Royalty: Caballo Blanco Project

Veracruz State, Mexico


Operator: Timmins Gold

Royalty: NSR: 1.5%

Caballo Blanco is a gold project on the east coast of Mexico, located 65 km northwest of Veracruz, Mexico.

The project was discovered by Almaden during a regional Mexican exploration program. It is at the PEA level and consists of two large areas of epithermal gold mineralization - the Northern Zone and the Highway Zone - contained within 13 mineral concessions covering over 54,000 hectares.

The project is easily accessible by roads with on-site power and clean water and is located in an area of unparalleled infrastructure, near to a power plant, highways and rail systems.

Almaden | Caballo Blanco

Preliminary Economic Assessment

A Preliminary Economic Assessment (PEA) was completed on Caballo Blanco entitled “Preliminary Economic Assessment Caballo Blanco Gold Heap Leach, Veracruz, Mexico”, dated May 7, 2012, prepared by Joseph M. Keane, Brent C. Bailey, Jim Cuttle, Gary Giroux, Stephen Taylor and Dino Pilloto, all of whom are independent Qualified Persons as defined in NI 43-101. The PEA discloses a Measured & Indicated Resource of 575,000 oz Au (28.9 million tonnes grading 0.62 g/t Au) and an Inferred Resource of 419,000 oz Au (24.0 million tonnes grading 0.54 g/t Au).

This PEA, which was re-filed on SEDAR by Timmins Gold Corp. in February, 2015, forecasts total life-of-mine production of 687,694 recovered ounces of gold and 1,344,052 recovered ounces of silver.

It should be noted that this PEA is preliminary in nature as it includes inferred mineral resources which are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves. There is no certainty that the PEA forecasts will be realized or that any of the resources will ever be upgraded to reserves. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.