Chairman's Message 3 26 2012

Chairman's Message 3 26 2012


To Our Shareholders,

I would like to report on progress on the Mary March property. This base and precious metals property is the Corporation’s principal mineral property holding and is located in the Buchans area of Newfoundland and Labrador.

Canstar has recently confirmed exploration expenditures of approximately $750,000 on the property. Combined with previous expenditures of $750,000 by Phelps Dodge Corporation, the total spent on the property is $ 1.5 million.

As per agreements between Canstar and PDC, and between Xstrata and PDC, this represents completion of an earn-in 50% interest by Canstar, with Xstrata holding the remaining 50%. Canstar has Right of First Refusal on Xstrata’s 50% interest.

Following execution of definitive documentation for Canstar’s acquisition of the Phelps Dodge interest, Canstar will become the operator and will propose a comprehensive exploration program of drilling and airborne electromagnetic and magnetic surveys over the property.

This program will commence as soon as the agreements have been formalized.


Thank you,

Harry J. Hodge, P. Eng.,
Chairman

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