Southern Arc Minerals

Southern Arc Minerals is a Canadian mineral exploration company with an aggressive exploration, acquisition and growth strategy.  The Company’s portfolio includes four exploration projects with epithermal gold and gold-copper porphyry prospects on the Lombok and Sumbawa islands in Indonesia, three of which are being advanced in partnership with major mining companies Vale and Newcrest.  Southern Arc is listed on the TSX Venture Exchange under the symbol “SA” and on the OTCQX under the symbol “SOACF”.

Southern Arc’s exploration focus is on the mineral-rich Sunda-Banda magmatic arc (see Magmatic Arc Map).  Spanning the islands of Sumatra, Java, Bali, Lombok, Sumbawa, Flores and Wetar, this feature hosts several “elephant-sized” porphyry copper-gold deposits, such as the Batu Hijau Mine and the Grasberg Mine which are currently being mined. Island arc terrains along the Pacific Rim are host to some of the world’s most significant copper-gold porphyry-related deposits and epithermal gold deposits. The company believes the Sunda-Banda arc remains relatively unexplored and may host more world-class mineral deposits.

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Thus far, Southern Arc has concentrated on acquiring and exploring areas in which there has been some exploration carried out previously. Southern Arc has also focused its activities in areas with established infrastructure. Although parts of Indonesia are infrastructure challenged, Southern Arc’s main projects are largely road accessible and within what can be described as low to only moderately challenging exploration environments.

Southern Arc’s key exploration property is its West Lombok project, with several gold-rich copper porphyry and epithermal gold vein prospects. The West Lombok property comprises a 13km long by 7km wide structural corridor of hydrothermal mineralization and alteration on Indonesia’s Lombok Island. Previous exploration by Newmont Mining established the presence of epithermal and porphyry mineralization on a district scale with three large prospects: the Pelangan epithermal gold prospect, the Mencanggah epithermal/porphyry copper-gold district, and the Selodong intrusive copper-gold complex. Southern Arc has completed phase 1 exploration at both Pelangan and Selodong, and in 2011 has completed approximately 7,000 meters of phase 2 drilling at Pelangan and 6,000 meters of phase 1 drilling at Mencanggah. Southern Arc is exploring the property with the objective of completing NI 43-101 compliant resource estimates for both Mencanggah and Pelangan.

Southern Arc and Vale S.A. are exploring the Sabalong and East Elang Projects under an option and joint venture agreement whereby Vale can earn a 75% interest (Southern Arc retaining 25%) by funding all project expenditures through to completion of a bankable feasibility study. Southern Arc is the operator at both projects. The Sabalong property is located 30km NNE of Newmont’s Elang deposit and 75km NE of Newmont’s Batu Hijau copper-gold mine. Ground geophysical and magnetic surveys and IP surveys have identified two high-sulphidation epithermal systems possibly related to near-surface porphyry copper mineralization. Phase 1 drilling commenced at Sabalong in October with a series of deep drill holes to establish the presence of a mineralized porphyry system. The East Elang property is located adjacent to Newmont’s Elang copper-gold deposit (25 Moz gold, 16 Blb copper). Southern Arc expects to initiate surface exploration on the property in 2012.

Southern Arc and Newcrest Mining have reached a heads of agreement to explore the Taliwang Project whereby Newcrest can earn a 63.75% interest (21.25% Southern Arc, 10% Indonesian Regency Government, 5% PT Puri Permata Mega) by funding project expenditures through to a maximum of US$50 million or completion of a bankable feasibility study. Southern Arc is the operator of the Taliwang Project. Located adjacent to Newmont’s world-class Batu Hijau copper-gold mine, the Taliwang property covers 31,200 hectares prospective for gold, silver and copper mineralization. Surface exploration activities during 2011 have focused on detailed lithological and alteration mapping of epithermal and porphyry prospect areas, as well as clay spectral analysis studies. Phase 2 drilling is planned for 2012.