NORTH AMERICAN PALLADIUM LTD. LAC DES ILES MINES LTD TRENCHING & DRILLING ASSESSMENT REPORT. on the LEGRIS LAKE PROPERTY

Transcription

1 NORTH AMERICAN PALLADIUM LTD. LAC DES ILES MINES LTD TRENCHING & DRILLING ASSESSMENT REPORT on the LEGRIS LAKE PROPERTY THUNDER BAY MINING DIVISION NORTHWESTERN ONTARIO NTS: 52H/04NE, 52H/04SE, 52H/03NW, 52H/03SW Lac des Iles G-0739, Max Lake G-0741, Whitefin Lake G-0778, Shelby Lake G-2512 Prepared by John Stoltz October 13 th, 2012

2 TABLE OF CONTENTS 1) Introduction.. 1 2) Land Tenure, Location and Access.. 1 3) Regional Geology ) Local Geology ) Previous Work ) Trenching. 14 7) Drilling ) Conclusions and Recommendations ) References FIGURES 1) Location and Access Map ) Location and Access Map ) Claim Map ) Zone Map. 9 5) Generalized Geology 10 6) Trench Washing Photo ) Channel Sample Photo TABLES 1) Claim Group ) Historic Diamond Drill Hole Significant Intervals 13 3) 2010 Diamond Drill Hole Significant Intervals ) 2011 Drill Hole Statistics..... APPENDIXES Appendix A Daily Trenching Work Log Appendix B Trench Assay Certificates Appendix C Drill Logs Appendix D Drill Log Abbreviation Descriptions Appendix E Drill Assay Certificates Appendix F Signature of Persons Who Prepared This Report

3 MAPS (Back Pocket) 1) Trench LLTR ) Trench LLTR ) Trench LLTR ) Trench LLTR ) Trench LLTR ) Trench LLTR ) Trench LLTR ) Trench LLTR ) Trench LLTR ) 2011 Trench Overview 11) Drilling Plan 12) Vertical Drill Section (LL11 001) 13) Vertical Drill Section (LL LL11 004)

4 1) Introduction This report, submitted to obtain assessment work credit, details the results of drilling and trenching programs performed on six mining claims ( , , , , , and ) between May 14th and December 16th, These claims are part of larger land package of 20 claims (approx hectares) that were the subject of an option agreement entered into by Lac des Iles Mines Ltd. and Optionors Kenneth Fenwick 55%; Don Leishman 25%; Dave Perlin 4.25%; Pat Meloche 4.25%; Jim Naida 4.25%; Tom Connor 2.25%; Donald Devereaux 5%. This land package is southeast and immediately adjacent to the Lac des Iles Mine claim group. Since discovery of the Main Showing in 1999, the Legris Lake Mafic Intrusive Complex has undergone modest exploration by prospectors and exploration/mining companies. The Northwest Border Zone has been the primary focus of historic trenching and diamond drilling programs, which have returned encouraging results. The 2011 trenching efforts were spread across the property, with the objectives of following up on NW Border Zone and Copper Zone mineralization, and to expose stratigraphy in the central and NE Border Zones. The 2011 drill program was designed to test a major magnetic anomaly and mafic/ultramafic stratigraphy of the NE Border Zone. 2) Land Tenure, Location and Access The 2011 Legris Lake trenching program was performed on mining claims , , , , and The 2011 drilling program was performed on mining claims , , , and Access to the Legris Lake Property is obtained by travelling approximately 20km east on Highway 11/17 from Thunder Bay, then 81km north along provincial highway 527. From there, Fensom Road (gravel) leads to the claim group 16km to the west. From kilometers 16 and 17 of Fensom Rd, trench and drill sites can be reached via a network of secondary and tertiary roads and access trails (Figures 1 and 2). On June 22, 2010, Lac des Iles Mines Ltd. entered into an option agreement with the Optionors (see section one for a list of beneficial interests) whereby LDI Mines Ltd. was granted exclusive rights to conduct exploration activities and the option to earn 100% interest in 15 claims in the Lac des Iles, Max Lake, Shelby Lake, and Whitefin Lake areas of the Thunder Bay Mining Division. In addition, the agreement acknowledges the optionee's right to acquire an interest in five mineral claims that were staked on behalf of Lac des Iles Mines Ltd. by Bill Spade of Clark Exploration Consulting between June 25th and July 2nd of 2010 (Figure 3 and Table 1). 1

5 Township/Area Claim Number Area (Hectares) Recorded Holder LAC DES ILES AREA Kenneth Fenwick LAC DES ILES AREA Kenneth Fenwick LAC DES ILES AREA Kenneth Fenwick SHELBY LAKE AREA Kenneth Fenwick SHELBY LAKE AREA Kenneth Fenwick LAC DES ILES AREA Kenneth Fenwick LAC DES ILES AREA Kenneth Fenwick WHITEFIN LAKE AREA Kenneth Fenwick SHELBY LAKE AREA Kenneth Fenwick WHITEFIN LAKE AREA Kenneth Fenwick WHITEFIN LAKE AREA Kenneth Fenwick MAX LAKE AREA Kenneth Fenwick SHELBY LAKE AREA Kenneth Fenwick LAC DES ILES AREA Kenneth Fenwick LAC DES ILES AREA Lac des Iles Mines Ltd. LAC DES ILES AREA Lac des Iles Mines Ltd. LAC DES ILES AREA Lac des Iles Mines Ltd. SHELBY LAKE AREA Lac des Iles Mines Ltd. SHELBY LAKE AREA Lac des Iles Mines Ltd. MAX LAKE AREA Kenneth Fenwick Table 1. Legris Lake Claims List 2

6 280,000 me 300,000 me 320,000 me 340,000 me 360,000 me 5,440,000 mn 5,460,000 mn Legris Lake Claim Group Lac des Iles Mine Rd Fensom Rd 5,460,000 mn 5,440,000 mn Muskeg Lake 5,360,000 mn 5,380,000 mn 5,400,000 mn 5,420,000 mn Hwy 17 Hwy 11 Dog Lake Hwy 11/17 Hwy 527 Thunder Bay Lake Superior 5,420,000 mn 5,400,000 mn 5,380,000 mn 5,360,000 mn Figure kilometres Scale 1:500,000 Projection: NAD83 Zone 16 Hwy 61 mn 280,000 me 300,000 me 320,000 me 340,000 me 360,000 me 5,340, 3

7 315,000 me 316,000 me 317,000 me 318,000 me 319,000 me 320,000 me 4 Stonefish Lake ,444,000 mn 5,445,000 mn Historic Core Laydown Area Gate Legris Lake LAC DES ILES SHELBY LAKE MAX LAKE WHITEFIN LAKE ,445,000 mn 5,444,000 mn ,443,000 mn Km17 Road 5,443,000 mn Legend DDH Collar 441,000 mn 5,442,000 mn metres Figure 2 315,000 me 316,000 me Fensom Road Km16 Road 317,000 me 318,000 me 319,000 me 320,000 me Roads and Trails Stream Marsh Lake 2011 Trench Claim Boundary Claim Area Boundary 5,442,000 mn

8 5 310,000 me 312,000 me 314,000 me 316,000 me 318,000 me 320,000 me 322,000 me 5,446,000 mn 5,448,000 mn *Claims held by Lac des Iles Mines Ltd. Max Lake Area Legris Lake 5,448,000 mn 5,446,000 mn Lac des Iles Area 5,440,000 mn 5,442,000 mn 5,444,000 mn Shelby Lake Area Figure ,000 metres Scale 1:50,000 Projection: NAD83 Zone ,000 me 312,000 me 314,000 me *Claims held by Kenneth Fenwick 316,000 me 318,000 me 320,000 me Whitefin Lake Area 5,444,000 mn 5,442,000 mn

9 3) Regional Geology The following excerpt was taken from Pettigrew Figure references do not apply to figures in this document. Refer to Pettigrew 2002 or see figures 4 and 5 for an overview of geology. "The Legris Lake Property is situated in the western part of the meso-archean, granite-greenstone Wabigoon Subprovince of the Superior Province (Fig. 3). The Legris Lake Complex is part of a series of PGE bearing mafic-ultramafic intrusions that forms a circular pattern approximately 30 kilometres in diameter (Sutcliffe 1986) near the Wabigoon-Quetico Subprovince boundary (Fig. 3). The series includes the Lac des Iles Complex ( /-2 Ma (Davis and Edwards 1986)), Tib Lake, Towle Lake, Wakinoo Lake, Demars Lake, Taman Lake, Buck Lake, and Dog River intrusions (Fig. 3). The country rocks surrounding the Legris Lake Complex consist of metasediments and metabasalts (Fig. 4 and Map 2). The sedimentary rocks are primarily fine grained greywackes, conglomerates, and siltstones, with minor oxidefacies iron formations and argillaceous beds. All rocks, including those of the Legris Lake Complex, were intruded by late granodiorite dykes and quartz-feldspar pegmatites that branched out from later voluminous granodiorite plutons. The Legris Lake Complex and surrounding rocks were later intruded by diabase sills during the formation of the Mid-continent Rift at 1.1 Ga (Paces et al. 1993) (Fig. 4 and Map 2)." (Pettigrew 2002) 4) Local Geology The following excerpt was taken from Pettigrew & Hatorri, 2002a. Refer to Pettigrew & Hattori 2002, Pettigrew & Hattori 2002a, Pettigrew 2000, and Pettigrew 2002 for detailed descriptions of local geology. Figure references do not apply to figures in this document. Refer to Pettigrew & Hatorri 2002a or see figures 4 and 5 for zone locations and generalized geology. "The Legris Lake Complex formed through multiple injections of volatile-rich mafic magmas and extensive assimilation of sedimentary rocks. This resulted in the Complex consisting of various gabbroic rocks with minor anorthosite and ultramafic rocks such as wehrlite. Of particular interest is a plagioclase (70 to 80 vol %) porphyritic leucogabbro with a matrix of fine grained clinopyroxene. This texturally distinct, medium to coarse grained leucogabbro is termed the Main Showing-type and is abundant in the Northwestern Border area of the Complex (Fig. 3). It is important because is hosts the majority of the known platinum group element (PGE) mineralization. This Main Showing-type is less evolved, with low Si02 ( wt%) and moderately high MgO (4 to 6 wt%) compared to other leucogarrbo which contain wt% Si02 and 4-5 wt% MgO. The Main Showing-type leucogabbro show overall low concentrations of large ion lithophile elements, displaying trace element patterns distinctly different from other leucogabbros (Fig. 4). 6

10 The Complex also contains numerous dykes, sills, and breccias containing fragments of cognate phases and metasedimentary country rocks. The interaction between the parental magmas and country rocks is so extensive that the boundary is not easily defined in some places. Gabbro with abundant sedimentary xenoliths grades into sedimentary rocks with abundant, irregular dyke stockworks. Fluids discharged from magmas and dehydrating sedimentary xenoliths resulted in significant deuteric alteration in. earlier solidified phases. The alteration is particularly abundant in the Northwestern Border area where complex textures are developed by numerous dykes and sills and abundant partially melted sedimentary xenoliths. The deuteric alteration resulted in uralization of clinopyroxene to hornblende +/- actinolite, serpentinization of olivine, and saussuritization of plagioclases. Such alteration may have contributed to the extensive conversion of mafic minerals to chlorite +/biotite. The rocks then underwent local, retrograde greenschist facies metamorphism around granodiorite dykes and pegmatite veins related to the voluminous granodiorite intrusion to the west of the Complex (Fig. 3). This late event resulted in the oxidation of magnetite to hematite and the formation of biotite +/- chlorite +/- epidote +/- carbonate +/- albite. Based on the lithological associations and textures, the Complex is divided into four areas: Central, Northeastern Border, Southwestern Border and Northwestern Border areas. Central Area This area has a surface exposure of several square km and consists almost entirely of medium grained, massive, biotite-rich leucogabbro with moderate magnetic susceptibilities. There are several large tongueshaped blocks of metasedimentary rocks extending up to 600 m from the contact with sedimentary rocks into the Complex which are interpreted to be roof pendants (Fig. 3). Airborne and ground magnetic data show that more magnetite-rich phases are present at depth, suggesting that the biotite-rich leucogabbro represents a highly evolved unit, capping the complex. Northeastern Border Area This area consists of mostly mesogabbro and clinopyroxenite with many other minor phases including leucogabbro and wehrlite. This area is very poorly exposed and much of the interpretation is based on geophysical and limited drill core data. This area contains the largest ultramafic body in the Complex, approximately 1 km in diameter (Fig. 3), consisting mostly of clinopyroxenite and wehrlite, both of which display weakly developed layering defined by variations in olivine content. A large (500 by 200 m) zone of clinopyroxenite breccia along the boundary with the Central area, termed the Cross Zone, is characterized by abundant anorthosite to melanogabbro breccias in a strongly magnetic matrix of clinopyroxenite to melanogabbro. Anomalous contents of PGEs (up to 300 ppb) occur in the matrix of this breccia.[2011 drill-testing of a magnetic anomaly in this zone (hole LL11-001; metasediments) has resulted in a significant reduction in the extent of the Northeastern Border Zone.] 7

11 Southwestern Border Area This area consists of mostly mesogabbro and coarse grained leucogabbro (Main Showing-type) and is homogeneous in comparison to the rest of the Complex (Fig. 3). This area also contains a dyke-shaped body of magnetite-rich ultramafic rocks. The narrow (less than 50 m wide) ultramafic rocks show concentric zoning with a melanogabbro exterior grading into a thin (- 10m) lherzolite - dunite core with abundant magnetite. Northwestern Border Area This area is extremely heterogeneous in texture and composition, consisting of predominant sedimentrich heterolithic breccias, and a wide variety of igneous rocks ranging from anorthosite to clinopyroxenite, yet magmatic layering occurs within individual sills. This area contains the majority of the Main Showing-type leucogabbro. The heterolithic breccias contain abundant dykes and sills, and xenoliths of metasedimentary rocks (Fig. 3). The xenoliths vary widely in size and shape; and most are highly distorted and internally deformed. The localized nature of the deformation suggests that these xenoliths were incorporated into semisolidified, dynamic magmas. The area displays numerous injections of gabbroic magmas as sills and dykes in clastic metasedimentary rocks (Fig. 5). The intervening metasediment lenses between these sills and dykes were partially melted and assimilated into the magmas, which caused them to fail, producing textures and structures akin to those produced by the sedimentary processes of slumping and soft-sediment deformation (Fig. 5). The assimilation of sedimentary rocks combined with fractional crystallization produced a wide spectrum of magmas, ranging in composition from diorite to melanogabbro. The matrix of the conglomerates within the metasedimentary rocks was most susceptible to assimilation, resulting in near complete disaggregation of conglomerates and transformation of cobbles into rounded xenoliths in gabbroic matrix. Furthermore, fluids expelled by dehydration of sedimentary rocks and solidifying magmas caused extensive brecciation of rocks. Sedimentary rocks generally contain pyrite (up to 1 vol%), and the assimilation of such rocks likely contributed to the saturation of sulphur in the magma and formation of Cu-Ni-PGE mineralization in this area." (Pettigrew & Hattori, 2002a) 8

12 5,444,000 mn 5,446,000 mn 5,448,000 mn 5,442,000 mn 5,440,000 mn 312,000 me 314,000 me 316,000 me Figure 4 318,000 me 320,000 me 322,000 me Legris Lake ,446,000 mn 5,444,000 mn 5,442,000 mn 5,440,000 mn metres 1,000 Scale 1:50,000 Projection: UTM Zone 16 (NAD83) 312,000 me 314,000 me 316,000 me 318,000 me 320,000 me 322,000 me

13 316,000 me 318,000 me 322,000 me 320,000 me 322,000 me 5,446,000 mn 320,000 me 10 5,448,000 mn 314,000 me 5,446,000 mn 312,000 me Legris Lake 5,444,000 mn 5,444,000 mn 5,440,000 mn 5,440,000 mn 5,442,000 mn 5,442,000 mn Figure metres 1,000 Scale 1:50,000 Projection: UTM Zone 16 (NAD83) 312,000 me 314,000 me 316,000 me 318,000 me

14 5) Previous Work In 1962, the property was covered by an Ontario Department of Mines/Geological Survey of Canada aeromagnetic survey. In 1965, field mapping was conducted by Les Kaye as part of the Eayrs Lake- Starnes Lake mapping. Kaye noted the similarities between rocks of the Legris Lake area and a similar triangular shaped intrusion near Wakinoo and Trumper Lakes The northwest portion of the property was covered by Richard Sutcliffe (Ontario Department of Mines) during a mapping program in 1985 and During 1987 and 1988, Heenan Senlac Resources Limited conducted a ground horizontal loop electromagnetic and magnetic survey, and contracted Aerodat Limited to conduct an airborne geophysical survey. The airborne survey included a four-frequency electromagnetic survey, a high sensitivity cesium vapor magnetometer, a two frequency VLF-EM system, a video tracking camera, a radar altimeter, and an electronic positioning system (Dvorak; MacRae) Kenneth Fenwick prospected the complex in 1999 and discovered the mineralization of the Main Showing. Avalon Ventures Ltd. and Starcore Resources Ltd. optioned the property in November, 1999 and signed a joint venture agreement with Placer Dome Ltd. in Between 1999 and 2002, they completed ground magnetometer, Spectral IP/Resistivity, trenching (twelve trenches), channel sampling, geological mapping, prospecting, soil sampling, and diamond drilling, which intersected significant mineralization in both the Poplar Zone and Main Showing. (MacRae). See figure 4. In 2000, The Ontario Geological Survey carried out an airborne magnetic and electromagnetic survey as a part of the Garden-Obonga Area. In June, 2004, North American Palladium Ltd. optioned the property and carried out small prospecting and trenching (six trenches) programs. In April of 2005, NAP drilled 3 diamond drill holes targeting gravity and magnetic anomalies. In September and October of 2005, Terraquest Ltd. was contracted to complete a high sensitivity magnetic and VLF-EM airborne survey. Due to a lack of 11

15 significant results from the ddh program, the property was returned to Kenneth Fenwick. The property was optioned by Abitibi Mining Corporation in May of In addition to compilation work and an inversion of airborne magnetic data, they completed a ground magnetometer survey over an area of the central zone that had not been covered by the Avalon surveys. In June, 2010, Lac des Iles Mines Ltd. optioned the property and staked five additional claims. A 3900m diamond drill program was carried out, along with a substantial trenching program. Although the grades encountered were less than economic, they continue to illustrate the fertile nature of the complex (Table 3). 12

16 Legris Lake Historic Significant Intercepts Hole Number Zone From To Pd (ppm) Pt (ppm) Au (ppm) Cu (%) Ni (%) LL00 01 Poplar Zone And Poplar Zone Including Poplar Zone And Poplar Zone LL00 02 Poplar Zone Including Poplar Zone Including Poplar Zone And Poplar Zone Including Poplar Zone LL00 03ext Main Showing And Main Showing And Main Showing And Main Showing LL00 04 Poplar Zone Including Poplar Zone LL00 07 Stonefish Lake Including Stonefish Lake LL00 08 Poplar Zone Including Poplar Zone And Poplar Zone And Poplar Zone L01 12 Cross Zone L01 13 Cross Zone L01 14 Poplar Zone Including Poplar Zone Including Poplar Zone And Poplar Zone L01 15 Main Showing Including Main Showing Including Main Showing L01 16 Poplar Zone Including Poplar Zone And Poplar Zone L01 20 Main Showing And Main Showing And Main Showing And Main Showing Including Main Showing Table 2. Historic significant DDH intercepts (Adapted from MacRae 2007). 13

17 Drill Hole From (m) To (m) Length (m) Pd g/t Pt g/t Au g/t Cu % Ni % Co % LL Including LL LL LL LL LL Including LL LL Including LL LL Including LL Including LL LL Including LL Including LL Including LL Including Table Significant DDH intercepts 6) Trenching The 2011 trenching program was designed with a three part focus: 1) Follow-up on areas of known mineralization in the NW Border Zone, Central Zone, and Copper Zone. 2) Test the strong magnetic anomaly that defines the northeast border of the complex. 3) Expose potential north-south-striking stratigraphy near the center of the complex. Belham Ltd. was contracted to carry out excavation of the trenches and did so between June 1 and June 27. Bedrock washing and channel sampling was also contracted to Belham Ltd., and was carried out between June 6 and July

18 Following excavation, bedrock exposures were pressure washed using a high-pressure wajax (or 5.5hp Honda) water pump and fire hose (Figure 6). Channel sample intervals were marked out on the bedrock by North American Palladium Ltd staff or personnel. Cutting was performed using a Stihl TS400 water-cooled cut-off saw equipped with a diamond blade; two parallel saw kerfs were cut four to five centimetres apart and eight to 10 centimetres deep; samples intervals were indicated by a saw cut placed perpendicular to the direction of the sampling lines (figure 7 ). Figure 6. LLTR11 03 Bedrock washing by Belham Ltd. 15

19 Figure 7. Channel sample intervals at LLTR Samples were chipped free using a masonry chisel and hammer, then packaged in individually labeled plastic sample bags (as a backup, the bags also included a labeled manila shipping tag). The plastic bags were then taped shut, packed three to four to a rice bag, and transported to the ActLabs assaying facility in Thunder Bay. For quality control purposes, a total of six blanks and standards were inserted per seventy-sample batch. For future reference, aluminum tags inscribed with the appropriate sample number, were secured to the starting saw kerf with masonry nails (Figure 7). Trench mapping was performed between June 14th and September 5th by staff or contract personnel from North American Palladium Limited s Metals Exploration Division. When available, a Leica GS15/GS10 real-time kinetic GPS system was used to survey trench outlines and sample intervals. The system was tied to control point TBM01790 and the positional accuracy is generally better than 5cm. When the RTKGPS system was not available, trenches were surveyed using a tape measure and three or more handheld GPS control points. Field trench maps were scanned, georeferenced, and digitized using Mapinfo Professional and Encom Discover software 16

20 packages. Trenching targets and results have been summarized below. Refer to map 10 for trench locations, and to maps 1-9 for detailed geology. LLTR11-01 & LLTR11-02 (Maps 1 & 2) These two trenches were designed to test the very strong linear magnetic anomaly that defines the northeast border of the complex. Due to the deep nature of overburden in this area, bedrock was not reached. Because copper and palladium mineralization have been observed in association with magnetite-anorthosite/leucogabbro at several locations on the property, this target was drill-tested later in the year. LLTR11-03 (Map 3) LLTR11-03 was planned with several targets in mind: a NE-structure and IP/Mag target interpreted by JVX, an extension to the Copper Zone exposure, and a possible N-Strending structure interpreted from the ground mag survey. Three distinct units were exposed including, from east to west, olivine-bearing clinopyroxenite, fine grained magnetite-anorthosite/lgab, and medium grained GAB/LGAB. Though no significant mineralization was encountered, anomalous copper levels exist throughout the ANOR- Mt, with the greatest concentrations (up to 0.05% Cu) occurring within 7m of the Ol- CPYXT contact. Other anomalous concentrations (~250ppm Cu) occur within the Ol- CPYXT, in association with Po+Ccp. LLTR11-04 (Map 4) This trench was designed as an extension to TR-04-03, in order to follow-up on anomalous nickel concentrations and a north-south-trending succession of mafic units observed in TR and TR Except for the westernmost several meters (metasediments) this new excavation exposed massive biotite/hornblende leucogabbro. Due to the consistantly-unmineralized nature of this unit, only one sample was collected per every five meters. No significant mineralization was encountered. TR was also remapped and is included in Map 4. LLTR11-05 (Map 5) The location of this trench, originally planned as an eastern extension to TR-04-01, was moved approximately 130m to the south (and rotated slightly) to an area where bedrock would be more attainable. It exposed gabbro with lesser amounts of melanogabbro, leucogabbro, and possble norite. Geochemically and texturally, the rocks often resemble the massive, biotite-rich leucogabbro. Locally, it appears to exhibit layering on 17

21 a scale of ~10cm, trending 250 degrees, and dipping moderately to the north-northwest. No significant mineralization was encountered. LLTR11-06 (Map 6) Planned as a western extension to TR-04-01, only 30m of addition bedrock were exposed before overburden depths became too great to excavate. It seems to have exposed a gradational succession of mafic/ultramafic units, which trend approximately northeast-southwest. Those portions of TR that are still exposed, were also mapped and sampled. Anomalous copper mineralization (up to 393ppm) occurs in association with magnetite-anorthosite/leucogabbro. LLTR11-07 (Map 7) This trench, originally planned 200m to the south, was moved to an area with abundant outcrop, and more shallow overburden. It was designed to expose an apparent lithologic contact, as interpreted from ground mag. The southwest end exposed massive, medium-grained, biotite-rich leucogabbro. The northeast end of the trench exposed very fine-fine grained, magnetite-bearing anorthosite-leucogabbro-gabbro. Southwesttrending, moderately dipping(se) felsic dikes are common in the southeast portion of the trench, while mafic-intermediate dikes are more common in the northeast portion. The only significant mineralization was 0.77% Cu (JS ), obtained from a chalcopyrite-rich xenolith. LLTR11-08 (Map 8) The highest palladium and platinum grades from historic Trench 7 occur at the eastern edge of the exposure. LLTR11-08 was planned as an eastern extension to this trench, in an effort to increase the extents of known mineralization, and to better understand the base metal-poor mineralization, and the structures/lithologies that host it. A complex mixture of gabbro, varitextured gabbro, magnetite-anorthosite/leucogabbro, and mottled anorthosite make up the majority of the newly-exposed bedrock. All of these units are closely related to each other and contacts are often gradational. The northern corner of the exposure consists almost entirely of metasediments, which are complexly folded at their contact with the mafic intrusives. Elevated PGE concentrations were encountered, usually in varitextured gabbro, but never at concentrations of greater than 1ppm Pd. LLTR11-09 (Map 9) 18

22 Due to the abundance of north-south-trending structures observed in the Poplar Zone, and Main Showing, it has been hypothesized that they are necessary for the remobilization of PGE's associated with this type of mineralization. LLTR11-09 was planned to intersect the northern extension of a set of such structures observed in historic Trench 1. While north-south-trending fracture zones were observed, favorable rock types were not. Exposed bedrock consists primarily of metasediments, and disaggregated conglomerate, with lesser granodiorite and heterolithic breccia. 7) Drilling 2011 diamond drilling in the Legris project area was contracted to Bradley Bros. Limited and was supervised by North American Palladium Ltd staff and contractors. Four diamond drill holes (DDH) were completed, totaling 2,168 meters (table 4) between November 4th and December 16th, Drill core was delivered to the Lac des Iles Mine Site by a driller or drill foreman on a daily basis. Each box was laid out in order, sample intervals marked by a geologist or geotechnician, photographed, and logged by a geologist prior to being split and sampled. With the exception of an interval of metasediments in LL11-002, LL LL were sampled in their entirety at one meter intervals. LL was sampled selectively. All ddh were left uncemented and capped in case assay results had warranted re-entering a hole. The DDH targets and results have been sumarized below. Refer to maps 11 through 13 for plan and vertical sections. HOLE_NUMBER EASTING NORTHING ELEVATION AZIMUTH DIP TOTAL_DEPTH LL LL LL LL * Azimuths are relative to UTM Grid (Nad83 Zone16) Table Drill Hole Statistics. LL was designed to test the southern limb of a very strong magnetic anomaly that was thought to define the northeast nose of the complex. There is very little outcrop in the area and trenching efforts failed to reach bedrock. The hole was collared in metasediments and encountered intervals of oxide-facies iron formation between 95m and 320m. Several small intervals (typically less than one meter) of sulfide-facies (pyrite,pyrotite) iron formation were also encountered. The abundance of veining warranted sampling, however no significant assays were encountered. 19

23 Limited structural data from the Copper Zone area suggested near vertical, NE-trending layering. LL LL were drilled as an ESE-oriented fence, intended to test a section of that stratigraphy for reef-style mineralization, and to test for a down-dip extension to Copper Zone mineralization exposed at the surface. LL succeeded in intersecting Copper Zone-type leucogabbro but it was not mineralized. LL intersected ultramafics (clinopyroxenite & wehrlite), gabbro/gabbronorite, and melanogabbro. LL intersected gabbro with intervals of ultramafics (probably as dikes). No significant assays were encountered. 7) Conclusions and Recommendations Most of the 2011 trenches (LLTR11-04, 05, 06, 07, and 09) did not expose significant mineralization and, therefore, do not warrant further work. LLTR11-08 did expose elevated levels of PGE concentration, however not so elevated as to warrant further trenching or drilling at this time. While the 2011 drill program did not encounter significant levels of PGE mineralization, it did encounter several intervals with PGE concentrations greater that typical Legris Lake background levels Most of the mineralization discovered on the property to date seems to occur as "pods" with limited extent, or in xenoliths. Now that the ultramafic rocks of the NE Border Zone have been tested, without significant results, further exploration efforts should be refocused on the NW Border Zone where PGE occurences are concentrated. 20

24 8) References Dvork, Z Report on Combined Helicopterborne Magnetic, Electromagnetic and VLF Survey Legris Lake Area Lac des Iles Area Northwestern Ontario, company report. Hart, T.R., MacDonald, C.A.K. and Lepine, C.D Precambrian geology, Lac des Iles greenstone belt, northwestern Ontario; Ontario Geological Survey, Preliminary Map P.3435, scale 1:20,000. Kaye, L Geology of the Eayrs Lake - Starnes Lake Area, District of Thunder Bay; Ontario. Department of Mines, Geological Report 77, 29p., Accompanied by Map 2171, scale 1:63360 MacDonald, C.A., Tremblay, E., ter Meer, M., Hart, T.R. and Easton, R.M Precambrian geology of the Max-Muskrat lakes area, west-central Nipigon Embayment, northwestern Ontario; Ontario Geological Survey, Preliminary Map P.3561, scale 1:50,000. MacRae, W Qualifying Report on Legris Lake Property Thunder Bay District, Ontario for Abitibi Mining Corporation, company report. Nielsen, P. E., 2005 North American Palldium Ltd Diamond Drilling Report Legris Lake Project, company report. Nielsen, P. E., 2005 North American Palldium Ltd. Assessment Report Airborne Geophysical Survey Legris Lake Project, company report. O.D.M. - G.S.C Lac Des Milles, Thunder Bay district; Ontario Department of Mines - Geological Survey of Canada, Aeromagnetic Survey Series, map 2099G, scale 1:63360 Ontario Geological Survey 2000 Airborne magnetic and electromagnetic surveys, Garden-Obonga area; Ontario Geological Survey, Map and , scale 1:20,000. Pettigrew, N. T Report on Exploration Program Legris Lake Palladium- Platinum Property Avalon Ventures Ltd./Starcore Resources Ltd. Joint Venture, company report. 21

25 Pettigrew, N. T. and Hattori, K. H Geology of the Palladium-rich Legris Lake Mafic-ultramafic Complex, Western Wabigoon Subprovince, Northwestern Ontario. Exploration and Mining Geology Journal, v10, Pettigrew, N. T. and Hattori, K. H. (2002a). Palladium-copper-rich PGE mineralization in the Legris Lake Mafic-Ultramafic Complex, Western Superior Province of Canada. Transaction, Institute of Mining and Metallurgy, 111, Series B, B46-B57. Pettigrew, N. T Report on Exploration Program Legris Lake Palladium- Platinum Property Avalon Ventures Ltd./Starcore Resources Ltd./Placer Dome (CLA) Limited Joint Venture, company report. Stoltz, J., 2011 North American Palladium Ltd Diamond Drilling & Trenching Assessment Report on the Legris Lake Property, company report. Surmack, S unpublished notes. Sutcliffe, R.H., Regional Geology of the Lac des Iles Area, District of Thunder Bay. In Summary of Field Work and Other Activities Ontario Geological Survey Miscellaneous Paper 132, p Sutcliffe, R.H. and Sweeny, J.M., Precambrian Geology of the Lac des Iles Complex, District of Thunder Bay, Ontario. Ontario Geological Survey, Map 3047, Geological Series-Preliminary Map, scale 1:15840 or 1 inch to ¼ mile. 22

26 APPENDIX A Daily Trenching Work Log

27 2011 Legris Lake Daily Trenching Log Date Workers Company Nature of work 15/03/2011 John Stoltz NAP Trench Planning 02/04/2011 John Stoltz NAP half day on 2011 prospecting, trenching, and drill planning 04/04/2011 John Stoltz NAP Geologic Interpretation prospectiong, trenching, and drill planning 06/04/2011 John Stoltz NAP Geologic Interpretation prospectiong, trenching, and drill planning 07/04/2011 John Stoltz NAP Geologic Interpretation prospectiong, trenching, and drill planning 11/04/2011 John Stoltz NAP Geologic Interpretation prospectiong, trenching, and drill planning 12/04/2011 John Stoltz NAP Geologic Interpretation prospectiong, trenching, and drill planning 13/04/2011 John Stoltz NAP Geologic Interpretation prospectiong, trenching, and drill planning 14/05/2011 John Stoltz NAP Prospecting/mapping NE corner of property. Flagged in 11P-JMS_LLTR009 near Copper Zone. 29/05/2011 John Stoltz NAP Legris Planning, data compilation, & data entry Field day. Flagged in 11P-JMS-LLTR008, 11P-JMS-LLTR011 & the start of 11P-JMS-LLTR010. Cleaned-up Helipad-B, and scouted access to 11P- 31/05/2011 John Stoltz NAP JMS-006 & 11P-JMS /05/2011 Steve Hamer Belham Ltd Mobilization of Excavator to Core Storage Location. Begin attaching skids to Sea Can. 01/06/2011 John Stoltz NAP Propecting along Km17 road. Supervision of mobilization of excavator to 11P-JMS-LLTR010 (LLTR11-01) 01/06/2011 Mike Grieve NAP Afternoon at Legris dropping off trench-washing equipment, checking road conditions, and checking possible access to 11P-JMS /06/2011 Steve Hamer Belham Ltd Afternoon. Worked on sea can skids. Remobilization of excavator to 11P-JMS-LLTR010 (LLTR11-01) 01/06/2011 Josh Belham Ltd Afternoon. Worked on sea can skids. 01/06/2011 Carmen Belham Ltd Afternoon. Worked on sea can skids. Remobilization of excavator to 11P-JMS-LLTR010 (LLTR11-01). Begin excavation of LLTR /06/2011 John Stoltz NAP Checked in on excavator at LLTR11-01, collected trench soil samples, prospecting in, and to the SE of, 11P-JMS-PROSPECT9. 02/06/2011 Carmen Belham Ltd Complete LLTR11-01 (no bedrock), excavate LLTR11-02 (no bedrock), mob. to LLTR11-03, and begin excavation. Checked in on excavator at 11P-JMS-LLTR009 (LLTR11-003), concentrated till samples from previous day, checked possible camp location, 03/06/2011 John Stoltz NAP and prospected along Km19 road. 03/06/2011 Carmen Belham Ltd Continue excavation of LLTR Leave early (~3:00pm) Field day. Checked in at LLTR11-03, helped Belham guys round up equipment and supplies. Afternoon prospecting/mapping in prospect zone 06/06/2011 John Stoltz NAP 8. Drive into town in evening to get trash pump. 06/06/2011 Carmen Belham Ltd Continue excavation of LLTR Late start (~10:00am) 06/06/2011 Lee Belham Ltd Partial day gathering up equipment and supplies. 06/06/2011 Tim Belham Ltd Partial day gathering up equipment and supplies. 07/06/2011 John Stoltz NAP Drop off 1.5" trash pump at LLTR11-03, Prospectin/mapping along fensom road, end of day check in at LLTR /06/2011 Steve Hamer Belham Ltd Drop off excavator at km17, pick up other excavator out on km16 road. 07/06/2011 Carmen Belham Ltd Excavating LLTR11-03 most of the day. Last couple of hours on LLTR10-04 reclaimation and mob to km16 road. 07/06/2011 Lee Belham Ltd Washing at LLTR /06/2011 Tim Belham Ltd Washing at LLTR11-03 Marked out sample intervals at LLTR11-03, flagged in 11P-JMS-LLTR012, scouted 11P-JMS-LLTR013, and showed Carmen location of next 08/06/2011 John Stoltz NAP trenches. 08/06/2011 Carmen Belham Ltd Excavating LLTR Move machine to km17 road at 5:00pm for fuel-up 08/06/2011 Lee Belham Ltd Washing and maybe start cutting at LLTR Meet Carmen at km17 road at 5:00pm. 08/06/2011 Tim Belham Ltd Washing and maybe start cutting at LLTR Meet Carmen at km17 road at 5:00pm. 09/06/2011 John Stoltz NAP Office day. Sample processing and data entry. 09/06/2011 Carmen Belham Ltd Excavating LLTR /06/2011 Lee Belham Ltd Cutting/sampling at LLTR /06/2011 Tim Belham Ltd Cutting/sampling at LLTR11-03 Checked in w/ excavator at LLTR11-04 and gave instructions for the rest of the trench. Checked in at LLTR11-03 to mark out more sample 10/06/2011 John Stoltz NAP intervals. 10/06/2011 Carmen Belham Ltd Continue excavation at LLTR Short day; left for the weekend around 1:00pm. 10/06/2011 Lee Belham Ltd Continue Cutting and sampling at LLTR Short day; left for the weekend around 1:00pm. 10/06/2011 Tim Belham Ltd Continue Cutting and sampling at LLTR Short day; left for the weekend around 1:00pm. 11/06/2011 John Stoltz NAP Office day entry, planning and interpretation. I little resarch into UAV aerial trench photos. 12/06/2011 John Stoltz NAP Geologic interpretation and preparation for upcoming week of field work. 13/06/2011 John Stoltz NAP Checked in with trench washers and excavator. Flag in proposed trench 11P-JMS-LLTR007. Prospecting in zone PROSPECT8. 13/06/2011 Carmen Belham Ltd Late start. Excavating at LLTR /06/2011 Lee Belham Ltd Late start. Washing, cutting and sampling at LLTR /06/2011 Tim Belham Ltd Late start. Washing, cutting and sampling at LLTR /06/2011 Steve Hamer Belham Ltd Supervising Belham crew and washing, cutting, and sampling at LLTR /06/2011 John Stoltz NAP Marking sample intervals, supervising, and trench mapping at LLTR /06/2011 Carmen Belham Ltd Finish digging sump at LLTR Road maintainance between LLTR11-04 and LLTR Begin excavating LLTR /06/2011 Lee Belham Ltd Washing, cutting, and sampling at LLTR /06/2011 Tim Belham Ltd Washing, cutting, and sampling at LLTR /06/2011 John Stoltz NAP Flag in proposed trenches 11P-JMS-LLTR003 & 11P-JMS-LLTR001. Trench Mapping at LLTR /06/2011 Carmen Belham Ltd Excavating at LLTR /06/2011 Lee Belham Ltd Complete cutting and sampling at east end of LLTR Move equipment to west end and begin pumping out water. 15/06/2011 Tim Belham Ltd Complete cutting and sampling at east end of LLTR Move equipment to west end and begin pumping out water. 16/06/2011 John Stoltz NAP Office day. Data entry and trench map digitizing. 16/06/2011 Carmen Belham Ltd Finish excavation LLTR Begin LLTR11-06.

28 16/06/2011 Lee Belham Ltd Pumping excess water and washing at west end of LLTR /06/2011 Tim Belham Ltd Pumping excess water and washing at west end of LLTR Half day in the field marking sample intervals for LLTR11-03, and excavator supervision. Half day in the office on sample descriptions, data 17/06/2011 John Stoltz NAP entry, etc. 17/06/2011 Carmen Belham Ltd Finish excavation of LLTR Begin excavation of LLTR /06/2011 Lee Belham Ltd Cutting and sampling at west end of LLTR /06/2011 Tim Belham Ltd Cutting and sampling at west end of LLTR /06/2011 John Stoltz NAP Trench Mapping at west end of LLTR /06/2011 John Stoltz NAP Trench map digitizing, data entry, preparing for field work 20/06/2011 John Stoltz NAP Trenching Supervision. Gave Devin a property tour. 20/06/2011 Devin Tait NAP Trenching Supervision. Property tour. 20/06/2011 Carmen Belham Ltd Excavating at LLTR /06/2011 Nate Belham Ltd Move equipment to LLTR Start washing. 20/06/2011 Tim Belham Ltd Move equipment to LLTR Start washing. 21/06/2011 Carmen Belham Ltd Excavating at LLTR /06/2011 Nate Belham Ltd Washing and sampling at LLTR /06/2011 Tim Belham Ltd Washing and sampling at LLTR /06/2011 Devin Tait NAP Trenching Supervision. Marking samples at LLTR and LLTR /06/2011 Carmen Belham Ltd Excavating at LLTR11-07 and LLTR /06/2011 Nate Belham Ltd Washing and sampling at LLTR /06/2011 Tim Belham Ltd Washing and sampling at LLTR /06/2011 Carmen Belham Ltd Excavating at LLTR /06/2011 Nate Belham Ltd Washing and sampling at LLTR /06/2011 Tim Belham Ltd Washing and sampling at LLTR /06/2011 Devin Tait NAP Trenching Supervision. Collecting Samples 24/06/2011 Carmen Belham Ltd Finish excavating LLTR Begin excavating LLTR /06/2011 Nate Belham Ltd Washing and sampling at LLTR /06/2011 Tim Belham Ltd Washing and sampling at LLTR /06/2011 Carmen Belham Ltd Finish excavating LLTR /06/2011 Lee Belham Ltd Washing and sampling at LLTR /06/2011 Tim Belham Ltd Washing and sampling at LLTR /06/2011 Devin Tait NAP Trenching Supervision. Collecting Samples 29/06/2011 Carmen Belham Ltd Washing and sampling at LLTR /06/2011 Lee Belham Ltd Washing and sampling at LLTR /06/2011 Tim Belham Ltd Washing and sampling at LLTR /06/2011 Devin Tait NAP Trenching Supervision. Marking samples at LLTR11-06 and LLTR11-07(only first section closest to the road) 30/06/2011 Carmen Belham Ltd Washing and sampling at LLTR /06/2011 Lee Belham Ltd Washing and sampling at LLTR /06/2011 Tim Belham Ltd Washing and sampling at LLTR /07/2011 John Stoltz NAP Partial day reviewing new assay data. Geologic interpretation. 03/07/2011 John Stoltz NAP Partial day reviewing new assay data. Geologic interpretation. 04/07/2011 John Stoltz NAP Picked up LLTR11-06 samples and 4" pump. Took a quick look at LLTR11-08, 09. Mapping at LLTR /07/2011 Carmen Belham Ltd Sampling at LLTR Move gear to LLTR /07/2011 Lee Belham Ltd Sampling at LLTR Move gear to LLTR /07/2011 Tim Belham Ltd Sampling at LLTR Move gear to LLTR /07/2011 John Stoltz NAP Mark out samples at LLTR Complete mapping at LLTR /07/2011 Carmen Belham Ltd Sampling at LLTR /07/2011 Lee Belham Ltd Sampling at LLTR /07/2011 Tim Belham Ltd Sampling at LLTR /07/2011 John Stoltz NAP Begin trench map digitizing, then had to go out to field to mark out sample intervals at LLTR11-09, and LLTR /07/2011 Carmen Belham Ltd Move gear to LLTR11-09 after bear encounter at LLTR Begin sampling. 06/07/2011 Lee Belham Ltd Move gear to LLTR11-09 after bear encounter at LLTR Begin sampling. 06/07/2011 Tim Belham Ltd Move gear to LLTR11-09 after bear encounter at LLTR Begin sampling. 07/07/2011 John Stoltz NAP LLTR11-05 trench map digitizing, data entry, geologic interpretation. 07/07/2011 Carmen Belham Ltd Channel sampling at LLTR /07/2011 Lee Belham Ltd Channel sampling at LLTR /07/2011 Tim Belham Ltd Channel sampling at LLTR /07/2011 John Stoltz NAP Mapped LLTR Picked up samples from LLTR11-09 and dropped them at the office. 08/07/2011 Lee Belham Ltd Partial day sampling at LLTR /07/2011 Tim Belham Ltd Partial day sampling at LLTR /07/2011 John Stoltz NAP Met surveyor on site. Showed him the trench and ddh locations. Return to the office to start digitizing and LLTR /07/2011 Darren Prinselaar NAP Partial day being shown location of trenches and ddh's that need surveyed. 10/07/2011 John Stoltz NAP Met surveyor on site again, and did sample descriptions for LLTR11-04 & LLTR11-06 channel samples. 10/07/2011 Darren Prinselaar NAP Partial day at legris attempting to do some trench surveying. Couldn't get equipment to work properly. 11/07/2011 John Stoltz NAP Trench map digitizing (LLTR11-09), data entry, geologic interpretation. 11/07/2011 Darren Prinselaar NAP Trench and ddh collar surveys 11/07/2011 Lee Belham Ltd Channel sampling at LLTR /07/2011 Tim Belham Ltd Channel sampling at LLTR11-08

29 12/07/2011 John Stoltz NAP Data entry, geologic interpretation, trench survey processing. 12/07/2011 Lee Belham Ltd Finish sampling at LLTR Move back to LLTR /07/2011 Tim Belham Ltd Finish sampling at LLTR Move back to LLTR11-07 Marked out sample intervals at LLTR Mapped LLTR Began mapping at LLTR Picked up samples from LLTR11-07 & LLTR11-13/07/2011 John Stoltz NAP /07/2011 Carmen Belham Ltd Channel Sampling at LLTR /07/2011 Lee Belham Ltd Channel Sampling at LLTR /07/2011 Tim Belham Ltd Channel Sampling at LLTR /07/2011 John Stoltz NAP Drop off supplies at LLTR11-07 and map LLTR /07/2011 Carmen Belham Ltd Channel Sampling at LLTR /07/2011 Lee Belham Ltd Channel Sampling at LLTR /07/2011 Tim Belham Ltd Channel Sampling at LLTR /07/2011 John Stoltz NAP Data entry, trench map digitizing, geologic interpretation, etc. 15/07/2011 Carmen Belham Ltd Channel Sampling at LLTR /07/2011 Lee Belham Ltd Channel Sampling at LLTR /07/2011 Tim Belham Ltd Channel Sampling at LLTR /07/2011 John Stoltz NAP Trench map digitizing, budjet tracking. 18/07/2011 Lee Belham Ltd Channel Sampling at LLTR /07/2011 Tim Belham Ltd Channel Sampling at LLTR /07/2011 John Stoltz NAP Sample descriptions at LLTR11-08 and LLTR /07/2011 Lee Belham Ltd Channel Sampling at LLTR /07/2011 Tim Belham Ltd Channel Sampling at LLTR /07/2011 John Stoltz NAP Data entry and geologic interpretation. 20/07/2011 Lee Belham Ltd Half day demob to Shebandowan area. 20/07/2011 Tim Belham Ltd Half day demob to Shebandowan area. 21/07/2011 John Stoltz NAP Data entry, geologic interpretation, etc. 02/08/2011 John Stoltz NAP Data review, geologic interpretation, & plannning. 03/08/2011 John Stoltz NAP Data review, geologic interpretation, & plannning. 04/08/2011 John Stoltz NAP Data review, geologic interpretation, & plannning. 05/08/2011 John Stoltz NAP Data review, geologic interpretation, & plannning. 06/08/2011 John Stoltz NAP Data review, geologic interpretation, & plannning. 10/08/2011 Darren Prinselaar NAP Half day surveying trenches LLTR11-04 & LLTR /08/2011 John Stoltz NAP Data review, geologic interpretation, & plannning. 13/08/2011 John Stoltz NAP Data review, geologic interpretation, & plannning. 14/08/2011 John Stoltz NAP Trench mapping at LLTR11-04 and prosprecting east of claim group. 15/08/2011 John Stoltz NAP Sample processing, trench map digitizing. 02/09/2011 John Stoltz NAP Half day supervising trench surveyor and doing some some sample descriptions at LLTR /09/2011 Darren Prinselaar NAP Half day surveying trenches LLTR10-08, LLTR11-07, and started LLTR had some trouble with equipment 03/09/2011 John Stoltz NAP Quarter day preparing trench base maps 05/09/2011 John Stoltz NAP Trench Mapping and sample descriptions at LLTR /09/2011 John Stoltz NAP Half day on trench sample data entry. 07/09/2011 John Stoltz NAP Report Writing 19/10/2011 John Stoltz NAP Map Making and Report Writing 20/10/2011 John Stoltz NAP Report Writing 21/10/2011 John Stoltz NAP Report Writing 12/10/2012 John Stoltz NAP Report Writing 13/10/2012 John Stoltz NAP Report Writing