A. The Macusani district has been well documented to contain numerous uranium showings since the 1970s. While regional prospecting and geological reconnaissance work for uranium actually began in the 1950s by groups such as the United States Atomic Energy Commission, the International Atomic Energy Association and the Peruvian Institute for Nuclear Energy, no economic concentrations of uranium were observed until 1978 when a significant discovery was made near the town of Macusani in the southeastern part of the country. It was in this region that a carborne radiometric survey identified numerous surface uranium anomalies hosted in volcanic rock, an occurence rarely seen elsewhere in the world.

After the first 60 uranium showings were discovered in 1978, systematic radiometric prospecting and trenching were carried out over an area of approximately 600 square kilometers, culminating in the discovery of numerous additional uranium showings.

A. In 1984, the OECD Nuclear Energy Agency and the International Atomic Energy Agency sponsored an International Uranium Resources Evaluation Project Mission to Peru. At the time, even with only limited exploration conducted, the mission estimated that the speculative resources of the country fell within the range of 6,000 to 11,000 tonnes (13 million to 24 million pounds) of uranium and recommended that US$10 million be spent on uranium exploration in the country. In particular, the mission identified the Macusani region to have the most potential to host much of this uranium.

A. Due to the falling uranium price at the time, spurred by negative public sentiment over the nuclear industry (Three Mile Island disaster in 1979), the exploration program recommended by the International Uranium Resources Evaluation Project Mission was never carried out. The area was largely left untouched until 2005, when Solex staked its first batch of concessions. The uranium price at the time was still only US$25 to US$30 per pound.

A. The project, if found to be economically viable, exhibits many characteristics that are highly favorable to a prospective operation:

• Near-Surface Mineralization - Uranium encountered from surface to depths of 30-40 metres can be extracted using a lower cost open-pit, bulk mining operation.
  
• Widespread, Continuous Mineralization - Uranium grades encountered through drilling have been in the 0.01% to 0.04% U3O8 range and mineralization has been found continuously spread over large areas.
  
• Ease of Recovery - A bottle roll leach test and acid leach test conducted in August 2006 on core rejects from the Sayana target showed recoveries of 89.7% after just three days and 99.4% after 16 days.
  
• Nearby Infrastructure - Electricity, water and labour are readily available from the towns of Macusani, Corani and Tantamaco, all located within the concession areas.
• Road Construction - Brazil and Peru are constructing a $700 million highway that would link Brazil's Amazon river port of Assis to Peru's Pacific ports of Matarini, Ilo and San Juan. This paved highway, to be completed in the next two years, will run along the eastern edge of the Macusani concessions. For more information and pictures of the highway, please click here.
  

A. Several changes have occurred in the nuclear industry to make the Macusani region look much more attractive today:

• The nuclear industry's sustained safety record over the past decade has improved public acceptance for the use of uranium to generate electricity.
  
• Concerns over global warming and the associated fears of catastrophic climate change have spurred governments and international agencies to view nuclear power as a clean, efficient and reliable alternative to society's current reliance on fossil fuels.
• Such changes have led to an explosion in demand for new nuclear reactors, which in turn increases demand for raw uranium to fuel the reactors. Currently, 438 reactors operate in 30 countries with an additional 32 reactors now under construction and another 300 planned for development (to see a table of planned nuclear reactors, please click here.
• Supply shortfalls and delays from major uranium producing companies, and decreasing secondary uranium supplies from converted nuclear weapons stockpiles, are putting pressure on the price of uranium, which reached US$136/lb earlier during the year before pulling back to US$74/lb due to supplies meeting demand in the short term.
• Based on higher uranium prices, foreseeable over the next five years and possibly beyond, the project is closer to economic viability today than it was 10 years ago (provided that drill programs return favourable results over many of the 53 targets at Macusani East).

A. Solex and its joint venture partner, Eldorado Gold Corporation, are the first companies to begin drilling the Macusani Uranium District in an effort to uncover the region's uranium potential. As such, much has yet to be learned and understood about the geological setting of the region and how mineralization is controlled. Solex and its JV partner's goal in 2008 is to establish an initial Inferred Resource Estimate on the Macusai East JV project based on drill results from a 24,000-metre drill program in 2007 (conducted on a less than 50% of the first seven of over 53 targets on this single project).

A. With over 500 years of mining activities in the country, Peru has one of the most successful track records of base and precious metal exploration and discoveries in the world. In fact, in a study commissioned by Canada's Fraser Institute, Peru was rated in the top 20% of world mining jurisdictions for its pro-mining policies, mineral potential and protection of mining assets.

The Country is the world's largest producer of zinc, the second largest producer of silver, and the fourth largest producer of lead. In short, Peru is a mining country. Yet much of this vast land remains unexplored by modern methods and subsequently has become an attractive location for top mining and exploration companies from around the world.