Dear Shareholder,

Firstly, I would like to thank you for your support and your continued interest in our company..

In Portugal we acted upon a new and exciting opportunity where we initially acquired two high profile exploration licenses in the Valongo Gold & Antimony belt.  We have commenced work on those licenses and managed to compile all the available historic and recent data in to our exploration database.  On July 23 we received three additional licenses of which two are contiguous to our existing Lagares and Balazar License.  With those additional licenses we control approximately 300 square kilometers of the core area that makes up the Valongo Gold and Antimony belt and are positioned to look for a partner suitable to develop those properties with Klondike Gold.

In general, I am pleased to report that the company remains on course with consolidating ownership of its core properties.

While the takeover of Klondike Star Mineral Corporation is awaiting regulatory approval from the SEC in the United States, we were able to make advancements at the Indian River placer project in Yukon thanks to a joint-venture agreement. Activation of the placer mine is now complete and operations will continue for the balance of the 2013 mining season.

The current capital markets for mineral resource exploration continues to provide challenges for our industry.  I feel that we can continue to deliver value to our shareholders and are well positioned to weather the storm. Going forward our strategy is to be moving ahead at a steady pace, and to concentrate on obtaining the right type of funding to advance our projects and to add value to your investment.  

Until recently we maintained one of the steadiest  market caps in our industry and I am concerned , as you likely are, why our shares have systematically been traded down while at the same time we are adding value to our company.  In spite of market negativity we remain focused on making best efforts for this to be an opportunity to average down rather than a long-term negative trend.

Should you have any questions, we will be happy to answer them.

Erich Rauguth

President and CEO