Exploration Report by Charquenses Charcas

Suite 301 – 700 West Pender St. Vancouver, BC, Canada, V6C 1G8 Telephone: (604) 604-685-9790 Facsimile: (604) 685-9744

Exploration Report, Charcas-West Project, Mexico May 25, 2011

Introduction: Parallel Resources Ltd. (“Parallel”) has the right to earn 50% interest of the Charcas-West property according to an option and joint venture agreement with Aztec Metals Corp. (an unlisted mineral exploration company). Details of the Charcas-West Option agreement are as follows: ⇒ CAD 150,000 cash (already paid) ⇒ CAD 200,000 non-drilling fieldwork program by January 13, 2011 (already executed; until Febr. 28, 2011 exploration expenditures totalled 276,673 CAD) ⇒ 1500 meter drill program by July 13 (it is planned to extend this deadline by 3-6 months) Total minimum commitment of CAD 575,000 (426,673 CAD have been spent until Febr. 28, 2011) As next exploration phase has been planned a 2,000 m drill program budgeted at 550,000 CAD. It consists of at least 7 diamond drill holes that will test four distinct blind VMS targets (zinc-copper-silver-gold) and one epithermal vein target (silver-lead-zinc).

Location & Access: The Charcas-West project is situated in the prolific Mexican Altiplano region and consists of two separate mining concessions covering a total surface area of 29,014 ha. The region is dominated by flat plains to slightly hilly terrain with elevations ranging between 1950 and 2300 m; isolated mountain ranges rise 100 to 400 m above the surrounding flat terrain, highest peaks may approach 2600 m. The two Charcas-West properties are located in the states of San Luis Potosi and Zacatecas to the west of the small city of Charcas (Fig. 1). All target areas within the claims R1 and R3 can be accessed via the highway 54 connecting the cities of Zacatecas in the south and Saltillo in the north. Driving time on gravel or dirt roads from paved roads to any exploration target located in the claims Charcas-West R1 and Charcas-West R3 is less than one hour.

Fig. 1 Location map for the Charcas-West project, consisting of two separate properties (R1 & R3). Also shown are the locations of major mines, mineral deposits and the claim block of the Matehuala project (owned by Aztec with Parallel as joint venture partner).

Regional Mineral Deposit Environment: Major mineral deposits and new discoveries in the regional vicinity are illustrated in Fig. 1. Some are associated to intrusive phases (diorite-monzonite-granodiorite) of early Tertiary age: Skarn and Pb-Zn-Ag-Cu-(Au) limestone replacement deposits (CRD) are hosted by Mesozoic limestone Formations and include the nearby deposits of â&#x20AC;&#x153;Concepcion del Oroâ&#x20AC;? 2

(Terminal de Providencia is still active, about 100 km north of Charcas-West R1), “La Paz” (active Cu-Ag mine), “Real de Catorce”, and “Charcas”. Very significant Au-Ag-(Pb-Zn) epithermal disseminated/stockwork-type deposits are hosted by the siliciclastic Caracol Formation (Late Cretaceous) and include “Penasquito” (active, Goldcorp), “Camino Rojo” (formerly Canplats, acquired by Goldcorp, 60 km north of Charcas-West R1) and the already exploited Ag deposit “Real de Angeles” (80 km south of Charcas-West R3). The large “San Nicolas/El Salvador” VMS deposit (Cu-Zn-Ag-massive sulphide, 60 km south of Charcas-West R3) and “Francisco I Madero” SEDEX type deposit (Zn-Ag-Pb massive sulphide, located near the city of Zacatecas) have been discovered in the state of Zacatecas within submarine Mesozoic volcano-sedimentary rocks of the Guerrero terrane.

Exploration Efforts Past initial exploration work (2007-2009), but specifically the prospecting campaign carried out in August/September 2010 led to the definition of multiple targets having potential for the discovery of volcanic associated submarine exhalative (massive) Zn-Cu-Ag-(Au) sulphide deposits (VMS), epithermal Ag-(Au)-Pb-Zn vein deposits and epithermal disseminated AuAg deposits (“Camino Rojo/Penasquito” type). The discovery of considerable Pt-Pd-Au-NiCr-Co values in a single piece of gossan float was a rarity for the Altiplano region of Mexico. In Nov.-Dec. 2010 and Jan.-Febr. 2011 additional detailed geological mapping and sampling was carried out on the Poseidon and Orion target areas of the Charcas-West R3 claim and at the Odysee West target located in the Charcas-West R1 claim. A total of 294 rock chip samples were collected from outcrops and float between August 2010 and February 2011. Samples were placed in sealed bags and delivered to the Inspectorate sample preparation facilities in Durango, Mexico and analysed in the Inspectorate laboratory Vancouver, Canada. In November and December 2010 a ground high-resolution magnetic and gravity survey were executed over the Poseidon targets by SJ Geophysics Ltd. (Vancouver, Canada). The magnetic survey covered an area of 15 square km while the gravity survey covered 5.8 square km with 666 gravity stations. These results in combined with the geology and assay data are the basis for drill targeting.

Exploration Targets at Charcas West R3 (see Fig. 4) â&#x20AC;&#x153;Poseidon targetsâ&#x20AC;? Four sub-targets (Poseidon 1, 2, 3 & 4: shown in Fig. 8) are hosted by the Guerrero rocksuite, a succession of Mesozoic submarine volcanic rocks and marine siliciclastic/chemical sediments (the same rock Formation that host the large Francisco y Madero mine, a SEDEX type deposit, and San Nicholas VMS polymetallic deposit). Stratiform Au & Ag -bearing synsedimentary exhalites consisting of up to 10 m thick beds of barite, carbonate and chert (silica deposited from hydrothermal submarine vents) assay up to 260 ppb Au & up to 24 ppm Ag. The presence of exhalites associated with gossan (silica and Fe-oxides derived from oxidation of massive pyrite) and bimodal submarine volcanic rocks (andesite-basalt and dacite-rhyolite) suggest a good potential for volcanogenic disseminated and massive sulphide deposits (VMS) formed by exhalation of sulphides at the seafloor or replacement of siliciclastic/tuffaceous sediments immediately below the seafloor. Also, the anomalous geochemical content of these exhalites (see figures 12, 16 & 20) is a prospective indicator for Zn-Cu-(Au-Ag-Ga-Ge-Sb) bimodal mafic type VMS deposits. The Poseidon Target 4 is linked to a multi-phase olivine-gabbro intrusion and exhibits many parameters associated with PGE-Au-Ni-Cr-Co and high-grade Fe-Mn mineralisation. A single piece of gossan float (sample R73) assayed very high Ni (>1%), Cr (0.22%), Co (586 ppm) and Mg (>10%) together with high Au (365 ppb), Pt (812 ppb), Pd (480 ppb) and Re (54 ppb).

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Fig. 4 Overview map showing geology and defined exploration targets for the concession area of "Charcas West R3Aâ&#x20AC;?.

Aztec Metals Corp. & Parallel Resources Ltd. March 16, 2011

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Fig. 8 Detail geology for the Poseidon target region.

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Aztec Metals Corp. & Parallel Resources Ltd. March 16, 2011

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Aztec Metals Corp. & Parallel Resources Ltd. March 16, 2011

Lithology

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Fig. 12 Poseidon 1 Target: Distribution of Au & Ag in rock chip samples and detail geology.

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Aztec Metals Corp. & Parallel Resources Ltd. April 1, 2011

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Fig. 16 Poseidon 2,3 & 4 Targets: Distribution of Au & Ag in rock chip samples and detail geology.

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rockchip-anomalies

Fig 20 Poseidon 2, 3 & 4 Targets: Areas with significantly anomalous metal values in rock chip samples and detail geology. Aztec Metals Corp. & Parallel Resources Ltd. April 1, 2011

The gravity survey demonstrated the presence of higher-density bodies at rather shallow depth that may represent concentrations of massive sulphides or Fe-Mn oxides. For proper interpretation it must be considered that only local positive gravity anomalies (also called residual anomalies) reflect density contrasts produced from higher than average density rocks at shallower depths. These anomalies are superimposed on the regional gravity anomaly reflecting much deeper-seated geological features. Better separation of the residual gravity anomalies from the regional anomalies is achieved by manual graphical interpretation or application of a number of different mathematical estimations (high-pass filtering). Outstanding positive residual (local) gravity anomalies obtained from high-pass filtering methods of the Bouguer gravity can be seen in Figures 28 (1st vertical gradient) and in Figure 30 (regional gravity trend removed). In the 3D inversion model for the gravity data two isolated “floating” gravity anomalies have been recognised: Poseidon 2 (drill target E) and Poseidon 4 (drill target C). The graphic in figure 32 outlines both anomalies at a depth of about 300 m. The strongest local contrast (about 0.1 g/cm3) is situated at the drill target E (Poseidon 2).

Fig. 32 Screenshot looking NW of 3D gravity inversion model with the lower isosurface set at 0.029g/cm. The northern “floating” anomaly represents the high density drill target E at Poseidon 2 (possible VMS lens); the central “floating” anomaly represents drill target C, Poseidon 4: a NW-SE trending, steeply dipping lens of higher than average density rock, hosted most likely in gabbroic rocks. The southern area is dominated by higher density rocks at depth, possibly a large intrusion.

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Fig. 25 Map illustrates results of magnetic survey over the Poseidon target region with reduced to pole magnetic signature (shadow enhanced: highest magnetic susceptibility white & red, lowest black and blue colours). Also shown are certain geological features that could be related to potential blind mineralization. Aztec Metals Corp. & Parallel Resources Ltd. March 17, 2011

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Fig. 28 The 1st vertical derivative of gravity data (overlain over the magnetic RTP map) represents a high-pass filter emphasising near-surface features. The maxima highlight bodies of higher density near to surface. High values are shown in warm colours, low values in cold colours; unit is mGal/m. Also shown are certain geological features that could be related to potential blind mineralization. Note the strong anomalies WNW of the barite mines (southern area) and NE of the large breccia zone (northern area) Aztec Metals Corp. & Parallel Resources Ltd. March 17, 2011

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Fig. 30 In this residual gravity map the regional gravity trend has been subtracted from the Bouguer gravity data. This method enhances local near-surface gravity features. High values are shown in warm colours, low values in cold colours; unit is mGal. Also shown are certain geological features that could be related to potential blind mineralisation. There can be recognised two principal â&#x20AC;&#x153;bulls eyeâ&#x20AC;? anomalies WNW of the barite mines (in the south) and NE of the large breccia zone (northern area). Aztec Metals Corp. & Parallel Resources Ltd. March 17, 2011

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Fig. 35 Detail geology and proposed drill program for the Poseidon targets. Also shown are the locations of three geological cross sections (see Figures 36-38). Aztec Metals Corp. & Parallel Resources Ltd. March 17, 2011

Five drill target areas have been defined in the Poseidon region. Good potential for VMSstyle deposits is suggested by coincident favourable relationships between submarine environment, exhalative horizons, Fe-silica gossan, felsic and basic volcanic centres, basic intrusions, and correlative geochemical (compare Fig. 20) and geophysical anomalies. The location of geological cross-sections and drill hole positions are shown in Figure 35. Geological cross sections demonstrating the exploration model for each target are shown in Figures 36, 37 and 38. The drill targets are described from south to north.

Drill target A at Poseidon 1 This drill target is located just west of the outcropping stratiform exhalative barite beds at the western flank of a submarine volcanic flow dome complex. (see Fig. 35 and Fig. 36). Significant Au-Ba-Ag-Te and moderate to low Cu-Zn-Pb-Cr values were returned from rock chip samples. Traces of Cu-oxides were observed in the historic mine dumps of the barite workings. The target is centred on a distinct positive residual gravity anomaly (Fig. 28 & 30). Depth to the higher density-rock target is estimated to about 50-200 m. For the first drill phase 2-3 holes (PD-1 to PD-3) totalling 460 or 660 m are recommended.

Fig. 36 WNW-ESE geological cross-section illustrating the exploration model for the Poseidon 1 target and proposed drill holes. The local near-surface gravity anomaly combined with prospective geology and geochemistry suggest potential for VMS mineralisation at depth of approximately 200 m. Drill-hole PD-2 will be oriented SSW where it may intersect a NWSE striking fault zone (which parallels this section to the SW).

9.4.2 Drill target B at Poseidon 4 Drill target area B is located south of a gabbro intrusion and characterised by anomalous ZrTh-Ga-Mo and moderate to low Ba-Ag-Co-Ni-Sb values in silicified felsic tuff outcrop and limonite (gossan) float (Fig. 35 and Fig. 37). The target is characterised by a large magnetic high and several local near-surface positive gravity highs. The exploration model illustrated in Fig. 37 is primarily based on the 3D inversion model of the magnetic data, indicating a steeply south plunging intrusion of mafic rocks. Multiple styles of mineralisation are targeted with this hole; VMS, massive Fe-Mn or Ni-CrPGE. The local gravity anomaly and the coincident magnetic high may be indicative of a lens of massive sulphides or Fe-Mn oxides bound between the felsic tuff unit and underlying intrusive subvolcanic micro-gabbro/basalt. Drill hole PD-7 (length 250 m) is proposed to test this exploration model. At greater depth the same hole may intersect the gabbroic intrusion and potential Ni-Cr-PGE mineralisation. Estimated depth to targets is 50 â&#x20AC;&#x201C; 250 m.

Fig. 37 NE-SW geological cross-section illustrating the exploration model for the Poseidon 4 target and associated drill target areas B (hole PD-7) and C (hole PD-6). The model is primarily based on the 3D inversion model of the magnetic data, indicating a steeply south plunging intrusion of mafic rocks. Two local near-surface gravity anomalies have been outlined by the ground gravity survey. These gravity anomalies combined with prospective geology and geochemistry provide for a VMS or Fe-Mn oxide target at the base of the felsic tuff unit (drill target B). 3D gravity and magnetics inversion modelling outlines a NW-SE trending coincident high cored at a depth of about 300 m. The gravity anomaly may be attributable to high-density bodies of gabbro-hosted magnetite-chromite with associated PGE-Co-Au mineralisation (drill target C).

9.4.3 Drill target C at Poseidon 4 Drill target area C is located at the southern margin of the gabbro intrusion and composes part of target Poseidon 4 (see Fig. 35 and cross-section in Fig. 37). Gabbro float returned anomalous Cr, Zr and Co values. The target is characterised by an E-W trending magnetic high and a moderate strength, small sized, near-surface positive gravity anomaly. This gravity anomaly is well defined by all high-pass gravity filters (Fig. 28 & Fig. 30). 3D gravity inversion modelling demonstrated a NW-SE trending high-density zone (Fig. 32) with a core depth of approximately 300 m. This 3D gravity anomaly coincides with a 3D positive magnetic anomaly and may be attributable to gabbro-hosted denser zones of magnetitechromite and associated PGE-Co-Au mineralisation. Drill-hole PD-6 (length 350 m) is proposed to test this target.

9.4.4 Drill target D at Poseidon 2 Drill target area D is located to the north of a north dipping exhalite horizon near the eastern portion of large breccia zone of felsic tuff (Fig. 35). The exploration model is shown in geological cross-section (Fig. 38). At the eastern margin of the felsic tuff breccia a N-S trending zone of limonite (gossan) breccia, locally over 20 m wide, and associated exhalite layers contain anomalous Ba-Au-Ag-Cu (up to 260 ppb Au) and more sporadic Te-Co-As-VSb-Zn values. The overlying felsic tuff/gossan breccia is characterised by elevated Ba-Zn-As17

Co with and lesser V-Te-Cu-Pb-Ag anomalies. The target is geophysically characterised by a moderate magnetic low, perhaps caused by hydrothermal activity. Gravity data are inconclusive, but in general there exists a low Bouguer gravity with several small near-surface gravity highs defined by high-pass filters (see Fig. 28, 30). The proposed drill hole PD-5 (length 200 m) will test the wide gossan breccia zone and the exhalite horizon for potential stockwork-breccia style Zn-Cu-Au-Ag mineralisation. Estimated depth to target is 50 â&#x20AC;&#x201C; 200 m.

Fig. 38 NNE-SSW geological cross-section illustrating the exploration model for the Poseidon 2 target and associated drill target areas D (PD-5) and E (PD-4). A prominent local near-surface gravity high has been outlined at drill target E. A gravity indicated highdensity body combined with geology and geochemistry in the exhalite horizon suggest a VMS body may exist at a depth of 300-400 m. Proposed drill hole PD-4 will test the gravity anomaly and hole PD-5 will test both the wide limonite-gossan breccia zone and the exhalite horizon.

9.4.5 Drill target E at Poseidon 2 Drill target area E is situated at the northern margin of target Poseidon 2 (Fig. 35). The exploration model is depicted in the geological cross-section of Figure 38. Most of the drill target area is covered by a thin layer of overburden overlying felsic tuff, shale-mudstone and basalt. A strong positive E-W trending magnetic anomaly is associated with basaltic rocks that may be flows or an intrusive subvolcanic body. The target is principally defined by magnetics and gravity. The magnetic survey results combined with surface mapping outline two NW-SE trending normal faults (Fig. 35) that may have developed during the deposition of submarine volcanosedimentary strata. The downdropped block between the faults defines a structural basin and represents a favourable environment for the accumulation of massive sulphides. A northerly dipping felsic tuff/exhalite horizon (chert-limestone and minor barite) with elevated Ba-Au-Ag-As and moderate Te-Co-Cu-V-Sb-Zn enrichment outcrops 500 m to the south. This same exhalite horizon should be present at a depth of about 300 m below drill target area E.

The drill target is characterised by a large west-east orientated residual gravity anomaly (700 x 250 m) that is well defined by all high-pass filters (Fig. 28, 30). 3D inversion gravity modelling (Fig. 32) outlines a strong isolated “floating” local density contrast (about 0.1 g/cm3) centred at an elevation of 1770 m (about 300 m depth). A vertical drill hole (450 m length) has been proposed for this target.

Proposed Drill Program for “Poseidon” targets The total recommended minimum core drilling program at the Poseidon targets comprises 1360 m (it includes proposed drill holes PD-1, PD-2, PD-4, PD-5 and PD-7). Alternatively a slightly larger program has been proposed, consisting of 1910 core meters. Costs for the 1360 m program are estimated to 345,000 CAD, costs for the 1910 m program are estimated to 435,000 CAD.

Exploration Targets at Charcas West R1 (Fig. 3) The Odysee West target is a large fault-controlled, roughly E-W trending, low sulphidation epithermal quartz vein system (see detail target geology in Fig. 42). Dense grey, finemicrocrystalline silica replaces limestone from the Cretaceous Cupido and Taraises Formations along numerous fissures, bedding planes and along two major W-E to WNW-ESE trending, south dipping (45-55°) fault/fissure systems. This early massive silica was brecciated and re-healed by multiple later stages of microcrystalline to fine-crystalline chalcedony/quartz and veinlets with small comb quartz. The quartz-breccia veins display distinctive epithermal textures; cockade, banding and bladed quartz replacing calcite. Quartz textures and trace elements (elevated Hg and Sb) indicate that current outcrop elevation represents a relatively high, low temperature level in the epithermal system. The vein system comprises numerous parallel quartz or silicification veins, splays, horsetailveining, both crosscutting and parallel to bedding. It is at least 400 m wide and can be traced over a length of 2.0 km. The system is open at both ends; on a third party concession to the west and disappearing under overburden to the east. The observed thickness of principal veins varies between 2 and 8, but in places swells to over 15 m. The overall vein system may be wider than the observed 400 metres at surface as its southern margin is covered by alluvium. The locally tightly folded, but generally flat lying Cretaceous limestone is exposed within an isolated ridge representing a horst (a horst is defined as an uplifted crustal block) defined by several N-S and E-W trending faults. Hundreds of metres of displacement on these faults juxtapose Early Cretaceous limestone (in the horst) with Late Cretaceous sandstone-siltstoneshale from the Caracol Formation. Quartz veining proximal to the faults is shown in the schematic N-S cross-section of Fig. 47. It must be noted that the exact location, attitude, and sense of movement (normal vs. reverse) of these large faults can only be inferred as they are concealed under 5-20 m of overburden. Faults and associated fault breccias and with variably intense pyritization have been mapped in the Caracol Formation. They outcrop in a 10 to 15 m deep canyon located in the southern

area of the Odysee West target (see detail geology map in Fig. 42) and appear to be associated with only minor offset. The flat plains in the eastern and southern areas of the Odysee West target are mainly concealed under overburden. Rock chip and chip-channel samples from vein outcrops returned consistent anomalous Ag values ranging between 1 and 33 ppm (Fig. 48). A dump grab sample from a small working returned the highest value of 50 ppm Ag. Other anomalous elements include Pb (up to 800 ppm), Zn (up to 1300 ppm), Ba (up to 2300 ppm), Li (up to 380 ppm), Hg (up to 8 ppm), Te (up to 1.7 ppm), Cu (up to 130 ppm), Sb (up to 280 ppm) and Au (up to 81 ppb). Noteworthy are very low values of Arsenic. High Sb, Hg and low As values typify the upper levels of many epithermal systems. Very high Sb values (above 1kg/t), with negligible associated Ag-Pb-Zn were returned from rock chip samples at small historic mine workings situated in the SW corner of the investigated area. These results and vein textures suggest that antimony (as stibnite) precipitated only locally during a late stage of the epithermal activity. Silver, lead and zinc deposited during an earlier epithermal pulse.

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Fig. 3 Map shows the region of the concession "Charcas West R1A", with simplified geology, principal villages and the defined exploration targets: "Odysee West" (epithermal veins, outcropping and under cover), "Odysee East" (epithermal silicification and quartz stockwork hosted by La Caja F., outcropping & under cover), target H (limestone hosted carbonate replacement target) and the"La Mancha" target (belt of pyritization of clastics/volcaniclastics in Caracol F, outcropping & under cover) with several subtarget areas. Aztec Metals Corp. & Parallel Resources Ltd. March 17, 2011

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Legend Lithology

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( !

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Fig. 42 Detailed geological map of the Odysee West target situated in the NW corner of Charcas-West R1 claim. Lithology April 1, 2011

limestone, Cupido & Taraises F. (Cretaceous)

siliciclastics: Caracol F. (Cretaceous)

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Aztec Metals Corp. & Parallel Resources Ltd.

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Fig 48 Detailed Geology and proposed drill program for the Odysee West target situated in the NW corner of Charcas-West R1 claim. Also shown are assay results for silver from rock chip samples collected in 2010-2011 Aztec Metals Corp. & Parallel Resources Ltd. April 1, 2011

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Field photographs from the Odysee West Target

A: Large quartz blocks at vein outcrop.

B: Vein breccia, silicified wall rock fragments cemented by multiple fine crystalline quartz generations and late comb quartz

C: Quartz breccia with late fine comb quartz stockwork

D: bladed quartz replacing older vein calcite

Discussion of the Odysee West target Common to all styles of low sulphidation epithermal (Ag-Au-basemetal) vein systems is the restriction of ore-grade mineralisation to a vertical range or â&#x20AC;&#x153;windowâ&#x20AC;?. The depth and range of this favourable window depends on numerous different physiochemical conditions affecting the solubility of metals contained within the hydrothermal fluids. One of the stronger influences upon the fluids is the chemistry of the rock in which the fluid is interacting. More calcareous rocks are highly reactive at higher temperatures and epithermal fluids can replace the carbonate rock with various sulphide and gangue minerals. In such a case we may see a continuum between pure epithermal and carbonate replacement deposits (CRD). An exploration model for the Odysee West target is presented in the schematic E-W longitudinal section in Fig. 46. Anomalous Ag-Pb-Zn combined with rather low Sb and Hg suggest that current exposures represent the higher level of an epithermal system and therefore favourable window is at depth. Bladed quartz textures (replacing calcite) indicate fluid boiling; a process critical for precious metal deposition, suggesting that the depth to the favourable window may in the range of only a few hundred metres. With increasing depth (and higher temperatures in the hydrothermal system) the carbonate wall rock could have reacted with the hydrothermal fluids and Ag-Pb-Zn- carbonate replacement mineralisation could have formed (CRD type). As third mineralisation style can be assumed disseminated epithermal Ag-Au-Pb-Zn mineralisation hosted by sandstonesiltstone (Caracol Formation) near the contact to limestone or along principal faults This style is similar to the nearby Camino Rojo deposit.

Fig. 46 Schematic exploration model along a W-E longitudinal section parallel to the main Odysee West quartz vein/fault system and the Sierra Hermosa fault. Wall-rocks are limestone and siliciclastic sediments. So far quartz veins have been only observed in the limestone host, however they could penetrate into the Caracol Formation. The model shows also the postulated eastern horst boundary fault. The shown horizontal W-E extension is about 10 km; vertical distances are not to scale.

The schematic relationship between quartz veins and the principal E-W trending basin & range fault of the Odysee West target is depicted in Fig. 47. The observed lateral E-W extent of the Odysee West epithermal vein system is 2 km. This could however extend for another km or more to the east under alluvial cover. 25

Ag-Pb-Zn-Au mineralisation may occur as: 1. epithermal quartz veins at greater depth hosted by limestone and/or by the principal fault itself at the limestone-siliciclastic contact (concealed under overburden), 2. limestone hosted CRD mineralisation, 3. sandstone-siltstone wall-rock breccias or disseminated mineralisation adjacent to the fault.

Fig. 47 Schematic N-S section illustrating the exploration model for the Odysee West target. The limestone units appear in an uplifted crustal block (horst), separated from the younger siliciclastic Caracol Formation by a basin & range fault with a displacement of several hundred meters. Pinching and swelling quartz veins, approaching widths of over 10 m, are observed in the limestone, and are potentially sourced from the principal fault concealed by overburden. Epithermal Ag-Pb-Zn mineralisation may be present at greater depth within the epithermal ore horizon . Also shown are the relative positions of proposed drill holes, to test this model. All distances and vein widths are to scale.

Recommendations for the Odysee West target There is sufficient information to justify an initial drill program to test the vein system at prospective depths for precious metal grades higher than those returned from surface sampling. Fluid inclusion research, investigation of the mineralogy and determination of the paragenetic sequence from vein material obtained from surface and drilling will help guide further drilling decisions. These studies will aid the assessment of epithermal zoning and allow for subsequent vectoring to areas of higher potential. The exploration model (see Fig. 46 & 47) suggests that elevated precious metal mineralisation could occur at moderate depths below surface. The deeper drill holes will test the vein system to a minimum depth of about 300 m.

The two most promising vein intervals (one in the west, the second in the east, both with elevated Ag values and vein widths greater 5 m) have been selected for this initial drill program. (Figure 48). The two shorter holes (each about 200 m in length) shall further define the dip of the veins mapped at surface. These holes will also investigate the presence of the postulated E-W basin & range fault.

Proposed Drill Program â&#x20AC;&#x153;Odysee-Westâ&#x20AC;? A first phase diamond drill program consisting of 1400 core meters has been proposed. Drilling would test a western and eastern vein segment within the principal, E-W trending, vein system (Fig. 48). The estimated costs for the proposed 1400 m drill program amount to 336,000 CAD. Alternatively, for reducing exploration costs, a smaller program has been proposed, consisting of 640 core meters (holes OD-1 and OD-2, see Fig. 48). The 640 m drill program is budgeted at 205,000 CAD.

Capital Structure of Parallel Resources Ltd. (as of 28 February 2011) Symbol, Exchange: PAL: TSX.V Shares Outstanding: 13,410,000 Stock Options: 820,000 Warrants: 1,268,000 Fully Diluted: 15,498,000

Contact Information David Thornley-Hall CEO and President Suite 301-700 West Pender Street Vancouver, BC, V6C 1G8 (Tel) 604 685 9790 (Fax) 604 685 9774 (email) david@parallelresltd.com (website) www.parallelresltd.com

CAUTIONARY DISCLAIMER â&#x20AC;&#x201C; FORWARD LOOKING STATEMENTS Certain statements contained herein constitute "forward-looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995. All statements that are not historical facts, including without limitation statements regarding future estimates, plans, objectives, fluctuations in precious metal prices, unforeseeable results of exploration activities, fluctuations in the costs of goods and services, changes in legal, social or political conditions in the jurisdictions where the Company operates, lack of appropriate funding and other risk factors are "forward-looking statements". We caution you that such "forwardlooking statements" involve known and unknown risks and uncertainties, as discussed in the Company's filings with Canadian and United States securities agencies. The Company expressly disclaims any obligation to update any forward-looking statements other than as required by applicable law. We seek safe harbour. This summary report has been prepared by Matthias Jurgeit, Parallelâ&#x20AC;&#x2122;s exploration manager, under supervision of James Moors, the Qualified Person for the company as required by NI 43-101.

This is not a recommendation to buy or sell any security 28