Overview

StoneShield has signed an option to acquire up to a 100% interest in the El Mercado gold property (“El Mercado”) located 8km north of the 8.9 million oz gold & 59.6 million oz silver Angostura project owned by Greystar Resources Ltd. (GSL-TSX), and the 3.5 million oz gold & 19.2 million oz silver La Bodega gold project owned by Ventana Gold Corp. in the Santander department of Colombia. See project location map here: http://www.stoneshieldcapital.com/projects/el-mercado-project/photo-gallery.php

El Mercado is a mining concession contract that totals 1,943 hectares. One of the five gold-bearing regional fault zones which control all known gold deposits in the district crosses the El Mercado property. Preliminary rock samples at El Mercado returned assay gold values up to 4.5g/t Au and 35g/t Ag.  Artisanal gold workings are present on the property with shallow adits having exposed mineralized veins. Limited, initial stream sediment samples have returned up to 60ppb Au and 170ppb Ag.

El Mercado Exploration Plans

StoneShield is excited by the prospects at El Mercado and by the proximity to two of the largest gold discoveries in Colombia during the past five years. The Company is now planning exploration to include geologic mapping, geochemistry and geophysics to delineate specific drill targets.

El Mercado Property

El Mercado is located in the mountains of the eastern Cordillera of South America, approximately 400 km north-northeast of Santa Fé de Bogotá and is 55 km from Bucaramanga, the capital city of Santander department. Bucaramanga is serviced by frequent daily jet and turbo-prop flights from Bogotá. The villages of California, Vetas, and Surata are all within approximately 10 km of the Project, which is serviced by local hydroelectric power.

Host rocks within the property consist of Jurassic to Cretaceous, coarse- to fine-grained, calcareous fluvial sediments and lesser early Paleozoic metavolcanics. Intrusive rocks similar to those at the La Bodega and Angostura deposits outcrop 1 kilometer to the west of the property.  These intrusive rocks may be present in the subsurface of the property and may be the source of mineralization within and surrounding the project.  Very little exploration has been completed on the El Mercado property. Mineralization is yet to be properly outlined, but appears to consist of quartz veining within a sericitic-argillic alteration envelope, both containing disseminated sulfides. El Mercado is situated between 2100 metres and 3650 metres above sea level with over 75% of the property below the 3200 metre level.

StoneShield's Geldenhoof gold project lies four kilometres to the east and on strike from Richfield Venture's Blackwater gold discovery in central British Columbia. The current resource at Blackwater is 4.2 million oz. of gold (1.83 mil. oz. indicated, 2.34 mil. oz. inferred) based on the company's most recent NI 43-101-compliant resource estimate reported in April, 2011. The discovery is a bulk-tonnage, open-pittable gold resource. Richfield recently accepted a $550 million buyout offer for the Blackwater gold discovery from New Gold Inc.

New extensions to the resource are on the far eastern side of Blackwater, trending toward Geldenhoof. Blackwater was discovered by geochemical sampling in an area of minimal outcrop exposure and thick glacial till cover. The mineralization is closely associated with geophysical anomalies, IP chargeability highs, resistivity highs and magnetic highs, due to intrusive rock sources of gold beneath the deposit and silicification/disseminated sulfides within the deposit.

Geldenhoof consists of 2,613 hectares with good road access from the town of Vanderhoof. Geophysical anomalies at Geldenhoof in the northern portion of the property indicate the presence of a strong magnetic high, similar in size to the geophysical anomalies at Blackwater.

StoneShield has entered into a service contract with Terracad Geoscience Services Ltd. to conduct Phase One exploration at Geldenhoof. Terracad has instructed a prospector and two geologists to conduct a thorough survey and geological mapping at Geldenhoof. A second Terracad crew will also grid and procure approximately 530+ geochemical soil samples from Geldenhoof’s magnetically anomalous regions and surrounding areas. The crew will also collect 40+ stream sediment samples to test for anomalous gold and other metals throughout the entire property. Terracad has also initiated the permitting process for both geophysical IP surveys and a future drill programs to test for gold mineralization at depth.

The Risby Project, located within the MacKenzie Mountains some 80km east of the MacMillan Pass in the Yukon Territories, is comprised of 93 claims totaling approximately 89,040 acres (360 km²). The southern claim blocks are located at the northern boundary of the Redstone copper/silver deposit owned by Western Copper Corporation (WRN-TSX), host to an inferred resource of 33.6 Mt of 3.92% Cu & 9.0g/t Ag (43-101 compliant; contained metals of 2.94 billion pounds Cu, 9.8 million ounces Ag). The Redstone deposit is estimated to be continuous over a surface area of 3.6km in length, 2.4km in width with an average thickness of 0.8 metres. The Redstone deposit is a laterally persistent, stratabound, blanket-like deposit, very similar to other sediment-hosted copper deposits, such as the Kupferschiefer in Poland and the copper belts of Zambia and the Congo.  Sediment-hosted deposits are among the largest in the world and contain approximately 25% of the world’s copper resources.  Many of the copper occurrences on the Risby Project have similar stratabound geologic characteristics to the Redstone deposit and these deposits.

The separate property blocks are divided into two main groups based on two main explorations targets: those of sediment-hosted copper affinity, termed the Proterozoic Copper/Silver properties; and those of Mississippi-Valley type affinity, termed the Paleozoic Lead-Zinc properties.

The Copper/Silver Properties

The primary exploration target consists of sediment-hosted copper occurrences within Proterozoic sediments that are scattered over the 300km long Redstone Copper Belt. The property includes claims within two of six structural embayments that host copper mineralization.  Copper mineralization is typically hosted near the contact between an oxidized clastic sediment footwall and a reduced carbonate sediment hangingwall, which is typical for these deposits.

Numerous sedimentary copper occurrences have been discovered on two separate claim blocks. The Keele block is the largest of the claim blocks and contains five main copper showings and four other untested occurrences.  The June showing was drill tested in the mid-1970s by Shell Canada Ltd. and returned drill results including 52m of 2.3% Cu. Drilling at the Jay showing returned drill results including 12m of 2.7% in one Shell drill hole.  Both areas require additional drilling to determine the extent of the mineralization. Drilling by Phelps Dodge at the Ann showing resulted in 3.5m of 1% Cu and 1.6m of 1.2% Cu in two separate holes.  This zone is considered to be open in all directions.  All three of these showings (June, Jay and Ann) are hosted within the transitional stratigraphy between the underlying redbeds and overlying carbonates (typical for redbed copper deposits) and the same stratigraphic horizon as the Redstone deposit.

The Nite and Hammer/Pat Creek showings are hosted within carbonates that are stratigraphically higher than the June, Jay and Ann and contain copper mineralization that is structurally complex.   Assays from surface exposures range from 13.7m of 1% Cu in a trench to an average sample value of 1-1.2% Cu over 400m of surface strike length. Three holes drilled by Phelps Dodge in 2007 each penetrated 1m to 2m thick mineralized intervals grading from 1% to 2% Cu.

The Lead/Zinc Properties

The Mississippi Valley style lead-zinc mineralization is hosted in structural and hydrothermal dissolution features in Devonian carbonates and occurs in numerous locations within three separate claim blocks (KAP, Boom, AdyJo).  The KAP area contains drill intercepts by Cominco Ltd. of 9.5m of 25% Zn and 13.5m of 16% Zn.  Gravity survey anomalies have been only partially tested by drilling. Nine high-grade zinc samples contained an average of 0.019% gallium and 0.077% germanium, both rare metals in high demand.