Meryllion Completes a 43-101 Technical Report on Its Cerro Amarillo Cu-(Mo-Au) Project in Argentina and Proposes a First Stage Drill Program - Seite 2

Geology and Mineralisation

The Cerro Amarillo project area covers part of the northwest margin of the Neuquén Basin which developed as a back-arc rift during late Triassic time and then filled with a transgressive sedimentary sequence during the Jurassic and Cretaceous time. The Neuquén Basin was subsequently intruded by intermediate igneous rocks and covered by associated volcanics during two periods of magmatic activity from the late Miocene to early Pliocene. Large porphyry style mineralisation systems are known to be associated with both magmatic events.

Geology within the project area includes an eastern domain of acid volcanics that represent basement to the Neuquén Basin, a central domain of sediments that represent the lower parts of the Basin fill and a western domain of andesites that represent the Miocene-Pliocene volcanic activity. The sediments and volcanics have shallow westerly dips. Boundaries between the domains may represent unconformable contacts or thrust faults. A suite of dioritic to dacitic porphyry intrusives occurs in several small complexes that intrude all three domains. These intrusives are thought to represent the Pliocene igneous event.

Large scale "porphyry style" hydrothermal alteration and mineralisation systems are associated with four of the five identified intrusive complexes on the property. These systems are: the Cajon Grande, Vaca De Cobre, La Blanca and Cerro Apero prospects. All four prospects contain intrusive hosted stockworks and hydrothermal breccia. Skarn style mineralisation has developed at the Cerro Apero and Cajon Grande prospects where intrusives have intersected carbonate-bearing stratigraphy. Similar skarns may have developed at the La Blanca prospect below the current level of exposure. The mineralised porphyry complexes define a remarkably linear northeast trend that is at a high angle to north trending regional structures. This trend may reflect a crustal level structure that has controlled magma transport for the intrusive complexes. The intersection of such transcurrent structures with orogen-parallel structures is thought to be important in controlling the location of many major porphyry mineralisation systems in plate margin environments.