Dear Medinah Shareholders:
Medinah Minerals, Inc.
Shareholder Update
Chile Business Trip
May 28, 2013
Dear Medinah Shareholders:
Upon the termination of the Amarant Mining/Johan Ulander Purchase Agreement, real alternatives for meeting with potential partners and development of new monetization options for the Altos de Lipangue mining claims needed to be expedited.
Legally bound by the very restrictive July 10, 2012 contract the Medinah Mining Chile company could not contact, inform, engage, or feature in any business representation/negotiation with a potential/interested party until the date of May 11, 2013.
Medinah Minerals, Inc. Trustee and Board Director then travelled to Chile over a 10-day period between May 13-23, 2013.
Prior to the above-referenced Agreement, several notable mining concerns had visited and displayed serious interest in the Lipangue properties. Each of the parties were re-contacted, meetings were set and discussions reopened. Medinah Mining Chile’s intention(s), with Medinah Minerals, Inc.’s (MDMN) concurrence, is to negotiate a new definitive agreement involving an upfront monetary outlay requirement as well as fund a significant drilling and exploration program to more fully evaluate the ADL exploration/exploitation potential. During the trip, representatives of several regional and international firms, including their mining engineers and geologists, toured the Lipangue claims. The visiting company representatives and their mining colleagues also visited the Las dos Marias claims. This was important due to the fact that the Compañia Minera mining project had opened up several additional adits into the mountains interior. During this time sequence, government mining officials inspected Minera LDM's exploration/exploitation activities and required Minera LDM to add two vertical chimneys to surface for escape and ventilation, add more timbering of adits and other mining safety protocols. Minera LDM is now recognized as a fully compliant mining operation relative to Chilean Ministry of Mines safety and environmental standards. As of this writing, LDM has completed over a mile of tunneling through the additional adits following homogenous vein structures. The interested parties were able to view and evaluate the physical evidence of exposed manto-type mineralization associated with porphyry-skarn complexes and clear indications of numerous epithermal feeders of chalcopyrites, chalcocites, pyrites, and bornites. The visiting parties requested details of previous exploration results of the Altos de Lipangue properties, including the 28 diamond drill hole program conducted by Gordon House, P. Geo, all A.C.A. Howe International reports, geological mapping, IP surveys, petrographic analysis, geochemical surveys, sampling(s) as well as all Certificado of Analisis' from the present LDM mining operation. All requested documents were processed to the four different parties with the admonition to present offers as soon as possible.
It is the intention of Medinah Mining Chile, with full concurrence by Medinah Minerals, Inc., to not be burdened by obtrusive and restrictive Non-Disclosure Agreement (NDA) provisions as in previous contracts, so as to allow for more transparency regarding contract Terms and Conditions.
Medinah Mining Chile and Medinah Minerals, Inc. representatives also discussed the need to explore and capitalize on all avenues of potential cash flow options from the Altos de Lipangue claims. The parties visited the most accessible plant to the Altos de Lipangue claims and Las dos Marias mining operation. The name of this recently upgraded processing plant is the Minera San Pedro Limitada. This plant is a very modern plant operation located near the town of Til Til, approximately 15 kilometers north of Lampa, Chile (see pictures in photo gallery). Of note, Chilean President Sebastián Piñera, personally visited the San Pedro plant and proclaimed that their operation was a prime example of environmental ingenuity. The San Pedro plant is an Enami recognized technology and transferring facility for producers of copper metals. (See the attached YouTube presentation).
As Compañia Minera LDM has continued stockpiling various high and lower grades of copper and gold ore, they joined in the discussions at the San Pedro plant to possibly handle their shipments of copper ore, rather than the much longer distance to the Enami processing facility. By processing at the San Pedro plant, Minera LDM can insure the required high concentration of metals for sale to Enami via the San Pedro Limitada processing operation. Alternative plant owners were also contacted relative to the handling/processing of the high and lower grade arsenopyrite gold ore shipments. Processing contracts are presently being formulated with each of the parties.
The LDM operation is currently focused on two goals. The first being the exporting of the high grade copper component for the purpose of cash flow production. The second is the continued explore/exploit of the actual intended target of the high-grade gold enrichment zone encountered by DDH-002. It is anticipated that this target will prove to be a super-enriched zone of high-grade, gold-bearing ore. In published documents, DDH-002 drill results had encountered a 2 meter section of +7 grams/gold at 40 meters and the higher-grade section of +100 grams/gold over 5 meters starting at the 65-meter station. Winching to reach the DDH-002 target areas is in process and results will be reported. This targeted high-grade gold material, if consistent, will produce significant cash flow to fund operations, anticipated drilling, and to further define the exploitation goals of the LDM discovery.
Medinah Minerals, Inc. was awarded a 30% free carried interest, without participation costs, in all net production profits from the Compañia Minera LDM mining operation. As well, Medinah Mining Chile has a 20% interest in Compañia LDM which also adds to Medinah Minerals, Inc's, potential cash flow interest. Medinah Minerals Inc. will receive documented accounting of its cash flow percentage portion(s) on a Quarterly basis.
Further developments will be reported as they occur.
Gregory A. Chapin
Board Director
Medinah Minerals, Inc.
