Contingency cash sources

The two requirements for Century to access the first $5M within the escrow account:

1) new crusher installed and operating to DB`s satisfaction

2) 16,800 tonnes of processed ore over a 14 day period (works out to 1,200 tpd)


With 200 tpd average realized in March, we probably had stockpiled around 6,000 tonnes of ore coming into April. Century`s mining target for April is 200 - 300 tpd. Let`s assume they averaged 275 tpd over the first 24 days of April (including today - Saturday).

275 tonnes * 24 days = 6,600 for 24 days in April

6,000 March + 6,600 = 12,600 tonnes of stockpiled ore

Century`s target for ore mining in May is 500 - 800 tpd.

Let`s be conservative. Let`s assume that Century only mines 300 tpd for the next 14 days.

At 300 tpd new ore mined, Century has potentially reached the point where it could pull 900 tpd from the stockpiled ore total in order to process 1,200 tpd over the next 14 days.

As a result, (assuming crusher installation and ore mining have both progressed well) the option of accessing the first $5M from escrow may be available in the near-future.

Assuming 95% gold recovery and 4.76 g/t grade, the 16,800 tonnes of ore could eventually be converted to 1,832 ounces. At the current gold price, this is worth $2.1M in gross revenue.

There is potentially also the 2,015 in unfinished gold inventory at Lamaque that can be finished off once the milling circuit is up and running again. At the current gold price, this is worth $2.3M in gross revenue.

Potential cash injection at Lamaque in the near-term:

$2.1M + $2.3M + $5.0M = $9.4M

Of course some of this money will need to go towards carrying our 115 employees at Lamaque (which probably cost around $575K per month) and also covering all of the other costs to operate Lamaque. We also have to cover our Corporate G&A costs. The non-employee mine development costs (and other such start up/ramp up costs) should already be funded from the orginal financing (non-escrow amount).

Some of this newly available cash can go towards our new Lamaque exploration program being launched in May.

Assuming all is progressing well, the numbers are suggesting that we should still be well funded. As a further contingency, we are generating positive cash flow out of San Juan, if a bit of emergency cash was needed to be redirected temporarily to Lamaque. As even a further contingency, we have the $15M worth of warrants from Finskiy. Those warrants are well in the money ($.30 exercise price versus current share price of $.72).