Sanatana Resources Inc. provided the exploration and operational update for the Watershed Property. During the second half of 2012, the Company's exploration program focused on fulfilling the terms of the option and joint venture agreement and testing potential distal extensions of IAMGOLD Corporation's Cote Gold Deposit and the Company's discovery on Clam Lake claim 3011820. The program comprised exploration drilling of 5,410 metres, collecting 1,454 soil samples from across the entire property and outcrop stripping, mapping and channel sampling over selected sites.

The objective of the drill program was to test anomalies previously identified through the Company's Induced Polarization (IP) geophysical work. The IP anomalies tested were predominately well to the west of the Company's previously successful drill program on claim 3011820, and included the Chain of Lakes, Clam Lake claim 3018412, and Chester prospects. SR-12-10 was collared in mineral claim 3017670 inclined 60 degrees and oriented to the south some 300 m north of hole SR-12-09 on cut Line 3 testing an east - west trending subsurface apparent resistivity anomaly.

This concluded the drill program for the Chain of Lakes area. The drill was relocated to mineral claim 3018412 testing for extensions of the gold mineralization from mineral claim 3011820 across to the western shore of Clam Lake. Holes SR-12-11, SR-12-12 and SR-12-14 - 16 were drilled as a fence along the western boundary of the mineral claim from north to south in sequential order at between 50 to 100 m spacing with hole SR-11-13 collared 150 m east on a peninsular in the north-central area of the claim.

Again, the drilling was angled at 60 degrees to horizontal towards the south, allowing for some slight drift to the west at times, except for hole SR-12-12 which was drilled due north at 50 degrees as a scissor hole testing gold mineralization encountered in hole SR-12-11. Holes SR-12-17 - 21 were drilled south of the Chain of Lakes area on mineral claim 3017674 targeting parallel IP anomaly trends 2.0 km southwest of the Clam Lake claim 3011820. Hole SR-12-22 tested an isolated IP anomaly oriented southeast - northwest in the Chester area within mineral claim 3017665.