Serengeti Resources President's Letter to Shareholders by 24hgold

Mots clés associés : Canada | Copper | Dollar | G Mexico |

Thursday, June 30, 2011

President's Letter to Shareholders

Dear fellow shareholders:

It has been sometime since I last wrote to you, so I thought it worthwhile to recap Serengeti's significant achievements over the past year and suggest what these may mean for your Company's future prospects.

At the Company's flagship Kwanika copper-gold property we achieved a number of milestones during the year:

Published the third NI-43-101 compliant resource update for the project in January, 2011. Aggregate mineral resources at Kwanika reporting to an open pit, combining the revised estimates for the Central and South Zones now total 1.23 billion pounds of copper and 1.66 million ounces of gold in the Indicated category (Central Zone) plus 1.25 billion pounds of copper and 0.91 million ounces of gold in the Inferred category (South and Central Zones).

Details of the estimate are provided in the following table:

2011 Kwanika Mineral Resource Estimate
ZONE	Open Pit Resource Category	Tonnes and Grade					Total Contained Metal
ZONE	Open Pit Resource Category	Tonnes (Mt)	Copper (%)	Gold (g/t)	Silver (g/t)	Moly (%)	CuEq (%)	Cu (Mlbs)	Au (Moz)	Ag (Moz)	Mo (Mlbs)
Central	Indicated	243.6	0.23	0.21	0.69	-	0.32	1,233	1.66	5.4	-
Central	Inferred	55.2	0.14	0.14	0.42	-	0.20	168	0.25	0.7	-
South	Inferred	239.9	0.20	0.09	1.49	0.007	0.27	1,081	0.66	11.5	37.6

Resources are reported within a conceptual pit shell with a 45 degree pit slope angle for rock and 30 degrees for overburden and are based on an insitu cut-off of $7.50/ tonne, then adjusted for metallurgical recovery and offsite costs. The dollar value and Copper Equivalent (CuEq) calculations are based on the following metal prices: US $3.50 / lb copper, US $1,200 / oz gold, US $21 / oz silver, US $17 / lb molybdenum with assumed recoveries as follows: Cu 89%, Au 70%, Ag 75%, Mo 60% based partially on preliminary metallurgical test work conducted on a sample from the Central Zone. At the prices used, a US $7.50 insitu cut-off is considered reasonable for a porphyry open pit deposit at this location.

Signed a landmark access agreement with the Takla Lake First Nation for the project in August, 2010, and can report that a positive dialogue continues with the community which is the principal source of our project's employees.
We have identified several exciting new exploration targets at Kwanika that we will be testing in our 2011 summer drill program which has just gotten underway. The first of these is a strong geochemical anomaly that is immediately adjacent to the Central Zone copper-gold resource and the second is a recently identified, deep IP geophysical response that is similar in size and magnitude to that associated with the Central Zone. Drilling success on either one of these targets has the potential to vault the project over the economic development threshold. A property-wide exploration program is also underway to identify further discovery opportunities.

On the balance of our extensive BC property portfolio, some 30 properties totaling over 125,000 hectares, we continue to take steps to enhance prospects for further discovery while carefully managing our financial resources:

The Company entered into an option agreement with Freeport-McMoRan of Canada Limited, a wholly-owned, indirect subsidiary of Freeport-McMoRan Copper & Gold Inc., whereby Freeport has the right to earn a 51% interest in Serengeti's Choo and Tchentlo properties, by making certain cash payments and incurring US$5 million in exploration expenditures over four years and an aggregate 70% interest in the properties by fully funding and completing a feasibility study. The agreement is subject to satisfactory environmental and title due diligence on the property and is expected to be completed shortly by Freeport.
In north-western BC, new copper-gold targets have been acquired and will be the subject of early stage exploration this summer.

In Mexico, Serengeti continues to advance a significant opportunity for the Company to provide future growth and diversification:

Serengeti's wholly owned subsidiary Minera F.B. Integral, SA. de CV. now controls over 70,000 hectares in seven prospective silver-gold properties located in Chihuahua and Durango States of Northern Mexico. One of these properties is located adjacent to a newly emerging district where a plus 250 million ounce silver resource has been outlined.
A 3000 line-kilometre airborne magnetic and radiometric survey has recently been completed on five of these properties and results will be incorporated with other data for follow-up ground targeting and potentially drilling later in the year.

On the corporate front, the Company has:

Established a $3.3 million budget for 2011 to aggressively pursue opportunities in BC and Mexico.
Recently completed a $1.3 million flow-through share financing to replace our planned 2011 BC exploration expenditures.
Strengthened our Board of Directors.
Brought in a new public relations/investor relations group with a strong market presence.

In summary, we have made significant progress during the year. In spite of this, our share price performance has not reflected these achievements. As significant shareholders ourselves, the management team and the Board of Directors are both motivated and committed to remain dedicated to see the Company's value more accurately reflected by the market.

Thank you for your ongoing support. Please visit our website at www.serengetiresources.com, and as always we welcome your calls and emails.

Yours truly,

David W. Moore
President & CEO

This document contains "forward-looking statements" within the meaning of applicable Canadian securities regulations. All statements other than statements of historical fact herein, including, without limitation, statements regarding exploration plans and other future plans and objectives, are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate and future events and actual results could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from our expectations are disclosed in the Company's documents filed from time to time via SEDAR with the Canadian regulatory agencies to whose policies we are bound. Readers are advised not to place undue reliance on forward-looking statements.

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