If you have any questionsj please contact Mike at ext. 24 or myself at Ext 21.

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1 ~~ =--c.-e~--. 1,1 Government or Gouvernemerit d~ Northwest Territories Territoires du Nord-Quest Telephone: ext. 24 Fax: December 18, 2018 Pine Point Mining Limited 1100 venue des Canadiens-de-Montreal Bureau 300 Montreal, QC H3B 2S2 ttention: Robin dair, Jeff Hussey File Number Type of Operation Location MV2017C0024 MINERL EXP - drilling SCS staging, First aid station, M48 drilling, camp set-up, X65 drilling, Faraco staging Dear Robin dair, Jeff Hussey, n inspection of the above noted operation was conducted on December 12, 2018 by Manager, Resource Management Mike Vassal and Manager, Resource Management Rob Walker. Enclosed is a copy of the Environmental Inspection Report. Please refer to the unacceptable and noted conditions in the general comments section of this report. Your attention to this matter is appreciated. If you have any questionsj please contact Mike at ext. 24 or myself at Ext 21. CC: MVLWB Rob Walker Manager, Resource Management Department of Lands South Slave Region P.O. Box 658, Fort Smith, NT X0E 0P0

2 Government or Gouvernement des Northwest Territories Territoires du Nord-Ouest ENVIRONMENTL INSPECTION REPORT Permittee: Land Use Permit No. Quarrying Permit No. Contractor: Location(s) Inspected: Current Stage of Operation: Program Modifications pproved: Pine Point Mining Limited MV2017C0024 Permit Expiry Date: Previous Inspection: July 19, 2022 October 04, 2018 Inspection December 12, Date: 2018 Subcontractor: First aid station, camp set-up, X65 drilling One drill in operation. Camp is being set-up ~ C on d 1tion.. o fo 1peration "" - ccepta bl e "U" -U naccepta bl e "N/" - N 0 t ~~ r 1ca bl e "N/1"- N 0 ti nspec t e d Operating Condition spect Inspected Drill Program Location as Permitted Time as Permitted Equipment as pproved (Type & Size) Methods & Techniques Facilities Erosion (Control or Prevention) Chemicals Wildlife and Fisheries Habitat (Protection) Wastes Historical/ rchaeological Sites Ecological Resources Fuel Storage Brush Disposal Restoration of l ands Permits Matters not Inconsistent Explanatory Remarks - Drill Program: Faraco was drilling in the X65 area on the X65-PP-023 site, 60 51' 54.1" N ' 49.6" W. 3 artesian wells were encountered in the X65 area and were all capped on Thursday Dec 13, including X at 60 51' 57.2" N ' 46.5" W which was previously plugged but had started flowing again. The area being drilled is quite swampy hence the increase in artesian wells being encountered. Inspected previously drilled holes at XGS-15: 60 51' 56.8" N ' 37.6" W, XGS-16: 60 51' 54.6" N ' 38.0" Wand XGS-22: 60 51' 54.8" N ' 47.1" W Faraco staging area was at 60 51' 50.6" N ' 40.7" W, set up next to the old ~-64 pit. The sump being used for the X65 holes was located at 60 51' 51.1" N ' 32.1" Wand Date: December 12, 2018 Permit#: MV2017C0024 Page No: 1

3 Governmcmt of Gou11er,it!men1 d~s Northwest Territories Terrltoires du Nord-Ouest ENVIRONMENTL INSPECTION REPORT was approximately 10 meters by 8 Meters. Water seen outside the pit was fresh water that was pumped through system when not drilling. There were a few leaners along the access routes in the X65 area, this was pointed out to llison the PPM L rep on site and was going to be fixed that day. Otherwise access routes were well cut with little windrowing and salvageable timber being cut and stacked. The mulcher is doing good work opening up the access routes. Work had just started that morning on the tent camp located on the top of the old 1-46 waste rock pile at 60 51' 32.5" N ' 51.0" W. Discovery Mining was setting up the camp with just a couple tent floors built at the time of inspection. First id truck and office area was located at 60 52' 01.3" N ' 13.5" Wat the intersection of two major haul roads. \...\, p., Representative Signature Date: December 12, 2018 Permit#: MV2017C0024 Page No: 2

4 Government of Gouvernement des Northwest Territories Territoires du Nord-Ouest ENVIRONMENTL INSPECTION REPORT Inspection Images: Figure 1 Figure 2 Foraco drilling at X65-18-PP-023 Foraco drilling X site Figure 5 Figure ~ - Foraco staging area at X65 I,. " ~..... _ t. V",, w '..,~. ~ Date: December 12, 2018 Permit#: MV2017C0024 Page No: 3

5 Government of Gouvernement de.s Northwest Territories Territoires du Nord-Ouest ENVIRONMENTL INSPECTION REPORT Figure 7 Figure 8 X drill hole X drill hole Figure 9 Figure 10 Closer view of X artesian well Figure 11 Figure 12 Core from X-65 hole, end of hole near 45 M. View of X drill site Date: December 12, 2018 Permit#: MV2017C0024 Page No: 4

6 Government of Gouvernement des Northwest Territories Territoires du Nord-Quest ENVIRONMENTL INSPECTION REPORT Figure 13 Figure 14 Completed hole XGS-016 with stacked wood PPM camp being set up ' ,. J Figure 15 Figure 16 PPM camp. Black diesel drums are empty PPM camp lay down area Figure 17 First aid and office site. Date: December 12, 2018 Permit#: MV2017C0024 Page No: 5

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