MEDINAH MINERALS Question & Answers
July 30, 2009
Question & Answer postings are compiled from time to time, as an information source as to company actions and/or activities. Q&A posts will continue in the post-Joint Venture Agreement phase concerning Company activities, to provide ongoing information for the benefit of Medinah Minerals shareholders.
1) The lack of news from Chile in the past many months has been very difficult for the shareholders. As such, we live by the news we can get, so can you please elaborate on the latest info regarding our interest in the Madre de Dios project. For example, have they done pre-production testing on the site? What is the expected production in terms of ounces per day? What is the reserve calculation, etc.? Any more detail would be important and appreciated.
A: Medinah Minerals, Inc. recently ended its affiliation with Global Gold, converted its investment capital holdings, and is now the owner of a 5% interest in the entire Madre de Dios, “Compania Minera Pumillahue” including plant, equipment, land titles, explorations and operations. This comprises a state-of-the-art production facility with all services, roads, power, permits, etc. Please find pictures of the production facility on the MDMN Company website.
The entire project has been built utilizing private shareholders funds with careful attention to all details to ensure a continuous supply of economic material to the plant for the foreseeable future.
The majority of the exploration to outline the reserves and grades has now been completed. The results to date indicate a substantially higher grade of gold than one usually encounters in a typical placer operation.
It is anticipated that the plant will commence production in October, initially on an 8-hour schedule, at a rate of 150 cu yds/hour and, subsequently, add a second shift. Once in production, Medinah Minerals, Inc.’s 5% holdings should result in a very positive cash-flowing situation.
Further details will be forthcoming upon the completion of the reserve calculations, including the results from the exploration shafts completed into the higher-grade ore zones.
2) Finally, speaking of lack of news, where are we with the Lipangue project? What is the current status of negotiations? How many groups are still at the table and when can we expect disclosure on the full status of this situation?
A: Negotiations continue daily to complete the Joint Venture agreements. Management remains legally bound pursuant to the “Acuerdo de Confidencialidad” as signed by MDMN Management in Santiago, Chile on February 12, 2008. Clause 2-201 states the parties will maintain the confidential information “in the most absolute secret”. Clause 2-2:3 further states that the parties will take all reasonable efforts to ensure that all representatives and associates of the parties comply with the obligation of the parties to the Non-Disclosure Agreement as if they had signed the agreement.
Each of the various potential Joint Venture Agreement parties that have been privy to negotiations on the Alto de Lipangue project, have been subject to similar legal Non-Disclosure Agreements, binding their Management and Boards of Directors from disclosing parties, and terms, etc.
To more specifically answer your question, the two main potential Joint Venture partner groups are moving forward to complete a meaningful Joint Venture Agreement and Management will make full status reports immediately as to any and all significant facts as soon as they are available for distribution. The Company website will continue to serve as the conduit of relative and verifiable information to the shareholder body. All relative data has been provided to the potential Joint Venture partners including, but not limited to, all geological reports, assays, clear property titles, notarized ownership certifications, property access agreements, road rights access, and attained approvals through all Chilean governmental authorities. Further, all the above-noted terms and conditions data has been accepted as “complete” by the respective Joint Venture parties.
3) What happened recently that changed Medinah’s Pink Sheet listing from a yield to a stop?
A: Due to an administrative oversight, the March 30, 2009 Financial Statements were not received by Pink Sheets by the due date of June 30, 2009. Immediately, when the oversight was discovered by Management, all applicable fees and statements were immediately filed and accepted by “Pink Sheets” and the “Stop” rescinded and replaced with our normative “Yield” classification. Management is investigating the upgraded requirement steps to move to the next level disclosure category on the “Pink Sheets”, and the applicable costs associated with the upgrade. Of note, Pink Sheets will be receiving the June 30, 2009 MDMN financial statements in a timely manner.
