Taxes
The federal Chilean tax rate used in the PEA is 20%. In addition, included in the economic analysis is the variable Chilean tax on mining activities levied on operational income.
Resource Estimate
On September 25, 2012, Atacama Pacific published a global unconstrained resource estimate summarized in Table 4. The pit constrained resource estimate used in the preliminary open pit mine model, Table 5, includes approximately 75% of the Measured and Indicated and 33% Inferred resources from the global unconstrained resource estimate.
The pit constrained resource estimate includes those resources which lie within the boundary of a conceptual open pit designed at an average gold price of $1,400 using the mining and processing parameters and associated costs outlined in the PEA. The cut off grade used in the estimation of the pit constrained resource is variable at 0.18 g/t Au up to the third year and at 0.15 g/t Au from year 4 to the end of the proposed mine life.
Table 4 - Cerro Maricunga Oxide Gold Project Global Unconstrained ResourceEstimate----------------------------------------------------------- Measured Indicated-----------------------------------------------------------Cut-off Tonnes Grade Tonnes Grade(g/t Au) (millions) (g/t Au) (millions) (g/t Au)----------------------------------------------------------------------------------------------------------------------0.2 60.4 0.44 187.5 0.41-----------------------------------------------------------0.3 40.7 0.53 123.1 0.50-----------------------------------------------------------0.4 24.5 0.64 71.2 0.61-----------------------------------------------------------0.5 15.1 0.77 42.8 0.72--------------------------------------------------------------------------------------------------------------------------------------- Measured and Indicated Inferred----------------------------------------------------------------------------Cut-off Tonnes Grade Gold Tonnes Grade Gold Ounces Ounces(g/t Au) (millions) (g/t Au) (000's) (millions) (g/t Au) (000's)--------------------------------------------------------------------------------------------------------------------------------------------------------0.2 247.9 0.42 3,344 226.3 0.36 2,654----------------------------------------------------------------------------0.3 163.9 0.51 2,667 120.7 0.47 1,810----------------------------------------------------------------------------0.4 95.8 0.62 1,912 57.8 0.60 1,118----------------------------------------------------------------------------0.5 57.9 0.74 1,370 32.3 0.73 754----------------------------------------------------------------------------Table 5 - Cerro Maricunga Oxide Gold Project Pit Constrained ResourceEstimate-------------------------------------------------------------------------Constrained at $1,400/oz Au Tonnes Grade Gold Ounces ------------------------------------------- (millions) (g/t Au) (000's)--------------------------------------------------------------------------------------------------------------------------------------------------Measured 48.6 0.43 668-------------------------------------------------------------------------Indicated 137.1 0.41 1,791--------------------------------------------------------------------------------------------------------------------------------------------------Measured and Indicated 185.8 0.41 2,460-------------------------------------------------------------------------Inferred 75.4 0.39 938-------------------------------------------------------------------------
