The Barra do França Gold Project is located in the southeastern part of the State of Piauí, only four kilometres southwest of São João do Piauí nickel laterite deposit, which is held by Vale (RIO:NYSE) formerly known as CVRD or Companhia Vale do Rio Doce. The Project is in an area with reasonable infrastructure and consists of an Exploration License (“EL”) of approximately 893 hectares. Subsequent to the LOI Talon has independently applied for and been granted mineral rights to an additional 7,864 hectares in four Exploration Licenses that cover the eastern and western strike extensions to the mineralized zone in the Project, thereby increasing the Project area to 8,757 hectares.

The Project covers part of the Mesoproterozoic Brejo Seco volcano-sedimentary sequence that is divided into two main domains. Domain I is represented by pelitic and chemical metasedimentary rocks and Domain II comprises basic and acid meta-volcanic rocks. The sequence is intruded by differentiated mafic-ultramafic intrusives. The São do Piauí nickel laterite deposit occurs on a plateau area on one of these intrusives.

The gold mineralization in the Project is developed in an intensely fractured quartzo-felspathic rock, interpreted as an acid volcanic unit, within Domain II. The mineralization is in wide zones of quartz-carbonate and potassic felspar veins, in which the gold mineralisation is associated with pyrite.

Preliminary exploration has delineated an area, through channel sampling and rock grab sampling, of anomalous gold grades in which the host rock dips at 60 degrees to the northeast and strikes northwest over a distance of 1,420 metres. The anomaly is between 80 and 200 metres wide.

Before signing the LOI, a consulting geologist (on behalf of Talon) undertook a systematic channel sampling survey of the main mineralized zone, and returned results of 39 samples, which included the following intersections:

6.59 g/t Au over 10 metres, in YBFC-020

3.21 g/t Au over 10 metres, in YBFC-007

2.04 g/t Au over 11 metres, in YBFC-029

1.25 g/t Au over 5 metres, in YBFC-030

0.96 g/t Au over 10 metres, in YBFC-008

0.90 g/t Au over 10 metres, in YBFC-016

0.81 g/t Au over 10 metres in YBFC-014

In addition to the channel sampling program, 62 grab samples were randomly collected along the mineralized zone, which returned assay results which included the following grades; 19.90, 8.88, 3.16, 2.22, 1.77 and 1.19 g/t Au.

Subsequently Talon has undertaken further exploration to identify the priority targets in the mineralized zone, which has included detailed mapping and an extensive channel sampling program.

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