Perama Hill Gold Project - Northeastern Greece

Project Highlights
Location:	Thrace region of northeastern Greece.
Area:	Two Mining Titles, 1,897.5 ha and two Mining Exploration Licenses: 1,762.7 ha.
Interest:	100%
Resources:	Indicated 1.36 million ounces gold.
Status:	Awaiting Approval of Permit Terms of Reference.

Description

The Perama Hill Gold Project lies between the prefectures of Evros and Rodopi in Thrace, Greece's most north-easterly province, an area recognized as having high epithermal gold potential. Perama Hill lies five kilometers inland and more than 200 meters above the Aegean Sea. It is 28 km from the city of Alexandroupolis on the Aegean Sea and approximately 5 km from the main highway. With its mineral resources and mild climate, modern Thrace is ideally suited for mining.

The Perama Hill gold deposit was discovered in 1995 by following up a stream sediment anomaly. To date a total of 19,452 metres in 245 diamond and reverse circulation drill holes were drilled up to October 1998 for resource evaluation purposes.

Roscoe Postle Mining Consultants of Toronto estimated the mineral resources of the Perama Hill Project in a technical report dated May 13, 2004:

At a 1.0 g/t gold cut-off grade, the estimated Indicated Mineral Resources of the Perama Hill gold deposit of 11.7 million tonnes at an average grade of 3.62 g/t gold cutting all assays above 30 g/t gold (3.73 g/t gold uncut) and 8.2 g/t silver and contain 1.36 million ounces of gold.
In addition an estimated Inferred Mineral Resource contains a total 330,000 tonnes at an average grade of 2.58 g/t gold (2.70 g/t gold uncut) and 4.5 g/t silver at the 1.0 g/t gold cut-off grade.

The mine life waste to ore ratio is 0.4 to 1. The proposed annual milling rate is 1.25 million tonnes per year through a conventional carbon-in-leach plant.

Estimated recoveries for gold and silver are 90% and 60% respectively. Total estimated gold production over a nine-year mine life is 1.2 million ounces at total cash costs of US$171 per ounce. Estimated initial capital cost is US$97 million. Several drill holes below the oxide resource encountered higher-grade gold mineralization which has not been incorporated in the overall resource estimation.

Geology

The Perama Hill oxide gold deposit is described as a typical low sulphidation banded quartz-chalcedony, barite, stockwork veinlet system. Two key controlling factors on the mineralization are the porosity and rock competency within sandstone. The gold mineralization has been fed into the system by structurally controlled feeders in andesitic rocks and disseminated into overlying porous sandstone units. The central part of the deposit is mushroom-shaped. Additional refractory sulphide gold mineralization underlies the oxide gold mineralization resource.

Permitting

There is a legislated permitting procedure in Greece. The final Environmental Impact Study (EIS) was completed and the Environmental Terms of Reference (ETR) which approve this environmental assessment (EIS) and guide the permitting process have been drafted by the Ministry of Environment and agreed to by the Company. The ETR sets out the rules under which the Company, through its subsidiary Thacean Gold Mining S.A., will operate the Perama Hill Gold Project in agreement with the Ministry of the Environment. Once the Permit ETR has been approved, the various construction and operating permits can be applied for and construction of the project can begin. The company is working closely with the Ministries of Environment and Development in order to obtain these approvals as soon as politically possible.

Economics and Potential

The Perama Hill Project is a surface, high grade oxide gold deposit which could generate a very robust rate of return with very little technical risk.

Resources	11.7 Mt @ 3.62g/t Gold and 8.2 g/t Silver
Resources - Gold	1.36 million ounces Gold (1.2M oz recoverable)
Strip Ratio	0.4:1
Recovery	90% Gold and 60% Silver
Project Life	9 years
Average Annual Production	131,000 oz Gold (170,000 oz/year first 3 years)
Capital Investment (€77.6M)	US$97 million including sustaining capital
Cash Operating Costs	$171/oz
Frontier-IRR @ $500 Gold	44% (including acquisition & royalty cost)

Development Progress

In August 2006 an engineering contract was awarded to Aker Kvaerner Engineering Services Ltd. ("Aker Kvaerner"), based in the UK, to provide capital cost and schedule upgrades for the Perama Hill Gold Project. Kvaerner Engineering & Construction UK Limited, Aker Kvaerner's predecessor company, carried out a detailed optimization study of the Perama Hill Project in 1999; this study was updated in July 2000 and the costs were updated again in May 2003.

The work performed by Aker Kvaerner included revised quotations for process equipment and buildings, material and construction cost updates and detailed supply schedules for the project. The information prepared during this work will be utilized within a full Bankable Feasibility Study to commence immediately upon Joint Ministerial approval of the ETR.

Additional contracts were awarded to Golder & Associates (UK) for cost updates on the Perama Tailings Management Facility and to Scott Wilson Consulting Group (UK) for cost updates on Pre-production Mining, Mine Equipment delivery and schedules. Discussions also took place with Greek engineering, construction and transportation companies regarding the construction and development of the Perama Hill gold project.

An updated Capital Cost for the project was completed by year-end 2006 and the revised estimate prepared by Aker Kvaerner was US $91 million.

Additional contracts have been awarded in 2007 to Aker Kvaerner and Scott Wilson Mining UK Ltd, for preliminary work on the Bankable Feasibility Study.

In January 2007, the company initiated a large scale Media Campaign with the intent to inform the general public within the vicinity of the proposed mine-site together with the general population of the Evros and Rodopi Prefectures, of the environmental safety and economic benefits of the Perama Hill Gold Mine.