Duncan Lake, B.C. NTS 83/K7

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1 ! L ASSESSMENT ZN CLAIM REPORT GROUP Duncan Lake, B.C. NTS 83/K7 b W.DOflDoRBASC Geological Engineer E. AUan Qnnan, BA.Q, P-E%-

2 Table of Contents Subiect Page introduction... 1 Location Map... 2 Location and Access... 3 Physiography and Timber... 3 Property and Ownership... 5 Summary of Work Done... 6 Geology... 7 Conclusions... 8 Cost Statement... 9 Statements of Qualifications Appendix Diamond Drill Hole Log Diamond Drill Hole Section Diamond Drill Hole Plan

3 ZN CLAIM GROUP ASSESSMENT REPORT Introduction The ZN Claim Group is comprised of 55 claim units located along the east side of Duncan Lake, Slocan Mining Division, British Columbia. Duncan Lake has been subjected to recurrent raising and lowering of the water level as a consequence of the dam at the discharge (south) end of the lake which is part of the Columbia River water flow control system. This has resulted in erosion of soil along the elevated shore line which has intermittently exposed an extensive gossan area over an aggregate strike length of approximately 3% km and a width of 2150 m. One diamond drill hole was drilled in 1996 to test the source of the gossan.

4 / I LOCATION MAP 2

5 Location and Access The ZN Claim Group is in the Lardeau area of the Slocan Mining division of British Columbia. It is on the east side of Duncan Lake. The causeway that accesses the peninsula from the east side of the lake between the Upper Arm and the Lower Arm is at the approximate mid point of the claim group. This is at latitude N and longitudes W, NTS 82 K/7. Access is by way of the Duncan Lake Forestry Road from Cooper Creek for 17 km. Cooper Creek is on paved provincial Highway No. 31, 40 km north of Kaslo. Phvsioqraphv and Timber The property is situated in the Columbia Mountains and lies between Duncan Lake and Mount Simpson. the eastern border. Elevations range from 580m at Duncan Lake to 1,675m along Terrain slopes vary from moderate near the lake shore to very steep inland to the east. The lower elevations support a mature growth of fir and cedar which declines uphill with increasing immature to scrub cedar above the 1,OOOm elevation, There is a large area of clear-cut in the northern section of the property.

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7 Property and Ownership The property consists of 55 claim units made up of 25 two-post claims and 2 four post claims. They are Claim Name ZN-1 ZN-2 ZN-3 ZN-4 ZN-5 ZN-6 ZN-7 ZN-8 ZN-11 ZN-12 ZN-13 ZN-14 ZN-15 ZN-28 ZN-29 ZN-30 ZN-31 ZN-32 ZN-33 ZN-34 ZN-35 ZN-36 ZN-37 ZN-38 ZN-39 ZN-40 ZN-41 Tenure No No. of Units Expire Date Feb 16/2000 Feb 16/2000 Feb 16/2000 Feb 16/2000 Feb 16/2000 Feb 16/2000 Feb 16/2000 Feb 16/2000 Feb 17/2000 Feb 17/2000 Feb 17/2000 Feb 17/2000 Feb 17/2000 Apr 09/2000 Apr09/1997 Nov 02/2000 Nov 02/2000 Nov 02/2000 Nov 02/2000 Nov 02/2000 Nov Oa2000 Nov 11/2000 Nov 11/2000 Nov11/2000 Nov11/2000 Nov11/2000 Novl1/2000 The claims are owned 50% by W. Don Sutherland of RR. #2 Cochrane, Alberta, and 50% by E. Allan Tipman of Calgary, Alberta.

8 Summarv of Work Done The following work has been done on the property Geological reconnaissance 15 man days Geophysical Surveys 10 line-kilometres 2000 stations 7200 readings Geochemical Surveys 423 samples 1269 analyses Petrographic Study Whole Rock Analysis 4 samples and prospecting 1993 Diamond Drilling metres (NQ-2 Core) Sampling 7 sludge samples 30 core samples 1 bedrock sample 33 soil samples 5 multi-element analyses 1994 Geochemical surveys 219 samples 076 analyses Geophysical surveys 1.8 line km. 366 stations 1,300 readings 1996 Diamond Drilling metres (NQ core)

9 Geoloay The Duncan Lake area lies within the Kootenay tectonic terrain of the Omineca Belt structural subdivision of the Columbian orogen. The Duncan Anticline and the Howser Syncline are the principle structural elements of the area. The property covers the west limb of the Duncan Anticline, and both the core and east limb of the Howser Syncline. Quartzites of the Marsh Adams Formation and carbonates of the Badshot-Mohican formations, defining the east limb of the Howser Syncline are exposed along east perimeter of the property. The remainder of the property is thought to be underlain by younger strata of the Index Formation of the Lardeau Group as mapped by Fyles (1964). However, much of the property at lower elevations and in proximity to Duncan Lake has little or no outcrop, and the structural relationships within the Howser Syncline are complex. The Index Formation is subdivided into an upper division of green chloritic schists and a lower division of grey carbonaceous schists. Both strata and cleavage strike approximately 340 and dip moderately to steeply east. The dominant lineation plunges 10 to the north by northwest. The 1996 diamond drill hole was collared near the contact of the Upper Index Formation as mapped by Fyles (1964). It was drilled to the south-west into the Lower Index Formation. The upper section of the hole was predominantly carbonaceous to argillaceous limestone with pyrrhotite and minor chalcopyrite mineralization. The lower section of the hole was predominantly cherty material with short sections of short grey tuff. The cherty material is pervasively mineralized with fine disseminated pyrite. The detailed diamond drill log and diamond drill hole section are presented in the Appendix.

10 The diamond drill hole (96D-1) intersected pervasive sulphides throughout the entire length. It is probable that the Duncan Lake gossan zone is sourced by sulphide mineralization. Additional drilling is warranted to test the full width of the zone and to explore the zone along strike for possible concentrations of economic mineralization. Signed, W. Don Sutherland, B.A.Sc. Geological Engineer E. Allan Tipman, &A.%, P. Eng, February 6, 1997

11 Cost Statement, 1996 Drillina Proaram West Gate Diamond Drilling: Diamond Drill Contract 14,321.OO Room & Board for Crew (Drifters Restaurant) 1, Mobilization , Ktuana-Kinbasket Tribal Council: Archaeological Investigation E. Allan Tipman: Drill Supervision Nov incl. (7 days 6 $350/day) Subsistence (7 days at $60/day) 4x4 Vehicle (7 days at $45/day) 2,450.OO ,185.OO W. Don Sutherland: Positioning Drill Nov 15 & 16, (2 $350/day) Subsistence (2 days at $60/day) 4x4 Vehicle (2 days at $45.00/day) Core Logging Jan 6, 19, 29, 1997, (3 days at $350/day) Report Preparation (2 days at $350/day) ,660.OO Total Cost $24,340.45

12 Statement of Qualifications I, W. Don Sutherland of RR #2, Cochrane, Alberta, hereby certify: 1. That I graduated from the Faculty of Applied Science and Engineering of the University of Toronto with the degree of Bachelor of Applied Science (B.A.Sc.) in Mining Geology in That my profession is that of Geological Engineer. 3. That I have practised my profession continuously since graduation, and have forty-six years experience in mineral exploration. 4. That I have personally supervised over 47 diamond drilling programs and have logged more than 50 km of diamond drill core. 5. That I located diamond drill hole 96D-1 and logged the core. 6. That I am a 50% owner of the ZN Claim Group. Dated at Cochrane, Alberta, Canada This 6th day of February, 1997 W. Don Sutherland, B.A.Sc. Geological Engineer 10

13 Statement of Oualifications I, E. Allan Tipman of 5933 Signal Ridge Heights, S.W., Calgary, Alberta, hereby certify: 1. That I graduated from the University of British Columbia with the degree of Bachelor of Applied Science (B.A.Sc.) in Metallurgical Engineering in That I am a member of the Association of Professional Engineers, Geologists and Geophysicists of Alberta and have been since April, That I have been actively engaged in mineral exploration intermittently over the past 27 years. 4. That I supervised the drilling of diamond drill hole 96D That I am a 50% owner of the ZN Claim Group. Dated at Cochrane, Alberta, Canada This 6th day of February, 1997 E. Allan Tipman, -B. ASc., P.Eng. 11

14 APPENDIX

15 ZN Claim Group Diamond Drill Log, D96-1 Property: ZW CLAIM GROUP Duncan Lake, B.C. Hole: 96D-1 Claim No.: ZN-28 # Location - U.T.M. Co-ordinates: Bearinq: 250' E N Inclination: -45O Elevation: 585 m Started: Nov 21, 1996 Finished: Nov 26, 1996 Collar: 920 m 130 from NW Corner post, Claim ZN28 Length of Hole: 500 ft. Driller: West-Gate Diamond Drilling Ltd. P.O. Box 255 Core Size: NQ = 4.8 cm Salmo, B.C. VOG 180 Description Casing Overburden Sand & clay Boulders of tuff, quartz & calcite Sand & clay with a few small boulders Limestone, strong wavy black and grey banding 80"/CA +3% pyrrhotite. Weakly magnetic. Moderately conductive. 119.o Tuff, grey-green, weakly sericitic, +3% pyrrhotite, minor pyrite, rare chalcopyrite. Weakly magnetic, moderately conductive. Banding 75O/CA Limestone, crenulated wavy black and grey banding 70'/CA. Moderate to strong pyrrhotite 3% 10% with intimate intergrowth of sparse chalcopyrite. Weakly to moderately magnetic. Moderately to strongly conductive. Black banding is carbonaceous Tuff, grey-green, weakly sericitic. Contacts and banding 600/CA. +6% pyrrhotite. Minor pyrite. Weakly magnetic. Moderately conductive. A few wavy chert bands Limestone, black & grey, caibonaceous, wavy banding 45O to 700/CA. +4% disseminated pyrrhotite. Rare pyrite. Weakly magnetic, moderately to strongly conductive Limestone continuing from above. Irregular quartz veining , , , A little scattered pyrrhotite (<l/4%) and minor pyrite. Some graphite slips. Moderately conductive. Very weakly magnetic Tuff, dark grey and buff-green. Highly contorted chert banding. Increased irregular pycrhotite (+'/4%). A little pyrite. Weakly to moderately magnetic. Moderately conductive. 1

16 ZN Claim Group Diamond Drill Hole Log, 960-l Description Cherty sediment, irregular wavy bands of chert of gley and dark grey banded material. Increased sulphide now +2% pyrrhotite with minor pyrite and LaIe chalcopyrite. Short sections of "crushed grit" surrounded by sulphides. Moderately conductive. Very weakly magnetic. Dark bands are graphitic Silicified zone, predominantly white and grey quartz, minor pyrite on fracture planes. Non magnetic, non conductive Cherty sediment, wavy bands of chert alternating with grey banded material 65'/CA. Fresh break has pearly lustre. 2 6% sulphides disseminated throughout, most11 pyrrhotite with lesser pyrite and minor chalcopyrite. Weakly conductive. Weakly to moderately magnetic. +lo% irregular granular grey quartz patches. Some irregular fractures with pyrrhotite & pyrite fracture filling. Final 5.0 ft. tuffaceous Limestone. Dark grey and light grey banding highly contorted 70"/CA. Decreased pyrihotite now &3%%. A little pyrite. Tuffaceous at start. Some graphite on dark banding. Weakly conductive. slightly to moderately magnetic QuaItz vein, grey and white, irregular contacts Tuff, dark grey and light grey wavy banding with wheat sized elongated grey clasts. A little pyrrhotite (<'/2). Weakly conductive. Weakly Magnetic. A few irregular grey quartz blebs. Rare pyrite Tuff(?) Dark grey fine grained material with 40% light grey j/z 1 mm angular clasts. Non-magnetic, non conductive. Occasional calcite seam. Indistinctly bandei 75O/CA. Rare pyrrhotite. Rare irregular quait seam to 245 ft., several quartz and calcite seams making up to 15% of rock 254 ft. to 262 ft. Slight increase in pyrrhotite from 262 ft. to This section weakly magnetic Tuff(?) continuing but becoming more siliceous with matrix now buff cherty material. Minor pyrihotite Tuff(?) Predominantly thinly banded dark grey material with +15% light grey clasts. A little chert banding. ill/z pyrrhotite with sparse pyrite. Non conductive. Weakly magnetic IQuartz vein, greyish white qllait7.. Kare PYrlEe. 2

17 ZN Claim Group Diamond Drill Hole Log, 960-l From (ft.) (TL Description Wavy chert and seiicite bands with ixreqular quartz blebs up to 0.2 ft. Banding irregular but mostly 45"/CA. Increased sulphides now +3%. Mostly pyrrhotite with lesser pyrite. Weakly conductive. Weakly to moderately magnetic. Sericitic bands predominate ovei chert Limestone. Thinly banded wavy and crenulated dark grey and light grey bands. +2% pyrrhotite in disseminated specks and elongated blebs. Some pyrite *l/4% with pyrrhotite. 0.4 ft. cherty band at 281 ft. Banding 55"/CA. Weakly conductive. Weakly magnetic Chert. Thinly banded brownish buff chert. Banding eo"/ca. Frequent grey and white quartz stringers parallel to banding up to 2 cm wide. Pervasive pyrite as fine dissemination and thin streaks and blebs, estimated at +l%. Minor pyrrhotite. Non conductive, non magnetic Limestone. thinly banded wavy and cienulated dark grey and light grey bands. *l%. Pyrrhotite. Non conductive, non magnetic Chert. thinly banded wavy brownish buff chert. Banding 75'/CA. Pervasive sulphides with pyrite-pyirhotite intergrowth with pyrite predominating. Pyrite estimated at fll/z%. Non conductive. Non magnetic. Similar to section from to Limestone, banded with thin wavy dark grey and light grey layers 70"/CA. A few irregular grey quartz seams up to 1 cm wide. weakly conductive. Very weakly magnetic. Minor pyrrhotite (+'/4%) Fault. 2 cm wide, highly altered talcose material. Fault direction 400/CA Chert. thin bands of wavy buff-brown chert 65"/CA. Very weakly conductive. Very weakly magnetic. Minor pyrrhotite (*%%) is thinly banded limestone Possibly tuff. Wavy and crenulated dark grey to black material with sub-angular lm 3m light grey clasts making up 15% 20% of rock. A few wavy 5mm quartz seams. Minor pyrrhotite (*l/2%). Weakly conductive. Non magnetic Tuffaceous chert. Irregular discontinuous buff brown chert bands in grey siliceous material with abundant rounded and sub-angular dark grey clasts. Very weakly conductive in part. Non magnetic. Scattered irregular quartz blebs. kl% sulphides as disseminated pyrrhotite and pyrite in equal proportions. 3

18 m ZN Claim Group Diamond Drill Hole Log, 960-l From (ft.1 (TL Description Possible tuff, as in Banding 65O/CA. +l% pyrrhotite. Weakly conductive. Weakly magnetic. Numerous wavy grey quartz seams up to 1 cm wide Chert. 70% wavy buff chert bands 55'/CA. Tuffaceous with 5% rounded 1 mm dark grey clasts. *l/z% pyrrhotite. Sparse pyrite. Weakly conductive. Non magnetic Possible tuff as in % grey quartz seams. Sparse pyrrhotite. Weakly conductive. Non magnetic Tuffaceous chert as in A few quartz stringers. +l'/z% pyrrhotite with minor pyrite as intergrowth in pyrrhotite. Weakly conductive. Weakly magnetic Limestone tending to argillite. Alternating fine bands of dark grey and light grey material wavy & crenulated. Numerous irregular dull white quartz seams and blebs making up 20% of Iock. *'/a% pyrrhotite. Rare pyrite. Very weakly conductive. Non magnetic. except in isolated short sections with increased pyrrhotite. Banding 65'/CA at start, 80"/CA at end Chert. Banded irregular wavy buff-brown chert. +l%% sulphides as piedominantly pyrrhotite to ft. then pyrite to ft. Several irregular dull white quait seams and blebs making up 15% of rock. Non conductive. Non magnetic Chert. Banded as above but becoming tuffaceous with fewer quait stringers. 5% angular dark grey clasts. Decreased sulphides, now *l/z%, predominantly pyrrhotite with i-aie pyrite. Non conductive. Non magnetic Tuffaceous argillite with narrow limestone banding. 30% semi-rounded l-2 mm clasts elongated parallel to banding, i.e., 65"/CA. +'/e% pyrrhotite with minor pyrite. Very weakly conductive. Non magnetic. 10% 20% wavy dull white quartz stringers. Banding 65"/CA Chert. Wavy buff-brown chert bands in grey tuffaceous rock. +2% pyrrhotite. Sparse pyrite. Rare pyrite. Quartz veins and Very weakly conductive. Weakly magnetic over shoxt sections. Irregular quartz blebs throughout Argillaceous tuff. Dark grey wavy bands with 35% light grey 1 mm elongated clasts. Banding 80O/CA. Weakly conductive. Weakly magnetic. 4

19 ZN Claim Group Diamond Drill Hole Log, 96D-1 From (ft.) Description Chert as in Increased pyrrhotite now +6%. Moderately conductive. Weakly magnetic. Increasing pyrite from ft. to ft. with decreasing pyrihotite. Pyrite +lm% for this section. A few chlorite slip planes with fine dusting of pyrite. -tlo% irregular quartz blobs and stringers. Decreasing sulphides from ft., now +2% and mostly pyrrhotite with l/3 pyrite Chert as above, moderately stressed with fine fractured lines 35"/CA filled with sphalerite and lesser pyrite. 20% dull white quartz. One 2 cm grey quartz bleb speckled with pyrite. Non conductive. Non magnetic Chert continuing from above but becoming tuffaceous and weakly calcareous. Minor pyrrhotite and +2% pyrite disseminated in middle 2.0 ft. Non magnetic and non conductive except between and which is weakly both Limestone. Wavy, crenulated and contorted narrow bands of light and dark grey material. Tuffaceous texture with abundant elliptical light grey 1 mm clasts. Very minor pyrrhotite and pyrite. Non conductive. Non magnetic Chert. Discontinuous narrow buff-brown chert bands in siliceous grey tuffaceous material. Pervasive finely disseminated pyrrhotite and pyrite. Pyrite strongest from ft. to ft. (?l%%. Weakly conductive and weakly magnetic over short sections pyrite estimated at +%% Quartz vein. Irregular blotches of grey quartz and white quartz Cherty tuff. Granular structure. Pervasive interstatial pyrrhotite & pyrite. Sulphides *8%. Moderately conductive. Moderately magnetic Chert. Banded narrow buff-brownish chert in siliceous grey material. +5% disseminated sulphides as pyrrhotite and pyrite in equal amounts. Possibly minor very fine galena and sphalerite. A few scattered quartz seams. Non conductive. Non magnetic Grey limy material with numerous 2 mm angular black clasts. Grades into and out of chert above and below. Reduced sulphides. Non conductive. Non magnetic Chert as in continuation of same material separated by grey limy material as above Tuffaceous argillite. Thinly banded 70O/CA. Frequent dull white swirls. Crenulated thin bands of black and grey. diminished sulphides, now *l/4% pyrrhotite. Non conductive. Weakly to moderately magnetic. 5

20 ZN Claim Group Diamond Drill Hole Log, 96D-1 From (ft.) Description Chert. Banded narrow buff-brown chert as above. +2% disseminated pyrite. Lesser pyrrhotite. Non conductive. Non magnetic except for small concentration of pyrrhotite at ft. next to 3 cm dull white quartz stringer Tuffaceous argillite as in Weakly conductive. Weakly magnetic. +'I& disseminated pyrrhotite Grey limy mateiia1 as in , grades into banded chert Chert. Narrow discontinuous bands of buff-brown chert in grey siliceous material. Pervasive pyrite disseminated throughout estimated at?2%. LesseI disseminated pyrrhotite. Weakly conductive. Weakly magnetic Grey siliceous material.?%% pyrrhotite. 1 cm grey and white quartz stringer at O/CA. Weakly conductive. Weakly magnetic Tuffaceous argillite as in tlyz% pyrrhotite. Non conductive. Weakly magnetic. Numerous wavy grey quartz stringers in final foot Grey siliceous material similar to tending to tuffaceous. +%% pyrrhotite. Non conductive. Weakly magnetic Tuffaceous argillite similar to l% pyrrhotite. Non conductive. Weakly magnetic. Banding 70"/CA Chert. Numerous thin wavy discontinuous bands of buffbrown chert in grey siliceous material. Several quartz blebs and occasional carbonate bleb. + % pyrrhotite. Non conductive. Weakly magnetic Tuffaceous argillite as in Banding 700/CA. +1X% pyrrhotite. Weakly conductive. Weakly to moderately magnetic Chert. Wavy discontinuous bands of buff-brown chert in greenish-grey tuffaceous material. A few 1 cm grey quartz stringers. +l%% pyrihotite with minor pyrite. Weakly conductive. Weakly magnetic. Grades into slightly calcareous light grey tuffaceous material with abundant dark Y-1 mm clasts at 466 ft. This has decreased pyrrhotite (+X%1 and is non magnetic and non conductive. 6

21 ZN Claim Group Diamond Drill Hole Log, 96D-1 FlZOIll (ft.) 2.) Description Tuffaceous argillite with a few narrow limy bands. Predominantly wavy dark grey to black banded material with abundant elongated light grey clasts. Minor quartz swirls. Minor pyrrhotite. Weakly magnetic. Non conductive. Banding 65O/CA Grey tuff. Banded 70"/CA. Abundant light and dark grey is cherty with *j/z% pyrite. Non conductive. Non magnetic to weakly magnetic depending on pyrrhotite content Chert. Thin wavy discontinuous bands of buff-brown chert. Banding 85'/CA. fine pyrite and lesser pyrrhotite pervasively disseminated throughout. Pyrite estimated at +2%%. Grey quartz vein with a little pyrite. Grey quartz vein Other lesser quartz stringers between 491 ft. and 494 ft. Non magnetic and non conductive except for short sections with increased pyrrhotite End of Hole. CoIe logged by W. Don Sutherland, BASc.,,,,..,,,,..,,,,..,... Date logging completed: January 28, 1997 Core stored at Buckspring Ranch Glenbow Road, RR #2, Cochrane, Alberta

22 ZN CLAIM GROUP DIAMOND DRILL HOLE SECTION 96-DDH-01 OVERBURDEN DARK GREY LIMESTONE WlTH SHORT TVFF SECTIONS FEET 0 tc=-lg METRES TUFFACEOUS IN PART SHORT SECTIONS OF SCALE

23 II a I\, DRILL HOLE 96 DUNCAN LAKE ,200,400 METRES w I -

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