Latin Ilo Iron Projects

Southern Coastal Iron Province

The Company has had a strong interest in the Coastal Sur Iron Province and Ilo area due to many known occurrences of iron (magnetite-maghemite veins), a geologic setting somewhat similar to Marcona and Pampa de Pongo, a large amount of open ground for staking and the proximity to the Pan American highway and port facility at Ilo city. The proximity of the project areas to well established infrastructure is consistent with the Company's strategy and the potential to have a lower capital intensity hurdle involved in any development opportunity.

The city and port of Ilo are located on the Southern Peruvian coast, 900 kilometres South of Lima in the Moquegua Department. The Company has applied for 100% ownership of these concessions over the last two years and currently has 22,200 hectares of granted concessions and 2,600 hectares of pending concessions. These concessions pre date the Teck Agreement and the Company has full economic rights to any mineral discovery within these concessions. Latin Resources intends to explore the region for a Pampa de Pongo or Marcona style deposit/ mineral occurrence.

Teck Ilo Iron Projects - Southern Coastal Iron Province

The Company has signed an agreement with Teck Cominco Peru S.A (Teck), a subsidiary of the largest diversified mining company in Canada, regarding the sharing and use of Teck airborne geophysical data flown by Teck in 2003. Teck flew the survey for copper exploration and Latin Resources is reprocessing the raw data for iron exploration. There are two large flight blocks totalling 297,400 hectares which are covered with 8,682 line-kilometres of airborne magnetic data (500 meter line spacing). The ground exploration data has been provided to the Company and several anomalies have been identified for investigation.

Latin Resources views the agreement with Teck as a major step forward in potentially discovering a Marcona style deposit in the Ilo region and it has expedited the Company's exploration and concession staking program.

With this data, Latin Resources has had the opportunity to enhance its Ilo portfolio of properties by remodelling the Teck data for major Iron anomalies. Based on this work, Latin has applied for a further 32,200 hectares of concessions within the areas of interest.

These concessions will be 100% owned by Latin (when granted), however, Teck has certain royalty rights for any iron ore sales and the right to earn in to any gold or base metal projects that are discovered in concessions staked within the area of interest following the execution of the Teck Agreement.

Ilo Norte Targets

Latin Resources has 7,300 hectares of 100% controlled concessions within 7 blocks at Ilo Norte.

Ground magnetic and gravity surveys were carried out over the Ilo Norte concessions. The Company has since identified a large iron skarn at Ilo Norte. The altered and anomalous outcrops cover an area of 600 x 400 meters and is partly surrounded by colluvial cover. The skarn consists of a stacked sequence, approximately 120 meters thick, of interlayered calc-silicate altered volcanic rocks and iron-rich (magnetite and maghemite) horizons up to 20 meters thick individually.

This package of altered and mineralized rocks dips east (into the hillside) at 20 to 30 degrees. Iron grades from 41 samples in the core of the skarn vary from 30.5% up to 34.6%. Approximately 800 meters to the south of the skarn target, there are several magnetite-rich veins of 0.5 to 1.5 meters width, which contain up to 62.29% Fe.

Ilo Norte drill target area

Ilo Sur target

The Company has been granted 10,200 hectares in twelve blocks at Ilo Sur, based on numerous occurrences of magnetite - maghemite veins, some exposed alteration and abundant covered areas. Latin Resources has a further two blocks totalling 2,000 hectares in application at Ilo Sur.

Ground magnetic and gravity surveys were also carried out over the Ilo Sur concessions. Mapping in the east block of the Ilo Sur property has identified a 300 x 300 meter area of several i ron veins (4-6 meters long) and weak to moderate skarn alteration in volcaniclastic and volcanic intrusive rocks (sample results pending). This area is surrounded by sand or colluvial cover. This alteration zone is adjacent to a magnetic andesite dike.

Magnetic surveying in the area has produced a 'remnantly' magnetized circular anomaly of 200 x 300 meters, coincident with the vein and altered area - the remnant magnetism may be the product of a remnant polar reversal effect or was produced by hydrothermal alteration, which is common in skarn deposits.

View of Ilo Sur surface at geophysical anomaly

Ilo Sur drill target area