATACAMA MINERALS CHILE CONSTITUIDA 2 02201-1808-8 ESTACA 269-V-78 SCM ATACAMA MINERALS CHILE CONSTITUIDA

3 02201-1809-6 ESTACA 270-V-78 SCM ATACAMA MINERALS CHILE CONSTITUIDA 4 02201-1810-K ESTACA 271-V-78 SCM ATACAMA MINERALS CHILE CONSTITUIDA 5 02201-1811-8 ESTACA 272-V-78 SCM ATACAMA MINERALS CHILE CONSTITUIDA 6 02201-1813-4 ESTACA 275-V-78 SCM ATACAMA MINERALS CHILE CONSTITUIDA 7 02201-1814-2 ESTACA 124-V-76 SCM ATACAMA MINERALS CHILE CONSTITUIDA 8 02201-1815-0 ESTACA 75-F-78 SCM ATACAMA MINERALS CHILE CONSTITUIDA 9 02201-1816-9 ESTACA 163-F-79 SCM ATACAMA MINERALS CHILE CONSTITUIDA

10 02201-1817-7 ESTACA 164-F-79 SCM ATACAMA MINERALS CHILE CONSTITUIDA 11 02201-1818-5 ESTACA 6-V-76 SCM ATACAMA MINERALS CHILE CONSTITUIDA

12 02201-1819-3 ESTACA 82-V-76 SCM ATACAMA MINERALS CHILE CONSTITUIDA 13 02201-1820-7 ESTACA 277-V-73 SCM ATACAMA MINERALS CHILE CONSTITUIDA 14 02201-1821-5 ESTACA 64-V-77 SCM ATACAMA MINERALS CHILE CONSTITUIDA

15 02201-1822-3 ESTACA 67-V-77 SCM ATACAMA MINERALS CHILE CONSTITUIDA 16 02201-1823-1 ESTACA 68-V-77 SCM ATACAMA MINERALS CHILE CONSTITUIDA 17 02201-1824-K ESTACA 69-V-77 SCM ATACAMA MINERALS CHILE CONSTITUIDA 18 02201-1825-8 ETACA 61-F-78 SCM ATACAMA MINERALS CHILE CONSTITUIDA 19 02201-1826-6 ESTACA 62-F-78 SCM ATACAMA MINERALS CHILE CONSTITUIDA 20 02201-1827-4 ESTACA 63-F-78 SCM ATACAMA MINERALS CHILE CONSTITUIDA 21 02201-1828-2 ESTACA 64-F-78 SCM ATACAMA MINERALS CHILE CONSTITUIDA

22 02201-1829-0 ESTACA 142-F-79 SCM ATACAMA MINERALS CHILE CONSTITUIDA 23 02201-1830-4 ESTACA 258-F-79 SCM ATACAMA MINERALS CHILE CONSTITUIDA 24 02201-1831-2 ESTACA 267-F-79 SCM ATACAMA MINERALS CHILE CONSTITUIDA 25 02201-1832-0 ESTACA 208-F-73 SCM ATACAMA MINERALS CHILE CONSTITUIDA 26 02201-1833-9 ESTACA 142/144-V-79 SCM ATACAMA MINERALS CHILE CONSTITUIDA 27 02201-1834-7 ESTACAS 47/48-230/232 F-79 SCM ATACAMA MINERALS CHILE CONSTITUIDA 28 02201-1835-5 ESTACAS 688/689 V-80 SCM ATACAMA MINERALS CHILE CONSTITUIDA 29 02201-1836-3 ESTACA 207-F-73 SCM ATACAMA MINERALS CHILE CONSTITUIDA 30 02201-1837-1 ESTACAS 229-233-234-F-79 SCM ATACAMA MINERALS CHILE CONSTITUIDA

31 02201-1838-K ESTACA 393/405-V-80 SCM ATACAMA MINERALS CHILE CONSTITUIDA 32 02201-1839-8 ESTACA 244-V-78 SCM ATACAMA MINERALS CHILE CONSTITUIDA 33 02201-2217-4 AMPLIACION DESCUBRIDORA 393 SCM ATACAMA MINERALS CHILE CONSTITUIDA

34 02201-3017-7 ESTACA 145-V-79 SCM ATACAMA MINERALS CHILE CONSTITUIDA 35 02201-1812-6 ESTACA 273-V-78 AMAX DE CHILE INC CONSTITUIDA MINING CONCESSIONS INDICE Rol nacional Nombre Titular Situacion

1 02201-1723-5 ANDREA I 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 2 02201-1724-3 ANDREA II 1/15 SCM ATACAMA MINERALS CHILE CONSTITUIDA 3 02201-1727-8 ANDREA V 1/15 SCM ATACAMA MINERALS CHILE CONSTITUIDA 4 02201-1728-6 ANDREA VI 1/10 SCM ATACAMA MINERALS CHILE CONSTITUIDA 5 02201-1730-8 ANDREA VIII 1/15 SCM ATACAMA MINERALS CHILE CONSTITUIDA 6 02201-1731-6 ANDREA IX 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 7 02201-1732-4 ANDREA X 1/10 SCM ATACAMA MINERALS CHILE CONSTITUIDA

8 02201-1733-2 ANDREA XI 1/15 SCM ATACAMA MINERALS CHILE CONSTITUIDA 9 02201-1734-0 ANDREA XII 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA

10 02201-1736-7 ANDREA XIV 1/15 SCM ATACAMA MINERALS CHILE CONSTITUIDA

11 02201-1737-5 ANDREA XV 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 12 02201-1738-3 ANDREA XVI 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 13 02201-1739-1 ANDREA XVII 1/14 SCM ATACAMA MINERALS CHILE CONSTITUIDA 14 02201-1740-5 ANDREA XVIII 1/6 SCM ATACAMA MINERALS CHILE CONSTITUIDA 15 02201-1741-3 IGNACIA I 1/15 SCM ATACAMA MINERALS CHILE CONSTITUIDA 16 02201-1742-1 IGNACIA II 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 17 02201-1743-K IGNACIA III 1/25 SCM ATACAMA MINERALS CHILE CONSTITUIDA


94 19 December 2013

18 02201-1744-8 IGNACIA IV 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA

19 02201-1745-6 IGNACIA V 1/10 SCM ATACAMA MINERALS CHILE CONSTITUIDA 20 02201-1746-4 IGNACIA VI 1/15 SCM ATACAMA MINERALS CHILE CONSTITUIDA 21 02201-1747-2 IGNACIA VII 1/19 SCM ATACAMA MINERALS CHILE CONSTITUIDA 22 02201-1748-0 IGNACIA VIII 1/10 SCM ATACAMA MINERALS CHILE CONSTITUIDA 23 02201-1749-9 IGNACIA IX 1/10 SCM ATACAMA MINERALS CHILE CONSTITUIDA 24 02201-1750-2 IGNACIA X 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA

25 02201-1751-0 IGNACIA XI 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 26 02201-2052-K ANGELES I 1/29 SCM ATACAMA MINERALS CHILE CONSTITUIDA 27 02201-2229-8 ANGELES II 1/40 SCM ATACAMA MINERALS CHILE CONSTITUIDA

28 02201-2230-1 ANGELES III 1/60 SCM ATACAMA MINERALS CHILE CONSTITUIDA 29 02201-2231-K ANGELES IV 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 30 02201-2054-6 ANGELES V 1/60 SCM ATACAMA MINERALS CHILE CONSTITUIDA

31 02201-1762-6 SANDRA I 1/10 SCM ATACAMA MINERALS CHILE CONSTITUIDA 32 02201-1763-4 SANDRA II 1/10 SCM ATACAMA MINERALS CHILE CONSTITUIDA 33 02201-1764-2 SANDRA III 1/10 SCM ATACAMA MINERALS CHILE CONSTITUIDA 34 02201-1765-0 SANDRA IV 1/10 SCM ATACAMA MINERALS CHILE CONSTITUIDA 35 02201-2048-1 TERESA II 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 36 02201-2049-K TERESA III 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA

37 02201-2051-1 TERESA IV 1/10 SCM ATACAMA MINERALS CHILE CONSTITUIDA 38 02201-2050-3 TERESA IV 1/5 SCM ATACAMA MINERALS CHILE CONSTITUIDA 39 02201-2013-9 YOLY II 1/40 SCM ATACAMA MINERALS CHILE CONSTITUIDA 40 02201-2465-7 YOLY III 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 41 02201-2466-5 YOLY IV 1/29 SCM ATACAMA MINERALS CHILE CONSTITUIDA 42 02201-2467-3 YOLY V 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 43 02201-2807-5 YOLY VI 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 44 02201-2469-K YOLY VII 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 45 02201-2470-3 YOLY VIII 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 46 02201-2138-0 PAULINA 7 1/5 SCM ATACAMA MINERALS CHILE CONSTITUIDA

47 02201-2139-9 PAULINA 8 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 48 02201-2150-K PAULINA 19 1/15 SCM ATACAMA MINERALS CHILE CONSTITUIDA 49 02201-2151-8 PAULINA 20 1/10 SCM ATACAMA MINERALS CHILE CONSTITUIDA

50 02201-2187-9 PAULINA 56 1/25 SCM ATACAMA MINERALS CHILE CONSTITUIDA 51 02201-2188-7 PAULINA 57 1/25 SCM ATACAMA MINERALS CHILE CONSTITUIDA 52 02201-2265-4 PAULINA 10 II 1/5 SCM ATACAMA MINERALS CHILE CONSTITUIDA 53 02201-2267-0 PAULINA 14 II 1/15 SCM ATACAMA MINERALS CHILE CONSTITUIDA 54 02201-2268-9 PAULINA 15 II 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 55 02201-3588-8 PAULINA 37 II 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 56 02201-3098-3 CRISTINA I 1/12 SCM ATACAMA MINERALS CHILE CONSTITUIDA 57 02201-4823-8 MIRIAM T 1/10 SCM ATACAMA MINERALS CHILE CONSTITUIDA 58 02201-4824-6 MIRIAM J 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA

59 02201-4825-4 MIRIAM K 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 60 02201-4826-2 MIRIAM G 1/10 SCM ATACAMA MINERALS CHILE CONSTITUIDA 61 02201-5156-5 MIRIAM 1 1/60 SCM ATACAMA MINERALS CHILE CONSTITUIDA

62 02201-5157-3 MIRIAM 2 1/60 SCM ATACAMA MINERALS CHILE CONSTITUIDA 63 02201-5158-1 MIRIAM 3 1/60 SCM ATACAMA MINERALS CHILE CONSTITUIDA 64 02201-5159-K MIRIAM 4 1/60 SCM ATACAMA MINERALS CHILE CONSTITUIDA 65 02201-5160-3 MIRIAM 5 1/60 SCM ATACAMA MINERALS CHILE CONSTITUIDA 66 02201-5161-1 MIRIAM 6 1/40 SCM ATACAMA MINERALS CHILE CONSTITUIDA 67 02201-5162-K MIRIAM 7 1/60 SCM ATACAMA MINERALS CHILE CONSTITUIDA 68 02201-5163-8 MIRIAM 8 1/40 SCM ATACAMA MINERALS CHILE CONSTITUIDA 69 02201-5164-6 MIRIAM 9 1/13 SCM ATACAMA MINERALS CHILE CONSTITUIDA 70 02201-5165-4 MIRIAM 10 1/60 SCM ATACAMA MINERALS CHILE CONSTITUIDA

71 02201-5166-2 MIRIAM 11 1/54 SCM ATACAMA MINERALS CHILE CONSTITUIDA 72 02201-5167-0 MIRIAM 12 1/60 SCM ATACAMA MINERALS CHILE CONSTITUIDA 73 02201-5168-9 MIRIAM 13 1/39 SCM ATACAMA MINERALS CHILE CONSTITUIDA

74 02201-5169-7 MIRIAM 14 1/40 SCM ATACAMA MINERALS CHILE CONSTITUIDA 75 02201-5170-0 MIRIAM 15 1/60 SCM ATACAMA MINERALS CHILE CONSTITUIDA 76 02201-5176-K MIRIAM G 1/10 SCM ATACAMA MINERALS CHILE CONSTITUIDA 77 02201-5177-8 MIRIAM J 1/10 SCM ATACAMA MINERALS CHILE CONSTITUIDA 78 02201-5178-6 MIRIAM M 1/2 SCM ATACAMA MINERALS CHILE CONSTITUIDA


95 19 December 2013

79 02201-5179-4 MIRIAM T 1/10 SCM ATACAMA MINERALS CHILE CONSTITUIDA

80 02201-5172-7 ESTER 1 1/10 SCM ATACAMA MINERALS CHILE CONSTITUIDA 81 02201-5175-1 SAN RAFAEL 1 1/10 SCM ATACAMA MINERALS CHILE EN TRAMITE 82 02201-5192-1 PAZ 1 1/8 SCM ATACAMA MINERALS CHILE CONSTITUIDA 83 02201-5209-K CANCRI 1 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 84 02201-5210-3 CANCRI 2 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 85 02201-5079-8 COSTA 3 1/22 SCM ATACAMA MINERALS CHILE CONSTITUIDA

86 02201-4966-8 REPAMPA C 1/100 SCM ATACAMA MINERALS CHILE CONSTITUIDA 87 02201-4967-6 REPAMPA D 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 88 02201-5181-6 REPAMPA F 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA

89 02201-5182-4 REPAMPA G 1/40 SCM ATACAMA MINERALS CHILE CONSTITUIDA 90 02201-5183-2 REPAMPA H 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 91 02201-5293-6 REPAMPA II 1/100 SCM ATACAMA MINERALS CHILE CONSTITUIDA

92 02201-5295-2 REPAMPA IV 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 93 02201-5296-0 REPAMPA V 1/200 SCM ATACAMA MINERALS CHILE CONSTITUIDA 94 02201-5297-9 REPAMPA VI 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 95 02201-5298-7 REPAMPA VII 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 96 02201-5299-5 REPAMPA VIII 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 97 02201-5300-2 REPAMPA IX 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA

98 02201-5830-6 NORTE 1 AB 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 99 02201-5831-4 NORTE 2 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 100 02201-5832-2 NORTE 3 AB 1/15 SCM ATACAMA MINERALS CHILE CONSTITUIDA 101 02201-5833-0 NORTE 4 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 102 02201-5834-9 NORTE 5 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 103 02201-5835-7 NORTE 6 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 104 02201-5836-5 NORTE 7 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 105 02201-5837-3 NORTE 8 AB 1/11 SCM ATACAMA MINERALS CHILE CONSTITUIDA 106 02201-5838-1 NORTE 9 AB 1/60 SCM ATACAMA MINERALS CHILE CONSTITUIDA 107 02201-5839-K NORTE 10 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA

108 02201-5840-3 NORTE 11 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 109 02201-5841-1 NORTE 12 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 110 02201-5842-K NORTE 13 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA

111 02201-5843-8 NORTE 14 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 112 02201-5844-6 NORTE 15 AB 1/11 SCM ATACAMA MINERALS CHILE CONSTITUIDA 113 02201-5845-4 NORTE 16 AB 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 114 02201-5846-2 NORTE 17 AB 1/5 SCM ATACAMA MINERALS CHILE CONSTITUIDA 115 02201-5847-0 NORTE 18 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 116 02201-5848-9 NORTE 19 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 117 02201-5849-7 NORTE 20 AB 1/25 SCM ATACAMA MINERALS CHILE CONSTITUIDA 118 02201-5850-0 NORTE 21 AB 1/25 SCM ATACAMA MINERALS CHILE CONSTITUIDA 119 02201-5851-9 NORTE 22 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA

120 02201-5852-7 NORTE 23 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 121 02201-5853-5 NORTE 24 AB 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 122 02201-5854-3 NORTE 25 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA

123 02201-5856-K CENTRO 26 AB 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 124 02201-5857-8 CENTRO 27 AB 1/12 SCM ATACAMA MINERALS CHILE CONSTITUIDA 125 02201-5858-6 CENTRO 28 AB 1/73 SCM ATACAMA MINERALS CHILE CONSTITUIDA 126 02201-5859-4 CENTRO 29 AB 1/104 SCM ATACAMA MINERALS CHILE CONSTITUIDA 127 02201-5860-8 CENTRO 30 AB 1/30 SCM ATACAMA MINERALS CHILE EN TRAMITE 128 02201-5861-6 CENTRO 31 AB 1/30 SCM ATACAMA MINERALS CHILE EN TRAMITE 129 02201-5862-4 CENTRO 32 AB 1/28 SCM ATACAMA MINERALS CHILE CONSTITUIDA 130 02201-5863-2 CENTRO 33 AB 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 131 02201-5864-0 CENTRO 34 AB 1/28 SCM ATACAMA MINERALS CHILE CONSTITUIDA

132 02201-5865-9 CENTRO 35 AB 1/29 SCM ATACAMA MINERALS CHILE CONSTITUIDA 133 02201-5866-7 CENTRO 38 AB 1/5 SCM ATACAMA MINERALS CHILE CONSTITUIDA 134 02201-5867-5 CENTRO 39 AB 1/11 SCM ATACAMA MINERALS CHILE CONSTITUIDA

135 02201-5869-1 CENTRO 42 AB 1/4 SCM ATACAMA MINERALS CHILE CONSTITUIDA 136 02201-5870-5 CENTRO 43 AB 1/4 SCM ATACAMA MINERALS CHILE CONSTITUIDA 137 02201-5871-3 CENTRO 44 AB 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 138 02201-5872-1 CENTRO 45 AB 1/35 SCM ATACAMA MINERALS CHILE CONSTITUIDA 139 02201-5873-K CENTRO 46A AB 1/8 SCM ATACAMA MINERALS CHILE CONSTITUIDA


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140 02201-5875-6 CENTRO 47 AB 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA

141 02201-5876-4 CENTRO 48 AB 1/14 SCM ATACAMA MINERALS CHILE CONSTITUIDA 142 02201-5879-9 CENTRO 51 AB 1/10 SCM ATACAMA MINERALS CHILE CONSTITUIDA 143 02201-5884-5 CENTRO 56 AB 1/70 SCM ATACAMA MINERALS CHILE CONSTITUIDA 144 02201-5886-1 SUR 58 AB 1/45 SCM ATACAMA MINERALS CHILE CONSTITUIDA 145 02201-5887-K SUR 59 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 146 02201-5888-8 SUR 60 AB 1/10 SCM ATACAMA MINERALS CHILE CONSTITUIDA

147 02201-5889-6 SUR 61 AB 1/5 SCM ATACAMA MINERALS CHILE CONSTITUIDA 148 02201-5890-K SUR 62 AB 1/15 SCM ATACAMA MINERALS CHILE CONSTITUIDA 149 02201-5891-8 SUR 63 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA

150 02201-5892-6 SUR 64 AB 1/45 SCM ATACAMA MINERALS CHILE CONSTITUIDA 151 02201-5893-4 SUR 65 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 152 02201-5894-2 SUR 66 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA

153 02201-5895-0 SUR 67 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 154 02201-5897-7 SUR 69 AB 1 SCM ATACAMA MINERALS CHILE CONSTITUIDA 155 02201-5898-5 SUR 70 AB 1 SCM ATACAMA MINERALS CHILE CONSTITUIDA 156 02201-5899-3 SUR 71 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 157 02201-5900-0 SUR 72 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 158 02201-5901-9 SUR 73 AB 1/5 SCM ATACAMA MINERALS CHILE CONSTITUIDA

159 02201-5902-7 SUR 74 AB 1/5 SCM ATACAMA MINERALS CHILE CONSTITUIDA 160 02201-5903-5 SUR 75 AB 1/30 SCM ATACAMA MINERALS CHILE EN TRAMITE 161 02201-5904-3 SUR 76 AB 1/46 SCM ATACAMA MINERALS CHILE CONSTITUIDA 162 02201-5905-1 SUR 77 AB 1/20 SCM ATACAMA MINERALS CHILE EN TRAMITE 163 02201-5906-K SUR 78 AB 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 164 02201-5907-8 SUR 79 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 165 02201-5908-6 SUR 80 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 166 02201-5909-4 SUR 81 AB 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 167 02201-5188-3 LIVIA 1 1/10 SCM ATACAMA MINERALS CHILE EN TRAMITE 168 02201-5189-1 LIVIA 2 1/20 SCM ATACAMA MINERALS CHILE EN TRAMITE

169 02201-5190-5 LIVIA 3 1/10 SCM ATACAMA MINERALS CHILE CONSTITUIDA 170 02201-5191-3 LIVIA 4 1/10 SCM ATACAMA MINERALS CHILE CONSTITUIDA 171 02201-5577-3 LIVIA 6 1/10 SCM ATACAMA MINERALS CHILE CONSTITUIDA

172 02201-5578-1 LIVIA 7 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 173 02201-5579-K LIVIA 9 1/40 SCM ATACAMA MINERALS CHILE CONSTITUIDA 174 02201-5562-5 LIVIA 18 1/30 SCM ATACAMA MINERALS CHILE EN TRAMITE 175 02201-5563-3 LIVIA 19 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 176 02201-5564-1 LIVIA 26 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 177 02201-5566-8 LIVIA 41 1/20 SCM ATACAMA MINERALS CHILE EN TRAMITE 178 02201-5567-6 LIVIA 43 1/20 SCM ATACAMA MINERALS CHILE EN TRAMITE 179 02201-5568-4 LIVIA 46 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 180 02201-5569-2 LIVIA 47 1/10 SCM ATACAMA MINERALS CHILE CONSTITUIDA

181 02201-5570-6 LIVIA 48 1/20 SCM ATACAMA MINERALS CHILE EN TRAMITE 182 02201-5571-4 LIVIA 49 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 183 02201-5572-2 LIVIA 53 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA

184 02201-5573-0 LIVIA 55 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 185 02201-5574-9 LIVIA 57 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 186 02201-5575-7 LIVIA 59 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 187 02201-5576-5 LIVIA 60 1/10 SCM ATACAMA MINERALS CHILE CONSTITUIDA 188 02201-5251-0 LIVIA 64 1/5 SCM ATACAMA MINERALS CHILE CONSTITUIDA 189 02201-6309-1 LIVIA 85A 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 190 02201-6310-5 LIVIA 86A 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 191 02201-6302-4 LIVIA 94A 1/5 SCM ATACAMA MINERALS CHILE CONSTITUIDA 192 02201-6303-2 LIVIA 94B 1/12 SCM ATACAMA MINERALS CHILE CONSTITUIDA

193 02201-6304-0 LIVIA 94C 1/17 SCM ATACAMA MINERALS CHILE CONSTITUIDA 194 02201-6305-9 LIVIA 101A 1/40 SCM ATACAMA MINERALS CHILE CONSTITUIDA 195 02201-6306-7 LIVIA 106A 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA

196 02201-6307-5 LIVIA 106B 1/20 SCM ATACAMA MINERALS CHILE EN TRAMITE 197 02201-6308-3 LIVIA 115A 1/87 SCM ATACAMA MINERALS CHILE CONSTITUIDA 198 02201-5559-5 LIVIA 132 1/100 SCM ATACAMA MINERALS CHILE CONSTITUIDA 199 02201-5560-9 LIVIA 133 1/50 SCM ATACAMA MINERALS CHILE CONSTITUIDA 200 02201-6311-3 PAZ 1 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA


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201 02201-6312-1 PAZ 2 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA

202 02201-6313-K PAZ 3 AB 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 203 02201-6314-8 PAZ 4 AB 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 204 02201-6315-6 PAZ 5 AB 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 205 02201-6316-4 PAZ 6 AB 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 206 02201-6317-2 PAZ 7 AB 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 207 02201-6318-0 PAZ 8 AB 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA

208 02201-6319-9 PAZ 9 AB 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 209 02201-6320-2 PAZ 10 AB 1/12 SCM ATACAMA MINERALS CHILE CONSTITUIDA 210 02201-6321-0 PAZ 11 AB 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA

211 02201-6322-9 PAZ 12 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 212 02201-6323-7 PAZ 13 AB 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 213 02201-6324-5 PAZ 14 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA

214 02201-6325-3 PAZ 15 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 215 02201-6326-1 PAZ 16 AB 1/18 SCM ATACAMA MINERALS CHILE CONSTITUIDA 216 02201-6327-K PAZ 17 AB 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 217 02201-6328-8 PAZ 18 AB 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 218 02201-6329-6 PAZ 19A AB 1/2 SCM ATACAMA MINERALS CHILE CONSTITUIDA 219 02201-6330-K PAZ 19B AB 1/2 SCM ATACAMA MINERALS CHILE CONSTITUIDA

220 02201-6331-8 PAZ 20 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 221 02201-6332-6 PAZ 21 AB 1/25 SCM ATACAMA MINERALS CHILE CONSTITUIDA 222 02201-6333-4 PAZ 22 AB 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 223 02201-6334-2 PAZ 23 AB 1/10 SCM ATACAMA MINERALS CHILE CONSTITUIDA 224 02201-6335-0 PAZ 24 AB 1/24 SCM ATACAMA MINERALS CHILE CONSTITUIDA 225 02201-6336-9 PAZ 25 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 226 02201-6337-7 PAZ 26 AB 1/30 SCM ATACAMA MINERALS CHILE CONSTITUIDA 227 02201-6338-5 PAZ 27 AB 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 228 02201-6339-3 PAZ 28 AB 1/20 SCM ATACAMA MINERALS CHILE CONSTITUIDA 229 02201-6623-6 AMPLIACION A 1/12 MIR BALMACEDA PABLO CONSTITUIDA

230 02201-6624-4 AMPLIACION B 1/5 MIR BALMACEDA PABLO CONSTITUIDA 231 02201-7352-6 RENACIMIENTO 1/27 MIR BALMACEDA PABLO CONSTITUIDA 232 02201-7492-1 CENTRO 1 AB 1/37 MIR BALMACEDA PABLO MensuradaSNGM

233 02201-7493-K CENTRO 2 AB 1/9 MIR BALMACEDA PABLO MensuradaSNGM 234 02201-7494-8 CENTRO 3 AB 1/44 MIR BALMACEDA PABLO MensuradaSNGM 235 02201-7495-6 CENTRO 4 AB 1/17 MIR BALMACEDA PABLO MensuradaSNGM 236 02201-7496-4 CENTRO 5 AB 1/40 MIR BALMACEDA PABLO MensuradaSNGM 237 02201-7497-2 CENTRO 6 AB 1/28 MIR BALMACEDA PABLO MensuradaSNGM 238 02201-7498-0 CENTRO 7 AB 1/28 MIR BALMACEDA PABLO MensuradaSNGM 239 02201-7499-9 CENTRO 8 AB 1/20 MIR BALMACEDA PABLO MensuradaSNGM 240 02201-7488-3 LINEA AB 2 1/30 MIR BALMACEDA PABLO Aprobada SNGM 241 02201-7489-1 LINEA AB 3 1/52 MIR BALMACEDA PABLO Aprobada SNGM

242 02201-7490-5 LINEA AB 4 1/37 MIR BALMACEDA PABLO Aprobada SNGM 243 02201-7491-3 LINEA AB 5 1/41 MIR BALMACEDA PABLO Aprobada SNGM 244 02201-7500-1 SUR 1 AB 1 AL 29 MIR BALMACEDA PABLO Aprobada SNGM

245 02201-7501-4 SUR 3 AB 1 AL 3 MIR BALMACEDA PABLO MensuradaSNGM 246 02201-7829-3 CERROS 8 1 AL 30 MIR BALMACEDA PABLO MensuradaSNGM 247 02201-7997-4 CERROS 9 1 AL 30 MIR BALMACEDA PABLO MensuradaSNGM

EXPLOITATION LICENCES

INDICE Rol Nacional Nombre Titular Situacion

1 02201-K711-5 CERROS 1 MIR BALMACEDA PABLO CONSTITUIDA 2 02201-K712-3 CERROS 2 MIR BALMACEDA PABLO CONSTITUIDA

3 02201-K713-1 CERROS 3 MIR BALMACEDA PABLO CONSTITUIDA 4 02201-K714-K CERROS 4 MIR BALMACEDA PABLO CONSTITUIDA 5 02201-K715-8 CERROS 5 MIR BALMACEDA PABLO CONSTITUIDA

6 02201-K716-6 CERROS 6 MIR BALMACEDA PABLO CONSTITUIDA 7 02201-K717-4 CERROS 7 MIR BALMACEDA PABLO CONSTITUIDA 8 02201-K718-2 CERROS 8 MIR BALMACEDA PABLO CONSTITUIDA 9 02201-K719-0 CERROS 9 MIR BALMACEDA PABLO CONSTITUIDA

10 02201-K720-4 CERROS 10 MIR BALMACEDA PABLO CONSTITUIDA


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EXPLORATION LICENCES

Rol Nacional Nombre Titular Situacion

1 02201-L861-3 ESTE AB 1 MIR BALMACEDA PABLO EN TRAMITE


3 02201-L863-K ESTE AB 3 MIR BALMACEDA PABLO EN TRAMITE



6 02201-L866-4 ESTE AB 6 MIR BALMACEDA PABLO

































39 02201-M043-K ESTE AB 39 MIR BALMACEDA PABLO EN TRAMITE


99 19 December 2013

Appendix B: STATISTICAL PLOTS

Composites – I2

Composites – NO3


100 19 December 2013

Composites – SO4



Variograms

Accumulation, at 200ppm I2 cut-off

Thickness, at 200ppm I2 cut-off



Nitrate

Sulphate

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