P.O. Box 643
47 Cox Gulch Road
Thompson Falls, MT 59873

OTCB: uamy.ob

Phone: 406-827-3523
Fax: 406-827-3543
Email: tfl3543@blackfoot.net

MEXICO OPERATIONS
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ANTIMONY SMELTER,
ESTACION MADERO, COAHUILA, MEXICO

USAC through its wholly owned subsidiary, USAMSA, owns and operates a smelting facility at Estacion Madero in the Municipio of Parras de la Fuente, Coahuila, Mexico.  It is approximately midway between Torreon and Saltillo (see map).

The property includes 13.48 hectares and it is convenient to a major rail line and highways for access to the Pacific Ocean through Manzanillo and to the Gulf of Mexico through Alltamira, and to United States. Three furnaces are operating and a fourth furnace is being permitted.

The plant will have a feed capacity of more than 250 mtpm. On a monthly basis, the crude oxide would contain more than 300,000 pounds of antimony metal content. Currently, crude antimony oxide is being produced, but the plant has the ability of making metal. Concentrates and hand sorted rock from Newfoundland, Peru, Honduras, Mexico, and other areas is being processed. The crude oxide is shipped to the Montana plant to produce finished oxide.

Antimony smelter at Estacion Madero between Torreon and Saltillo

LOS JAUREZ ANTIMONY AND SILVER DEPOSIT, QUERETARO, MEXICO

            USAC holds three concessions that are collectively called the "Los Juarez" property in Coahuila as follows:

1. San Miguel I and II are being purchased by a USAC subsidiary named Antimonio de Mexico, S.A. de C. V ("AM"). The concession consists of 40 hectares.

2. San Juan I and II are concessions owned by AM and include 466 hectares.

3. San Juan III is held by a lease Agreement by AM in which the Company will pay a 10% royalty based on the net smelter returns from another USAC Mexican subsidiary named United States Antimony Mexico, S. A. de C. V. ("USAMSA"). It consists of 214 hectares.

The concessions are contiguous and collectively constitute 720 hectares.
 

Part of the USAC Mexican property including San Miguel I and II and part of San Juan III was originally drilled by Penoles in 1970 when antimony metal prices were high. They did not proceed with the property due to the complex metallurgy of antimony.

Subsequently, the Mexican Government did additional work and reported a reserve of 1,000,000 metric tons (mt) grading 1.8% antimony and 8.1 ounces of silver per mt in Consejo de Recursos Minerales (Publicato M-4e). However, the Securities and Exchange Commission does not recognize this report and the Company (USAC) claims no reserves.

The mineralized zone is a classic manto-type deposit in limestone that has a length of more than 4,500 meters with a potential width of 250 meters, and a thickness of up to 8 meters.  The mineralization is typically very fine-grained stibnite with silver and minor gold that affords it recoverable by flotation methods unlike many Mexican deposits.

The mining for many years will be by open pit methods, but eventually it will be by underground methods. At the present time, mineralized rock is being hand-sorted for the flotation mill.

SOYATAL MINING DISTRICT, PINAL DE AMOLES, QUERETARO, MEXICO

USAC through USAMSA also holds a Supply Agreement with Pinar de Amores S. A. de C. V. on 4 concessions in the Soyatal Mining District in the State of Queretaro totaling 283 hectares. The concessions are the "Chihuahua" and three "Fox-1's". Reportedly, the Soyatal District was the third largest producer of antimony in Mexico. U.S. Geological Survey Bulletin 960-B, 1948, Donald E. White, Antimony Deposits of Soyatal District state of Queretaro, Mexico records the production from 1905-1943 at 25,000 tons of antimony metal content. This mining was performed primarily by all hand labor and, recoveries were less than 40%.

White remarks p. 84 and 85: “In the Soyatal Mines, as in practically all antimony mines, it is difficult to estimate the reserves, for the following reasons. (1) The individual deposits are so extremely irregular in size, shape, and grade that the amount of ore in any one of them is unknown until the ore has been mined. (2) As only the relatively high grade shipping ore is recovered, the ore bodies are not systematically sampled and assayed …The total reserves are thus unknown and cannot be estimated accurately, but they probably would suffice to maintain a moderate degree of activity in the district for at least 10 years. The mines may even contain enough ore to equal the total past production.”

USAMSA does not claim any reserves at Soyatal. However, hand sorted rock is being mined and purchased by the USAMSA smelter according to a schedule for direct shipping ore.

USAMSA FLOTATION MILL, GUANAJUATO, MEXICO

A flotation mill was completed at San Antonio de la Cal in the Municipio of Toliman. All of the permits to construct and operate the plant were obtained. The Governor of the State of Queretaro then said that he would not allow the plant to operate due to the designation of a nearby area as a UNESCO World Heritage site. The plant has a capacity of 150 metric tons per day.

USAC is moving the mill to the neighboring State of Guanajuato. The plant will be used for the processing of rock from Los Juarez, Soyatal, and other properties.