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SHAREHOLDER UPDATE
August 9, 2006
Dear Shareholders:
The Lobo Solitario project is located on the northeast edge of Alto de Lipangue approximately 8 kilometers west of the small town of Lampa, Chile at the edge of a 2,000-meter high plateau.
During the spring of 2006, a team of geologists employed by Cerro conducted an examination of the original Lobo claim group and newly acquired surrounding claims which more than doubles Cerro’s original land holdings. During this period, road construction and trenching carried out by a neighbour, granted access to areas not previously explored. A new regional exploration model was prepared when all the source of data were compiled.
The results of the recently completed work have indicated that an area of the southern part of the claims is an excellent target for further exploration work. Mapping has shown this area to be covered with a large number of quartz and molybdenum structures. Local sampling of this quartz has shown it to contain up to 6-to10 g/t gold.
The IP/Resistivity survey over this area has shown a strong, widespread zone of high resistivity (interpreted as silicification) and a co incident high polarization (interpreted as the presence of sulphides). This area constitutes an impressive target zone given the presence of strong gold and base metal mineralization at the Fortuna Mine and Gordon Breccia. The new Cerro Dorado, Inc. Breccia to the north and the Lipangue Breccia, the Dos Marias Property, and the past producing molybdenum properties (acquired in late 2005 by Medinah) requires more detailed geophysics surveys included in the new budget.
The results of the CSAMT survey, however, have located discrete zones of apparent resistivity that are interpreted as being zones of silicification, possibly gold mineralized. These represent secondary targets of possible high-grade gold mineralization, some of which will be tested as part of the program to investigate the area to the south covered by the IP/Resistivity grid.
Cerro Dorado, Inc. will survey, detail map and sample the new Breccia to establish strike, dip and plunge of the structure in order to place future drill holes for reserve calculations. Significant values were obtained from the new zones approaching 3% copper with molly and gold values.
The Board of Directors of Cerro Dorado has had written communications from Juan Jose Quijano as of July 14, 2006. The letter established that negotiations with several major mining companies in Chile are progressing in a positive manner. Meetings are still ongoing as of this date, with a goal of concluding a working joint venture.
Note: This News Release may contain certain "forward-looking statements" within the meaning of the United States Securities Exchange act of 1934, as amended. All statements, other than statements of historical fact, included in this release, including, without limitation, statements regarding potential mineralization and reserves, exploration results, and future plans and objectives of Cerro Dorado, Inc., are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate, and actual results and future could differ materially form those anticipated in such statements. Important fators that could cause actual results to differ materially from the Company's expectation are disclosed under the heading "Risk Factors" and elsewhere in documents filed from time to time with the United States Securities and Exchange Commission and other regulatory authorities.
Return to News
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