MOUNTAIN MINERALS CO. SURVEYS OF PARTS OF THE CLAIMS IN NORTH CENTRAL B.C. LIARD MINING DIVISION GEOGRAPHIC COORDINATES ) L.C.P.

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1 MOUNTAIN MINERALS CO. LTD GEOLOGICAL E GEOPHYSICAL SURVEYS OF PARTS OF THE VERDE # 1 (16 units) E VERDE # 2 (2 units) MINING CLAIMS IN NORTH CENTRAL B.C. LIARD MINING DIVISION GEOGRAPHIC COORDINATES 59' 8' N ) ) L.C.P. 128' 11' W ) N.T.S. 14 P McDAME BY JOHN W. PERSTON, B.Sc. M.Sc MOUNTAIN MINERALS CO. LTD. P.O. Box 7 LETHBRIOGE, Alberta. T1 J 326

2 TABLE OF CONTENTS INTRODUCTION TECHNICAL DATA (a) Geological Report. (b) Geophysical Report. ITEMIZED COST STATEMENT AUTHOR ' S QUALIFICATIONS LIST OF ILLUSTRATIONS Figure 1. General Index Map B.C. Figure 2. Location Map Verde #J & Verde #2 Figure 3. Part of Claim Map 14P/lE. Figure 4. Sketch Geology Location 1. Figure 5. Sketch Geology Location 2. Figure 6. C.E.M. Plot Line 1. Figure 7. C.E.M. Plot Line 2. LIST OF TABLES Table 1. C.E.M. readings Line 1. Table 2. C.E.M. readings Line 2. APPENDIX I. PAGE (S) 1 & 2 6 & 7 1, 11 pr A 2. 4 i I.I

3 - 1 - INTRODUCTION (i) The two Verde claims are located at 59' 8' N and 128' 11' W (L.C.P.) in north central British Columbia approximately 1 air kilometers south-southwest of Watson Lake in the Yukon Territory. The local topography is rugged with elevations ranging from 12 m. to 18 m. in deep incised valleys. Tree cover is limited to the valley floors with sub-arctic tundra at the higher more exposed elevations where only arctic birch and dwarf willows survive in the more sheltered areas. The whole area is covered in mud and rock slips, this surface mobility being a result of the severe climate. (see figures 1-3). (ii) The property comprises two claims of 16 and 2 units respectively staked on by S. Wise and J. Kubiak acting as agents for Mountain Minerals Co. Ltd. They were recorded on under record number 122E. It has had a varied history having been prospected and worked over for a period of 2 years. Five different sets of claim posts are locatable, old x-ray drill holes (at site 2) and blast holes (at site 1) indicating that work was carried out on the property. However, no factual data exists to complement this information. The property appears as number 53 named Hope or Debbie and is listed as a copper prospect on the B.C. Revised Mineral Inventory Map 14P (M 1.) The property is mislocated on the map the first mineralized showing lying 1.5 km. southwest of the noted site, the mineralization extending northwest from this location. The current owner of the property is unknown as it was sold by Mountain Minerals Co. Ltd. before the date it was due to lapse as part of an agreement between the company and the

4 - 2 - prospectors who brought the property to the attention of the company. However, it is assumed that the property was not maintained in good standing and that the ground is now open to the staking of mineral cl aims. (iii) The two locations showing the most mineralization were mapped geologically at a scale of 1:2. The total area covered was 12, sq. m. Two C.E.M. lines were run across these areas each one being 4 m. long for a total length of.8 km. (iv) The claims worked were the Verde #1 and Verde #2 mining claims.

5 VERDE PROPERTY BRITISH COLUMBIA Pike George.Fat N*hon I i i i i i i I ALBERTA t I Scale: 1:8,,. Figure 1.

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7 . L, \' \ f33 PART OF CLAIM SHEET 14 P/lE 1:5.. Showing true claim Locations Sample sites & C.E.M. lines, t # Figure 3

8 - 6 - TECHNICAL DATA. (a) Geological. The regional geology comprises a series of limestones and limestone schists striking at approximately 33' and dipping subvertically. Slumping and contortion of surface exposure due to the climatic conditions has left large blocks of seemingly in situ material scattered widely over the area. The bedrock units are cut by an extensive series of quartz veins ranging in width from several millimeters to many meters. These are traceable in some cases for several hundred meters and form the host for limited copper mineralization. Most veins are barren but three separate veins do contain some copper minerals. At site number 1 (Figure 3. and Figure 4.) at the south eastern end of the property grey and brown (iron-stained) calcareous shales outcrop dipping 8' at 225' and striking 315'. These shales are cut by irregular vertical quartz veins trending along the strike, the irregularities being well exhibited in the valley section. These veins are barren. To the west lie brown shales with a 1 m. quartz vein containing some shale sections. This vein carries irregularly distributed sulfide material and shows surface oxide staining of copper mineralization. Chalcopyrite, chalcocite and bornite after chalcopyrite were noted in the rock giving surface oxidation products of azurite and malachite. On the southwest side of this valley several pits have been blasted in a different quartz vein. The fragmented samples show a thin (1 cm.) vein of disseminated oxidized sulphide. Boulders in the stream show this same vein but no in situ material was found. It is thought that the mineraliza- tion represents one large boulder broken up and spread around by the

9 - 7 - blasting. Although this mineralization lies along strike from the mineralized zone across the stream, the grey shales contrast sharply with the brown shales suggesting a fault zone along the stream. At site number 2 (Figure 3 and Figure 5) approximately 1.5 km. northwest of 1 and 15 m. off strike to the southwest exposure is limited to a 1 m. quartz vein and its intercalated sediments slumped rock and mud effectively mask the southern side of the unit while the vein can be traced approximately 1-15 m. northwest. Grey limey sub-vertical shales underlie the vein which comprises a 1 m. quartzose section with minor shales and a 2 m. mixed section of quartz and shale. Mineralization is limited to the 1 in. vein. It comprises minor chalcopyrite, bornite after chalcopyrite, and pyrite with surface alteration to azurite and ma1 achi te. Although the veins at sites 1 & 2 are 1.5 km. apart and only 15 m. strike distance apart, it is apparent that they are not the same vein as the breaks in slope of the landform presumably indicate the location of the harder quartzose material and the breaks over the continuations of these veins do not meet. Site 3 (Figure 3.) 2.1 km. further northwest and an additional 35 m. off strike to the southwest is a 2 m. vein of quartz with very minor sulfide material but extensive oxide bloom. Float material is traceable for 3 m. along the apparent strike length but only one section appears to be in place. From the geological evidence it is concluded that the prospect comprises three separate quartz veins with minor copper mineralization. The suggestion of a continuous zone up to 4 km. long is invalid.

10 . -8-

11 - 9-1 N,-' No m*,

12 - 1 - (b) Geophysical. Two continuous electromagnetic lines were run over sites one and two for 4 m. at each site. The methodology used was horizontal shootback as outlined below: HORIZONTAL SHOOTBACK EM METHOD With this method both operators traverse along the same line (perpendicular to the expected strike direction). Both operators in turn transmit and receive - measuring the dip angle of the field. The two dip angles are then added together and equal "" if no conductors are present. The station measured is the mid-point between the two men. The separation between the two men can vary from 1' to 6' (3 meters to 2 meters). Readings are generally taken at two frequencies if a conductor is detected. The ratio of the resultant dip angles permits an evaluation of the conductivity of the body. OPERATION: The way the coils are held in the transmit and receive positions is very important and is as follows: The two operators proceed along the survey line until they reach their positions. The leading operator receives first (switch at Rx) The trailing operator who is the chief operator (he records the readings) places his coil in the transmit position - accurately horizontal - and switches it on Tx. Note both operators must face perpendicular to the line of traverse with the other operator always on his left hand side. The gain control of the receiver is now set (this is normally done only once per day). This is done by holding the receiver in the horizontal position and turning the volume control until the Field Strength meter is at 1 on the black scale. This is carried out at the first

13 reading only by both operators preferably in a non-anomalous area. (1 1 OPERATOR RECEIVING OPERATOR TRANSMITTING - switch at Rx - switch at Tx - Coil moved to Null - Coil Horizontal - Inclinometer read on red - Inclinometer accurately scale (Example -8') - Other operator to his left kept on red T mark - Other operator to his left Station Read (2) LEADING OPERATOR shouts "OFF" and calls reading -8' to chief (over 3' use Wal ki-tal kies) (3) Both operators remaining in the same position and facing in the same direction reverse the procedure. LEADING OPERATOR TRANSMITTING OPERATOR RECEIVING - switch at Tx - switch at Rx - Coil Horizontal - Coil moved to Null - Inclinometer accurately kept on - Inclinomete read on red scale red T mark (Example +8 s ) - Other operator to his left - Other operator to his left (4) Operator records readings - Shouts "OFF" - Both men switch to "OFF" and move to next station.

14 FREQUENCIES: In most areas use 183 Hz for basic coverage and 39 Hz in anomalous areas. In areas of highly conductive background conditions where the 183 Hz frequency produces -5' to -2' readings over wide areas then both 39 Hz and 183 Hz frequencies should be used for basic coverage. In the exploration for weak conductors use 51 Hz and 183 Hz. OUT OF PHASE MEASUREMENT: This reading is sometimes helpful in separating overburden effects from subsurface conductors particularly in areas of very high or very low surface conductivity. The reading is simply the minimum Field Strenght reading when the coil is in the null position. If the coil is set for a Field Strength reading of 1 (by means of the volume control) when both coils are horizontal, then the out-of-phase is read as a percent of the normal field. Usually the reading is taken only by the Chief operator who must be careful with his notes since the resultant dip angle reading is recorded at the station midway between the two men and the out-of-phase at his own location. Appendix 1 gives information regarding the type of C.E.M. unit used and its specifications. The dip angle readings taken are listed in Tables 1 and 2 and the difference values plotted on figures 6 and 7 following standard methods. The results are interpreted to indicate that no significant mineralization (i.e. less than 1% disseminated sulfides) occurs at these sites. The negative readings to the south on line 1 and to the north on line 2 are indicators of conductive overburden.

15 1-.I.Z $4

16 .z S* S

17 HORIZONTAL SHOOTBACK E.M. Line 1. Coil Spacing 5 m. Medium frequency (183 HZ) Station Leading Difference Receiving 2+s OS l+oos +5OS + O+5N 1+N 1 +5N 2+N Zone of Interest TABLE 1.

18 HORIZONTAL SHOOTBACK E.M. Line 2. Coil Spacing 5 m. Medi urn frequency (1 83 HZ). Station L.eadi ng Difference Receiving 2+s 1+5OS 1 +oos ' +5S + O+5N 1 +N 1+5N 2+N Zone of Interest + TABLE 2.

19 AUTHOR'S QUALIFICATIONS J.W. Perston graduated from London University in 1969 with a B.Sc. (Hons.) in geology. He worked full time from 1969 to 1973 in Canada and Latin America on mineral exploration and mine geology. in He returned to university in 1973 and received his M. Subsequent exploration activities have been in Latin Sc. America, the Middle East and western North America.

20 ITEMIZED COST STATEMENT (a) J. W. Perston 7 days June $8.OO/day $ 56. H. V. Smith 7 days June $loo.oo/day 7. (b) Camp food supplies Misc. meals en route (c) (i) Transportation to Watson Lake J. W. Perston H. V. Smith (ii) Excess baggage charges 45. (iii) Car rental. Watson Lake. (June 19) 31.8 (iv) He1 icopter usage 3141.OO (d) Geophysical equipment $525/month (min. charge) 525. Freight (e) Mi scell aneous i terns (f) Report preparation, typing, copying, etc. 25. Total ; $65.65

21 CRONE GEOPHYSICS LIMITED AUSTRALIAN OFFICE: US. OFFICE: 244 NEWBRIDGE RD E. ORCHARD RD.. SUITE 38 MISSISSAUOA. ONTARIO MOOREBANK. N.S.W. 217 ENGLEWOOD. COLORADO. Boll CANADA LSClV8 Phone: (418) Phone : (2) Telex: Cable: CRONGEO. TORONTO CEM THE CRONE ELECTROMAGNETIC INSTRUMENT DESIGNED TO BE USED WITH THE HORIZONTAL SHOOTBACK EM METHOD AS WELL AS VERTICAL LOOP AND HORIZONTAL LOOP METHODS. EQUIPMENT SALES AND RENTALS Appendix I. C.E.Y. Specifications.

22 - 2 - CEY SPECIFICATIONS The complete CEM instrument consists of two identical coils both capable of receiving and transmlttlng alternating magnetic fields at three fixed frequencies. Battery Supply is contained in a aluminum box mounted on a magnesium packframe. Coil dimensions and weight: Diameter of 56 cm (22'); 3.8 Kg (8.3 Ib). Complete unit shipped in two wooden shipping boxes: Dimensions and weight of one empty box: 31 x 61 x 77 cm(12" x 24" x 3"). 13 Kg (29 Ib). Weight of one shipping box complete with coil, packframe. batteries and earphones: 23 Kg (51 Ib). Shipping weight of complete unit (2 boxes): 46 Kg (12 Ib). Standard Frequencies: 39, 183 and 51 Hz (others available upon request). Field tilt measwement by visual null on field strength meter and audio null through crystal earphones. Inclinometer range of 2, accuracy It.5 degrees. Receiver gain control: Linear calibrated 1 turn pot. Field strength measurements from meter. Operating range of coils: Up to 2 meters (6'). Battery Supply: 3 of 6 volt lantern batteries, Eveready #731 weight per battery; 1.3 Kg (2.8 Ib). audio battery supply; 1 of 9 volt, Eveready #216 Normal operational lifetime of battery supply - 3 to 6 weeks. OPTIONAL EXTRAS Recharge battery supply and audio pack - 3 of 6 volt Gel cells Clip on battery pack (two of 9 volt Eveready #216) for use of coil as a visual receiver only (Vertical loop surveys). Plug In battery supply and audio pack for use of coil as audio and visual receiver only (Vertical loop surveys). Canvas knapsack for carrying coil with above options. Note that the CEM coil is used as a receiver with the Crone VEM - large Vertical Loop system with a range of 8 meters, (26').