The Quimsacocha Project is located in southern Ecuador 480 kilometres south of the capital Quito. It is located in the Western Cordillera of the Andes, in the Azuay Province, approximately 30 kilometres southwest of the city of Cuenca.

The Republic of Ecuador is bordered by Colombia to the north, Peru to the east and south, and by the Pacific Ocean to the west. The country is just over 256,000 km² with a population of almost 14,000,000.

The Quimsacocha property consists of four mining concessions (Cerro Casco, Rio Falso, Cristal and San Martìn), covering an approximate area of 9,497 hectares.

Access to the property from Cuenca is by 40 kilometres of paved road to the town of San Gerardo, 8 kilometres of winding gravel road to the exploration base camp and 10 kilometres of winding gravel road to the project. This access leads from the main highway between Cuenca, the third-largest city in Ecuador, and Machala, the second largest port in the country.

History

The first known systematic exploration in the Quimsacocha area was carried out by the United Nations in the late 1970’s to define base metal anomalies. Follow-up work resulted in the drilling of the Jordanita and Loma Tasqui targets, located just south of what has become known as the Quimsacocha deposit.

In 1991, the property was acquired by COGEMA who completed 2,944 m of diamond drilling on vein and disseminated targets. Gold, Silver and Copper mineralization was intersected but results were not sufficiently encouraging for COGEMA to continue exploration on its own and in 1993, Newmont Mining and TVX Gold became COGEMA’s joint venture partners. Under Newmont’s management, a further 7,581 m of diamond drilling was carried out. Newmont was seeking a Yanacocha-like deposit, and when this failed to materialize, Newmont and TVX withdrew from the joint venture. IAMGOLD acquired the Cerro Casco, Cristal, and Rio Falso concessions from COGEMA in March 1999.

In 2003 IAMGOLD began drilling the Cerro Casco and Rio Falso concessions. In 2004, IAMGOLD drilled an angled hole (IQD-122) which intersected 102 m averaging 9.1 g/t Au, 46.9 g/t Au and 0.4% copper giving the company the confidence to proceed with the drilling program. A pre-feasibility study began in the second quarter of 2008. In April 2008, a Constituent Assembly, formed to examine Ecuador’s Constitution, accepted a mandate to revise the mining laws. The Government of Ecuador, through the Ministry of Mines and Petroleum, issued a 180 day suspension of all mining and exploration activity while such laws were to be revised. On January 12, 2009, Ecuador’s interim legislature approved a new draft mining law, lifting the previously imposed exploration moratorium while a new law was developed. The new law calls for the negotiation between mining companies and the Government of project-specific mining contracts.

Milestones:

1999     IAMGOLD acquires the Quimsacocha property from COGEMA
2003     IAMGOLD commences drilling the Cerro Casco and Rio Falso concessions
2006     SRK Consulting completes preliminary scoping study
2008     Ecuador votes in favour of a new constitution to form a new policy for mining development
2009     Pre-Feasibility study completed