QA/QC Procedures

All sampling, drilling, testing and analysis are conducted using rigorous QA/QC procedures to ensure reliability and validity of results beyond basic regulatory guidelines. Having sound QA/QC protocols in place instills a level of confidence within the Company, as Orex is fully aware of what is happening with all samples, at all times. Moreover, transparent QA/QC procedures demonstrate Orex's strict adherence to industry "Best Practices" to the investment community.

The following is an example of the QA/QC procedures performed during Phase-I drilling. Similar procedures have been employed by Fresnillo Plc during subsequent phases of drilling.

1. Orex geologists lay out drill-hole locations in the field. Orex staff supervises pad construction (and later reclamation) & fore-sight/back-sight markers are set to align the direction of drilling.
2. Drilling has been conducted by Major Drilling de Mexico S.A. de C.V., with a skid-mounted UDR-200 MX #24 rig, plus Kluane Drilling Inc. utilising man-portable KD-1000 rigs. The diamond drilling core is HQ size, reducing to NQ size with depth, which provides a large sample as recommended for the testing of precious metals deposits.
3. Down-hole surveys are conducted at 50 m intervals down the drill hole using a Reflex survey device to measure azimuth and dip of the hole.
4. The driller is responsible for insuring that core in boxes is in correct order, and to mark the length tags for each rod-length of core and mark the inside of core boxes where the tag is located. This step is examined by the on-duty project geologist.
5. Orex personnel pick up core boxes from the drill site & taken to drill core logging facilities on the property.
6. Boxes are then laid out on logging tables and checked to make sure that the core is continuous and in the right order in each box. Core boxes are cleaned at this stage to remove drill grease.
7. Measurements of core between rod-length tags are taken to determine drill core recovery.
8. The proportions of core fragments greater than 10 cm and 20 cm in length are determined to obtain RQD values. This data is entered into an RQD log. While this information will not be used in the exploration stage, it will be valuable information for future mine design indicating where competent ground & broken ground conditions can be expected.
9. All core boxes and lids are then clearly labelled with "from" and "to" lengths in metres.
10. Geological logging of core is conducted & sample positions are marked to conform with lithological/alteration changes. Sample numbers are written inside of core boxes corresponding to pre-printed sample tags.
11. Chalk lines are marked down the axis of core and boxes for sampling are moved to cutting area. Diamond saw blade cutters are used to cut the core in ½. (This method is preferred over core splitters for precious metal deposits.)
12. Core boxes are returned to their places in order on the logging tables. Strong plastic rock sample bags are labelled with sample numbers on the outside and the sample tags inserted inside, then ½ the core is placed in their respective sample bags.
13. The boxes from which samples have been taken are marked and placed in sequence on core racks.
14. Sample bags are moved to the testing table for determination of specific gravity. An SG value is determined for every sample and samples with high sulphide and/or barite content, or possessing extensive open-space vugs, are tested twice to confirm higher or lower SG readings. This information is used when determining tonnage.
15. Geostandard samples are weighed and inserted every 10th sample as an analytical check for laboratory batches. Geostandard "Orex-1" was prepared by SGS Mineral Services of quartz vein material from the Santa Cruz epithermal silver-gold project. Geostandards "Orko-8" and "Orko-10" were prepared by SGS Mineral Services of quartz vein material from the La Preciosa epithermal silver-gold project, each of which have undergone 5-lab analytical testing. Geostandard "Orex-Blank" is of barren andesitic rock and represents a laboratory blank sample.
16. Sample bags are then closed and inserted in large sacks. These sacks are labelled with the sample range and company name, with laboratory instruction sheet placed in sack #1 of sampling batch.

Durango, Mexico is fortunate to have the services of several accredited and well-respected analytical laboratories, including certified SGS Mineral Services and Inspectorate.

1. Orex personnel deliver sacks of samples to preparation laboratory of SGS Mineral Services in Durango, Mexico.
2. From this point onward, SGS takes responsibility for the samples. The Durango lab is where the samples are crushed and a sub-sample is pulverized. The pulverized pulp is placed in kraft sample bags and the un-pulverized portions are returned to original sample bags.
3. Orex personnel pick up the remainder of the crushed samples, referred to as "sample rejects", which are stored in Durango. The sample rejects are thus available for re-testing when required.
4. In Durango, the sample pulps are analysed by Inductively Coupled Plasma (ICP-14B) for 35 elements. Au & Ag are tested by Fire Assay, with an Atomic Absorbtion or Gravimetric finish depending on grade (FAG323) and Ag is tested by Atomic Absorbtion Spectrometry (AAS). Each method has a lower and upper calibration range for which results are accurately determined.
5. Sample results falling out of the calibration range for the elements Au, Ag, Pb, Zn, Cu and As are re-analysed by methods with higher calibration ranges. This is true for Ag >300 g/t, Au >10 g/t, and Pb, Zn, Cu and Ba >10,000 ppm.
6. SGS also performs a "duplicate analysis" on every 12th sample, insuring that there is at least one duplicate run with every batch.

1. Results are tabulated on spreadsheets and e-mailed to Orex geologists. Originals of the assay certificates are sent in hard-copy format to Vancouver.
2. Upon receiving completed analytical results, geologists then extract the duplicate & standard samples for examination of expected values versus tested values.
3. The spreadsheet information for drill hole samples is then matched with sampling intervals & geological observations for interpretation.
4. Results of the merged data are then sent to Orex management, along with interpreted true width of the structures.
5. Orex management periodically prepares news releases to make public the information from the drilling in a format compatible with NI 43-101 standards. A "Qualified Person" signs-off on news releases containing technical data.