EXPLORATION

GEOLOGY OVERVIEW

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The geology of Uruguay consists of a Proterozoic basement covered by younger sediments and flood basalts. Over 40% of Uruguay's surface area is an extension of the Brazilian Shield. The basement is divided into two cratonic areas, namely the Piedra Alta and Nico Perez terranes. Rocks of Proterozoic age are present in the Piedra Alta Terrane, and Archaean ages have been determined for some Nico Perez Terrane lithologies. These basement rocks are mapped up to 100 kilometres inland along the southern and southeastern portions of the country, although they are obscured by Cenozoic sands along much of the coastline. To the north and west, the outcrop is dominated by Mesozoic volcanics, and Palaeozoic sediments outcrop in the northeast of the country, near the border with Brazil.

A brief description of the prospective regions is given below.

Isla Cristalina Belt: This belt is located 450 kilometres from Montevideo in northern Uruguay and it hosts the Company's operating San Gregorio gold mine at Minas de Corrales. It is an erosional window of crystalline Proterozoic basement rocks, approximately 110 kilometres in length and 40 kilometres in width. The belt is composed of granites and greenstones which range in metamorphic grade from greenschist to amphibolite facies. Anomalous gold mineralization exists along the entire strike length of the belt. UME has near mine, advanced, and regional gold exploration in this belt, as well as one early stage nickel project.  

Dom Feliciano Fold and Thrust Belt: The fold and thrust belt occupies the western third of the Dom Feliciano belt in Uruguay. The southern end of the north-northeast trending Dom Feliciano Belt is located 95 kilometres east of Montevideo. The fold and thrust belt is exposed for over 250 kilometres along strike, and for 40 - 50 kilometres, in an east-west direction. It comprises structurally deformed Proterozoic meta-sediments, greenstones and granitoids which are bound on the east and west by two major north-northeast trending shear zones. Limited historical precious and base metal production has been reported from this terrane. UME's gold projects in the belt include Presidente Terra and the Isla Patrulla District. The Company's base metal properties are also located in this belt.

Laguna Merin Basin: The Laguna Merin Basin is located along the eastern coast of Uruguay. This basin is Cretaceous in age, and lies on top of basement rocks of the Dom Feliciano Belt. It is filled with clastic material and volcanic rocks which are associated with continental break-up, and the opening of the South Atlantic Ocean. The Lascano copper-gold project is located in the Laguna Merin Basin.  

La Florida and Arroyo Grande Belts: The La Florida and Arroyo Grande Belts which are comprised of Proterozoic meta-volcanic and meta-sedimentary rocks interspersed through a granitic terrain, occupy the southwestern third of the country (part of the Piedra Alta Terrane). These rocks are exposed for 240 kilometres from the western side of the Dom Feliciano Belt to almost the western border of Uruguay, and up to 175 kilometres north of Montevideo, where they are covered by younger Paleozoic and Mesozoic sediments and flood basalts. UME's gold projects include Casupa-Crucera, Chamizo, Paso de Lugo, and Nueva Helvecia. These projects are hosted in granitic rocks and greenstone lithologies. The Company also has two early stage nickel projects in the La Florida Belt.

Rio de la Plata Craton: The Rivera diamond project is located on the Rio de la Plata Craton in the departments of Rivera and Tacuarembo in northern Uruguay, approximately 500 kilometres from Montevideo.