form revision date: 09/19/09 /-,llj lead inspector: … · mmd recommends using rebar stakes of...

I RECEIVED

JUN01 2016

FOR MMD USE ONLY:PROJECT NAME: S pg N&.8,MtNERALS DlVISON

PERMIT NUMBER: Ra v’,

DATE RECEIVED: c1 i

DATE APPROVED: P&/bI M4

LEAD INSPECTOR: J4’s /-,LLJ

FORM REVISION DATE: 09/19/09

STATE OF NEW MEXICOENERGY, MINERALS AND NATURAL RESOURCES DEPARTMENT

DirectorMining and Minerals Division

1220 South Saint Francis DriveSanta Fe, New Mexico 87505Telephone: (505) 476-3400

Webpage: www.emnrd.statenm..usIMMDIindex.htm

SUBPART 3MINIMAL IMPACT EXPLORATION

PERMIT APPLICATION

The following information is required under the New Mexico Mining Act (Sections 69-36-1through 69-36-20, NMSA 1978) and associated rules. The Mining and Minerals Division ofthe Energy, Minerals and Natural Resources Department is the administrative agencythrough which this application is to be processed. See §302, Minimal Impact ExplorationOperations, of the New Mexico Mining Act Rules for all regulations associated with MinimalImpact Exploration Operations.

The applicant is requested to use this application. If additional space is needed, allinformation requested in this form must be submitted in this same format.

To be considered a minimal impact exploration operation, the following requirements apply:• A minimal impact exploration operation will not exceed 1000 cubic yards of

excavation, per permit.• Disturbances for constructed roads, drill pads and mud pits shall be no more than 5

acres total.

Permit Application Requirements: (302.A - C)• Please submit six copies of the application.• Confidential information shall be clearly identified and submitted separately• Exploration commencing after 12/31/94 shall submit an application not less than 45

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days prior to the anticipated date of operations.• Renewal applications shall be filed at least 30 days preceding expiration of the

current permit.

Check the “YES’ or “NO” box for each of the following characteristics as related to theproposed minimal impact exploration operation:

YES NOD Located in or having a direct surface impact on wetlands, springs, perennial or

intermittent streams, lakes, rivers, reservoirs or riparian areas.

Located in designated critical habitat areas as determined in accordance withthe federal Endangered Species Act of 1973 or in areas determined by theDepartment of Game and Fish likely to result in an adverse impact on anendangered species designated in accordance with the Wildlife ConservationAct, Sections 17-2-37 through 17-2-46 NMSA 1978 or by the State ForestryDivision for the Endangered Plants Act, section 75-6-1 NMSA 1978.

o Located in an area designated as Federal Wilderness Area, Wilderness StudyArea, Area of Critical Environmental Concern, or an area within the NationalWild and Scenic River System.

0 Located in a known cemetery or other burial ground.

ci Located in an area with cultural resources listed on either the National Registerof Historic Places or the State Register of Cultural Properties.

0 Having or expected to have a direct impact on ground water that has a totaldissolved solids concentration of less than 10,000 mg/L, except exploratorydrilling intersecting ground water may be performed as a minimal impactoperation.

0 Expected to use or using cyanide, mercury amalgam, heap leaching or dumpleaching in its operations.

ci Expected to result in point or non-point source surface or subsurface releases ofacid or other toxic substances from the permit area.

ci Requiring a variance from any part of these Rules as part of the permitapplication.

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IMPORTANT NOTES!!If the operation exceeds 1000 cubic yards of excavation or disturbs more than 5acres total or any of the above boxes have been checked “YES”, then theexploration does not qualify as a minimal impact exploration operation.

If you do meet the above requirements and have checked “NO” to all of theprevious boxes, continue filling out this application.

Obtaining a Mining Act permit does not necessarily satisfy the obligation toobtain other federal, state and local permits.

All proposed disturbance should be flagged or staked in the field prior to theMining and Mineral Division’s (MMD) initial inspection. Failure to properly markany proposed drill holes or trenches will delay processing of the permitapplication.

All proposed disturbance, including any new proposed access road centerlines,all four (4) corners of any proposed drill pads, and proposed drill hole location(s)within the drill pad area must be staked in the field.

Any staking of proposed disturbances (access road centerline, drill pad corners,drill hole) should be completed using durable materials such as steel re-barstakes or T-posts. MMD recommends using rebar stakes of suitable height, andflagging on the rebar at all four (4) corners. Drill holes should be marked by asingle T-post driven at the location of proposed drilling.

The application will be deemed incomplete, without a proper map included.Provide a 1:24,000 USGS quadrangle map with the application. The map shouldidentify locations of drill holes, pads and any new disturbance anticipated

If possible, please include with this application for submittal, any otheroperational plans that may have been submitted, as required, to other landmanagement agencies. Plans of Operations (P00) submitted to the USFS andNotices of Intent (NOI) submitted to the BLM are very helpful in processing thisapplication.

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ELEASE FILL IN ALL APPLICABLE INFORMATION AS COMPLETELY AS POSSIBLE.

PLEASE PRINT OR TYPE ALL INFORMATION.OPERATOR INFORMATION (3O4.D.1)

PROJECT NAME: SP Project

NAME OF APPLICANT (or entity obligated under the Mining Act):Southern Silver Exploration Corp. (US), a wholly owned subsidiary ofSouthern Silver Exploration Corp.

ADDRESS: 1199 West Hastings Street, Suite #1100Vancouver, B.C., Canada V6E 3T5Aftn: Larry Page, President

PHONE: 604-641-2770

FAX:

__________________________________________

NAME OF OWNER (if different from Applicant’s name and address):

ADDRESS:

___________________________________

PHONE:

_____________________________________

FAX:

____________________________________________

NAME OF ON-SITE CONTACT OR OPERATOR’S REPRESENTATIVE:

Elliott Crist or Joseph Kizis

ADDRESS: 4790 Caughlin Pkwy, #207Reno, Nevada 89519-0907

PHONE: 775-746-3780 (office), 775-813-0058 (Crist Cell)775-772-8746 (Kizis Cell)

FAX:

__________________

EMAIL: bigecristcharter.net

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2. RIGHT TO ENTER INFORMATION (3O2.D.1)

A. Describe or attach copies of documents that give the applicant the right to enterthe property to conduct the exploration and reclamation, include: leaseagreements, access agreements, right of way agreements, surface owneragreements, and claim numbers, if applicable.

(1)BLM federal lode claims are being acquired via an option agreementdated August 28, 2006 with Phillip J. Sterling and Manuel H. Hernandezthat has previously been submitted to MMD. Additional claims have beenstaked on BLM land in the names of Sterling and Hernandez. The right ofSouthern Silver to explore these unpatented mining claims is grantedunder an agreement with Sterling and Hernadez that includes an area ofinfluence. Southern Silver has completed the obligations to acquire theclaims from Sterling and Hernandez, and official transfer of ownership isin progress. Proposed drill sites are located on the Oro 303, 305 and 307unpatented lode mining claims. A total of 12 drill sites are located onBLM land.

SP Claims Where Proposed Work Is Planned on the SP Project

Name of Claim NMMC# Drill Site

Oro 303 191610 SP-COro 303 191610 SP-DOro 303 191610 SP-EOro 303 191610 SP-FOro 305 191612 SP-GOro 305 191612 SP-HOro 305 191612 SP-lOro 305 191612 SP-JOro 305 191612 SP-KOro 305 191612 SP-LOro 307 191614 SP-MOro 307 191614 SP-NOro 305 191612 Trench

B. List the names and addresses of surface and mineral ownership within theproposed permit area. If the mineral is federal mineral, indicate as federal mineral,but provide the name of the claim holder or lease holder.

Surface Owner(s):5

Federal BLM Land Under Location to Sterling and Hernandez

Mineral Owner(s):Minerals are owned by the United States and are under claim to Sterling andHernandez. Transfer of ownership to Southern Silver is in progress.

Name Address Phone #

Phillip J. Sterling and Sterling Exploration 505-271-2788Manuel H. Hernandez 6121 Rosetree Pt NE(owners of SP claims) Albuquerque, NM 87111-7201

Please see attachment listing the Oro Claims Where Work Is Planned

C. Provide information on any Cultural Resource Survey that may have beenperformed on the site. The survey would have been provided to the landowner orland management agency. Please provide the following: author, title, and dateand report number.

New Mexico Mining and Minerals and the BLM conducted surveys in 2011 inconnection with permits issued for most of the same work proposed by thisMinimal Impact Exploration Permit application. NMMM Permit GR062proposed most of the same exploration activities as described in thisapplication, but the proposed work was never done and the permits andbond were released by NMMM and the BLM.

Attachment

_____

D. Provide information on any vegetation or wildlife surveys that may have beenperformed on the site.

New Mexico Mining and Minerals and the BLM conducted surveys inconnection with permits issued in 2011 for the same work proposed by thisMinimal Impact Exploration Permit application. NMMM Permit GR062proposed all of the exploration activities described in this application, butthe proposed work was never done and the permits and bond were releasedby NMMM

3. MAPS AND LOCATION (3O2.D.2)

A. Provide a legal description of the proposed site (i.e. Township(s), Range(s) and

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Section(s) NM PLSS (as well as GPS coordinates corresponding to each

proposed drill hole.

Proposed Permit Area Legal Description:T27S, RI5W, section 30.

Proposed Drill Hole/Exploration Site GPS Coordinate(s):1. List the drill hole/exploration name and the GPS Coordinate for each site.

2. Include datum/coordinate system of GPS coordinates (i.e. decimal degrees,

UTM Zone 13, UTM Zone 12, NAD 27, NAD 1983, WGS 1984, etc.).

SP Project Proposed Drill Sites

Southern Silver; 05/23/2016

Datum 1927 Con US (UTM Zone 12)

Drill Site Easting Northing

Sp-C 744782 3535632

SP-D 745080 3535544

SP-E 744973 3535520

SP-F 744862 3535489

SP.G 744869 3535429

SP-H 744811 3535354

SP-l 744871 3535318

SP-J 744949 3535338

SP-K 744976 3535399

SP-L 745040 3535462

SP-M 744928 3535267

SP-N 744957 3535214

B. Provide a topographic map(s) of at least 1 inch = 2,000 feet or appropriate scale

for the size of disturbance (i.e. a 1:24,000 USGS Quadrangle map). The map

name and at least two edges of the map (i.e. bottom and side edge) clearly

showing all areas of land to be disturbed by the proposed exploration and

reclamation. If the area to be explored contains the following features, show them

on the map(s):

Datum 1983 NAD (UTM Zone 12)

Drill Site Easting Northing

Sp-C 744719 3535828

SP-D 745017 3535740

SP-E 744910 3535716

SP-F 744799 3535685

SP-G 744806 3535625

SP-H 744748 3535550

SP-l 744808 3535514

SP-i 744886 3535534

SP-K 744913 3535595

SP-L 744977 3535658

SP-M 744865 3535463

SP-N 744894 3535410

Trench 744834 3535380

NOTE: The sites have been stakedTrench 744771 3535576

in the field withaluminum tags on 36” wooden stakes. Boundaries of the

sites were flaed in 2012 and will remain the same as

those that were previously approved by NMMM. Overland

travel to these sites will follow the previously approved

paths as indicated on the enclosed map.

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1. Boundary of the proposed permit area on a topographic map, and the area ofproposed disturbance. This boundary should be labeled.

2. Perennial, intermittent and ephemeral streams, springs, wetlands, riparianareas, lakes and reservoirs

3. Residences4. Proposed and existing roads and other access routes5. Pipelines and support facilities6. Cemeteries, burial grounds and cultural resources7. Previously disturbed areas8. Oil, gas, water wells and monitoring wells within the permit area9. Areas and types of proposed disturbances that include the anticipated

dimensions of each proposed disturbance10. Identify the location of drill holes, shafts, pits, adits, trenches, ponds,

stockpiles, wastes dumps etc.

Attachment

C. Provide detailed written driving directions to access the site.The SP Project is located approximately 46 miles southwest of Deming.Travel 32 miles west of Deming on Interstate 10, and then travel south onroute 146 for 19 miles to the town of Hachita. Travel 4.6 miles west on route9 to a gate on the south side of the highway. Pass through the gate on a dirtroad heading south and immediately turn right (west) for 1/2 mile into thedrilling area.

4. EXPLORATION DESCRIPTION (302.D.3 & 4)

A. List the proposed exploration dates:

Start Date: September 15, 2016End Date: September 14, 2017 or 1 year from permit approval_

B. List the mineral or minerals to be explored for:

Minerals containing gold, silver, copper, lead, zinc, molybdenum and otherassociated minerals

C. Check the box beside the box beside the proposed method(s) of exploration.

LI Cuts fl Pits Trenches LI ShaftsLI Tunnels/Adits/DeclinesLI Air drilling LI Fluid drilling LI Drilling & Blasting

Other method (describe): Reverse Circulation Drilling or core drilling by

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circulating air or water

D. List the following approximate proposed disturbance for each:

Drill pads:How Many? 12

_____

Width (ft.): 60 Length (ft.) 80

Drill holes:How Many? 12 Depth (ft.): <500’ Diameter (in.): 6”

Other Types of Excavations or Surface Disturbances:Please describe:

Most of the sites are on relatively flat land and will require only vegetationremoval. Leveling of the sites by mechanical means may be required onsome sites. Sumps to contain drill cuttings and fluids will be approximately30’ X 6’ X 6’ deep. These pits will be within the 60’ x 80’ area of each drillpad and will contain drill cuttings and fluids emitted from the drill hole. Pitswill be sloped to allow emergency escape. When bedrock is near surfaceand pits cannot be dug, dams will be constructed to contain drill cuttings.Fencing and berms will be erected to discourage accidental entry into thesumps. A mesh will cover any pits containing drill fluids.

Access to the drill sites can be accomplished through overland travel withno blade work necessary except for very short entrances from existingroads and across minor dry wash drainages. The total length of crosscountry travel, exclusive of the drill sites that they cross, will beapproximately 3,100 feet.

One short trench approximately 30 feet long, 6 feet wide and 6 feet deep willbe constructed.

Approximately 2.40 acres will be disturbed. Each drill site will be approximately 60’X 80’ and the overland access routes are assumed to be 15’ wide. The area oftrench disturbance, including the waste pile, is assumed to be double the trenchwidth of 6 feet.

The total estimated disturbance is:

Acres of drill sites = (12 X 60’ X 80’143,560) = 1.32 acresAcres of overland travel = 3,100’ X 15’!43,560 = 1.07 acresAcres of trench = 30’ X 12’143,560 = 0.01 acres

Total Acres: (1.32 + 1.07 + 0.01) = 2.40 acres estimated disturbance

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E. Describe the typical equipment to be used for the exploration operations.

(1) A backhoe or small excavator will be utilized to construct mudsumps and the trench. This equipment will also conduct minor levelingof drill sites, access routes and roads and to remove vegetation inorder to provide a safe work area. The backhoe or small excavator willalso make minor road repairs, level short areas across minor dry washdrainages and level short stretches of existing roads. The overallcharacter of the existing roads will not be changed.

(2) Track, buggy, or truck-mounted reverse circulation drill rig, pipetruck, water truck, service trucks and pick-up trucks. A core rig maybe utilized as well.

F. Road(s).

Roads shall be located to minimize disturbance to land and wildlife andenhance stability. Roads shall be constructed and maintained to controlerosion. Roads constructed in or across intermittent or perennial streamsrequire site specific designs. Roads to remain permanent must be approvedby the surface owner and must be stabilized to control erosion.

List for New Road(s) the following:Road description: None____________ Length (ft.)

____

Width (ft.)

_____

List for Extension or Widening of Existing Road(s) the following:No roads will be widened by mechanical means.

G. Describe (location and size) any support facility disturbances (equipment staging,storage and/or lay down areas, vehicle parking, temporary housing and/or trailers)to be created or situated on the site during exploration operations.

Mud and drill equipment will be temporarily stored in a non-vegetated, flatarea approximately 2000 feet south of State Route 9 and adjacent to a maindirt road (see map). Temporary storage may also be done on constructeddrill sites. All equipment and materials will be removed soon after thedrilling project is completed.

TOTAL ACREAGE TO BE DISTURBED: 2.40 acres

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5. CHEMICAL USE (3O2.D.4)

A. List all chemicals, and include Material Safety Data Sheets (MSDS), for anychemicals proposed to be used by the exploration operation, including but notlimited to any drilling mud, polymers, down-hole bit lubricants, lost circulationmaterials (LCM), or any other drilling additives, fuel and lubricants. MaterialSafety Data Sheets (MSDS) describing must be included. If any water is to behauled onsite, please provide source information and intended use.

Name Use

Bentonite and non-toxic polymers (EZ Mud) Drilling fluidsWater (purchased from local ranch) Drilling fluidCement or approved abandonment material Abandon drill hole

B. Describe in detail a plan for the containment, use and disposal of all chemicalslisted above:

All drilling fluids will be contained in sumps constructed on the drill sites.The cuttings will be buried when excess water has evaporated sufficientlyto allow burial and re-contouring consistent with the previous surface.

6. GROUND WATER INFORMATION (3O2.D.5)

A. Provide an estimate of depth to ground water and the total dissolved solids (TDS)

concentration.

Depth to ground water (ft.): unknown___________TDS concentration (mgIL): unknown_____________

B. What is the source of this information?

C. Will dewatering activities be conducted:

LlYes No

If yes, please describe:

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7. RECLAMATION AND OPERATION PLAN (3O2.D.6)

Reclamation of the disturbed area shall be initiated as soon as possible following the

completion or abandonment of the exploration operation, unless the disturbed area is

included within a complete permit application for a new mining operation.

Topsoil or topdressing material removal and stockpiling shall precede any excavation

within the drill site area. All lands, including access roads or terrain damaged in

gaining access to or clearing the site, or lands whose natural state has been

substantially disturbed as a result of the exploration by drilling, shall be restored as

nearly as possible to their original condition. Where vegetation has been removed or

destroyed within the permit area, vegetative cover shall be reestablished by seeding,

planting, transplanting, or by other adequate methods. All open mud pits shall be

constructed in a manner to prevent wildlife entrapment, and shall be constructed to

prevent any overflows. When drilling is completed, the mud pits shall be allowed to

dry and then backfilled with native cover.

A. Describe in general how the operation will be operated to salvage topsoil, best

prevent erosion, protect wildlife, and meet the requirements of reclamation

described above. Include the removal and storage of excavated material and the

construction of roads. Describe how these facilities will be protected from erosion.

If applicable, describe dewatering activities, the location and construction of mud

pits and drill pads and any other activities causing disturbance.

Existing roads will be used for access to the drill sites as much as

possible. Minimal vegetation clearance and leveling will be

necessary within the area of the drill site for safety and fire

prevention. Overland travel will avoid major vegetation as much as

practical.

B. Describe in general how re-contouring, topsoil or topdressing, and re

establishment of vegetation will be conducted. If no revegetation is planned,

provide a justification as to why none is needed.

The drill sites will be re-contoured to their approximate state prior to

disturbance activities.

Topsoil excavated from the sumps and the trench will be stockpiled and

spread over the areas that are dug. This will be done soon after the mud

pits have dried sufficiently to allow re-contouring without shrinkage due

to evaporation and absorption of the wet drill fluids and mud.

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Overland travel will be reseeded. Overland travel routes will be rippedprior to seeding if directed by the BLM or Mines and Minerals asnecessary.

The short stretches of road that are upgraded will remain so unless otherprocedures are recommended by the BLM or Mines and Minerals.

C. Where revegetation is to be conducted, describe the plant species to be used inthe re-establishment of vegetation.

Plant name Seeding Rate (lbs./acre)Seed mixture and seeding rates will be as requested by BLM and specifiedin their Notice approval for these sites, all of which are on BLM land.

D. Proposed Reclamation dates:

Start Date: Recontouring and sump burial will commence by September 10,2017 and be completed by September 15, 2017

End Date: Reseeding will be accomplished by July 15, 2017 if surfacerecontouring is completed by this date. The BLM stipulates that reseedingmust be done between June 15 and July 15. Reseeding may have to becompleted in 2018 if recontouring is not completed by July 15, 2017.

E. If this is a drilling operation each drill hole shall be plugged from total depth towithin 2 feet of the original ground surface or the collar of the hole, whichever islower, with a column of cement, high density bentonite clay or other materialsspecified in the permit. If the approved plugging material is not cement, then thetop ten feet of the column must be a cement plug. The hole shall be backfilledwith topdressing or topsoil from above the cement plug to the original groundsurface. The hole shall be plugged as soon as is practical after drilling iscomplete, but no later than 30 days after completion of drilling; however, if a waterbearing stratum is encountered, the hole shall be plugged as soon as practicableand satisfy the requirements of the Office of the State Engineer and the NewMexico Environment Department for proper plugging of such holes. This pluggingrequirement may be waived if the State Engineer issues a permit for a well for theexploration drill hole. Describe how drill holes will be plugged. What pluggingmethods will be employed where groundwater is encountered versus holes whereno groundwater is encountered? (Plugging methods must comply with 19.27.4NMAC of the State Engineer Office’s plugging and abandonment requirements.)

It is assumed that ground water will be encountered; therefore, NMAC

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19.27.4.30 methods and materials will be utilized: “To plug a well, the entirewell shall be filled from the bottom upwards to land surface using a tremiepipe” or through drill pipe. “The well shall be plugged with neat cementslurry, bentonite based plugging material, or other sealing materialapproved by the state engineer for use in the plugging of non-artesianwells.” The upper portion between a depth of 12’ and 2’ will be filled withcement as a cap if neat cement is not used as plugging material. Theupper 2’ will be filled with dirt.

If drill holes are dry, the appropriate method of plugging as recommendedby the State Engineer will be done.

All drill holes will be properly abandoned immediately upon completion ofeach hole before the drill rig leaves the site.

Bonding will be sufficient to cover I drill hole to a maximum depth of 500feet. When the drill hole is abandoned, the Mining and Minerals Divisionwill be informed of the abandonment so that bonding can be applied to anew drill hole.

F. Describe how the reclamation of portals, drilling mud and/or waste pits, adits,shafts, ponds, roads or other disturbances will be performed.

Sumps will be allowed to dry prior to filling and re-contouring so thatminimal slumpage will occur due to shrinkage of wet mud after burial.

8. PERMIT FEES (302.l.2)

A. Attach the permit fees as determined pursuant to Subpart 2. The application feefor a minimal impact exploration permit is $500.00.Check the method of payment.LI Cash

Check Check Number: 0074 dated May 9, 2016 ($500.00)Financial institution: TD Canada Trust

9. FINANCIAL ASSURANCE (302.l.(5)Financial assurance must be posted with Mining and Minerals Division prior toapproval of this application. The acceptable forms of financial assurance aresurety bonds, letters of credit, or cash accounts described in 19.10.12.1208NMAC. Provide an estimate of, and an instrument for, the proposed financialassurance required by Subpart 12.

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Attachment: Please See Bond Calculation of $22, 760.00

10. CERTIFICATION REQUIREMENT (302.L3 & 4)

Each application shall be signed by the applicant or an authorized agent of the

applicant for the operation with the following certification made.

(Certification does not require notarization):

I certify that I have personally examined and am familiar with the information

submitted herein, and based on my inquiry of those individuals responsible for

obtaining the information; I believe the submitted information is true, accurate,

and complete. I agree to comply with the reclamation requirements set forth in

this permit application and related correspondence, the New Mexico Mining Act

and the Rules. Further, I certify that I am not in violation of any other obligation

under the New Mexico Mining Act or the Rules adopted pursuant to that Act and

I allow the Director to enter the permit area, without delay, for the purposes of

conducting inspections during exploration and reclamation.

Signature of Permittee or Authorized AgentName (typed or print) Elliott M. Crist

TitlelPosition: as Agent and Consulting Geologist for Southern Silver

Date: May 23, 2016

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EXPLORATiON CORP

Oro ProjectGrant Co., NM

Playas Peak 7.5’ Quadrangle

535OOOmN

,1

• 3534;OO&W/

-

- E,fl9n353960

•- Proposed Drill Si

.. Existing Road

Qverland Travel

-as36oOonN

Trench

I

I

a

I_______0 2,000 4,000

Drill Hole Permit Mapfeet

Scale: 1:24,000Projection: UTM Zone 12, NAD27

May 13, 2016

Bond Calculation for Southern Silver Exploration (US) Inc SP Project (May 23,

2016)

1 hole at 500 depth (500’ X 14.00/foot) $7,000.00

First acre of disturbance $8,900.00

1.4 acres additional disturbance @ $4,900/acre $6,860.00

Total Calculated Bond $22,760.00