Antofagasta Minerals is a wholly-owned subsidiary and the mining division of Antofagasta plc. Antofagasta has three business divisions: Mining, Transport and Water. Antofagasta is one of the world's largest copper producers. Its activities are mainly concentrated in Chile where it owns and operates three copper mines with a total production of 442,500 thousand metric tons of copper and 7,800 metric tons of molybdenum in 2009.

Antofagasta Minerals can earn an initial 51 percent interest in Pyramid by incurring US$6 million in expenditures during the first four years, (US$1.5 million the first year) and pay Full Metal US$200,000 in cash (US$50,000 at the end of the first year). By spending a minimum of US$4 million to complete a scoping study Antofagasta Minerals can then increase its stake in the project to 65 percent, which can be increased by an additional 15 percent, for a total of 80 percent interest, by funding at its sole cost a feasibility study on the porphyry project.

The 37,296-hectare, or 92,160-acre, Pyramid project lies along the southern margin of the Alaska Peninsula about eight kilometers, or five miles, from tidewater. It was discovered in 1974 by the Aleut-Quintana-Duval Joint Venture, who drilled 19 shallow holes in late 1975 (1,695 meters total), identifying a resource of 125 million tons of copper mineralization grading 0.403 percent copper and 0.025 percent molybdenum in a near-surface zone consisting largely of chalcocite-enriched rock. This resource is historical in nature, was completed prior to 2001 and NI 43-101 and should therefore not be relied upon. More recent exploration by Battle Mountain Gold identified associated gold values that have improved the potential of Pyramid. Recent work completed by former Joint Venture partner Metallica Resources significantly advanced the geologic understanding of the porphyry system at Pyramid.

The 2010 exploration program will consist of a 2,000-meter core drilling program, comprising five or six deep drill holes, targeting the potassic core of the porphyry system. Drilling in the 1970's avoided the potassic core, with the majority of drill holes less than 100 meters in length (maximum 168 meters). Full Metal said it welcomes Antofagasta Minerals' expertise in porphyry systems, as their technical team is world-renowned for their understanding of exploration and mining these types of deposits, primarily in Chile.

In June Full Metal amended the exploration agreement with option to lease to acquire 100 percent interest in mineral rights covering the Pyramid Project, with the Aleut Corp. The revised terms with the Alaska Regional Native Corporation extends the original term length of the exploration agreement to the end of 2016. Over the period, Full Metal will make cash payments totaling US$285,000 (US$35,000 first year) over seven years, as well as annual materials payments of US$20,000 per year. Additionally, Full Metal will incur annual exploration expenditures totaling US$4.5 million (US$300,000 first year).

While the exploration agreement is in effect Full Metal can enter into a mining lease with the Aleut Corp. Upon entering into a lease, Full Metal would make annual advanced royalty payments escalating from $25,000 in the first year, to $400,000 on the 16th anniversary and subsequent years. Upon completion of a feasibility study Full Metal will transfer 500,000 of its own common shares to the Aleut Corp. Upon commencement of commercial production, Full Metal will pay a net smelter returns royalty to the Aleut Corp. of 2.5 percent for all commodities except for gold and other precious metals. For gold and other precious metals, Full Metal will pay a sliding-scale net smelter return royalty ranging from 2 percent if gold is less than US$300.00 to 5 percent if the selling price is above US$500 per ounce.

Full Metal and Shumagin Corp., an Alaska Native Village Corporation, signed a letter outlining terms of agreement for a mining exploration agreement and option to lease between the companies. The terms outlined in the letter include annual cash payments totaling US$210,000 through the end 2016 (US$20,000 first year). The Shumagin Corp. and Full Metal will endeavor to complete a comprehensive agreement by the fall of 2010.

According to the letter, Full Metal may enter into a lease agreement with Shumagin Corp. at any time before the end of 2016. Upon the effective date of a lease until commercial production Full Metal would make annual payments to Shumagin Corp. equal to ten percent of the fair market value of the lease area. After commercial production has begun, Full Metal would pay Shumagin Corp. an annual rental equal to ten percent of commercial production fair market value of the lease area.

Full Metal and TDX Pyramid LLC, an affiliate of an Alaska Native Village Corporation, signed an exploration agreement with option to lease covering surface lands at Pyramid. This agreement includes annual cash payments totaling US$180,000 over seven years (US$15,000 first year). At any time prior to the end of 2016 Full Metal may enter into a lease agreement with TDX Pyramid LLC. Upon the Effective Date of the Lease and then on or before each annual anniversary during the term of this lease until there is commercial production, Full Metal shall pay to TDX Pyramid an annual rental equal to ten percent of the fair market value of the lease area. After commercial production has commenced, Full Metal will pay TDX Pyramid an annual rental equal to ten percent of commercial production fair market value of the lease area, provided, however, that in no event shall the annual rental ever be less than US$75,000.