The Padre Antonio Copper Project Huehuetenango, Guatemala

The Padre Antonio Project is located in western Guatemala, specifically, east of the village of Santa Eulalia in the Huehuetenango Department. This property is held by Creso Resources Inc., under the Exploration License No. LEXR-702. The property has an area of 24 km2 in rugged terrain, which range in elevation between 2,000 and 2,500 meters (AMSL). The main access to the property from Guatemala City is through 246 km of reasonably kept highway CA-1 to the city of Huehuetenango. From Huehuetenango one travels north for another 87 kms to the village of Santa Eulalia, passing through Chiantla, La Capellanía, San Juan Ixcoy and Soloma. Temperatures are pleasant through most the year ranging from 25 to 30º C during the summer and 15 to 25º C during the winter months. There is little mining tradition in the Santa Eulalia area. The Padre Antonio Project was discovered by an Italian immigrant turned prospector after he organized a stream sediment sampling of the Tziquiná river that crosses the area. Near the highest copper value samples, located almost at the centre of the license, Mr. Bruno Montuori then organized the digging of a 7 meters pit that found massive chalcopyrite and abundant secondary copper minerals. Creso Resources Inc of Montreal, Canada, bought the mining rights from Mr. Mortuori early in 2005. In mid 2005 Creso completed a self potential (S.P.) survey over one square kilometer around the discovery pit and a soil sampling survey for the same area. The SP survey discovered four vertical conductors around 70 meters in diameters and at least 75 meters in depth. The geochemical soil survey confirmed the S.P. results. Based on these results Creso has initially extended the original area of license to an exploration license of 70 square kilometers and one reconnaissance licenses of 504 square kilometers. The regional geology of the Huehuetenango area belongs to that of the North American Plate in spite that it is bounded, to the south, by a sequence of active faults (Polochic, Río Negro, etc.) that represent the North American – Caribbean Plate boundary. The oldest rocks in the region are metamorphic Paleozoic schist of the Chuacús Series, Pelagic shales and mudstones are then deposited over the metamorphic basement during the Carboniferous and massive carbonates are subsequently deposited over the pelagic sediments during the Permian. At the end of the Permian, there is a hiatus of approximately 51 million years. Uplifting and possibly the first interplate tectonism resulted in the abduction of the oldest ophiolitic belt (Huehuetenango ophiolites) of the region. During the Upper Jurassic more carbonates of the Todos Santos Fm. are deposited. The Upper Cretaceous, and Lower Tertiary periods are tectonically very active with the deposition of clastic and volcanoclastic deposits and the intrusion of granitic rocks. Also during these periods, occurs the emplacement of several of the ophilitic complexes of Central Guatemala. Locally, sandstones with interbedded of limestone are in fault contact with slates to the north of the Tziquiná River which occupies the trace of the fault. The discovery mineralization is contained entirely within the volcano-sedimentary unit. Our working model proposes the existence of a sedimentary type deposit in the area. The vertical pipe-like zones of conductivity discovered by the self-potential (SP) survey done by Creso, are interpreted as mineralized vertical breccias pipes controlled by the presence of a reduction environment and organic material. The soil survey done at 100x100 m spacing in the previously cut geophysical grid and a Spatiotemporal Geochemical Hydrocarbons (SGH) testing of the same area was carried out. The soil survey confirmed the presence of localized anomalous copper zones. These anomalous Cu zones are however displaced downslope which is normal in steep tropical weathering environments. The limited exploration work done at the Santa Eulalia region and the preliminary work done by Creso Resources does not entitle us to speak of quantities, resource, much less reserves, however the evidence thus far obtained, points out towards what may result in a very interesting discovery of a new mining camp. It is recommended that the soil sampling grid be extended along strike to search for further high copper soil anomalies. Also, an IP (dipole-dipole?) survey may help to further define the lower configuration of the vertical zones of conductivities and one “discovery” diamond drill holes should be drill in each of the zones at different elevation to test the ore shoots or breccias pipe interpretation.

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