The Chépica property consists of a group of five adjoining exploitation (mining) concessions totaling 1,390 hectares, a producing gold-silver-copper mine, an associated sulfide flotation plant and related infrastructure. Polar Star holds an option to purchase agreement whereby it can purchase 100 % of the Chépica property and associated mining and processing assets. Polar Star’s wholly owned Corinto, Batuco, Botalcura and Molinos mineral exploration concessions, the “Talca Project”, covering an area of 31,710 hectares totally surround the Chépica property.

The Chépica Property is located 270 kilometres south of Santiago and 20 km west of the city of Talca, in the Pencahue District, Region VII, Chile.

Within the Chépica property, the Company has discovered to date seven gold-silver-copper enriched epithermal vein systems with cumulative strike length of over 7 kilometers of which only about 10% has been drilled.

The Company believes the Chépica Property has much greater resource potential than has been defined to date. The Chépica property contains seven known gold-silver-copper enriched epithermal vein systems with cumulative strike length of over 7 kilometers of which only about 10% has been drilled.

Based on the limited exploration to date, the Company believes that the Chépica property alone could host >1 million tonnes of mineralization grading +3g/t Au (>130,000 ozs) plus 0.75% Cu (>22-44 million pounds) in the four vein systems drilled to date.

Current Resources

In November 2011 SRK’s Santiago Office completed a resource estimate based on the 2008, 2009 and 2010 diamond drill results from the Foot Wall vein in the Chépica No.1 vein system.

Chépica Project Gold Mineral Resource Statement on Vein No.1, as of November 11, 2011

									Contained Metal
Resource		Tonnage		Gold		Silver		Copper		Gold	Silver	Copper
Classification*		(ktonne)		(g/t)		(g/t)		(%)		ozs	ozs	lbs
Measured		198.2		3.43		12.06		0.75		21,857	76,850	327,717
Indicated		85.0		2.33		11.61		0.72		6,360	31,691	134,764
Demonstrated		283.0		3.10		11.92		0.74		28,217	108,540	462,481
Inferred		30.0		1.92		14.90		0.66		1,858	14,419	43,797

^{*Source: SRK NI 43-101 Technical Report, November 2011, using a cut-off of 1.0 g/t Au}

Regional Resource Potential

The Talca Corinto, Batuco, Botalcura and Molinos mineral exploration concessions are at an early stage of exploration but contain similar mineralized veins systems to those known from the Chépica property and have the potential to host significant additional resources. Prior exploration on the Talca properties by other companies identified 15 sub-volcanic intrusive many of which contain gold bearing veins and alteration zones from which surface values ranging from 2-14 g/t Au were obtained.

Polar Star’s surface exploration programs to date have outlined six 1 – 2 km2 areas of multiple, 0.5-25 metres wide, massive and banded quartz-sulfide veins on its wholly owned claims. Continuous chip samples across individual veins from these areas assay from 0.5 g/t Au over 5 metres width to 3.5 g/t Au over 3.2 metres of width.

During 2012 the Company intends to test the 3.4 kilometers of mapped vein systems in close proximity to the Chépica mine. The Chépica mill and mine have been refurbished. Production is on ramping up towards full production during the fourth quarter of 2011.

The Chépica property, is located 220 kilometres southwest of Santiago, in Maule Region VII, and is readily accessible by paved road from the city of Talca 25 kilometres to the east.

The Chépica property lies within the Continental Mediterranean climate zone, with a dry season of eight months. Average annual rainfall is 749 millimetres and the annual temperature averages 13°C.

The Chépica property, a former producing mine, flotation plant and surface facilities lies 2 km west of the village of Pencahue on the west side of the paved road to Curepto and the coast. It is accessible by paved and gravel road.

The Chépica property consists of an adjoining group of five exploitation (mining) concessions totaling 1,390 hectares and associated sulfide flotation plant and related infrastructure.

The property includes surface rights to about 40 hectares.

The property has been in the hands of the current owners Gian Carlo Bordoni Magni and family since 1999 and with whom Polar Star has an option to purchase agreement.

Polar Star Mining Corp. through its wholly owned Chilean subsidiary, Minera Polar Mining Chile Limitada, currently owns 15% of the Chépica mining property, mill and associated assets and holds an Option to Purchase Agreement whereby it acquire the remaining 85 %.

The full cost of this option is US $7 million to be paid over 26 installments terminating in 2016. Polar Star may, at its sole discretion, terminate the agreement at any time with no obligation to continue paying installments.

The Corinto, Batuco Botalcura and Molinos mineral concessions are wholly owned by Polar Star's 100% held subsidiary, Minera Polar Mining Chile Limitada.

The rehabilitation of the mine has concentrated on establishing on-vein production drives. A new portal access, North Portal, was mined to gain access to the high-grade ore gold shoot identified by the surface drilling. Ore for the plant during commissioning came from the north and south production drives Chépica No. I vein system. By the end of November 2011 the drive from the South Portal, on the 125-meter level, was mined to the northern limit of the property. A vertical ventilation chimney is planned to connect the drive with the North Portal and provide through ventilation.

The North Portal crosscut intersected the Chépica No 1 vein at the end of October 2011. The drive is ramping down at 12 degrees on the vein to establish the 100-meter level.

With the completion of the development, stoping along the 125-meter level commenced during the last week of November 2011.

Ore reporting to the plant during December will be a combination of development ore and production from planned stopes along the 125-meter level.

The existing plant and infrastructure have been fully refurbished. Improvements made to the circuit during the rebuild will allow expansion of the operation during 2012.

The current plant consists of a fully permitted 5,000 tonne/month crushing system, a ball mill, gravity gold concentrator, flotation circuit, thickening & filtration and a tailings disposal facility. The services to the mine, offices, laboratory and plant are supplied by an onsite water well and government grid power supply.

The concentrator plant is designed to produce a gold doré and a gold/copper concentrate using standard processes for metal recovery from sulphide rich ore. The plant is centrally located between the North and South Portals on the Chépica No. I vein system.

The mine and plant are designed to be operated twelve months of the year.

Fully permitted underground mine, flotation plant, tailings pond and waste disposal area; all mining and environmental permits have been maintained in good standing and the site has been regularly reviewed and approved by the local branches of the Chilean mines and environmental protection bodies SERNAGEOMIN and CONAMA.

The Chépica and Talca properties lie within the Chilean Coastal Range which is geologically comprised of Mesozoic age volcanic arc rocks accreted on to the South American craton. The western margin of the Coastal Range is mostly Triassic to early Cretaceous in age and not known to be well mineralized. The eastern margin of the Coastal Range is an assemblage of Late Cretaceous age rocks and these contain a host of mineral occurrences, most associated with sub-volcanic porphyry bodies. The Chépica and Talca properties cover a NE-SW trending roof pendent of Cretaceous volcanics, sub-volcanic porphyry bodies and sediments within Cretaceous granodiorites of the southern Chilean Coastal Gold Belt.

Several gold deposits, either currently being mined or previously mined, exist in this belt. The majority are vein systems or pipes related to high level plutonic bodies. El Chivato, Las Palmas and Yamana’s La Florida (Alhué) Mine (4.2 million tonnes grading 5.55 g/t Au and 41 g/t Ag Source: Mineria Chilena, June 2009) 100 km to the north, are examples. Also known are deposits associated with porphyry intrusives.

The Chépica property covers a NE-SW trending roof pendent of Cretaceous volcanics, subvolcanic porphyry bodies and sediments within Cretaceous granodiorite.

Two sets of NE-NNE and NW-WNE trending faults crosscut the roof pendent and are locally the focus of clay-sericite-quartz alteration.

Extensive gold-silver and gold-silver-copper mineralization in the form of epithermal to upper mesothermal veins, pipes and disseminations occur throughout this roof pendent and are generally associated with the altered fault zones. Wall rock between these veins is either brecciated, silicified and sericitised or permiated by a stockwork of smaller quartz veins and stringers. The footwalls to the vein systems tend to be sharp and often fault controlled, while their hanging walls are typically a silicified quartz stockwork ranging from a few meters to 15 metres wide. Internal faults are common within the vein systems but they tend to be sealed by late stage silicification.

Gold occurs both with banded chalcedonic quartz veins, sheets and stockworks containing weak disseminated pyrite (+/- chalcopyrite) and associated with phyllic alteration or colloform banded multistage quartz veins, breccias and sheets containing pyrite, chalcopyrite, galena and sphalerite associated with sericite – clay alteration containing limonite, hematite and goethite.

In drill holes to a depth of 175 metres the veins still consist of banded opaline quartz with semi-massive to heavily disseminated course pyrite, chalcopyrite plus minor bornite, galena, sphalerite and tenantite-tetrahedride.

Within the Chépica property, the Company has discovered to date seven gold-silver-copper enriched epithermal vein systems with cumulative strike length of over 7 kilometers of which only about 10% has been drilled.

Pre Polar Star Exploration

1990s: Limited surface exploration by Noranda and several Australian juniors in early to mid 1990’s including geological mapping and trenching, 4,150 metres of drilling and 2.5-3.4 g/t gold, with a weighted average of 2.5% copper and 3.0 g/t gold. None of the samples from Chépica No. 2 vein were analyzed for silver

2001-2003: The Bordoni family with the aid of Chile's state-owned mining company Empresa Nacional de Minería (“ENAMI”) geologists and engineers conducted surface trenching, about 500 lineal metres of drifting and crosscutting and raising on the Chépica 1 and 2 veins. From this work, 12 run of mine bulk samples of about 30 tonnes each from the Chépica No. 1 vein and 8 similar samples from the Chépica No. 2 vein were shipped to plants north of the area for processing. Head grades from the Chépica No. 1 vein samples ranged from 1.4-2.4% copper, 0.3-12.2 g/t gold, and 7.8-28 g/t silver, with a weighted average of 1.6% copper, 3.0 g/t gold and 16g/t silver. Head grades from the Chépica No. 2 vein samples ranged from 2.2-3.2% copper.

Based on the 2001-2003 underground samples and additional re-sampling Empresa Nacional de Minera (ENAMI, a Chilean state contract mining and processing company) estimated in 2007 (non-compliant NI 43-101) a combined ‘diluted mineable resource’ for both veins to the 75m level of 220,000 tonnes grading 1.8 g/t Au and 1.9% Cu.

2005: MCK Mining Corp. conducted limited exploration of the Chépica property that included some drilling. The number of holes drilled and their results are not known, but it was reported that approximately US$356,000 was spent on the program. Unconfirmed reports said that the recoveries of the diamond drilling were very poor, on the order of 50%.

2008 – 2009: The then owners, the Bordoni family, built a 200 t/d capacity processing plant to produce a copper-gold sulphide concentrate and constructed the associated tailings and waste disposal facilities. It was reported that between November 2008 and October 2009 the mine and plant operated on an average 70 t/d with ore being extracted from the Chépica No. 2 vein only.

Polar Star Exploration

2008 - 2009: The channel samples and the 49 diamond drill completed in 2008 - 2009 on the No.1 vein system were used by SRK to prepare a NI 43-101 compliant resource report dated May 8, 2009 The SRK report states that using a cutoff grade of 1.3 g/t Au the drilled section of the Chépica No.1 vein contains measured and indicated resources of 178,000 tonnes grading 4.1 g/t gold, 9.5 g/t silver and 0.51% copper.

2010 - 2011: Results from the 2010 diamond drill program were used by SRK Consulting to prepare an updated NI 43-101 Report dated November 11, 2011. It states that using a cut of grade of 1.0 g/t Au, the drilled section of the Chépica No. 1 vein contains measured and indicated resources of 283,000 grading 3.10 g/t gold, 11.92 g/t silver and 0.74 % copper.

Phase I Drilling: In second half of 2008 Major Drilling Chile S.A. completed a 6,758 metre diamond drill program on the Chépica No.1 and No. 2 vein systems in late November, 2008.

• 49 holes (5,274 metres) were drilled and assayed on the Chépica No.1 vein system. All cut the veins to depths of 150 metres vertical which vary from 3-20 metres true width and consist of banded opaline quartz with semi-massive too heavily disseminated course pyrite, chalcopyrite, bornite plus minor galena, sphalerite and chalcocite. This program was designed to confirm and extend a copper-gold resource reported by ENAMI (Empresa Nacional de Minería, Chile) in 2005 to exist below this adit.
• 16 holes (1,484 metres) on the Chépica No.2 vein system. Fourteen 20-25 metre spaced fences have been drilled across the No.1 vein system. All cut veins similar to those at No. 1 but over narrower widths of 2-5 metres.

2009: In mid-October 2009 the small mine on the Chépica No. 1 Vein system and plant were closed and put on care and maintenance. The site was also cleaned up and secured to allow for further exploration and drill targeting

2010: The Phase II diamond drill program on the Chépica property was designed to expand on the resource identified in SRK Consulting’s 2009 NI 43-101 report on the No. 1 vein system, define resources on the No. 2 vein systems and test the nearby No. 3 and No. 4 vein systems, which contain significant surface gold and silver values.

The Phase II diamond drill program on the Chépica property commenced in May 2010 and was completed September 9, 2010. A total of 5,206 metres in 34 holes was completed on the Chépica No. 1 - 4 vein systems.

Chépica No.1 vein system

Seven holes drilled in 2010 on the Chépica No.1 vein system extend the previous known mineralized zone 200 metres along strike to 450 metres in length and extends the mineralized zone a further 100 metres down dip to a depth of 250 metres.

Significant new gold–silver-copper +/- zinc and lead intercepts from the Chépica No.1 vein system, including highs of 2m grading 1.37 g/t Au, 10.6 g/t Ag and 1.79% Cu in CH10-99.

In addition a new gold-copper bearing vein system was intersected 30 metres east of, and in the hanging wall, of the previously known extent of the Chépica No.1 vein system.

The No. 1 vein system remains open along strike and at depth.

Chépica No.2 vein system

The six holes drilled in 2010 on the Chépica No.2 vein system has identified a mineralized zone 350 metres in length and up to 250 metres down dip.

Significant new gold–silver-copper +/- zinc and lead intercepts from the No.2 vein system, including highs of 3m grading 2.14 g/t Au, 13.3 g/t Ag, 1.09% in CH10-76.

The No. 2 vein system remains open along strike and at depth.

Chépica No.3 vein system

First time reconnaissance drilling in 2010 on the No.3 vein system returned very encouraging intercepts of 2m grading 1.05 g/t Au, 7.8 g/t Ag, 0.88% Cu and 0.39% Zn in CH10-80 and 3.1m grading 1.15 g/t Au, 5.2 g/t Ag and 0.59% Cu and 0.15% Zn in CH10-97. Prior surface channel sampling from this vein system returned gold values from lows of 0.5 g/t Au over 5 metres to a high of 30.5 g/t Au over 1.5 metres.

The No. 3 vein system remains open along strike and at depth.

Phase I + II Diamond Results
No. 1 VEIN SYSTEM

Hole No.	From	To	Interval	Au	Ag	Cu	Zn	Pb
	(m)	(m)		g/t	g/t	%	%	%
CH10-99	138.0	142.0	4.0	1.26	8.2	1.18
includes	138.0	140.0	2.0	1.37	10.6	1.79
CH10-93	88.4	90.0	1.6	0.38	3.8	0.03	0.23	0.16
	176.0	179.3	3.3	0.58	6.2	0.92
CH10-94	76.0	78.1	2.1	0.68	3.3	0.17	0.63	0.35
CH10-91	96.8	103.0	6.2	0.93	10.3	0.7	0.1	0.1
includes	99.4	102	2.6	1.74	13.6	1.06	0.11	0.13
CH10-92	43.2	45.2	2.0	0.29	5.7	0.52	0.76	0.53
	118.0	124.0	6.0	0.07	3.2	0.29
includes	120.0	122.0	2.0	0.13	5.7	0.53
CH10-95	44.7	48.7	4.0	0.25	3.7	0.29	0.29	0.13
includes	45.7	47.7	2.0	0.38	5.0	0.56	0.16
	131.3	134.8	3.5	1.41	5.1	0.63
includes	132.0	134.8	2.8	1.73	4.8	0.56
CH10-96	41.3	43.6	2.3	0.28	5.4	0.39	0.45	0.32
	102.0	103.0	1.0	0.3	7.9	1.04
CH10-66	60.0	78.0	18.0	1.2	8.1	0.98
includes	64.0	72.0	8.0	1.81	17.6	1.64
	144.0	149.0	5.0	2.6	19.1	1.03
includes	147.0	149.0	2.0	4.60	30.3	1.33
CH10-67	75.0	77.0	2.0	0.5	15.6	0.37
	155.0	165.0	10.0	0.7	10.0	0.67	0.96	0.71
includes	160.0	163.5	3.5	1.99	25.6	1.97	2.20	1.64
	182.0	184.0	2.0	0.34	5.5	1.65
CH10-68	114.5	123.0	8.5	0.79	4.5	0.68
includes	117.0	119.2	2.2	1.02	4.9	0.91
	121.0	123.0	2.0	1.80	4.5	1.04
CH10-69	89.0	91.0	2.0	2.1	10.4	0.42	0.40	0.26
CH10-70	69.0	73.0	4.0	0.55	2.8	0.1	3.01	0.18
includes	69.0	71.0	2.0	1.1	2.9	0.2	5.82	0.3
CH10-71	83.0	88.0	5.0	0.11	13.0	0.69
includes	86.0	88.0	2.0	0.19	24.6	1.61
	111.0	115.0	4.0	0.96	6.4	0.49
includes	111.0	113.0	2.0	1.68	7.3	0.78
	120.0	123.0	3.0	0.89	6.2	0.29
includes	120.0	122.0	2.0	1.22	8.4	0.35
CH10-72	68.0	85.0	17.0	0.21	6.5	0.09
includes	81.5	85.0	3.5	0.12	4.7	0.34
CH10-74	76.4	79.4	3.0	0.23	7.7	1.30	0.23	0.10
CH10-75	98.1	104.3	6.2	0.18	5.2	0.49	0.37	0.11
includes	98.1	101.0	2.9	0.26	6.7	0.84	0.46	0.14

No. 2 VEIN SYSTEM

Hole No.	From	To	Interval	Au	Ag	Cu	Zn	Pb
	(m)	(m)		g/t	g/t	%	%	%
CH10-81	87.9	93.4	5.5	0.47	16.7	0.29	0.32	0.49
includes	87.9	90.0	2.1	0.40	34.5	0.51	0.88	1.32
CH10-82	94.0	99.0	5.0	0.14	8.2	0.60	0.28
includes	95.0	97.0	2.0	0.15	10.8	0.99	0.42
	154.0	162.0	8.0	0.07	6.1	0.26
CH10-83	62.0	65.0	3.0	0.17	7.4	0.46
	71.0	75.0	4.0	0.17	4.6	0.89
includes	72.0	74.0	2.0	0.22	6.8	1.30	0.14
	134.0	136.0	2.0	0.50	5.9	1.20
CH10-84	133.0	135.0	2.0	0.16	22.1	0.45	1.04	0.66
	188.0	190.0	2.0	1.24	8.4	2.40
CH10-76	92.0	123.0	31.0	0.46	5.9	0.46	0.11
includes	93.0	96.0	3.0	0.93	20.4	0.40
	107.0	110.0	3.0	2.14	13.3	1.09
	115.0	117.0	2.0	0.67	9.0	1.04	1.05
CH10-88	117.0	120.0	3.0	0.37	5.0	0.55
	129.0	133.0	4.0	0.13	3.3	0.34	0.1

No. 3 VEIN SYSTEM

Hole No.	From	To	Interval	Au	Ag	Cu	Zn	Pb
	(m)	(m)		g/t	g/t	%	%	%
CH10-79	32.7	33.9	1.2	0.25	2.6	0.35	0.11
	48.0	50.0	2.0	1.10	1.5		0.22	0.17
CH10-80	49.2	51.2	2.0	1.05	7.8	0.88	0.39	0.09
CH10-89	56.0	58.0	2.0	0.13	2.9		0.28	0.15
CH10-90	3.0	11.0	8.0	0.03	1.7		0.87	0.34
includes	9.0	11.0	2.0	0.04	3.4		2.49	1.01
	43.0	45.0	2.0	0.06	5.1	0.10	0.97	0.26
	174.0	176.0	2.0	0.13	4.7	0.11	0.16	0.08
	190.0	192.0	2.0	0.10	6.2	1.16
CH10-97	36.9	40.0	3.1	1.15	5.2	0.59	0.15
	46.0	47.0	1.0	0.32	3.6	0.45	0.09	0.44
	189.4	190.4	1.0	0.16	2.8	0.33
CH10-98	50.0	53.0	3.0	0.14	3.9	0.18	0.70	0.21
includes	52.0	53.0	1.0	0.34	6.1	0.49	0.26	0.13