Cortez Project, Lander County, Nevada, USA

Transcription

1 Cortez Project, Lander County, Nevada, USA Technical Report and Qualified Person s Review Prepared for: by: Placer Dome Inc. Larry Smith, P.Geo. Effective Date: 20 Project Number:

2 IMPORTANT NOTICE Recognizing that Placer Dome Inc. (PDI) has legal and regulatory obligations in a number of global jurisdictions, AMEC Americas Limited (AMEC) consents (a) to the filing of this report with any stock exchange and other regulatory authority and any publication of this report by them for regulatory purposes, including electronic publication in the public company files on their websites accessible by the public, and (b) to the publication of this report and/or excerpts thereof and/or information therein by PDI on its company website or otherwise, and (c) to all other uses by PDI of this report and/or excerpts thereof and/or information therein in connection with its business. This report was prepared as a National Instrument Technical Report, in accordance with Form F1, for Placer Dome Inc. (PDI) by AMEC Americas Limited (AMEC). The quality of information, conclusions, and estimates contained herein is consistent with the level of effort involved in AMEC s services, based on: i) information available at the time of preparation, ii) data supplied by outside sources, and iii) the assumptions, conditions, and qualifications set forth in this report. This report is intended to be used by PDI, subject to the terms and conditions of its contract with AMEC. That contract permits PDI to file this report as a Technical Report with Canadian Securities Regulatory Authorities pursuant to provincial securities legislation. Except for the purposes legislated under provincial securities laws, any other use of this report by any third party is at that party s sole risk.

3 CERTIFICATE OF AUTHOR Larry B. Smith, R. Geo, C. P. Geo 780 Vista Blvd., Suite 100 Sparks, Nevada Tel: (775) Fax: (775) I, Larry B. Smith, R. Geo, C.P. Geo., am a Registered Geologist and Chartered Professional Geologist, and Manager of Mining & Metals Consulting of AMEC Mining & Metals, Inc. of 6575 Stone Valley Drive in the city of Reno in the state of Nevada. I am registered as a Professional Geologist in the state of Wyoming (PG-324), am a Fellow and Chartered Professional Geologist in the Australasian Institute of Mining and Metallurgy (Registration number ) and am a Certified Professional Geologist with the American Institute of Professional Geologists (CPG-10313). I graduated from Boise State University with a Bachelor of Science in geology in 1972 and subsequently obtained a Master of Science degree in Economic Geology from the Colorado School of Mines in I have practiced my profession continuously since 1972 and have been involved in: mineral exploration for uranium, copper, gold, silver, nickel, lead, zinc, and industrial minerals in the United States, Canada, Mexico and Central America; exploration data evaluation, geological modeling and resource modeling of gold, copper, iron, manganese and industrial mineral deposits in the United States, Canada, Colombia, Chile, Bolivia, Brazil, Greenland, Bosnia and Niger. As a result of my experience and qualifications, I am a Qualified Person as defined in National Instrument I am currently a Consulting Geologist and have been so since February I am responsible for the preparation of the technical report titled Technical Report and Qualified Persons Review, Cortez Joint Venture, Nevada and dated 20 (the Technical Report ) relating to the Cortez Joint Venture Mine in Lander County, Nevada. I prepared Sections 1 through 12, 15, 18, 19.7 to 19.10, 20 and 21 of the Technical Report. Between 9 to 18 December 2003, 23 to 24 August 2004 and 26 to 30 September 2005 I visited the Cortez Joint Venture property and reviewed exploration programs, exploration data, geological models, resource estimates and reserve estimates for the purpose of preparing a technical report on all mining operations and mineral resources and reserves within the joint venture. I was assisted in the site review of resource estimations, mining, pit designs and reserve estimation by Mr. Tracy E. Barnes, P.Eng., a Qualified Person in the areas of resource estimation, reserve estimation and mining engineering, and in analysis of sampling, assaying and quality assurance / quality control by Todd Wakefield, Member, AusIMM, a Qualified Person in the area of assaying and quality assurance / quality control. Mr. Barnes prepared Sections 17, 19.1, 19.2, 19.6 and through Mr. Wakefield prepared Sections 13 and 14. Alexandra Kozak, P.Eng, a AMEC E&C Services In. 780 Vista Blvd., Suite 100 Sparks, Nevada Tel Fax

4 Qualified Person in the area of metallurgy and process, assisted with an office review of metallurgical tests and plant performance. She prepared Sections 16 and 19.3 through The resulting Technical Report was prepared under my supervision. I was the Qualified Person responsible for the preparation of the previous technical reports on the Cortez property, which reports were dated 26 February 2004 and 08 September 2004 respectively and which were filed with the Canadian securities regulators on 5 March 2004 and 13 September 2004 respectively. I have had no other prior involvement with the property that is the subject of the Technical Report.. Tracy E Barnes is a Registered Professional Engineer in the State of Colorado, Registration No , and is employed by Barnes Engineering Services, Inc as President and Principal Mining Engineer, and residing at W 15 th Drive in the City of Golden in the State of Colorado, USA. He is a member of the Society for Mining, Metallurgy, and Exploration, the American Statistical Association, and the International Association for Mathematical Geology. He graduated from the University of Washington, Seattle, Washington with a Bachelor of Science in Mining Engineering degree in Mr. Barnes has practiced his profession continuously since 1975 and has been involved in: gold operations in the United States, New Zealand and Chile and preparation of mine audits, scoping, pre-feasibility, and feasibility level studies for gold properties in United States, Canada, Chile, Peru, New Zealand, and Brazil. Todd Wakefield is a Member, Australasian Institute of Mining and Metallurgy, employed as Principal Geologist of AMEC E&C Services Inc. and residing at 4110 Twin Falls Drive in the City of Reno in the State of Nevada, USA. He is a Member of the Society of Mining, Metallurgy and Exploration and the Geological Society of Nevada. He graduated from the Colorado School of Mines with a Masters of Science in Geology in 1989 and from the University of Redlands, California with a Bachelor of Science in Geology in Mr. Wakefield practiced his profession continuously from 1989 to 2002 and from 2004 to the present. He has been involved in geology, geochemistry, sampling, assaying and QAQC evaluation in exploration and at established mine sites in the United States, Canada, Venezuela, Peru and Indonesia. Alexandra J. Kozak, P.Eng. is a Professional Engineer, employed as Senior Process Engineer of AMEC Americas Limited and residing at 5021 Pinetree Crescent in the City of West Vancouver in the Province of British Columbia. She is a member of the Association of Professional Engineers and Geoscientists of British Columbia (APEGBC). She graduated from the University of Alberta with a Bachelor of Science in Mineral Process Engineering degree in Ms. Kozak has practiced her profession continuously since 1985 and has been involved in: gold operations in Canada and Guyana and preparation of scoping, pre-feasibility, and feasibility level studies for gold, silver, zinc, nickel/cobalt and molybdenum metal recovery from properties in Canada, United States, Peru, Mexico, Mongolia, Ghana and New Guinea. I am not aware of any material fact or material change with respect to the subject matter of the Technical Report, which is not reflected in the Technical Report, the omission to disclose which makes the Technical Report misleading. I, Mr. Tracy Barnes, Mr. Todd Wakefield and Ms. Alexandra Kozak are independent of Placer Dome Inc. in accordance with the application of Section 1.5 of National Instrument

5 I have read National Instrument and certify that the Technical Report has been prepared in compliance with that Instrument. I further certify that, as of the date of this certificate, the Technical Report contains all of the information required under Form F1 in respect of the property that is the subject of the report. Dated at Sparks, Nevada, this 20 th day of. Larry B. Smith, P.Geo., C.P. Geo.

6 Larry B. Smith, R. Geo, C. P. Geo 780 Vista Blvd., Suite 100 Sparks, Nevada Tel: (775) Fax: (775) CONSENT of AUTHOR TO: British Columbia Securities Commission Alberta Securities Commission Saskatchewan Securities Commission Manitoba Securities Commission Ontario Securities Commission Commission des valeurs mobilieres du Quebec Nunavut Legal Registry Officer of the Administrator, New Brunswick Nova Scotia Securities Commission Registrar of Securities, Prince Edward Island Securities Commission of Newfoundland Registrar of Securities, Government of the Yukon Territories Securities Registry, Government of the Northwest Territories AND TO: Placer Dome Inc. I, Larry B. Smith, do hereby consent to the filing of the technical report prepared for Placer Dome Inc. titled Technical Report and Qualified Persons Review, Cortez Joint Venture, Nevada and dated 20 (the "Technical Report") with the securities regulatory authorities referred to above. I further consent (a) to the filing of the Technical Report with any stock exchange and other regulatory authority and any publication of the Technical Report by them for regulatory purposes, including electronic publication in the public company files on their websites accessible by the public, and (b) to the publication of the Technical Report and/or excerpts thereof and/or information therein by Placer Dome Inc. on its company website or otherwise, and (c) to all other uses by Placer Dome Inc. of the Technical Report and/or excerpts thereof and/or information therein in connection with its business, and (d) to the use of my name as a Qualified Person in connection with the Technical Report in any continuous disclosure documents or other regulatory documents or filings of Placer Dome Inc., in all applicable jurisdictions. I certify that I am not aware of any material fact or material change with respect to the subject matter of the Technical Report, which is not reflected in the Technical Report, the omission to disclose which makes the Technical Report misleading. I confirm that I have read the Placer Dome Inc. news release dated September 15, 2005 entitled Placer Dome Approves Cortez Hills Project and that its contents are consistent with the information in the Technical Report. Dated this 20th day of. Larry B. Smith AMEC E&C Services In. 780 Vista Blvd., Suite 100 Sparks, Nevada Tel Fax

7 th West 15 Drive, Golden, Colorado USA CERTIFICATE OF QUALIFIED PERSON Tracy E Barnes, P.E W 15 th Drive Golden, Colorado, USA Tel: (303) Fax: (303) tbarnes@barnesengr.com I, Tracy E Barnes am a Registered Professional Engineer in the State of Colorado, Registration No , employed by Barnes Engineering Services, Inc as President and Principal Mining Engineer, and residing at W 15 th Drive, Golden, Colorado, USA. I am a member of the Society for Mining, Metallurgy, and Exploration, Inc., the American Statistical Association, and the International Association for Mathematical Geology. I graduated from the University of Washington, Seattle, Washington with a Bachelor of Science in Mining Engineering degree in I have practiced my profession continuously since 1975 and have been involved in: gold operations in the United States, New Zealand and Chile and preparation of mine audits, scoping, pre-feasibility, and feasibility level studies for gold properties in United States, Canada, Chile, Peru, New Zealand, and Brazil. As a result of my experience and qualifications, I am a Qualified Person as defined in National Instrument I am currently a Consulting Engineer and have been so since May I served as the Qualified Person writing sections 17, 19.1, 19.2, 19.6 and through of the technical report titled Technical Report and Qualified Persons Review, Cortez Joint Venture, Nevada and dated 20 on the Cortez Joint Venture Mine in Lander County, Nevada (the Technical Report ), relating to mineral resource and reserve estimates, mine design, mine planning, and mining operations. I visited the Cortez Mine site December 15 through 18, 2003, August 23 through 24, 2004 and September 26 through I served as a Qualified Person writing sections 17 and 19 of the previous technical reports on the Cortez property, which reports were dated 26 February 2004 and 08 September 2004 respectively and which were filed with the Canadian securities regulators on 5 March 2004 and 13 September 2004 respectively. I have had no other prior involvement with the property that is the subject of the Technical Report. I am not aware of any material fact or material change with respect to the subject matter of the Technical Report which is not reflected in the Technical Report, the omission to disclose which makes the Technical Report misleading. I am independent of Placer Dome Inc. in accordance with the application of Section 1.5 of National Instrument Voice: (303) Facsimile: (303) tbarnes@barnesengr.com

8 I have read National Instrument and certify that the portions of the Technical Report for which I served as a Qualified Person have been prepared in compliance with that Instrument. I further certify that, as of the date of this certificate, the portions of the Technical Report for which I served as a Qualified Person contain all of the information required under Form F1 in respect of the property that is the subject of the report. Dated at Golden, Colorado, United States of America, this 20 th day of. Signature on File Tracy E. Barnes, P.E.

9 12945 West 15 th Drive, Golden, Colorado USA Tracy E. Barnes, P.E W 15 th Drive Golden, Colorado, USA Tel: (303) Fax: (303) tbarnes@barnesengr.com CONSENT of AUTHOR TO: British Columbia Securities Commission Alberta Securities Commission Saskatchewan Securities Commission Manitoba Securities Commission Ontario Securities Commission Commission des valeurs mobilieres du Quebec Nunavut Legal Registry Officer of the Administrator, New Brunswick Nova Scotia Securities Commission Registrar of Securities, Prince Edward Island Securities Commission of Newfoundland Registrar of Securities, Government of the Yukon Territories Securities Registry, Government of the Northwest Territories AND TO: Placer Dome Inc. I, Tracy E. Barnes, do hereby consent to the filing of the technical report prepared for Placer Dome Inc. titled Technical Report and Qualified Persons Review, Cortez Joint Venture, Nevada and dated 20 (the "Technical Report") with the securities regulatory authorities referred to above. I further consent (a) to the filing of the Technical Report with any stock exchange and other regulatory authority and any publication of the Technical Report by them for regulatory purposes, including electronic publication in the public company files on their websites accessible by the public, and (b) to the publication of the Technical Report and/or excerpts thereof and/or information therein by Placer Dome Inc. on its company website or otherwise, and (c) to all other uses by Placer Dome Inc. of the Technical Report and/or excerpts thereof and/or information therein in connection with its business, and (d) to the use of my name as a Qualified Person in connection with the Technical Report in any continuous disclosure documents or other regulatory documents or filings of Placer Dome Inc., in all applicable jurisdictions. I certify that I am not aware of any material fact or material change with respect to the subject matter of the Technical Report, which is not reflected in the Technical Report, the omission to disclose which makes the Technical Report misleading. I confirm that I have read the Placer Dome Inc. news release dated September 15, 2005 entitled Placer Dome Approves Cortez Hills Project and that its contents are consistent with the information in the Technical Report. Dated this 20 th day of. Signature on File Tracy E. Barnes Voice: (303) Facsimile: (303) tbarnes@barnesengr.com

10 CERTIFICATE OF QUALIFIED PERSON Alexandra J. Kozak, P.Eng. 111 Dunsmuir Street, Suite 400 Vancouver, BC Tel: (604) Fax: (604) I, Alexandra J. Kozak, P.Eng., am a Professional Engineer, employed as Senior Process Engineer of AMEC E&C Services Limited and residing at 5021 Pinetree Crescent in the City of West Vancouver in the Province of British Columbia. I am a member of the Association of Professional Engineers and Geoscientists of British Columbia (APEGBC). I graduated from the University of Alberta with a Bachelor of Science in Mineral Process Engineering degree in I have practiced my profession continuously since 1985 and have been involved in: gold operations in Canada and Guyana and preparation of scoping, pre-feasibility, and feasibility level studies for gold, silver, zinc, nickel/cobalt and molybdenum metal recovery from properties in Canada, United States, Peru, Brazil, Mexico, Mongolia, Ghana and New Guinea. As a result of my experience and qualifications, I am a Qualified Person as defined in National Instrument I am currently a Consulting Engineer and have been so since September I served as the Qualified Person writing sections 16 and 19.3 through 19.5 of the technical report titled Technical Report and Qualified Persons Review, Cortez Joint Venture, Nevada and dated 20 th on the Cortez Joint Venture Mine in Lander County, Nevada (the Technical Report ), relating to mineral processing, metallurgical testing and process operating cost estimates. I visited the Cortez Mine site December 17 and 18, My work on the current Technical Report did not necessitate a further site visit. I served as a Qualified Person writing sections 16 and 19 of the previous technical reports on the Cortez property, which reports were dated 26 February 2004 and 08 September 2004 respectively and which were filed with the Canadian securities regulators on 5 March 2004 and 13 September 2004 respectively. I have had no other prior involvement with the property that is the subject of the Technical Report. I am not aware of any material fact or material change with respect to the subject matter of the Technical Report, which is not reflected in the Technical Report, the omission to disclose which makes the Technical Report misleading. AMEC Americas Limited 111 Dunsmuir Street, Suite 400 Vancouver, B.C. V6B 5W3 Tel (604) Fax (604)

11 2 I am independent of Placer Dome Inc. in accordance with the application of Section 1.5 of National Instrument I have read National Instrument and certify that the portions of the Technical Report for which I served as a Qualified Person have been prepared in compliance with that Instrument. I further certify that, as of the date of this certificate, the portions of the Technical Report for which I served as a Qualified Person contain all the information required under Form F1 in respect of the property that is the subject of the report. Dated at Vancouver, British Columbia, this 20 th day of. Signature on File Alexandra J. Kozak, P.Eng.

12 Alexandra J. Kozak, P. Eng. AMEC Americas Limited 111 Dunsmuir Street, Suite 400 Vancouver, BC Telephone: (604) Fax: (604) CONSENT of AUTHOR TO: British Columbia Securities Commission Alberta Securities Commission Saskatchewan Securities Commission Manitoba Securities Commission Ontario Securities Commission Commission des valeurs mobilieres du Quebec Nunavut Legal Registry Officer of the Administrator, New Brunswick Nova Scotia Securities Commission Registrar of Securities, Prince Edward Island Securities Commission of Newfoundland Registrar of Securities, Government of the Yukon Territories Securities Registry, Government of the Northwest Territories AND TO: Placer Dome Inc. I, Alexandra J. Kozak, P. Eng., do hereby consent to the filing of the technical report prepared for Placer Dome Inc. titled Technical Report and Qualified Persons Review, Cortez Joint Venture, Nevada and dated 20 (the "Technical Report") with the securities regulatory authorities referred to above. I further consent (a) to the filing of the Technical Report with any stock exchange and other regulatory authority and any publication of the Technical Report by them for regulatory purposes, including electronic publication in the public company files on their websites accessible by the public, and (b) to the publication of the Technical Report and/or excerpts thereof and/or information therein by Placer Dome Inc. on its company website or otherwise, and (c) to all other uses by Placer Dome Inc. of the Technical Report and/or excerpts thereof and/or information therein in connection with its business and (d) to the use of my name as a Qualified Person in connection with the Technical Report in any continuous disclosure documents or other regulatory documents or filings of Placer Dome Inc., in all applicable jurisdictions. I certify that I am not aware of any material fact or material change with respect to the subject matter of the Technical Report, which is not reflected in the Technical Report, the omission to disclose which makes the Technical Report misleading. I confirm that I have read the Placer Dome Inc. news release dated September 15, 2005 entitled Placer Dome Approves Cortez Hills Project and that its contents are consistent with the information in the Technical Report. Dated this 20 th day of. Signature on File Alexandra J. Kozak, P.Eng. AMEC Americas Limited 111 Dunsmuir Street, Suite 400 Vancouver, B.C. V6B 5W3 Tel (604) Fax (604)

13 CERTIFICATE OF QUALIFIED PERSON Todd Wakefield 780 Vista Blvd., Suite 100 Sparks NV Tel: (775) Fax: (775) I, Todd Wakefield, am employed as Principal Geologist of AMEC E&C Services Limited and residing at 4110 Twin Falls Drive in the City of Reno in the State of Nevada. I am a member of the Australasian Institute of Mining & Metallurgy (AusIMM). I graduated from the University of Redlands with a Bachelor of Science degree in Geology in 1986 and the Colorado School of Mines with a Masters of Science degree in Geology in I have practiced my profession continuously since 1987 and have been involved in: gold and copper operations in the United States, Venezuela, Indonesia, and Peru. I have been involved in exploration for gold, silver, copper, and lead-zinc deposits in the United States, Venezuela, Ecuador, Peru, Chile, Colombia, Argentina, Paraguay, Indonesia, the Philippines, Thailand, Laos, and Myanmar. I have been involved in evaluating the data quality for scoping, prefeasibility, and feasibility level studies for gold, diamonds, nickel, silver, and copper from properties in Canada, United States, Peru, Australia, and Mexico. As a result of my experience and qualifications, I am a Qualified Person as defined in National Instrument I served as the Qualified Person writing sections 13 and 14 of the technical report titled Technical Report and Qualified Persons Review, Cortez Joint Venture, Nevada and dated 20 th on the Cortez Joint Venture Mine in Lander County, Nevada (the Technical Report ), relating to sample preparation, analyses, and security and data verification. I visited the Cortez Mine site from 26 to 29 September I am not aware of any material fact or material change with respect to the subject matter of the Technical Report, which is not reflected in the Technical Report, the omission to disclose which makes the Technical Report misleading. I am independent of Placer Dome Inc. in accordance with the application of Section 1.5 of National Instrument I have read National Instrument and certify that the portions of the Technical Report for which I served as a Qualified Person have been prepared in compliance with that Instrument. I further certify that, as of the date of this certificate, the portions of the Technical Report for which AMEC Americas Limited 111 Dunsmuir Street, Suite 400 Vancouver, B.C. V6B 5W3 Tel (604) Fax (604)

14 2 I served as a Qualified Person contain all the information required under Form F1 in respect of the property that is the subject of the report. Dated at Reno, Nevada, this 20 th day of. Signature on File Todd Wakefield.

15 Todd Wakefield 780 Vista Blvd., Suite 100 Sparks NV Tel: (775) Fax: (775) CONSENT of AUTHOR TO: British Columbia Securities Commission Alberta Securities Commission Saskatchewan Securities Commission Manitoba Securities Commission Ontario Securities Commission Commission des valeurs mobilieres du Quebec Nunavut Legal Registry Officer of the Administrator, New Brunswick Nova Scotia Securities Commission Registrar of Securities, Prince Edward Island Securities Commission of Newfoundland Registrar of Securities, Government of the Yukon Territories Securities Registry, Government of the Northwest Territories AND TO: Placer Dome Inc. I, Todd Wakefield., do hereby consent to the filing of the technical report prepared for Placer Dome Inc. titled Technical Report and Qualified Persons Review, Cortez Joint Venture, Nevada and dated 20 (the "Technical Report") with the securities regulatory authorities referred to above. I further consent (a) to the filing of the Technical Report with any stock exchange and other regulatory authority and any publication of the Technical Report by them for regulatory purposes, including electronic publication in the public company files on their websites accessible by the public, and (b) to the publication of the Technical Report and/or excerpts thereof and/or information therein by Placer Dome Inc. on its company website or otherwise, and (c) to all other uses by Placer Dome Inc. of the Technical Report and/or excerpts thereof and/or information therein in connection with its business and (d) to the use of my name as a Qualified Person in connection with the Technical Report in any continuous disclosure documents or other regulatory documents or filings of Placer Dome Inc., in all applicable jurisdictions. I certify that I am not aware of any material fact or material change with respect to the subject matter of the Technical Report, which is not reflected in the Technical Report, the omission to disclose which makes the Technical Report misleading. I confirm that I have read the Placer Dome Inc. news release dated September 15, 2005 entitled Placer Dome Approves Cortez Hills Project and that its contents are consistent with the information in the Technical Report. Dated this 20 th day of. Signature on File Todd Wakefield, Geologist AMEC Americas Limited 111 Dunsmuir Street, Suite 400 Vancouver, B.C. V6B 5W3 Tel (604) Fax (604)

16 C O R T E Z P R O J E C T C ONTENTS 1.0 SUMMARY Introduction Geology and Mineralization Exploration Data Mineral Resource Estimates Metallurgy and Processing Mining and Mineral Reserves Environmental Conditions and Operating Permits Mineral Resource and Mineral Reserve Summary INTRODUCTION AND TERMS OF REFERENCE Introduction Terms of Reference Units of Measure Common Units Common Chemical Symbols Metric Conversion Factors (divide by) DISCLAIMER PROPERTY DESCRIPTION AND LOCATION Location Mineral Tenure and Agreements Mineral Rights Agreements and Royalties Operational Permits and Jurisdictions ACCESSIBILITY, CLIMATE, AND PHYSIOGRAPHY HISTORY GEOLOGICAL SETTING Regional Geology District Geology and Stratigraphy Deposit Geology Pipeline/South Pipeline/Crossroads Gold Acres Gap Cortez and Cortez NW Deep Cortez Hills and Pediment Hilltop DEPOSIT TYPES MINERALIZATION Pipeline/South Pipeline/Crossroads Gap Deposit Cortez NW Deep Cortez Hills and Pediment Deposits Cortez Hills Deposit Pediment Deposit Project No.: TOC i

17 C O R T E Z P R O J E C T 9.5 Hilltop EXPLORATION DRILLING Introduction Reverse-Circulation Drilling Core Drilling Blast Holes Surveying Drill Collars Down-Hole Surveys Core Recovery Reverse-Circulation Sample Recovery SAMPLING METHOD AND APPROACH Introduction Sample Collection Reverse Circulation Drilling Core Drilling Core and Reverse-Circulation Drilling Comparison Cortez Hills Deposit Blast Holes List of Significant Data SAMPLE PREPARATION, ANALYSES, AND SECURITY Introduction Sample Preparation Gold Assays Trace Element Analysis Assay Quality Assurance and Quality Control Introduction Standards Check Assays Analytical Precision Bulk Density Assay Adjustments DATA VERIFICATION ADJACENT PROPERTIES MINERAL PROCESSING AND METALLURGICAL TESTING Pipeline and South Pipeline Crossroads and Gap Pediment Cortez Hills Cortez NW Deep Hilltop MINERAL RESOURCE AND MINERAL RESERVE ESTIMATES Introduction Geological Models Pipeline/South Pipeline/Crossroads/Gap/Cortez NW Deep Deposits Pediment and Cortez Hills Deposits Project No.: TOC ii

18 C O R T E Z P R O J E C T Cortez NW Deep Deposit Hilltop Deposit Pipeline/South Pipeline/Crossroads/Gap Mineral Resource Estimates Introduction Resource Model Cross Validation Mine to Model Reconciliation Sample Block Model Sections and Plans Conclusions and Recommendations Pediment and Cortez Hills Mineral Resource Model Introduction Resource Model Estimation of the Underground Resource Model Estimation Validation Conclusions and Recommendations Cortez NW Deep Mineral Resource Estimate Introduction Resource Model Model Validation Recommendations and Conclusions Hilltop Mineral Resource Estimate Introduction Resource Model Model Validation Recommendations and Conclusions Mineral Resource Classification Classification Parameters Comments Mineral Reserve Estimation Mineral Resource and Mineral Reserve Statements OTHER RELEVANT DATA AND INFORMATION REQUIREMENTS FOR TECHNICAL REPORTS ON PRODUCTION AND DEVELOPMENT PROPERTIES Open Pit Mining Operations Dewatering Process Operations Mill No Mill No Pipeline/Cortez Hills Mill Flowsheet Water, Power, and Tailings Gold Recovery Operating Costs Markets Contracts Environmental Considerations Taxes and Royalties Capital and Operating Costs Estimates Economic Analysis Mine Life Project No.: TOC iii

19 C O R T E Z P R O J E C T 20.0 CONCLUSIONS AND RECOMMENDATIONS REFERENCES T ABLES Table 1-1: CJV Mineral Resource Models Table 1-2: CJV Mineral Reserve Estimate, 1 September Table 1-3: CJV Mineral Resource Estimate, 1 September Table 4-1: Unpatented Lode Mining Claims Wholly Owned or Leased by Joint Venture in Area of Interest Table 4-2: Unpatented Millsites in Pipeline Area Wholly-Owned by Joint Venture Table 4-3: Unpatented Mill Site Claims in Pipeline Area under Lease to Joint Venture Table 4-4: Holdings of Fee Lands (Wholly Owned Unless Otherwise Noted) Table 4-5: Patented Lode Mining Claims in Cortez Mine Area (Wholly-Owned) Table 4-6: Patented Millsites in Cortez Mine Area (Wholly-Owned) Table 4-7: Patented Lode Claims in Gold Acres Area (Wholly-Owned) Table 4-8: Patented Lode Claims in Hilltop Area (Wholly-Owned) Table 6-1: History of Exploration and Mining in the Cortez Joint Venture Table 6-2: Cortez Joint Venture Annual Production, August Table 11-1: Drilling in CJV by Area Table 13-1: Mine Analytical Standards Table 13-2: Bulk Densities - Pipeline, South Pipeline, Crossroads, and Gap Deposits Table 13-3: Bulk Densities Pediment and Cortez Hills Deposits Table 13-4: Assay Adjustments Used in 2003 and 2004 Resource Models for Pipeline, South Pipeline, Crossroads and Gap Deposits Table 13-5: Comparison of Adjusted and Unadjusted Models for Pipeline/South Pipeline Table 17-1: CJV Resource Models Table 17-2: Cortez Hills Pediment Rock Types Table 17-3: Gold Estimation Parameter Summary Table 17-4: Indicator Classes for Shear Zone Rock Type Table 17-5: Pipeline Variogram Summary Ordinary Kriging Table 17-6: Pipeline Variogram Summary, Shear Zone Indicator Kriging Flat Zone Table 17-7: Pipeline Variogram Summary, Shear Zone Indicator Kriging Steep Zone Table 17-8: Drill Hole vs. Model Statistics Table 17-9: Pipeline Monthly Reconciliation Summary Table 17-10: Cortez Hills Pediment Composite Trimming Limits Table 17-11: Variogram Summary Cortez Hills and Pediment Table 17-12: Cortez Hills Pediment Model Validation Table 17-13: Cortez NW Deep Search Parameters Table 17-14: Cortez NW Deep Variogram Parameters Table 17-15: Hilltop Search Parameters Table 17-16: Hilltop Variogram Parameters Table 17-17: Estimation Variance Thresholds for Classification of 2003 Mineral Resource Table 17-18: Factors Considered in Establishing Individual Block Value Project No.: TOC iv

20 C O R T E Z P R O J E C T Table 17-19: 1 September 2005 Proven and Probable Mineral Reserve Estimates for Cortez Joint Venture at $350 Gold Price Table 17-20: Cutoff Grades and Recoveries Used in Mineral Resource and Mineral Reserve Estimates by Zone and Ore Type Table 17-21: 1 September 2005 Measured + Indicated Mineral Resource Estimates for Cortez Joint Venture at $425 Gold Price Table 17-22: 1 September 2005 Inferred Mineral Resource Estimates for Cortez Joint Venture at $425 Gold Price Table 19-1: Current Mining Equipment Table 19-2: List of Major Equipment in Mill No Table 19-3: Historic Mill Gold Recovery, 1991 through Table 19-4: 3 rd Party Roaster Recovery, 2000 through Table 19-5: Heap Leach Recovery, 1999 to date Table 19-6: Taxes and Royalties Applied to the CJV Operation F IGURES Figure 4-1: Location of Cortez Joint Venture in Nevada Figure 4-2: Mining Operations and Leases for Mining and Exploration Purposes Figure 7-1: Location of Cortez Mine in Regional Gold Trends, North Central Nevada Figure 7-2: District Geology Figure 7-3: Stratigraphy of Cortez Joint Venture Area Figure 7-4: Geology of Cortez, Cortez Hills, and Pediment Areas Figure 7-5: Southwest-Northeast Section in Cortez Hills Deposit Figure 9-1: East-West Cross Section of Pipeline Deposit at 5700N Figure 9-2: North-South Longitudinal Section of Pipeline and South Pipeline Deposit at E. 9-4 Figure 9-3: Level Plan for Pipeline and South Pipeline Deposit at 4670 ft Elevation Figure 9-4: East-West Cross Section of Crossroads Deposit at 52500N Figure 9-5: North-South Longitudinal Section of Crossroads Deposit at E Figure 9-6: Level Plan of Crossroads Deposit at 4210 ft Elevation Figure 9-7: Grade x Thickness Plot for South Pipeline Area Figure 9-8: East-West Cross Section of Gap Deposit at 57400N Figure 9-9: North-South Longitudinal Section of Gap Deposit at 99300E Figure 9-10: Level Plan of Gap Deposit at 5010 ft Elevation Figure 9-11: Plan Geological Map of Cortez Hills and Pediment Deposits at 5750 Ft Elevation Figure 9-12: Longitudinal Section of Cortez Hills and Pediment Deposits (Looking East Southeast)9-15 Figure 9-13: East-West Cross Section of Cortez Hills Deposit at 28600N (Looking North) Figure 9-14: East-West Cross Section of Pediment Deposit at 26000N (Looking North) Figure 9-15: Geological Map and Diagrammatic Section of Hilltop Deposit, from Kelson, et al., Figure 10-1: Geological Setting of Cortez Hills and Pediment Deposits Figure 10-2: Cortez Hills Deposit and Gravity Anomalies Figure 11-1 Hole Collar Map Pipeline and South Pipeline Deposits Figure 11-2: Drill Hole Collar Map Crossroads Deposit Figure 11-3: Drill Hole Collar Map Gap Deposit Project No.: TOC v

21 C O R T E Z P R O J E C T Figure 11-4: Drill Hole Collar Map Cortez NW Deep Deposit Figure 11-5: Drill Hole Collar Map Pediment and Cortez Hills Deposits, Showing Outline of Ultimate Design Pit Figure 11-6: Drill Hole Collar Map Hilltop Deposit Figure 17-1: East-West Cross Section of Pipeline-South Pipeline Block Model at 57000N, Looking North Figure 17-2: North-South Longitudinal Section of Pipeline-South Pipeline Block Model at E, Looking West Figure 17-3: Level Plan of Pipeline-South Pipeline Block Model at 4670 ft ASL Figure 17-4: East- West Cross Section of Crossroads Block Model, Looking North Figure 17-5: North-South Longitudinal Section of Crossroads Block Model, Looking West Figure 17-6: Level Plan of Crossroads Block Model at 4,270 ft ASL Elevation Figure 17-7: East-West Cross Section of Gap Deposit Block Model at 57,400N, Looking North Figure 17-8: North-South Longitudinal Section of Gap Deposit Block Model at 99,300E, Looking West Figure 17-9: Level Plan of Gap Deposit Block Model at 5,010 ft ASL Elevation Figure 17-10: Plan Map of Cortez Hills and Pediment Deposits at 5750 Ft Elevation Showing Block Model Grades Figure 17-11: East-West Cross Section of Cortez Hills Deposit at 28600N (Looking North), Showing Block Model Grades Figure 17-12: East-West Cross Section of Pediment Deposit at 26000N (Looking North), Showing Block Model Grades Figure 17-13: Longitudinal Section of Cortez Hills and Pediment Deposits (Looking East Southeast), Showing Block Model Grades Figure 17-14: Southwest-Northeast Cross Section of Cortez NW Deep Deposit Block Model, Looking Northwest Figure 17-15: Southeast-Northwest Longitudinal Section of Cortez NW Deep Deposit Block Model, Looking Northeast Figure 17-16: Level Plan of Cortez NW Deep Deposit Block Model Figure 17-17: East-West Cross Section of Hilltop Deposit Block Model, Looking North Figure 17-18: North-South Longitudinal Section of Hilltop Deposit Block Model, Looking West Figure 17-19: Level Plan of Hilltop Deposit Block Model Figure 19-1: Layout of Pipeline Mining Operations Figure 19-2: Pipeline Mining Phases Figure 19-3: Pipeline and Gap Ultimate Pit Outlines Figure 19-4: Layout of Infrastructure for Cortez Hills and Pediment Pits Figure 19-5: Pediment and Cortez Hills Ultimate Pits Figure 19-6: Simplified Flowsheet for Mill No A PPENDICES A Assay Composite Data Project No.: TOC vi

22 C O R T E Z P R O J E C T 1.0 SUMMARY 1.1 Introduction Placer Dome Inc. (PDI) commissioned AMEC Americas Limited, formerly AMEC E&C Ltd (AMEC) to review mineral resource and mineral reserve estimates for the Cortez Joint Venture (CJV) and determine if these estimates have been carried out in accordance with industry standard practices and are compliant with Canadian Institute of Mining, Metallurgy and Petroleum (CIM) Standards on Mineral Resources and Reserves and Canadian National Instrument AMEC prepared this Technical Report in support of the public disclosure of Mineral Reserve and Mineral Resource estimates as of 1 September The format and content of the report are intended to conform to Form F1 of National Instrument (NI ) of the Canadian Securities Administrators. Larry B. Smith, P.Geo., and Alexandra Kozak, P.Eng., employees of AMEC, and Tracy Barnes, P.E., Principal of Barnes Engineering Inc., served as Qualified Persons responsible for preparation of this report. Larry Smith visited the property between 9 and 18 December 2003, between 23 and 24 August 2004 and between 26 and 30 September 2005, and reviewed pertinent aspects of geology, exploration data, geological models, resource estimates, land status and permitting. Tracy Barnes visited the property from 15 to 18 December 2003, 23 to 24 August 2004 and 26 and 30 September 2005 and reviewed resource estimates, mining and reserve estimates. Alexandra Kozak visited the project 17 and 18 December 2003 and reviewed metallurgical studies and processing facilities. She reviewed additional metallurgical test results and recovery information for the Cortez Hills and Pediment deposits between 3 to 5. All information was reviewed in sufficient detail to ensure that mineral resource and reserve estimates as of 1 September 2005 comply with NI Significant assistance in preparation of files, presentation of geological models, resource estimates, pit designs, production plans, permitting, land status, metallurgy, and process performance, and preparation of report figures were provided by Cortez Gold Mines staff, including Bill Martinich, Robert Hays, Kerry Hart, Thomas Dyer, Andrew Issel, Jerritt Collord, Julius Stieger, and Randy Powell. Unless stated otherwise, all quantities are in United States Commercial Imperial units and currencies are expressed in constant 2005 US dollars. The Cortez Joint Venture (CJV) is operated by Placer Dome US Inc. Equity is held 60% by Placer Cortez Inc., an indirect wholly-owned subsidiary of PDI, and 40% by Kennecott Explorations (Australia) Ltd. The joint venture produces approximately 1 Moz of gold annually from one integrated open pit and mill-heap leach facility. Project No.: Page 1-1

23 C O R T E Z P R O J E C T 1.2 Geology and Mineralization Gold mineralization in the Cortez Joint Venture occurs as multiple deposits hosted by Paleozoic carbonate rocks, siliceous metasediments, and felsic intrusive porphyries. Mineral reserves are estimated for the Pipeline, South Pipeline, Gap, Pediment, and Cortez Hills deposits. These deposits contain additional mineral resources separate from mineral reserves. Mineralization in the Crossroads, Cortez NW Deep, and Hilltop deposits are classified as mineral resources only. The Pipeline, South Pipeline and Crossroads deposits are separate zones of one system of gold mineralization hosted by altered, dolomitic siltstones of the Silurian Roberts Mountains Formation. Ore-grade mineralization preferentially occurs within a shallow eastdipping thrust duplex, high-angle NNW and NE structures and intersections of these features. Pipeline is from 50 to 300 ft thick and extends 750 ft north-south by 1,500 ft eastwest. The top of the ore body is from 500 to 600 ft below surface. South Pipeline consists of two zones: a shallow body between 65 and 150 deep and a deeper zone 1000 ft below surface. The shallow zone is up to 300 ft thick and extends 1,880 ft north-south and 2,000 ft east-west. The deep zone is up to 250 ft thick and extends 200 ft north-south and 600 ft east-west. Crossroads is a deeper extension of the South Pipeline lower zone to the southeast. A majority of Pipeline, South Pipeline, and Crossroads mineralization is oxide and is treated either on an oxide leach heap or in a mill. Refractory, carbonaceous mineralization is mined and stockpiled for eventual shipment to a third-party processing facility. Pit phases 8 and 9 are dominantly unoxidized, refractory mineralization. The Cortez NW Deep deposit is a downward extension of mineralization previously mined in the dormant Cortez pit. Gold mineralization is hosted by decalcified, argillized, and silicified Roberts Mountains Formation near NNW and NE structures. The Gap deposit is located west of Pipeline. It is hosted by weakly thermally altered, oxidized Devonian Wenban Limestone and locally skarn. Mineralization occurs in the axial zone of an anticline along well-developed NNW fault zones. The Pediment deposit is a recent discovery located about three miles south of the Cortez mine. Pediment is a unique gold deposit for Nevada, consisting of mineralized clasts in Tertiary to recent conglomerates that have been transported from their place of mineralization and deposited in a NNE trending bedrock trough by landslide, debris flow, or alluvial processes. The top of mineralization is from 150 to 300 ft from surface, beneath unaltered colluvium. The deposit is 250 ft thick and extends 3,000 ft northeast by 600 ft northwest. The water table is at a depth of about 500 ft. Mineralization in Wenban Limestone marble was discovered north of Pediment in This new discovery, Cortez Hills, is a structurally controlled, high-grade gold deposit Project No.: Page 1-2

24 C O R T E Z P R O J E C T hosted by variably metamorphosed, silty to micritic limestones of the Roberts Mountains and Wenban Formations. The deposit has similarities to high-grade, structurally controlled deposits in the Carlin District such as Miekle, Deep Star and West Leeville. The top of the deposit is 350 ft below surface, concealed beneath colluvium and landslide debris. Mineralization extends downward at least 2,000 ft. The deposit extends up to 1,800 ft NNW. Gold mineralization follows the upper portion of a marble zone, which rises upward from the west and extends more than 10,000 ft north-south. Individual zones of high-grade mineralization dip 65 to 75 SW and strike NNW. Mineralization plunges steeply SW through the Wenban Formation and less steeply SW in the underlying Roberts Mountains Formation. The primary control on mineralization is the intersection of a series of faults that strike NNW and dip WSW and a series of faults that strike WNW and dip SSW. The result is strong fracturing that plunges to the SW. Zones of less steeply plunging mineralization in the Roberts Mountains Formation may be related to low-angle thrust faults of Antler Orogeny age. Internal CJV feasibility studies demonstrate that a significant portion of the deposit can be mined by open pit methods. Additional resources are present that are of suitable grade and geometry to be mined by underground methods. The Hilltop deposit is located 16 miles northwest of the Pipeline mine and mill. Gold mineralization occurs in silicified and brecciated argillite, siltstone, and chert within the Ordovician Valmy Formation and Tertiary felsic intrusives between two, shallow westdipping fault zones. Internal CJV feasibility studies suggest that the deposit could be economically mined by open pit and processed in a combined oxide and bio-oxide heap leach facility at a gold price between $425 and $ Exploration Data Data used in resource estimates consist of assays of HQ (2.5") diamond drill core and reverse-circulation (RC) drill cuttings. Drill samples for the Pipeline, South Pipeline, Crossroads, and Cortez NW Deep deposits are primarily core, and drill holes are spaced on nominal centres of 100 ft. Gap and Hilltop were drilled with a combination of core and RC tools. Initial drilling on Pediment and Cortez Hills was with RC tools. Sampling was converted to a combination of RC and core for development drilling. RC stepout holes are surrounded by core infill holes to a nominal spacing of approximately 100 ft. Drilling and sampling methods are professional and are carried out to ensure high recoveries of mineralized materials. Sample preparation protocols have improved with time and are generally adequate for gold mineralization of this type. CJV s mine laboratory now employs automated crushing and splitting equipment for both exploration samples and blast hole samples. Project No.: Page 1-3

25 C O R T E Z P R O J E C T CJV mine laboratories have served as the primary laboratories for a majority of core and RC gold assays for Pipeline, South Pipeline, Crossroads, Gap, and Cortez NW Deep. Mine assays were first provided by Laboratory #1 at the Cortez mill. This laboratory was closed in 1996 and assaying shifted to Laboratory #2 at the Pipeline mill. A variety of commercial laboratories, including Rocky Mountain Geochemical Laboratory (RMG), American Assay Laboratory (AAL), Monitor Geochemical Laboratory (MGL), Chemex, Barringer Laboratories, and Assayers Laboratory provided checks of CJV mine laboratory assays in the period between 1992 and Since then, RMG and AAL have provided the majority of check assays. RMG and AAL served as the primary laboratories for analysis of exploration samples for the Pediment and Cortez Hills deposits in 2002 and In 2004, the primary laboratory was changed to ALS Chemex and to a lesser extent, Inspectorate. CJV #2 Laboratory has provided checks and assays all production blast holes. Assays are supported with appropriate quality assurance and quality control measures with insertion of mine standards, duplicates (rig, coarse, and pulp) and blanks in the sample stream. Standards are developed from mine ore and exhibit more variation than commercial standards, but the method of identifying analytical failures accounts for this. Check assays of pulps are routinely obtained from commercial laboratories and these show that the mine laboratory is still biased from 5% to 8% low. Assays from the mine laboratory and commercial laboratories employed are suitable to support resource estimates. Density measurements for ore and waste materials have been performed with generally acceptable methods and are adequate to support resource estimates. All core and RC holes are surveyed at collar and downhole with acceptable methods. There are a relatively small number of holes in the early period of Pipeline and South Pipeline drilling without downhole surveys. Drill hole logging of geological and geotechnical attributes is professional and applicable for sediment-hosted gold mineralization. Core recovery exceeds 92% in all drilling campaigns. Geological models reflect primary ore controls and are suitable to support resource estimates. Alteration and structure are the primary controls of mineralization in the Pipeline, South Pipeline, Crossroads, Gap and Cortez NW Deep deposits and these features are emphasized in geological modelling. Mineralization in the Pediment deposit is controlled by lithology. Mineralization in the Cortez Hills deposit is controlled by a combination of lithology, structure, and alteration. Future work on geological modelling will attempt to better define local controls of high-grade mineralization to guide resource estimation. Project No.: Page 1-4

26 C O R T E Z P R O J E C T 1.4 Mineral Resource Estimates Four mineral resource models cover eight gold deposits on the joint venture, as listed in Table 1-1. Mineral reserves are estimated for five deposits in two areas. Additional reserves are contained in various stockpiles. Table 1-1: CJV Mineral Resource Models Model Deposits Resource Reserve Pipeline Pipeline South Pipeline Crossroads Gap Cortez Hills / Pediment/ Northwest Deeps Cortez Hills Pediment Northwest Deep Cortez Hills Underground Cortez Hills Hilltop Hilltop The Pipeline resource model, which includes the spatially related Pipeline, South Pipeline, Crossroads, and Gap deposits, has evolved from the feasibility study model created in 1995 to the present model. Resource estimation uses two interpolation methods: ordinary kriging for all domains except for shear zone, and indicator kriging for the shear zone rock type. Recent improvements include incorporation of a local anisotropy model, use of additional data in density modelling, use of spatial statistics for classification and adjustment in historical assays for laboratory and sampling biases. AMEC checked the general descriptive statistics of the model by domain and as compared to drill hole values. Global statistics of domains and drill holes show a very good correlation. There is a slight negative bias in some of the higher-grade zones, which would make the model slightly conservative. Reconciliation of the new model using adjusted assays against mill and leach production for the period of June 2004 to August 2005 suggests that the model accurately predicts global production of tons and contained gold, but is biased between components of mill and leach tons and grade, most likely due to over smoothing at mill cutoff grades.. The Pediment resource model was estimated using lithological controls on mineralization. Gold grades were estimated using ordinary kriging with semi-soft boundaries from the lithological model, using the main mineralized units of siltstone and limestone conglomerate. The Cortez Hills resource model was developed using lithological, alteration and structural controls. First, two mineralized domains were built encapsulating all contiguous zones of gold mineralization exceeding oz/t; one for the Wenban Formation and the other for the underlying Roberts Mountains Formation. Separate Project No.: Page 1-5

27 C O R T E Z P R O J E C T domains were then made in the upper zone from the Horse Canyon Member of the Wenban Formation and the main limestone of the lower Wenban Formation. Grade was estimated in the upper domain using soft boundaries between the Horse Canyon domain and the Wenban limestone domain. The lower zone was estimated only with composites from the Roberts Mountains Formation. Dikes were volumetrically removed from the resource blocks, but composites from dike intervals were used in estimating grade for adjacent mineralized carbonate rocks. This was done because of low confidence in the actual outlines and limits of post-mineral dikes. Oriented core was used to determine the bedding dip of host units (strike of N0 E, dip of 20 E). Structural information obtained from recent drilling has allowed understanding of relatively complex displacements of ore zones along post-mineral and reactivated syn-mineral faults. Newly identified faults include a series of N70 W, 65 SW-dipping faults (the 287 faults) and a system of faults striking N15-20 W and dipping WSW. The geological interpretation of ore zones also consider that a NNW-striking and ENE-dipping normal fault cuts the host section and 287 Faults, down-dropping mineralization to the east. The resource model for the open pit portion of Cortez Hills and Pediment appears to provide a reasonable representation of the drill hole information. Standard industry practices were used in the estimation of the model. There is no production history to use to validate the model, but it has been statistically validated. These statistical validations show that the model should provide a reasonable global estimate of the resource, but the grades in the Horse Canyon member of the Wenban Formation in the Cortez Hills deposit are oversmoothed, therefore the estimate is conditionally biased. It is recommended that future models attempt to provide a better match between the theoretical variance reduction and the model variance. This would minimize any problems that could arise for conditional biases in the estimate. A small block (10 ft x 10 ft x 10 ft) resource model of the underground resources for Cortez Hills, developed by CJV in May 2005, was not directly validated by AMEC, but the total Indicated and Inferred Resources in this model are similar to the total Indicated and Inferred Resources in the July 2004 large block model that was validated by AMEC. Gold was estimated in the Hilltop deposit model using ordinary kriging. The boundary between the Hilltop Main Zone and the other rock types was treated as a hard boundary with the other five rock types treated as a single unit. Model validation statistics are not available for the Hilltop model. The model was examined in cross-section and plan relative to the drilling. It appears that the model does a reasonable job of representing the drilling. The Hilltop resource model provides a reasonable estimate sufficient for the declaration of an Indicated or Inferred resource. It would be necessary to refine the model and the economic evaluation of the deposit prior to the declaration of a reserve. AMEC reviewed mineral resource classification parameters used by the CJV. The classification of the mineral resource and reserves for the CJV was based primarily on the kriging estimation variance derived in the estimation of each particular block. This was correlated to the drilling support and sample distances that appeared to be visually Project No.: Page 1-6

28 C O R T E Z P R O J E C T reasonable for each resource class by inspection of sections and plans. Inspection of cross sections and plans revealed that Measured Resources (high confidence in estimation of grade and tons) are supported by assay composites no farther than 80 ft from individual resource blocks. Indicated Resources (less confidence in estimation of grade and tons, but with reasonable continuity) are supported by assays from drill holes between 80 ft and 150 ft from individual resource blocks. Inferred Resources are generally supported by assays from holes spaced greater than 150 ft from a resource block. The estimation variance was examined in cross-section and plan view relative to the composite data used for the estimates and the thresholds chosen that would be relatively consistent with the distance criteria. The exception is in the Hilltop resource. This model was built in 1997, prior to CJV adopting estimation variance as a classification criterion. For the Hilltop model, the classification was based on the search radii used with a two-pass kriging plan. Anything estimated using the initial pass was classified as Indicated. The search radii were expanded by 50 ft, and the additional blocks estimated were classified as Inferred. Sufficient work has been accomplished by CJV and Placer Dome to demonstrate reasonable prospects for future economic extraction of mineralization beneath the Cortez Hills open pit. AMEC examined the models in cross-section and plan and found that the classification is consistent with the definition of Measured, Indicated, and Inferred Mineral Resources as referenced in CIM Standards on Mineral Resources and Reserves, Definitions and Guidelines (2000). 1.5 Metallurgy and Processing The metallurgical process has been well established and developed over an operating period of more than 30 years. The CJV has a number of processing facilities: Mill No. 1, the Cortez mill (inactive) Mill No. 2, the Pipeline mill Heap leaching at Cortez (now inactive), Pipeline, Gold Acres, and South Area facilities Dry grinding and roasting plant at Cortez (inactive). The metallurgical characteristics of the South Pipeline and Pipeline deposits have been developed through extensive mill and heap leach experience and ongoing testwork at site. Mill and heap production show stable metallurgical performance consistent with ongoing in-house test programs. Carbonaceous materials are also present in the Pipeline and South Pipeline deposits. Currently, carbonaceous materials are stockpiled for future processing through the Cortez roasting plant or potential treatment through new proprietary processes being developed Project No.: Page 1-7

29 C O R T E Z P R O J E C T by Placer Dome Technical Services Limited (PDTS). Some of the stockpiled carbonaceous ores are sold for outside roaster processing at third-party facilities. Some pilot scale testwork has been completed on new PDTS proprietary processes to support predictions for metallurgical performance. Implementation of these processes would require construction of additional leach heap facilities. A small portion (4%) of the Pipeline and South Pipeline reserves that comprise carbonaceous material requires support from a successful, production-scale execution of these processes at the Pipeline facilities. The Crossroads deposit is an extension of the South Pipeline deposit. The Gap deposit contains oxide mineralization similar to that present in South Pipeline, although the host rocks are somewhat different. CJV predicts that the oxide mill ore from Gap will have a similar recovery to oxide mill ore from South Pipeline. Leach material from Gap will have a somewhat lower recovery compared to South Pipeline leach ore. These are reasonable assumptions. The Crossroads deposit contains some carbonaceous ores. Alternative treatment processes are assumed to be the same as those proposed for Pipeline and South Pipeline ores. This is a reasonable assumption. The Pediment deposit primarily consists of oxide ore and contains little to no sulphide component. Column leach testwork was conducted on RC or PQ drill samples from the Pediment deposit in 2002 and Pediment ore requires a 90 day primary leach cycle compared to 60 days for Pipeline ores. Reagent consumption for Pediment ore is similar to Pipeline ores. Testwork on mill grade oxide Pediment ore in milling is limited; however, results to date indicate that the ore is reasonably amenable to milling. Metallurgical tests of mill grade oxide ore from Cortez Hills indicate recovery characteristics not dissimilar to Pipeline oxide feed to Mill #2. Results of column tests demonstrated that the primary leach cycle for Cortez Hills ore is in the order of 120 to 150 days. Gold in the Cortez NW Deep deposit is extremely fine grained and is associated with quartz, pyrite, and arsenopyrite. In 1993 and 1994, a number of preliminary roasting and bottle roll tests were conducted on ore from the Cortez NW Deep zone. Results showed that roasting followed by leaching would result in reasonable recovery. Leaching alone resulted in poor recovery. The Hilltop deposit includes both sulphide and oxide material. Preliminary tests have been conducted including, flotation, bottle rolls, leach columns, and bioxidation/leach columns. Potential flowsheet options for Hilltop include heap leach, flotation, bioxidation, roasting, and various combinations thereof to optimize oxide and sulphide recoveries. The most Project No.: Page 1-8

30 C O R T E Z P R O J E C T economically feasible process option is an oxide heap leach combined with a separate biooxidation assisted heap leach. Gold recovery is a function of the processing method (milling, leaching, roasting) and ore type. Mill recovery is 89% for Pipeline, Gap, and Crossroads, 88% for Cortez Hills and 87% for Pediment ores. Heap leach recoveries are 50% for Gap, 54% for South Pipeline O Zone, 62% for South Pipeline and Crossroads, 65% for Cortez Hills oxide, and 68% for Pipeline and Pediment oxide. Metallurgical recoveries for refractory, carbonaceous and sulphidic mineralization depends on the process used. Roasting followed by milling on a toll basis recovers 85% of the gold. Anticipated recovery for Pediment and Cortez Hills refractory ore on a toll basis is 80%. During 2004, the mine produced 1,051,336 oz of gold (45.3% mill, 47.1% heap leach, and 5.6% carbonaceous). Unit cash and total production costs were US$162 and US$201/oz, respectively. The mine has produced 644,645 oz of gold in the first eight months of 2005, comprised of 49.2% mill, 45.5% heap leach and 5.3% carbonaceous ores. 1.6 Mining and Mineral Reserves Pit optimization at the CJV is achieved using routine 60 (an implementation of the Lerchs- Grossmann Algorithm) in Placer Dome s in-house OP software system. OP60 allows the use of multiple slope domains based on the geology and a pre-determined profit/cost block model to estimate an optimal pit shell. The profit/cost block model is based on grade, recovery, and economic data, including: Gold resource model Different recovery models for each processing method (CIP milling, leaching, and roasting) and the distinctly different geological domains. Estimates of the block revenue are based on the best block value less the estimated mining and processing costs associated to produce the gold product, and less royalties. A cutoff grade is applied at a zero profit breakeven, and block profit or cost is attributed accordingly. Operating costs are dependent on the lithology and/or the ore/waste classification, and mining costs are incremented with depth below the pit rim. The optimal pit shell is smoothed to produce an operationally viable design using the VULCAN software package and obeying geotechnical constraints. All pit optimizations were based on resource models developed during the fall of 2003 and in the spring of The recovery and cost models were developed in conjunction with the 2005 budget plan and the life of mine (LOM) plan using a long-term gold price of US$375/oz for the Cortez Hills and Pediment pits and $350/oz for all other pits. Project No.: Page 1-9

31 C O R T E Z P R O J E C T The most recent pit designs for the Cortez Hills deposit have incorporated geotechnical studies carried out in 2003, 2004, and 2005 by BGC Engineering, Inc. Ore cutoff grades are determined by reviewing variable mine operating costs for ore and waste, mill processing tonnage costs by material type, variable leach tonnage costs by material type, roasting costs, variable gold refining costs and fixed overhead costs. Milling and leaching costs include allowances for all other costs applicable to pit optimization other than mining costs. AMEC reviewed these costs and found them to be reasonable and in agreement with historical costs. AMEC found pit design criteria to be reasonable and consistent with past operating and design criteria. The lack of comprehensive, pilot-scale tests with this proprietary technology and the uncertainty of the performance of the present resource model with respect to predicting mill tonnes and grade in Phases 8 and 9 lowers the confidence in these reserves. These modifying factors may justify a reclassification of Proven Mineral Reserves to Probable Mineral Reserves for the two phases. AMEC recommends that this adjustment be made in the next update of reserves. The net effect would be only a re-classification and not a reduction in reserves Proven and Probable Mineral Reserves are adequate for a mine life of approximately 13 years, or to the end of Environmental Conditions and Operating Permits The CJV has appropriate operating permits with the US Department of Interior, Bureau of Land Management (BLM) and the Nevada State Division of Environmental Protection for the Pipeline and South Pipeline pit through mining Phases 1 to 9. A Record of Decision for the Pipeline/South Pipeline Pit Expansion Project, which incorporates deepening of Phases 8 and 9 of Pipeline, expansion of the Pipeline pit into the Crossroads deposit and mining of the Gap deposit, was received on 13 July Preparation of an Environmental Impact Study (EIS) for the Pediment deposit began in February 2001 and is expected to be completed in Baseline work including Cortez Hills is in progress. CJV anticipates filing an Amendment to the Pipeline Plan of Operation (POO) for the Cortez Hills/Pediment project in the fourth quarter of NDEP water permits will also be required. Cultural artefacts in the Cortez Hills area will need to be mitigated to obtain a final operating permit. It is reasonable to expect that operating permits will be obtained. New POOs will be required in the future to mine the Cortez NW Deep and Hilltop deposits, which are presently held as resources. It is reasonable to expect that operating permits will be obtained. Project No.: Page 1-10

32 C O R T E Z P R O J E C T The CJV mine operates under Placer Dome s sustainability policy, which commits the operation to a high standard of environmental stewardship. 1.8 Mineral Resource and Mineral Reserve Summary CJV mineral reserve and mineral resource summaries, as of 1 September 2005, are listed in Tables 1-2 and 1-3. Table 1-2: CJV Mineral Reserve Estimate, 1 September 2005 Classification Ore Tons (000s) Gold Grade (oz/ton) Ore Tonnes (000s) Gold Grade (g/t) Contained Gold Ounces (000s) Proven Mineral Reserves 180, , ,193 Probable Mineral Reserves 95, , ,875 Proven + Probable Reserves 275, , ,068 Notes: Mineral reserves are separate from mineral resources. Reserves are contained within pits designed with a gold price of US$375/oz for Cortez Hills and $350/oz for all other deposits. Estimates use a leach ore cutoff grade of oz/t and variable cutoff grades for different mill ores. Columns and rows do not total exactly due to rounding. Table 1-3: CJV Mineral Resource Estimate, 1 September 2005 Classification Ore Tons (000s) Gold Grade (oz/ton) Ore Tonnes (000s) Gold Grade (g/t) Contained Gold Ounces (000s) Measured Mineral Resources 128, , ,209 Indicated Mineral Resources Open Pit 175, , ,669 Indicated Mineral Resources Cortez Hills Underground 5, , ,422 Total Measured + Indicated Mineral Resources 309, , ,300 Inferred Mineral Resources Open Pit 34, , Inferred Mineral Resources Cortez Underground 4, , ,492 Total Inferred Mineral Resources 39, , ,262 Notes: Mineral resources are exclusive to mineral reserves. Open pit resources are estimated within ultimate pits developed with a $425/oz gold price and a leach ore cutoff grade of oz/t. Underground resources are defined using cutoff grades for oxide and refractory gold calculated at a gold price of $425/oz and are bound by the outer limit of the resource model envelope. Columns do not total exactly due to rounding. Project No.: Page 1-11

33 C O R T E Z P R O J E C T 2.0 INTRODUCTION AND TERMS OF REFERENCE 2.1 Introduction Placer Dome Inc. commissioned AMEC to review resource and reserve estimates for all gold deposits within the Cortez Joint Venture (CJV) in Lander County, Nevada USA and prepare a Technical Report to support the public disclosure of Mineral Reserve and Mineral Resource estimates as of 1 September The format and content of this report are intended to conform to Form F1, Technical Report of National Instrument , Standards of Disclosure for Mineral Projects of the Canadian Securities Administrators. Larry B. Smith, P.Geo., an employee of AMEC, directed the review of resource and reserve estimates for the property. Mr. Smith reviewed the geology, exploration data, geological models, resource estimate procedures, land position, and status of permits. Tracy Barnes, P.E., an employee of Barnes Engineering Inc., reviewed resource estimates, mine designs, production plans, reserves, and cash flows. Alexandra Kozak, P.Eng., an employee of AMEC, reviewed metallurgical test data, process facilities and processing performance. Information and data for the review and preparation of the report were obtained from the Cortez Joint Venture during site visits carried out between 9 and 18 December 2003, between 23 and 24 August 2004, between 26 and 29 September 2005, and from transmittal of data to AMEC following the site visits. Some aspects of this report regarding summarizations of the geology, mineralization, mining, and mineral processing were derived from an internal Placer Dome Technical Report authored by Alfred L. Hills and Robert B. Pease (2003) and an internal Placer Dome and Kennecott Minerals feasibility study on the Cortez Hills/Pediment project (2005). Contributions from these reports were checked for accuracy by AMEC staff. William M. Martinich, Member AusIMM, a Cortez Joint Venture Qualified Person, provided assistance in making all pertinent data available to the AMEC team. 2.2 Terms of Reference Unless stated otherwise, all quantities are in US Commercial Imperial units and currencies are expressed in constant 2004 US dollars. This report is written for the entire operation; the interests of any particular joint venture owner must therefore be deduced from the figures presented. Placer Dome Inc. generally uses metric units of measurement in its public disclosures. However, since the CJV uses imperial measurement units this report has been prepared using imperial units. To convert numbers from imperial to metric please refer to Project No.: Page 2-1

34 C O R T E Z P R O J E C T Section The mineral resource and mineral reserve summaries are reported in both imperial and metric units. 2.3 Units of Measure Common Units Above mean sea level... amsl Ampere... A Annum (year)... a Billion years ago... Ga British thermal unit... Btu Cubic feet per second... ft 3 /s or cfs Cubic foot... ft 3 Cubic inch... in 3 Cubic yard... yd 3 Day... d Days per week... d/wk Days per year (annum)... d/a Degree... Degrees Fahrenheit... F Foot... ft Gallon... gal Gallons per minute (US)... gpm Greater than... > Horsepower... hp Hour... h Hours per day... h/d Hours per week... h/wk Hours per year... h/a Inch... " Kilo (thousand)... k Kilovolt... kv Kilovolt-ampere... kva Kilovolts... kv Kilowatt... kw Kilowatt hour... kwh Kilowatt hours per short ton (US)... kwh/st Kilowatt hours per year... kwh/a Less than... < Megavolt-ampere... MVA Megawatt... MW Micrometre (micron)... µm Miles per hour... mph Milliamperes... ma Project No.: Page 2-2

35 C O R T E Z P R O J E C T Milligram... mg Milligrams per litre... mg/l Millilitre... ml Millimetre... mm Million... M Minute (time)... min Month... mo Ohm (electrical)... Ω Ounce... oz Parts per billion... ppb Parts per million... ppm Percent... % Phase (electrical)... Ph Pound(s)... lb Pounds per square inch... psi Short ton (2,000 lb)... st Short ton (US)... t Short tons per day (US)... tpd Short tons per hour (US)... tph Short tons per year (US)... tpy Specific gravity... SG Square foot... ft 2 Square inch... in 2 Total dissolved solids... TDS Total suspended solids... TSS Volt... V Yard... yd Year (US)... yr Common Chemical Symbols Aluminum... Al Ammonia... NH 3 Antimony... Sb Arsenic... As Bismuth... Bi Cadmium... Cd Calcium... Ca Calcium carbonate... CaCO 3 Calcium oxide... CaO Calcium sulphide dehydrate... CaSO 4 2H 2O Carbon... C Carbon monoxide... CO Chlorine... Cl Chromium... Cr Project No.: Page 2-3

36 C O R T E Z P R O J E C T Cobalt... Co Copper... Cu Cyanide... CN Gold... Au Hydrogen... H Iron... Fe Lead... Pb Magnesium... Mg Manganese... Mn Manganese dioxide... MnO 2 Manganous hydroxide... Mn (OH) 2 Molybdenum... Mo Nickel... Ni Nitrogen... N Nitrogen oxide compounds... Nox Oxygen... O 2 Palladium... Pd Platinum... Pt Potassium... K Silver... Ag Sodium... Na Sulphur... S Tin... Sn Titanium... Ti Tungsten... W Uranium... U Zinc... Zn Metric Conversion Factors (divide by) Short tons to tonnes Pounds to tonnes Ounces (Troy) to tonnes... 32,150 Ounces (Troy) to kilograms Ounces (Troy) to grams Ounces (Troy)/short ton to grams/tonne Acres to hectares Miles to kilometres Feet to metres Project No.: Page 2-4

37 3.0 DISCLAIMER AMEC did not independently verify the validity of unpatented mining claims, leases, and title to wholly-owned patented mining claims and fee lands, but reviewed records on mining claims, fee lands and mineral leases at the mine office. AMEC interviewed Cortez Joint Venture staff regarding the status of state and federal mining and water permits, but did not independently confirm the status of permits with government agencies. Geotechnical Engineering studies by Golder Associates support pit designs for the Pipeline, South Pipeline, and Gap deposits. BGC Engineering Inc. (BGC) conducted geotechnical studies supporting pit designs for the Pediment deposit in 2000 and for the Cortez Hills deposit in 2003, 2004, and Leach pad designs were developed by AMEC Earth and Environmental. In each case, AMEC s review was based on the assumption that the work was prepared by qualified experts. Project No.: Page 3-1

38 4.0 PROPERTY DESCRIPTION AND LOCATION 4.1 Location The Cortez Joint Venture (CJV) is located 80 miles southwest of Elko, Nevada, USA., in Lander County (Figure 4-1). The Pipeline gold operation is seven miles northwest of the original Cortez milling complex. The new Pediment and Cortez Hills gold deposits are three miles south of the Cortez mill. The Hilltop resource is 16 miles northwest of the Pipeline mine and mill. The operation is accessed on Nevada State Highway 306, which extends southward from US Interstate 80, both of which are paved roads. The Pipeline, South Pipeline, Crossroads, and Gap deposits all lay within Township 27 North, Range 47 East (T27N, R47E) and Township 28 North, Range 47 East (T28N, R47E) Mount Diablo Base and Meridian (MDBM). The Pediment deposit and proposed facilities are in the southeast portion of Township 27 North, Range 47 East, the southwest portion of Township 27 North, Range 48 East, the northeast portion of Township 26 North, Range 47 East, and the northwest portion of Township 26 North, Range 48 East MDBM. The Cortez Hills deposit is principally in the northwest portion of Township 27 North, Range 48 East MDBM. The Hilltop deposit is in the northwest portion of Township 29 North, Range 46 East and the southwest portion of Township 30 North, Range 46 East MDBM. 4.2 Mineral Tenure and Agreements The CJV is managed and operated by Placer Dome US Inc.for the benefit of the CJV. Equity is split between Placer Cortez Inc., an indirect wholly-owned subsidiary of PDI and Kennecott Explorations (Australia) Ltd. in the following amounts: Placer Cortez Inc....60% Kennecott Explorations (Australia) Ltd...40% The joint venture is governed by the terms of an Amended and Restated Mining Venture Agreement dated effective 01 January 1998, between Placer Cortez Inc. and Placer Dome US Inc. and Kennecott Explorations (Australia) Ltd Mineral Rights CJV encompasses an area of approximately 640,000 acres (258,700 ha) along the Cortez/Battle Mountain mineral trend, within which the CJV directly controls about 249,100 acres (100,850 ha) of mineral rights with ownership of mining claims and fee lands (Figure 4-2). In total, the property rights controlled by the CJV through outright Project No.: Page 4-1

39 C O R T E Z P R O J E C T Figure 4-1: Location of Cortez Joint Venture in Nevada Project No.: Page 4-2

40 ownership consist of 75 patented lode claims, 8,932 unpatented lode claims, 363 unpatented millsite claims, 124 patented millsite claims, and 48,437 acres of fee mineral and surface land. An additional 4,000 acres of surface rights are owned. The CJV also has lease agreements on an additional 865 unpatented lode claims, 282 unpatented millsites, and 5,080 acres of fee lands throughout the area of interest. Table 4-1 lists the principal groups of unpatented lode mining claims on the entire joint venture Area of Interest. Table 4-2 shows the unpatented mill site claims in the Pipeline area whollyowned by the joint venture. Table 4-3 lists unpatented mill site claims in the Pipeline area leased by the joint venture. Table 4-4 lists the fee lands wholly-owned by the joint venture and under lease in the entire Area of Interest. Table 4-5 shows the principal groups of patented lode claims in the Cortez Mine area. Table 4-6 lists wholly-owned patented millsites at the Cortez Mine, followed by a list of patented lode mining claims at Gold Acres (Table 4-7) and patented lode mining claims at Hilltop (Table 4-8). Table 4-1: Unpatented Lode Mining Claims Wholly Owned or Leased by Joint Venture in Area of Interest Claim Group Number of Claims Owned Claims Black Lady 1 Cooks Creek HS&HO 109 Cortez Mine 5,026 GAS 526 Gavel 58 Hilltop 276 Marvel 79 MOAB 127 Mocking Bird & Juniper 15 Percival 37 Robertson Coral Resources 161 Toiyabe Mine 152 Chivo 61 Cricket 16 Emmy 8 Grit 99 Mari 35 Match 31 Moab 128 Patch 734 Powder Keg 168 Sand 204 Storm 257 WFM 4 Wind 483 Zach 27 Total Owned 8,932 Project No.: Page 4-3

41 Claim Group Number of Claims Leased GAS 318 Genesis - JR 127 Kurtz 7 Ward Fox, PF and PUP 60 Ward PFX 12 Ward Sly 212 Ward SlyR 11 WPL 118 Total Leased 865 Total Lode Claims 9,797 Table 4-2: Unpatented Millsites in Pipeline Area Wholly-Owned by Joint Venture Claim Name Nevada Claim Number Claim Name Nevada Claim Number AL NMC M NMC AL NMC M NMC AL NMC M NMC AL NMC M 200 NMC AL NMC M NMC AL NMC M NMC AL NMC M NMC AL NMC M NMC AL NMC M NMC AL NMC M 448 NMC AL R74-78 NMC M 456 NMC AL R NMC PLMS R1-R83 NMC AL R NMC PLMS R86-R89 NMC AL R NMC PLMS R92-R96 NMC M 15 NMC PLMS R99-R103 NMC M NMC PLMS R108-R112 NMC M 149 NMC SAW 1-31 NMC M 157 NMC Total Millsites 363 Project No.: Page 4-4

42 C O R T E Z P R O J E C T Figure 4-2: Mining Operations and Leases for Mining and Exploration Purposes Project No.: Page 4-5

43 Table 4-3: Unpatented Mill Site Claims in Pipeline Area under Lease to Joint Venture Mill Site Claim Numbers Nevada Claim Number SPMS NMC SAE 1-51 NMC Table 4-4: Holdings of Fee Lands (Wholly Owned Unless Otherwise Noted) Fee Lands Acreage Dean Ranch - Eureka and Lander Counties 48,437 Surface Rights Township 30 North, Range 46 East, MDB&M Section 33: All 640 Township 29 North, Range 46 East, MDB&M Section 4: Lot 4 (NW/4 NW/4) 40 Section 5: All 640 Section 8: N/2, S/2 SE/4 400 Township 28 North, Range 49 East, MDB&M Section 17: All 640 Township 28 North, Range 47 East, MDB&M Section 13: S1/2 320 Section 27: E1/2 320 Section 35: W/2 320 Section 36: SW/4 160 Township 26 North, Range 48 East, MDB&M Section 7: NE/4, NW/4 SE/4 200 Section 18: Lot 4, SE/4 SW/4 80 Section 19: Lot 1, E/2 NW/4, NW/4 SE/4, S/2 SE/4 240 Marvel Lease 5,000 Baumann Lease 80 Total 57,517 Project No.: Page 4-6

44 Table 4-5: Patented Lode Mining Claims in Cortez Mine Area (Wholly-Owned) Eureka County Records Claim Name Book Pages Arctic Avalanche Adjunct Alta Bewick Cummings Central Consolidated Concave Compressor Conjunction Chance Devalla Equator Eclipse Excelsior Fitzgerald Garrison Hidden Treasure Idaho Junction Jeanette Kingsbury Lead Moring Monarch Meteor Mt. Tenabo Premium Pontifex Protection Revision Quartzite Rosebush Remnant St. Louis Speculation Summit Millsite Cortez Project No.: Page 4-7

45 Table 4-6: Patented Millsites in Cortez Mine Area (Wholly-Owned) Claim MS# Patent # Claim MS# Patent # Claim MS# Patent # Claim MS# Patent # M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M M No M M M No M M M No M M M No M M M No M M M No M M M No M M M No M M M No M M M No M M M No M M M No M M M No M M M M M M M M M Project No.: Page 4-8

46 Table 4-7: Patented Lode Claims in Gold Acres Area (Wholly-Owned) Claim Name Patent No. Ambrose E Afterthought Bruce Fandango Gold Drift Gold Bar Gold Case Harry C Hub Homestead No Hope to Do Iron Blossom No Jumbo Jupiter New Monarch Neptune Polaris Robert W Second Guess Venus Table 4-8: Patented Lode Claims in Hilltop Area (Wholly-Owned) Claim Name MS # Patent No. Hilltop No Independence Strike Independence Strike Independence Strike Independence Strike Cloro Sunshine Hobo Golden Creek White Rock Hilltop Hilltop Extension Hilltop Hilltop Nellie G Log Cabin Carnation 1 & Project No.: Page 4-9

47 The CJV also manages the Buckhorn Joint Venture, which holds 34 patented lode claims, 157 unpatented lode claims, and 24 unpatented millsite claims. The CJV does not have declarable mineral resources and reserves on the Buckhorn Joint Venture land Agreements and Royalties All production at Cortez is subject to a 1.5% gross smelter return (GSR) royalty payable to the former shareholders of Idaho Mining Corporation. This pertains to any production from the Pipeline, South Pipeline, Crossroads, Gap, Gold Acres, Cortez NW Deep, Cortez Hills, Pediment and Hilltop deposits. In addition, Royal Gold Inc. holds a GSR royalty over the Pipeline/South Pipeline deposits (graduating from 0.4% to 5.0% based on the price of gold), and ECM Inc. holds a net value royalty of 5.0% of gold sales from the South Pipeline deposit (which is approximately equivalent to a 3.9% GSR). A separate sliding scale GSR (based on gold price) from 0.72% to 9.0% is owed to Royal Gold Inc. and Royal Crescent Valley Inc. on 370 GAS claims in the vicinity of the South Pipeline deposit. An additional sliding scale GSR (based on gold price) is owed to Royal Gold Inc. and Royal Crescent Valley Inc. on 52 other claims in the vicinity of the South Pipeline deposit. Production from the Hilltop deposit is subject to a 10% Net Profits royalty, capped at $8 million, due to LHTW Properties (owned by Chevron). Since 1992, Placer Dome US Inc. (PDUS) and the CJV have been involved in litigation against ECM Inc. concerning claims by ECM arising from PDUS' and the CJV's acquisition of a lease from ECM of the GAS mining claims on which the South Pipeline deposit was discovered. This claim is disclosed in the notes to Placer Dome Inc.'s consolidated financial statements, but no loss accrual for that contingency has been made since management believes, on balance, that it will be finally successful in defending the litigation against ECM. 4.3 Operational Permits and Jurisdictions All mineral reserves and mineral resources, in addition to existing and future facilities to be used to exploit the mineral reserves, are on public lands administered by the Battle Mountain Field Office of the US Department of Interior, Bureau of Land Management (BLM). The Nevada State Division of Environmental Protection (NDEP) requires Water Pollution Control Permits related to heap leach and mill process facilities and aquifer infiltration galleries. Existing state and federal permits cover the Pipeline and South Pipeline pits. Mining of stockpile material at the Gold Acres pit is covered by the existing BLM Plan of Operation (POO). In January 2001, the CJV filed an Amended POO with the BLM in to deepen Phases 8 and 9 in the Pipeline/South Pipeline pit and extend the pit into the Crossroads deposit to the south. The Amendment also included mining of the Gap pit located between Project No.: Page 4-10

48 Pipeline/South Pipeline and the historical Gold Acres pit. The final Environmental Impact Statement (EIS) for this amendment was released at the end of January 2004 and a positive Record of Decision was received from the BLM on July 13, Preparation of an Environmental Impact Study (EIS) for the Pediment deposit began in February 2001 and is expected to be completed in Baseline work including Cortez Hills is in progress. CJV anticipates filing an Amendment to the Pipeline Plan of Operation (POO) for the Cortez Hills/Pediment project in the fourth quarter of NDEP water permits will also be required. Cultural artefacts in the Cortez Hills area will need to be mitigated to obtain a final operating permit. It is reasonable to expect that operating permits will be obtained. The Cortez NW Deep deposit (located northwest of the historical Cortez mine pit) and the Hilltop deposit are presently classified as resources. If the Cortez NW Deep deposit were mined in the future, an amendment to the existing POO for the Cortez pit would be required. The Hilltop deposit would require a new POO and EIS if resources there were converted to reserves. The CJV mine operates under Placer Dome s sustainability policy, which commits the operation to a high standard of environmental stewardship. This involves protecting human health, reducing the impact of mining on the ecosystem, and returning the site to a state compatible with a healthy environment. Nine issue management plans (IMPs) have been developed for the major environmental issues identified. These IMPs include a plan for rehabilitation, site decommissioning, and closure. Environmental considerations are discussed in Section 19.9 of this Technical Report. Project No.: Page 4-11

49 5.0 ACCESSIBILITY, CLIMATE, AND PHYSIOGRAPHY The Cortez Joint Venture operation is reached by travelling approximately 32 miles east from Battle Mountain, Nevada, on US Interstate 80 (I-80). Alternative access is from Elko, Nevada, approximately 45 miles west to the Beowawe exit, then approximately 35 miles south on Nevada State Route 306. The present Pipeline/South Pipeline mine and Mill No. 2 of the CJV are at the southern end of the Crescent Valley in Lander County, Nevada. The Crescent Valley is a structural and topographic basin between the Northern Shoshone Range on the west and the Cortez Range on the east. Most mine facilities are on the west side of the valley at an elevation of about 5,000 ft. This includes the original workings of the Gold Acres mine, now inactive and the proposed pit of the Gap deposit. The Cortez mine and Mill No.1 (both inactive) are located along the northern edge of the Cortez Range seven miles southeast of the Pipeline pit. The recently discovered Cortez Hills and Pediment deposits are located in the Cortez Hills approximately three miles south of the Cortez pit and at an elevation of about 6,000 ft. The mine workforce presently consists of 370 employees, who commute to the property via company sponsored bussing, company vehicles, or privately owned vehicles. The area is sparsely populated. The small community of Crescent Valley is about 10 miles north of the Cortez Mill No. 2 complex. The climate of central Nevada is generally characterized as mid-latitude steppe. Low humidity, mostly clear skies, and large diurnal temperature fluctuations represent normal daily conditions. Winds are generally from the southwest; however, channelling of wind flow by the north-south oriented mountain ranges is common. Temperatures range from an average mean of 48 F to an absolute minimum of -30 F and an absolute maximum of 105 F. January is the coldest month, with an average mean monthly temperature of 26 F. July is the warmest month, with an average temperature of 72 F. Average annual precipitation is approximately 9". May is the wettest month (one inch average) and July is the driest (0.3" average). Precipitation between November and March is normally dominated by snowfall. Summer precipitation is usually characterized by short-duration, high-intensity thunderstorms. Water for process use at Cortez Mill No. 2 is supplied from the open pit dewatering system. Currently, approximately 1,450 gpm of the pit dewatering volume is diverted for plant use. Electric power at Pipeline is supplied by Sierra Pacific Power Company (SPPC) through a 50 mile long, 120 kv transmission line. The average power requirement of the mine is about 150 MkWh/a. Project No.: Page 5-1

50 6.0 HISTORY The following history of mining in the Cortez Joint Venture is abstracted from Hays and Foo (1990), Foo, et al., (1996) and Thompson and Hays (2000), and is listed in Table 6-1. Mining in the area occurred as early as 1862 when silver was discovered near the present Cortez mine. Gold, lead, copper, and antimony were mined from quartz veins at the Hilltop deposit from 1912 to 1921 (Kelson, et al., 2000). Gold mineralization at Gold Acres was discovered in the late 1920 s and mined by a small mining company from 1935 to The mine was one of the few gold operations to remain open during World War II. Mining began with underground methods and later converted to open pits. The north pit produced about US$10 million in gold from 1942 to 1961 (Hays and Foo, 1990). In 1959, American Exploration & Mining Co. (AMEX), a wholly-owned US subsidiary of Placer Development Ltd., entered into a lease-option agreement on the properties of the Cortez Metals Co. and started extensive exploration of the mine workings and surrounding area. In 1963 AMEX entered into an exploration agreement with Idaho Mining Corp., which had acquired large areas of mineralized ground adjoining the AMEX holdings. In 1964, AMEX formed the Cortez Joint Venture with the added participation by the Bunker Hill Co., Vernon F. Taylor, Jr., and Webb Resource, Inc, The US Geological Survey found anomalous gold in altered outcrops at the base of the Cortez Range in The CJV shortly afterwards discovered the Cortez deposit. Production at Cortez began in 1969 and continued until 1972, and then resumed from 1988 to Unmined resources comprise deep extensions of mineralization northwest of the existing Cortez pit. Work continues to convert these resources to reserves. The CJV obtained exploration rights to the Gold Acres mine in Drilling confirmed reserves and open pit mining began in Low-grade ores from Gold Acres were mined and processed by heap leaching until Leaching and milling of Gold Acres stockpiles and dumps continued until Drilling resumed, resulting in the discovery of refractory gold mineralization in the vicinity of the north pit. Mill-grade ores were mined from 1987 to 1996 and processed at the Cortez Mill #1. In 2003, the CJV commenced shipping Gold Acres refractory stockpiles for toll processing at third-party facilities. The Pipeline, South Pipeline, and Crossroads gold deposits occur in sequence from northwest to southeast and are entirely concealed beneath pediment gravels up to 300 ft thick. The Pipeline deposit was discovered by CJV geologists in March 1991 during drilling of deep condemnation holes on the pediment east of Gold Acres. Initial indications of the South Pipeline deposit were discovered by Royal Gold during drilling campaigns carried out in 1990 and CJV shortly afterward assumed the role of operator in the Royal Gold-ECM joint venture and then in late 1991 discovered the South Pipeline deposit. Drilling west of the South Pipeline deposit revealed a shallow zone of gold mineralization termed the Crescent deposit and mineralization farther west at Gap. Project No.: Page 6-1

51 Mining began on the Crescent pit in An internal feasibility study covering the Pipeline and South Pipeline deposits was completed by Placer Dome Technical Services in Construction of Mill #2 and pre-stripping of the first stage of the Pipeline pit began in Continued drilling along northwest-southeast structural trends at Pipeline in 1998 resulted in discovery of the Crossroads deposit southeast of the South Pipeline deposit. Crossroads is concealed beneath 550 ft of alluvium. It represents a continuation of mineralization from South Pipeline. Table 6-1: History of Exploration and Mining in the Cortez Joint Venture Period Activity Cortez Silver mine in operation Mining of gold, lead, copper and antimony at Hilltop Late 1920s Gold Acres deposit discovered Gold mined from the Gold Acres deposit by other companies. Gold Acres mined as an open pit operation 1964 Cortez Joint Venture (CJV) formed 1966 Cortez deposit discovered ; Cortez deposit mined New southern extension of the Gold Acres deposit mined and Horse Canyon deposit discovered Low-grade oxide ores from Cortez and Gold Acres heap leached Horse Canyon deposit mined Mining resumed in the Cortez and Gold Acres deposits 1989 Hilltop deposit acquired 1991 Pipeline, South Pipeline, Crescent and Gap deposits discovered 1994 Commenced mining the Crescent pit within the north western portion of the South Pipeline deposit 1996 Mining commenced on the Pipeline deposit 1997 Production at Mill No. 2 commenced. Total development and capital costs were $250 million Crossroads deposit discovered Pediment deposit discovered 1999 Mill No. 1 was placed on care and maintenance Plan of Operations was submitted for Pipeline expansion and Pediment projects 2002 South Area heap leach facility was commissioned 2003 Cortez Hills deposit discovery was announced in April 2004 Infill drilling continued at Cortez Hills and Pediment deposits 2005 Condemnation drilling and geotechnical drilling for Cortez Hills pit In 1996, CJV geologists began a program to test for concealed mineralization south of the Cortez mine. Geochemical and geophysical surveys were used to guide deep reverse- Project No.: Page 6-2

52 circulation drilling, initially focussing on an area immediately west of the Cortez Fault. In 1998, the Pediment deposit was discovered in a ten hole, deep RC drilling program designed to test potential for bedrock mineralization in the central and western portions of the alluvium-covered Cortez Fault Corridor. One of these holes, 98205, cut a 130 ft intercept averaging oz/t Au. A second drill hole, 98207, demonstrated the economic potential of the Pediment deposit cutting a 190 ft intercept averaging >0.100 oz/t Au. Subsequent RC and core drilling programs through 2002 defined the Pediment reserve. The Cortez Hills deposit was discovered in October 2002 as part of a seven RC hole exploration program investigating a steep gravity gradient anomaly near the projected intersection of NNW trending Cortez Fault Corridor structures and WNW trending faults beneath alluvial cover immediately to the north of the Pediment deposit. The sixth RC hole of this program intercepted 120 ft with an average grade of oz/t Au. Three additional RC holes drilled were drilled in the fall of 2002 to confirm potential continuity and significance of mineralization. Continued RC and core drilling programs have defined the current reserves. Development drilling was carried out to the extent that a resource estimate was announced by PDI in April Since then, a total of 626 core and RC holes totalling 893,989 ft have been drilled on the Cortez Hills and Pediment deposits. Production from the Cortez Joint Venture from 1991 to 30 August 2005 is shown in Table 6-2. Table 6-2: Cortez Joint Venture Annual Production, August 2005 Year Ended Gold (troy oz) , , , , , , , ,138, ,328, ,009, ,188, ,082, ,065, ,051, (to 30 August) 644,645 Total 9,439,083 Project No.: Page 6-3

53 7.0 GEOLOGICAL SETTING 7.1 Regional Geology Comprehensive regional geologic studies of the Cortez area include Gilluly and Masursky (1965), Gilluly and Gates (1965), and Madrid (1987). Other publications discuss more detailed geologic features of the Cortez (Wells et al., 1969), Horse Canyon (Foo and Hebert, 1987), Gold Acres (Hays and Foo, 1990), the Pipeline and South Pipeline (Foo et al., 1996), Cortez (Thompson and Hays, 2000) and Cortez Hills/Pediment (Thompson, 2003) gold deposits. The geological setting of the Cortez area is typical of the Basin and Range province in northeastern Nevada and western Utah. The gold deposits of the district lie along the western margin of the Crescent Valley at the foot of the Shoshone Range (Pipeline, South Pipeline, Crossroads, Gap and Gold Acres) or within the southern end of the Cortez Range (Cortez, Cortez NW Deep, Cortez Hills and Pediment). Alluvial fill in the Crescent Valley between the fault blocks forming the two mountain ranges is up to 10,000 ft thick. The regional geology consists of deep-water siliceous rocks, and shallower-water carbonate rocks of the Paleozoic Roberts Mountains allochthon. Time-equivalent siliceous rocks of the upper plate of the Roberts Mountains Thrust (RMT) are juxtaposed over lowerplate carbonate rocks. Cretaceous to Eocene felsic dikes cut host rocks and mineralization throughout the district. Locally, volcanic rocks of Oligocene to Miocene age cover the Paleozoic-age sedimentary rocks. Styles of gold mineralization within the CJV Area of Interest include Carlin-type sedimenthosted deposits, porphyry deposits, and epithermal vein/stockwork deposits. The style most conducive to large tonnage and higher grades is the Carlin-type deposits hosted in the lower-plate carbonate rocks (e.g., Pipeline, South Pipeline, Crossroads Cortez, Cortez NW Deep, Gold Acres, Gap, Cortez Hills, Pediment, Horse Canyon, and Toiyabe). The porphyry and epithermal styles of mineralization rely on extensive structural ground preparation in less-receptive siliceous and volcanic host rocks (e.g., Hilltop, Coral, and Buckhorn). Carlin-type, sediment-hosted gold mineralization is the main target of exploration efforts in the CJV. These deposit types are situated along the Cortez Rift, which is within the northern Nevada Rift as defined by Stewart et al. (1975, Figure 7-1). The Cortez Rift is a distinct geological feature within the Battle Mountain-Eureka mineral belt (otherwise known as the Cortez Trend) defined by Roberts (1960). The rift is principally a feature of Miocene-age extension, normal faulting and emplacement of mafic intrusives and volcanic rocks. This structural zone mimics older north-northwest trending structures in some areas and in others masks older northwest and northeast-trending faults and folds that control mineralization. Gold mineralization in the CJV occurs within the lower-plate carbonates in Project No.: Page 7-1

54 or adjacent to structural closures (folds and horst blocks), which are along major, throughgoing normal faults and Mesozoic-age intrusive stocks. The principal hosts of gold mineralization are the Silurian Roberts Mountains Formation and the Devonian Wenban Limestone. Figure 7-1: Location of Cortez Mine in Regional Gold Trends, North Central Nevada Cortez Hills/Pediment x 7.2 District Geology and Stratigraphy Figure 7-2 shows the local geology of the joint venture area. The general stratigraphy of the CJV deposits area is illustrated in Figure 7-3. The geological and stratigraphic setting of individual CJV gold deposits is described in subsequent sections. Project No.: Page 7-2

55 C O R T E Z P R O J E C T Figure 7-2: District Geology Hilltop Pipeline/S. Pipeline/Crossroads Gold Acres/Gap Cortez/Cortez NW Deep Cortez Hills/Pediment Note: Map supplied by CJV. Cortez Pediment map data is from detailed Cortez Joint Venture field mapping; Cortez Joint Venture map data is from Stewart & Carlson Geological Map of North-Central Nevada Project No.: Page 7-3

56 Figure 7-3: Stratigraphy of Cortez Joint Venture Area Note: Host of Gap deposit and majority of Cortez Hills deposit is Devonian Wenban Limestone. Host of Pipeline, South Pipeline, Crossroads and lower Cortez Hills deposits is Silurian Roberts Mountains Formation. The Cortez region is underlain by Paleozoic sedimentary rocks of the Roberts Mountain allochthon, Mesozoic granitic plutons and Tertiary volcanic rocks. A majority of the Northern Shoshone Range, comprising the northwest portion of the district, is underlain by siliceous cherts, sandstones, shales, and mafic volcanic rocks of deep-water origin, representing the upper structural plate of the Roberts Mountains Thrust. This includes the Project No.: Page 7-4

57 Cambrian Harmony Formation, Ordovician Valmy and Vinini Formations, Silurian Elder Sandstone and Fourmile Canyon Formations, and the Devonian Slaven Chert. The Hilltop gold deposit is hosted by brecciated, Upper Plate siliceous sedimentary rocks of the Ordovician Valmy Formation and Eocene porphyry along a northwest-trending fault system. The Gold Acres, Gap, Pipeline, South Pipeline, and Crossroads occur within Lower Plate Roberts Mountains Formation and within the Wenban Limestone at the south end of the Shoshone Range where erosion has exposed these units within structural uplifts. The Crescent Valley cuts southwest across the centre of the district, disrupting the northnorthwest trend of Cortez Rift structures and windows of Lower Plate rocks. In part, the top of bedrock on the west side of the valley slopes south-eastward, forming the toe of the southeast-dipping Shoshone Range structural block. Alluvium is abruptly thick on the southeast side of the Valley due to a normal fault bounding the front of the Cortez Range. Gravity data suggest that the alluvium is up to 10,000 ft thick on the east side of the valley. The south-western Cortez Range is underlain by Upper Plate Valmy and Vinini Formation, Lower Plate Roberts Mountains Formation and Wenban Limestone, Jurassic intrusives (the Mill Canyon Stock) and Oligocene to Miocene volcanic rocks. Gold mineralization at Cortez, Horse Canyon, Cortez Hills, and Pediment occur along a north-northwest corridor where erosion of structural uplifts has exposed the Lower Plate limestones. To the west and east, Paleozoic rocks are covered by Oligocene felsic volcanic rocks and Miocene mafic volcanic rocks. Emplacement of Jurassic and Cretaceous granitic stocks appears to have increased the structural preparation of carbonate host rocks in gold deposits within the Gold Acres- Pipeline and Cortez-Horse Canyon areas, although thrust zones within the carbonate rocks exhibit a strong local control on mineralization. Mineralization at Gold Acres, Gap, and Pipeline-South Pipeline are within the west, apex, and east portions, respectively, of an anticline created by emplacement of the Gold Acres stock. The Jurassic Mill Canyon Stock lies immediately east of the Cortez deposit and north of the Horse Canyon deposit. Oligocene felsic dikes are common at Gold Acres, Cortez, and Cortez Hills. The intersection of north-northwest-trending faults and shallow east-dipping thrust faults within the Roberts Mountains Formation and Wenban Limestone control the location of gold mineralization in the Gold Acres, Gap, Pipeline, South Pipeline, Crossroads, Cortez and Cortez NW Deep deposits. Locally, mineralization expands where these features are intersected by northeast- and northwest-striking faults. The Pediment deposit appears to be contained within a Miocene-age slide block that was displaced southwest from an original source located somewhere near Mt. Tenabo. The Cortez Hills deposit is within Wenban Limestone bedrock immediately north of Pediment. Both deposits are concealed underneath from 10 ft to 300 ft of alluvium and colluvium. Project No.: Page 7-5

58 7.3 Deposit Geology Pipeline/South Pipeline/Crossroads These deposits represent a continuum of gold mineralization along a north-northwest (N15W to N20W), high-angle fault. Mineralization occurs where this structure, termed the Pipeline Fault, intersects a shallow east-dipping thrust duplex within the Roberts Mountains Formation. The thickest zones of mineralization occur where this structural setting is intersected by northeast-trending faults. Quaternary alluvium covers the area and contains a wide range of grain sizes from coarser cobbles and boulders of chert, argillite, siltstone, limestone, and quartzite to fine sands and silts. The alluvium-bedrock contact dips gently to the east (less than 10 ) at an angle shallower than and sub-parallel to the bedding of the Roberts Mountains Formation below. The most important ore host is a silty carbonate unit in the Roberts Mountains Formation. Unaltered Roberts Mountains Formation is typically black to dark grey, thin- to mediumbedded, thinly laminated, calcareous to dolomitic siltstone, containing about 70% total carbonate, 22% detrital silt-sized grains of quartz and feldspar, and about 8% clay minerals (Stewart, 1980, and Mullens, 1980). Petrographic descriptions from the immediate deposit area indicate that the Roberts Mountains Formation can have a variable composition ranging from 10% to 80% quartz silt and up to 90% total carbonate as an indication of degrees of alteration. Carbonaceous material and pyrite are common. Fossiliferous horizons are noted in the deposit area, but detailed identification and dating have not been completed. The thickest Roberts Mountains Formation in its type section is 1,900 ft thick. In the Cortez Mountains, the thickest measured section is 1,000 ft (Gilluly and Masursky, 1965). Drill data suggest that the Roberts Mountains Formation exceeds 2,500 ft in thickness in the deposit area. Thickening is thought to be the result of repeated orogenic activity from the Antler through the Sevier Orogenies and a possible variation in deposition basin morphology. Doming, related to the Jurassic intrusives, may account for additional thickening along the margins of the igneous bodies. The lower-plate Devonian Wenban limestone is exposed to the west of the deposit and is evident to the south at depth. The Wenban Limestone is similar to and overlies the Roberts Mountains Formation, but is typically thicker bedded with less detrital silt grains. It is generally a relatively crystalline limestone, which was deposited in a shallow-shelf to moderately deep outer-shelf environment (Stewart, 1980). Although the Wenban Limestone is not evident within the Pipeline, South Pipeline, and Crossroads deposits, it will comprise portions of the ultimate western pit wall. The stratigraphically deeper Ordovician Hanson Creek Formation was also encountered in deep reverse-circulation drill holes to the south. Project No.: Page 7-6

59 The distribution of host rocks and gold mineralization is controlled by a series of northnorthwest-trending (N15W-N20W) faults that dip from 75 to 85 east. The most important of these is the Pipeline Fault, which was recognized as a photo lineament early in exploration drilling. The Pipeline Fault and sub-parallel faults to the west cut through the centre of a horst block of Lower Plate rocks located between Wenban Formation to the west and Upper Plate rocks to the east Gold Acres Gold Acres is located within the western limb of an anticline in Lower Plate and Upper Plate rocks that overlies the Cretaceous Gold Acres Stock. The Upper Plate siliceous rocks are represented by the Ordovician Valmy Formation, the Silurian Elder sandstone and the Devonian Slaven chert. The Upper Plate units consist of quartzite, chert, shale, siltstone, greenstone, and minor amounts of limestone; silty sandstone with lesser amounts of sandy siltstone and chert; and thin-bedded chert, respectively. The Lower Plate carbonate rocks are represented by the Silurian Roberts Mountains Formation and the Devonian Wenban limestone. The Roberts Mountains Formation is a thin-bedded calcareous to dolomitic siltstone, with discontinuous thin lenses of black chert. The Roberts Mountains Formation is pervasively carbonaceous near mineralization. The Wenban Limestone is a medium- to thick-bedded, silty to crystalline limestone, which has been altered to skarn near gold mineralization. Ore is hosted predominantly by the Roberts Mountains Formation, with minor gold hosted within the Upper Plate Slaven chert and Valmy Formation. The Gold Acres Stock lies beneath the Gold Acres area, but does not outcrop near the deposit and is not evident in the walls of the pit. Drilling indicates that the pluton is from 400 to 600 ft below the current Gold Acres pits. The deposit is bounded on the north by the Gold Acres Fault, which strikes northeast and is near vertical. The Island Fault strikes N20E and dips 50 northwest. It displaces mineralization in the North Pit downward relative to mineralization within the South Pit. Multiple northeast-trending faults are present between the Gold Acres and Island Faults and these displace mineralized stratigraphy downward in a stair-step pattern to the north. The Gold Acres pit is presently inactive Gap The Gap deposit is hosted in Devonian Wenban Limestone. Mineralization occurs where north-northwest and northeast, high-angle faults intersect thermally altered Wenban Formation in the axis of the Gold Acres Anticline. Bedding in the Wenban Limestone is relatively horizontal to gently east dipping. Mineralization preferentially occurs at the intersection of the faults. Project No.: Page 7-7

60 7.3.4 Cortez and Cortez NW Deep The geological setting of the Cortez, Cortez NW Deep, Cortez Hills, and Pediment Deposits is illustrated in Figure 7-4. The Cortez Deposit is hosted by thin- to medium-bedded, thinly laminated, calcareous to dolomitic siltstone of the Roberts Mountains Formation. Dolomite, limestone and calcareous mudstones of the Ordovician Hanson Creek Formation underlie the Roberts Mountains Formation at the deposit and crop out east of the deposit on Mt. Tenabo. The Wenban Formation caps most ridges and hills around the Cortez deposit and locally appears to have acted as a cap rock over alteration systems in the underlying Roberts Mountains Formation. Prior to mining, Quaternary alluvium formed a thin veneer of cover over mineralization. Alluvium thickens abruptly to the north across the Cortez range-front normal fault. Quartz monzonites of the Jurassic Mill Canyon Stock are present east of the deposit on the uplifted side of a north-northwest-trending normal fault. Numerous Oligocene quartz porphyry dikes and sills intrude the deposit. These dikes are barren of gold and pathfinder elements and are post mineral (Thompson and Hays, 2000). A series of north-northwest-trending and northeast-trending faults cut the Roberts Mountains Formation at the deposit. Mineralization occurs where these faults intersect shallow east-dipping thrust breccia zones (thrust duplexes) within the Roberts Mountains Formation. The Cortez NW Deep Zone comprises mineralization between the 4,300 ft and 4,500 ft elevations beneath previously mined mineralization in the Cortez pit. Mineralization occurs within two zones: an oxidized and strongly altered thrust zone within the Roberts Mountains Formation and an unoxidized, sulphide-bearing thrust zone at the top of the Hanson Creek Formation Cortez Hills and Pediment Cortez Hills is located in concealed lower plate rocks in the Cortez window, two and onehalf miles south of the Cortez deposit. The Pediment deposit is located an additional mile south of Cortez Hills and is in Tertiary, mass-wasting conglomerates on top of lower plate rocks and beneath recent alluvial and colluvial cover. Figure 7-4 shows the surface geology of the area between the historic Cortez deposit. Assemblages of the eastern facies (lower plate) are exposed on the uplifted east side of the Cortez fault. From youngest (shallow) to oldest, the exposed assemblages of the Eastern Assemblage are: the Mississippian-Devonian Pilot shale (MDps), Devonian Wenban Limestone (Dw), Silurian-Devonian Roberts Mountain Limestone (DSrm), Project No.: Page 7-8

61 Ordovician Hanson Creek Dolomite/Limestone (Ohc), Ordovician Eureka Quartzite (Oe), and Cambrian Hamburg Dolomite (Ch). On the west side of the Cortez Fault, the eastern facies extend to a depth of at least 2,500 ft below the surface in the area of the Cortez Hills deposit. The Roberts Mountains Formation is a dark grey, carbon rich, calcareous to dolomitic siltstone, and is exposed at the top of Mount Tenabo east of the Cortez Fault. The Hanson Creek Formation, a grey to black dolomite with an intermediate medium gray limestone unit, and the brown to white cliff-forming Eureka Quartzite are exposed down the western slope of Mount Tenabo. The Cambrian Hamburg Dolomite, a thick uniform sequence of gray parallel-bedded dolomite, is in fault contact with the Devonian Wenban Limestone along the Cortez fault. The Wenban Limestone is exposed to the east of the Cortez fault on the east side of Mount Tenabo, as well as at the top of the southern Cortez Mountains. It also occurs in a ridge immediately to the west of the planned Cortez Hills pit, extending westward to the Crescent Fault and northward forming the upper wall rocks in the formerly mined Cortez, F-Canyon, and ADA 52 pits. The Wenban Limestone varies from 300 ft to 1,000 ft deep in the proposed pit area and is overlain by more recent alluvial deposits. Quaternary and Tertiary alluvium, resulting from ongoing erosion of the Cortez Mountains, covers the Wenban Limestone at the western base of Mount Tenabo. The proposed Cortez Hills pit will be excavated in marbleized Wenban Limestone, carbonate-cemented Tertiary conglomerate, and Quaternary alluvium. The eastern high wall and part of the pit floor will expose marbleized and unaltered Wenban Limestone, and extend to a depth of approximately 1,000 ft to 2,300 ft below surface. The western wall and pit floor will expose Quaternary alluvium as well as Tertiary conglomerate units. Gold mineralization in the Cortez Hills deposit is hosted by Devonian Wenban Limestone and Silurian Roberts Mountains Formation. The limestones dip east at 20 (Figure 7-5). Mineralization is hosted by siltstones and cherts in the upper portion of the Wenban Limestone (Horse Canyon Member), limestones in the lower calcareous unit of the Wenban Limestone and calcareous siltstones of the Roberts Mountains Formation. The majority of mineralization is in decalcified, metamorphosed micritic limestones of the lower Wenban Limestone. Hydrothermal breccias are common and generally high grade. Mineralization extends upward into decalcified, silty limestone and chert units of the Horse Canyon Member of the Wenban Limestone. The core of the deposit is associated with an irregular zone of marble that rises upward from the west and extends more than 6,000 ft north from beneath the Pediment deposit to a location immediately north of the Cortez Hills deposit. The marble front is not related to any known intrusive mass, but CJV geologists propose that a Mesozoic pluton similar to the Mill Canyon Stock (east of Cortez) is present at depth west of the deposit. Tertiary felsic dikes and sills intrude the marble and unmetamorphosed Wenban Limestone and cut mineralization. These appear to be the same as Oligocene quartz porphyry dikes exposed in the Cortez pit. Oriented drill core suggest that the dikes strike N50 to 70 W and dip SW Project No.: Page 7-9

62 at 65 to 75. Drilling information also suggests the presence of numerous NW and NNWstriking faults, some of which control deposition of mineralization and others that displace mineralization. SW-dipping faults include the Cortez Hills 287-1, 287-2, and faults. The deposit occurs at the intersection of 287 faults and normal faults parallel to the Cortez Fault, striking 15 to 20 W and dipping 60 to 65 WSW. The result is complex series of fault blocks and a body of mineralization that plunges 65 WSW. A deeper zone of sub-horizontal, refractory mineralization is also present in the upper portion of the Roberts Mountains Formation approximately 2,000 feet below surface and feet beneath the presently designed Cortez Hills ultimate pit. This zone, as well as high-grade mineralization hosted by Wenban Formation beneath the ultimate pit are being explored as a resource mineable by underground methods. Cortez Hills mineralization is entirely concealed beneath from 250 ft to 300 ft of colluvium and alluvium. The Pediment deposit is unique to the district in that it is comprised of a Miocene conglomerate slide block or debris flow of mineralized Silurian Roberts Mountains Formation. The slide block was most likely derived from the east in an area near Mt. Tenabo. Four distinct stratigraphic units are recognized in the deposit. These may represent different slide block or debris flow events and different sources. The uppermost unit is an unmineralized colluvium composed of limestone and quartzite cobbles and boulders. The colluvium is from 80 ft to 130 ft thick. Limestone conglomerate underlies the colluvium. The conglomerate consists of gravel to cobble-sized clasts of siltstone and limestone and is from 50 ft to 200 ft thick. Limestone within the conglomerate is locally mineralized. The third unit is a siltstone conglomerate, which consists of gravel to cobblesize fragments of mineralized siltstone and limestone. The siltstone conglomerate is 100 ft to 800 ft thick and dips from 10 to 20 west. Rock types represented in the mineralized siltstone conglomerate are similar to lithologies in the Roberts Mountains Formation. Limestone blocks in the limestone conglomerate are similar to the Wenban Limestone. Bedrock beneath the limestone conglomerate is marble formed from thermal metamorphism of the Wenban Limestone. The marble is locally altered and mineralized. Quaternary alluvium and colluvium conceal the slide-block lithologies. The alluvium and colluvium are from 10 ft thick (along eastern part of property) to more than 150 ft thick (western part of property). There are no apparent structural controls, although the deposit is strongly elongated northnortheast. Project No.: Page 7-10

63 C O R T E Z P R O J E C T Figure 7-4: Geology of Cortez, Cortez Hills, and Pediment Areas Cortez Flt D U Note: See Figure 7-2 explanation for key to geological units, figure supplied by CJV. Project No.: Page 7-11

64 C O R T E Z P R O J E C T Figure 7-5: Southwest-Northeast Section in Cortez Hills Deposit Note: See Figure 7-4 for location of section; for explanation of units, see following figure. Figure supplied by CJV. Project No.: Page 7-12

65 7.3.6 Hilltop The Hilltop deposit is located in Upper Plate siliceous sedimentary rocks of the Ordovician Valmy Formation and in Oligocene intrusive porphyries and breccias (Kelson, et al., 2000). Mineralization is hosted by megabreccia developed between the Hilltop Mine and Independence Faults, which dip west at 20 and 30, respectively. Thrust movement along the faults developed the host breccia, which was intruded by diorite-granodiorite sills and dikes in Eocene time. Initial weak porphyry-style copper, molybdenum, gold mineralization was associated with emplacement of the 41.2 ±0.5 Ma intrusives. Gold mineralization in the fault breccias followed the porphyry event. Project No.: Page 7-13

66 8.0 DEPOSIT TYPES Styles of gold mineralization within the CJV include Carlin-type sediment-hosted, porphyryhosted and epithermal, volcanic-hosted deposits. The style most conducive to large tonnage and higher grades is the sedimentary rock-hosted, Carlin-type deposits located in carbonate rocks of the lower plate of the Roberts Mountains Thrust (e.g., Pipeline, South Pipeline, Crossroads, Cortez, Cortez NW Deep, Gold Acres, Gap, Horse Canyon, and Cortez Hills). The porphyry and epithermal styles of mineralization rely on extensive structural ground preparation in less-receptive siliceous and volcanic host rocks (e.g., Hilltop). The Carlin-type mineralization is the main focus of exploration efforts. The typical deposit is structurally controlled, with sub-microscopic gold particles distributed throughout strongly altered sedimentary host rocks near controlling structures. Gold is usually associated with anomalous levels of arsenic, antimony, and mercury. The Carlin-type deposits in the CJV are situated along the Cortez Rift, which is within the northern Nevada Rift defined by Stewart et al., (1975) and is a distinct geologic feature within the Battle Mountain-Eureka mineral belt defined by Roberts (1960). North-northwest-trending faults that define the Miocene-age rift are developed along older faults of the same orientation. Oligocene and older northwest- and northeast-trending faults and the margins of Mesozoic intrusive stocks control the distribution of structural blocks near each deposit. Deposits are exposed where erosion has removed Upper Plate rocks of the Roberts Mountains Thrust. The Silurian Roberts Mountains Formation is the principal ore host at Gold Acres, Pipeline, South Pipeline, Crossroads, Cortez, and Cortez NW Deep. The Devonian Wenban Limestone is the main host in the Gap and Cortez Hills deposits. The Cortez Hills deposit shows similarities to other structurally controlled, high-grade gold deposits in the Carlin District such as Meikle, Deep Star and possibly West Leeville. The Pediment deposit comprises mineralization in the Roberts Mountains Formation and Wenban Limestone that has been displaced in a landslide block. Project No.: Page 8-1

67 9.0 MINERALIZATION 9.1 Pipeline/South Pipeline/Crossroads The following description of deposits was derived mostly from Foo, Hays, and McCormack (1996) and confirmed by AMEC in inspections of cross sections and level plans. The Pipeline, South Pipeline, and Crossroads deposits are disseminated, Carlin-type, sedimentary rock-hosted gold occurrences which are located within the projected extent of the Gold Acres window in the Roberts Mountains Thrust. The deposits represent pods of similar mineralization along one structural trend and essentially are segments of one deposit. The mineralization is hosted in variably altered, silty carbonate units of the Roberts Mountains Formation. The deposits occur within an extensively altered and mineralized system estimated to be more than 10,000 ft long (north-south) and 5,000 ft wide (east-west). Economic gold grades do not occur over the full expanse of this system, but variable degrees of hydrothermal alteration are evident throughout. Alteration types include oxidation, decalcification, weak contact metamorphism, argillization, silicification, and carbonization. The top of the main Pipeline deposit is from 500 ft to 600 ft beneath the surface. The deposit is tabular, dips at a low angle to the east and extends 750 ft north-south by 1,500 ft east-west. The mineralized zone is from 50 to 300 ft thick. Figures 9-1 to 9-3 illustrate a typical cross section, longitudinal section and level plan of the deposits. Figures 9-4 to 9-6 show a typical cross section, longitudinal section, and level plan of the Crossroads deposit. Figure 9-7 illustrates a composite grade x thickness map of the deposits. South Pipeline consists of two zones: a shallow zone with a depth to the top of the zone ranging from 65 ft to 150 ft deep, and a deep zone, which begins at approximately 1,000 ft. The shallow mineralized zone exhibits both low-angle and high-angle structural controls to gold deposition and occupies an area approximately 1,800 ft in a northerly direction by 2,000 ft in an easterly direction. The shallow zone is approximately 300 ft thick. The deep zone is up to 250 ft thick and has more closely spaced high-angle structural control; it occupies an area extending approximately 200 ft north-south and more than 600 ft east-west. Crossroads comprises additional, deeper mineralization along the Pipeline duplex zone south of South Pipeline. Mineralization is in Roberts Mountains Formation immediately west of a NNW-trending fault that is located east of the main Pipeline Fault. A primary ore-controlling feature is a low-angle, bedding sub-parallel duplex zone ranging from less than 10 ft thick to more than 300 ft thick near the centre of the deposits. The duplex zone has an overall easterly dip of less than 20. It is generally steeper to the west (30 ) and flatter to the east. The zone is intensely sheared, shattered, and/or brecciated, Project No.: Page 9-2

68 with minor offsets along the high-angle faults. Bedding within the zone varies from lowangle to highly contorted. Some deformed bedding appears, in places, to be soft-sediment deformation. Current interpretations suggest that the duplex was generated during the formation of the Roberts Mountains Thrust along rheologic and stratigraphic boundaries within the lower plate of the thrust. The deposit occurs within a horst block of Roberts Mountains Formation on the northeast limb of an anticline, or domed feature, formed by the intrusion of the Gold Acres stock. The direction of movement along the roof structure was west to east. A weakly developed structural zone is present beneath and sub-parallel to the duplex zone, which is referred to as the microbreccia zone. The rocks within this zone appear weakly altered in hand sample, but in thin section display patchy silicification and quartz veinlets within a brecciated texture. In the microbreccia zone, gold is associated with silica in veinlets or replacements of the matrix, and occurs in and on iron oxide pseudomorphs after pyrite. Decalcification is not pervasive in this zone and when present is confined to fractures. The microbreccia zone is thought to be a weakly developed structural horizon similar to the ore-hosting duplex zone described above. High-angle faults include a NNW-striking fault set (N15W to N20W), of which the Pipeline Fault is the most readily identifiable, with steep (75 to 85 ) easterly dips. This fault set parallels the overall Cortez trend and is inferred to be an offset extension of the NNW-striking fault set in the Cortez Range (McCormack and Hays, 1995). Intersecting the NNW fault system are N30-50E- and N35-45W-striking sets of high-angle faults. Figure 9-1: East-West Cross Section of Pipeline Deposit at 5700N 5000 L 1000 ft 3000 L E E Note: See explanation following Figure 9-3 for geological units, all geological sections and plans were supplied by CJV. Project No.: Page 9-3

69 C O R T E Z P R O J E C T Figure 9-2: North-South Longitudinal Section of Pipeline and South Pipeline Deposit at E 5000L 4000L 1000 ft 60000N 55000N Figure 9-3: Level Plan for Pipeline and South Pipeline Deposit at 4670 ft Elevation 60000N N 55000N 1000 ft E E Project No.: Page 9-4

70 C O R T E Z P R O J E C T Explanation for all geological cross sections, longitudinal sections, and level plans for Pipeline, South Pipeline, Crossroads, and Gap deposits. Explanation of Colors and Symbols Used in Figures Qal Quaternary alluvium Dw Devonian Wenban Limestone Srm Silurian Roberts Mountains Siltstone Carbonaceous, less altered Wenban Limestone or Roberts Mountains Formation Oxidation within carbonaceous, less altered rock Shear Zone Duplex development within the Roberts Mountains Formation Gossan developed in the Wenban Limestone Marble developed in the Wenban Limestone Chlorite-epidote skarn developed in the Wenban Limestone Proposed reserve or resource pit outlines in plan or section Approximate trace of major faults in plan or section Approximate location of Pipeline Pit Wall east of the Gap Deposit Main Mineralization Outline. Project No.: Page 9-5

71 C O R T E Z P R O J E C T Figure 9-4: East-West Cross Section of Crossroads Deposit at 52500N 4000L 3000L 1000 ft E E Figure 9-5: North-South Longitudinal Section of Crossroads Deposit at E 4000L 3000L 1000 ft 54000N 52000N Project No.: Page 9-6

72 Figure 9-6: Level Plan of Crossroads Deposit at 4210 ft Elevation 54000N N 51000N 1000 ft E E An example of this fault set is the Fence Fault. The NNW faults typically display normal oblique right-slip and the NE faults some component of normal movement with significant left-slip. Multiple fracture and joint sets tend to parallel the NNW and NE fault systems. Ore occurs at the intersection of the duplex with both fault systems, as shown by the grade times thickness plot (Figure 9-4). Decalcification affects most of the deposit area and is typified by the partial or complete removal of carbonate matrix material. Carbonization is typified by a pronounced, black, sooty appearance to the host rock resulting from thermal maturation of remobilized organic carbon in concentrations of up to Project No.: Page 9-7

73 4% (Edison and Hallager, 1987). Carbon-rich zones often contain less pyrite than the less carbonaceous zones, which contain up to 2% by visual estimates. Contact metamorphism from the intrusion of the Gold Acres stock in the deposit area has produced local low-grade/low-temperature metasomatic changes in the Paleozoic host rock. The presence of up to 5% of disseminated calc-silicate minerals, or the recrystallization of limy or siliceous beds, marks the thermal aureole of the stock. Argillization is characterized by illite and/or sericite and occurs pervasively throughout the rock or as concentrations along fractures. An accessory amount of authigenic sericite grains typically occurs along bedding planes. Silicification occurs as bedding replacement after decalcification and as microveins. Locally, microveining is intensely developed, forming an interconnected mesh of linear and irregular fillings. Bedding replacement occurs along what were carbonate-rich interbeds, forming a coarse, interlocking, crystalline, granular, central core that grades into a finegrained exterior. With increasing silicification intensity, the interbeds become massive silicified zones. Oxidation is the most common type of alteration and affects the entire deposit area, including some overprint of the deep carbonaceous units. The oxidation is typically disseminated to pervasive. It is commonly bedding and fracture controlled, and is often present as abundant iron oxide pseudomorphs after iron sulphides. Hematite and limonite are common, while goethite and other identified forms of iron oxides occur as stainings. Uninterrupted oxidation extends to depths in excess of 1,300 ft. In some areas, oxidation is isolated from the surface, occurring beneath fresh to weakly carbonaceous sedimentary rock at depths in excess of 1,800 ft. Gold typically occurs as submicroscopic disseminated grains in both sheared and unsheared Roberts Mountains Formation associated with all alteration types. Petrographic examinations show that microscopic gold particles most commonly occur as sparse, very fine (1 µm or 2 µm), irregularly shaped blebs disseminated through the host matrix. Gold is most typically associated with silica, in replaced matrix and quartz veinlets, and in and on larger goethite pseudomorphs after authigenic pyrite. Project No.: Page 9-8

74 Figure 9-7: Grade x Thickness Plot for South Pipeline Area Pipeline N South Pipeline Contours (grams Au x m) > 500 Fault Crossroads 500 FEET Gold in carbonaceous samples is also associated with silicification, but displayed no obvious pyrite association. The original presence of pyrite is inferred from limonite and goethite pseudomorphs; however, pyrite does occur locally in low concentrations (typically <2%) in carbonaceous samples along bedding planes, fractures, open-space fillings, and occasionally as framboids. Extremely fine (1 µm to 3 µm) pyrite commonly occurs in all samples encapsulated in silica. These occurrences suggest that both authigenic and syngenetic pyrite are present. Project No.: Page 9-9

75 9.2 Gap Deposit The Gap deposit is a sedimentary rock-hosted, disseminated Carlin-type gold deposit situated east of the Roberts Mountains Thrust near the western margin of the Gold Acres window, less than 2 km to the west of the Pipeline mining complex. Mineralization occurs where massive Wenban Limestone in the axis of an anticline is strongly faulted. The primary control for gold mineralization is the intersection of NNW- and NE-striking high-angle faults and skarns in the Wenban Formation. Figures 9-8 to 9-10 show a representative cross section, longitudinal section, and level plan of the deposit. A northern zone of mineralization is primarily hosted within gossan horizons cut by high-angle faults in thermally altered, marbled, and skarned Devonian Wenban Limestone. There appears to be a gently southeast plunging antiform with two mineralized zones at a depth of 30 to 300 ft and a second at greater than 600 ft deep. The northeast and southwest limbs dip at 15 to 20 and roughly define the apex along the projected axis of the buried Gold Acres stock. A deep skarn host in the upper Roberts Mountains Formation (approximately1,500 ft depth) occurs in the area between the two main resources and appears to be relatively flat dipping from west to east. The geometry of the deep skarn resource is very similar to a deep duplex zone, with a later skarn overprint, and may represent the regional duplex horizon in the upper Roberts Mountains Formation. The southern zone is hosted within a 1,000 ft wide corridor of strong fracturing bounded on the northeast side by a high-angle, N45W northeast-dipping fault. The southern area of mineralization does not show any recognizable thermal metamorphic component. Gold mineralization occurs as a post-metamorphic, late-stage, strongly oxidized to gossanous overprint on Wenban Limestone and Wenban Limestone marble. Gold is geochemically associated with elements such as As, Sb, Hg, and Tl that are distinctly different from the anomalous elements typical in the skarn. Project No.: Page 9-10

76 C O R T E Z P R O J E C T Figure 9-8: East-West Cross Section of Gap Deposit at 57400N 5000L 4000L 1000 ft 98000E E Note: See map explanation after Figure 9-3. All geological sections and plans were provided by CJV Figure 9-9: North-South Longitudinal Section of Gap Deposit at 99300E 5000L 4000L 1000 ft 58000N 56000N Project No.: Page 9-11

77 C O R T E Z P R O J E C T Figure 9-10: Level Plan of Gap Deposit at 5010 ft Elevation 57000N N 55000N 1000 ft 99000E E Project No.: Page 9-12

78 C O R T E Z P R O J E C T Figure 9-11: Plan Geological Map of Cortez Hills and Pediment Deposits at 5750 ft Elevation Note: Figure supplied by CJV. Project No.: Page 9-13

79 C O R T E Z P R O J E C T Figure 9-12: Longitudinal Section of Cortez Hills and Pediment Deposits (Looking East Southeast) Project No.: Page 9-14

80 C O R T E Z P R O J E C T Figure 9-13: East-West Cross Section of Cortez Hills Deposit at 28600N (Looking North) Note: Figure supplied by CJV. Project No.: Page 9-15

81 C O R T E Z P R O J E C T Figure 9-14: East-West Cross Section of Pediment Deposit at 26000N (Looking North) Project No.: Page 9-16

82 9.4.1 Cortez Hills Deposit The Cortez Hills deposit is a sedimentary rock-hosted, Carlin-style gold deposit. The Cortez Hills deposit is hosted by marble developed after massive limestones in the Wenban Limestone, silty limestones within the Horse Canyon member of the Wenban Limestone and laminated calcareous siltstones of the Roberts Mountains Formation. The majority of mineralization is in marbles developed from massive, micritic limestones in the main Wenban Limestone. As presently defined by drilling, the main zone of mineralization in the Wenban Limestone plunges 65 WSW and extends 2,000 ft downward beneath a Quaternary cover sequence and 1,800 ft NNW. Gold mineralization follows the structural intersection between faults striking N60-70W and dipping 55 to 65 SSW and normal faults striking N15-25W and dipping 65 to 75 W. High-grade mineralization appears to be associated with decalcification of marbles and development of hydrothermal or tectonic breccias along structural intersections. A sub-horizontal zone of carbon-rich, refractory mineralization is present in the upper Roberts Mountains Formation down-plunge from mineralization in the Wenban Limestone. Mineralization appears to follow bedding in the Roberts Mountains Formation. Its limits have not yet been defined, but to date it is up to 500 ft thick, 500 ft wide, and 1,000 ft long. The majority of gold mineralization identified to date is oxidized with high atomic absorption/fire (AA/FA) assay gold ratio. Oxide zones contain goethite after pyrite and goethite as veins with limonite envelopes. Gold is present as 2 µm to 5 µm grains of relatively pure gold. Within the marble, two types of poor AA/FA ratios occur. One appears to be associated with carbonaceous beds with a strong, sooty sulphide component. The other is present within oxidized marble and may be zones of fine-grained sulphides that were not fully oxidized. Zones of refractory mineralization in the Wenban Formation appear to be of a sulphide type. Late-stage realgar veins cut mineralization and occur with calcite in veins outside zones of mineralization. The water table rises from an elevation of 4600 ft at the Cortez pits to 5000 ft within the main Cortez Hills design pit, then abruptly up to 5700 ft on the south side of the Cortez Hills pit. Hydraulic pressures presently are an important design consideration for the Cortez Hills pit. Apparent late-stage veins of realgar are observed cross-cutting mineralized zones, as well as peripheral calcite veins. Realgar veins occur both within and outside mineralized drill intercepts. No other identifiable sulphide minerals have been observed thus far. Project No.: Page 9-17

83 9.4.2 Pediment Deposit The Cortez Pediment deposit is an oxidized gold deposit derived from an in situ, sedimenthosted Carlin-type gold deposit. The Cortez Pediment deposit is unique to the district in that it is comprised of a Tertiary conglomerate slide block or debris flow sourced from areas of mineralized Silurian Roberts Mountains Formation and Wenban Limestone. Two mineralized zones have been delineated: a shallow zone along the southern extent of the deposit, with a depth to the top of the zone ranging from 150 to 300 ft, and a deeper zone at the northern part of the deposit, which begins at approximately 500 ft. Both mineralized zones exhibit a tabular morphology and occupy a general area 3,000 ft north-south by 600 ft east-west. Thickness of the main mineralized zone averages about 250 ft. Figures 9-12 and illustrate a typical longitudinal section and cross section of the deposit, respectively. Quaternary alluvium and colluvium ranging in thickness from less than 10 ft (along eastern part of property) to more than 150 ft (western part of property) covers the deposit area. Four distinct material types are recognized, which may represent different slide block or debris flow events and different sources. The Tertiary units identified suggest a focussed slide or debris flow. There is no placer-style gold enrichment. The majority of gold in the Pediment deposit is present within the lower of two conglomerate units draped over a paleo-topography of thermally altered limestone and marble basement. Gold is contained in mineralized clasts of Roberts Mountains Formation calcareous siltstone and silty limestone clasts consistent with the Wenban Limestone. The current geologic model places the source area for the gold mineralized clasts as the eroded western portion of the Mt. Tenabo deposit. The paleo-channel morphology of the gold deposit suggests that rock mass failure from the elevated Mt. Tenabo deposit to the base of the Cortez Fault, followed by erosion and dispersion through weathering, placed the gold mineralized clasts in their present location. Gold mineralization is associated with clasts of strongly altered carbonate rocks. The most commonly observed alteration is strong to intense goethite and hematite oxidation. Mineralized clasts are also predominately decalcified, silicified, and retain relict textures suggesting that the original in situ deposit formed as part of a gold mineralized breccia in the footwall of the Cortez Fault. 9.5 Hilltop The Hilltop deposit is retained as a resource and periodically is evaluated for its potential conversion to a reserve. An internal Cortez Gold Mines feasibility study in 1997 concluded that the deposit would be marginally economic at a $425 gold price if ores were treated with a bio-oxidation/heap leach process. The CJV acquired the property in 1989 after Project No.: Page 9-18

84 several other companies explored the deposit from the 1960s to the 1980s. The deposit has been tested with 401 core, rotary, and reverse-circulation drill holes. Mineralization is present as a tabular, lense-shaped body of silicified and sulphideimpregnated breccia within argillite, siltstone and chert of the Ordovician Valmy Formation and Eocene felsic porphyry (Figure 9-15). Gold is associated with pyrite, marcasite, arsenopyrite, stibnite, and fine-grained black sulphides, which occur as veinlets, breccia matrix, and fault gouge. Dominant gangue minerals are quartz, sericite, and dolomitic calcite. Mineralization is hosted by megabreccia ( main zone ) developed between the Hilltop Mine and Independence Faults, which dip west at 20 and 30, respectively. Thrust movement along the faults developed the host breccia, which was intruded by dioritegranodiorite sills and dikes in Eocene time. Initial weak porphyry-style copper, molybdenum, gold mineralization was associated with emplacement of the 41.2 ±0.5 Ma intrusives. This mineralization is physically separate from the main zone. Main-stage gold mineralization in the megabreccia followed the porphyry event. A separate style of gold, lead, zinc, copper and silver mineralization occurs in a discordant quartz-impregnated breccia pipe, which cuts across the megabreccia zone. The breccia pipe is truncated by the Hilltop Mine Fault. The main zone is approximately 250 ft thick and extends 2,500 ft north-south and at least 10,000 ft down-dip to the west (Figure 9-17). Mineralization is generally restricted to veins and open-space infillings of quartz and sulphides because of the generally unreactive nature of the siliceous host rocks. Base and precious metal values increase towards the upper and lower boundaries of the megabreccia; silver, arsenic, and antimony increase within the core of the megabreccia (Kelson, et al., 2000). Copper, lead, and zinc increase down-dip. Project No.: Page 9-19

85 C O R T E Z P R O J E C T Figure 9-15: Geological Map and Diagrammatic Section of Hilltop Deposit, from Kelson, et al., 2000 Units are in feet Valmy Fm. Valmy Fm. Project No.: Page 9-20

86 10.0 EXPLORATION Since 1964, the CJV has explored the joint venture Area of Interest using geological mapping, geochemistry, geophysical surveys, and drilling. The extent of surveys and drilling has varied each year depending on the profitability of the mine and the availability of exploration funding. The CJV has been aggressive in funding exploration annually since 1991, when the Pipeline and South Pipeline deposits were discovered. This has led to a better understanding of the geological setting and controls of gold mineralization. New exploration tools, such as the use of detailed gravity data to map basement structures, have guided exploration drilling in areas where upper plate rocks of the Roberts Mountains Thrust or alluvium cover favourable carbonate host rocks in the lower plate of the Roberts Mountains Thrust. Exploration and development activities are carried out by CJV staff and independent contractors under the direction of CJV personnel. Exploration data, geological models, resource estimates and reserves are audited at least biannually by Placer Dome Inc. personnel and less frequently by representatives of Rio Tinto and independent auditors. CJV typically first drills exploration targets with reverse-circulation tools until making a discovery. Core drilling is implemented after from 15 to 25 RC holes indicate the presence of gold mineralization. Drilling is guided by structural geology (drilling extensions of structural corridors known to host gold mineralization), geophysics and geochemistry. Since the discovery of the Pipeline deposit in 1991, exploration has mainly emphasized areas where lower plate host rocks are concealed beneath post-mineral overburden or upper plate rocks. The best example of an integrated exploration program resulting in discovery of a major gold deposit is the Cortez Hills discovery. As documented by Thompson (2003), Cortez Hills was discovered after evaluation of the structural and stratigraphic setting of the area south of the historic Cortez deposit. The following tools were used: detailed geological mapping along pediment edges and projection of known orecontrolling structures into cover aeromagnetics, remote-sensing data and district-scale gravity data to map structures detailed gravity, induced polarization and magneto-telluric surveys to map specific orecontrolling structures and define presence of Lower Plate carbonate rocks rock, soil and drill-hole geochemistry to prioritize structural targets RC drilling to test concepts. The application of these techniques to identify, prioritize, and test individual targets results in a cost-effective use of exploration funds. Geological mapping and interpretation of regional aeromagnetic and gravity data led to the understanding that Lower Plate Rocks in the Cortez erosional window must extend under colluvium southeast of the historic Cortez mine (Figure 10-1). NNW-trending ore-controlling structures also extend into this covered Project No.: Page 10-1

87 area. RC drilling in 1998 within this structural corridor revealed the slide-block Pediment deposit. The consensus was that the Pediment deposit was derived from an in situ, sediment-hosted gold deposit located east of the Cortez Fault (Figure 10-1) and topographically much higher than its present position. Follow up geophysical surveys developed a more precise understanding of the basement stratigraphy and structure beneath the colluvium west of the Cortez Fault to guide further drilling. A detailed gravity survey revealed a basement uplift north of the Pediment deposit. NWW faults associated with mineralization at the Cortez mine cut through the gravity high, demonstrating a structural setting similar to Pipeline and South Pipeline. Drilling north of Pediment encountered the Cortez Hills deposit where a gravity low occurs along the southern flank of the gravity high. A current thought is that the gravity low represents strong alteration of the Wenban Limestone in the structural margin of the basement uplift. Grade x thickness contours suggest that mineralization is controlled by both WNW and NW structures (Figure 10-2). Approximately 163,000 ft of exploration, development and condemnation drilling were completed in A total of 300,030 ft of drilling was carried in Of this drilling, 36% was directed to the Pipeline/South Pipeline/South Pipeline Extension/Gap area and 64% to the Cortez Hills/Pediment area. The 2003 drilling program continued delineation of the Pipeline/South Pipeline/South Pipeline Extension (Crossroads area), Gap, Cortez Hills and Pediment deposits. The exploration focus in 2004 was to define lateral and downward extensions of the Cortez Hills mineral resource, explore other anomalous areas within the joint venture, and continue to refine the limits of mineralization around the Pipeline/South Pipeline and Gap deposits. In 2005, most drilling was carried out to condemn areas needed for infrastructure around the Cortez Hills and Pediment deposits, and to provide geotechnical information for the Cortez Hills pit. Deep step out holes on the west-southwest side of the Cortez Hills deposit have defined a sub-horizontal zone of high-grade, refractory mineralization in the Roberts Mountains Formation beneath oxide mineralization in the Wenban Formation and approximately 2,000 ft below the surface. This and both oxide and refractory mineralization in the Wenban Formation beneath the Cortez Hills pit have the potential to be developed as underground mineable mineralization. A decline will be sunk starting in the fourth quarter of 2005 to provide access for exploration. The decline will be collared at the F-pit at Cortez and driven southward to beneath Cortez Hills. Project No.: Page 10-2

88 C O R T E Z P R O J E C T Figure 10-1: Geological Setting of Cortez Hills and Pediment Deposits Tertiary Dikes Cortez Deposit Roberts Mtns. Thrust Lower Plate Roberts Mtns Fm/Wenban Limestone Colluvium & Alluvium Mill Canyon Stock (Jurassic) Cortez Hills Deposit Upper Plate Rocks Tertiary D ikes Pediment Deposit Undifferentiated Lower Plate Rocks Cortez Fault Tertiary Felsic Tuffs Colluvium & Alluvium Note: All figures were supplied by CJV Project No.: Page 10-3

89 C O R T E Z P R O J E C T Figure 10-2: Cortez Hills Deposit and Gravity Anomalies NNW Ore Controlling Structures at Cortez Mine Gravity High 287 Structures Gravity Low Cortez Hills Deposit Pediment Deposit 300m 1000 Ft Grade x Thickness Key (oz x ft): Gray 1-2, Blue 2-5, Yellow 5-10, Green 10-25, Orange 25-50, Red , Magenta , Purple , Pink >300. Project No.: Page 10-4

90 11.0 DRILLING 11.1 Introduction The majority of drilling supporting resource and reserve estimates has been carried out since 1991, when the Pipeline deposit was discovered. A limited amount of documentation is available for RC and core drilling at the Hilltop resource. Drilling methods for the majority of reserves and resources (Pipeline, South Pipeline, Crossroads, Gap, Cortez NW Deep, Cortez Hills and Pediment) are documented in the 1995 Pipeline Feasibility Study (Placer Dome Technical Services, 1995), numerous internal CJV memoranda, and Placer Dome Inc. internal audits. Methods have not changed significantly since 1992, with the exception of improvements in core recovery techniques, sampling for density determinations and RC sampling protocols. AMEC interviewed present CJV geology staff and confirmed drilling and sampling protocols. Drilling methods generally meet or exceed industry standard practices for sedimentary rock-hosted gold deposits. The Pipeline deposit was discovered in a RC drilling campaign carried out to condemn potential sites for extensions of the Gold Acres heap leach pad. Projections of NNW lineaments into the pediment were tested and drilling quickly detected anomalous gold values in strongly altered Roberts Mountains Formation. Studies of RC sampling results early in the drilling campaign showed that down-hole contamination was occurring in the RC holes, primarily due to a shallow water table. Core drilling was substituted for RC methods for the remainder of drilling in the Pipeline, South Pipeline, Crossroads and Gap deposits. Presently, RC drilling is used during the initial phases of exploration and RC holes encountering mineralization are bracketed on four side with core holes to gradually produce sampling in mineralization that is dominated by core samples. RC tools are used for all condemnation drilling and to pre-collar core holes through intervals of overburden and unaltered cap rocks. RC intervals of precollar holes are cased with 4.5 inch rod casing, and drilling is continued with core tools through mineralization and footwall rocks. Mud-rotary drills have been used to drill relatively thick sections of alluvium over the Crossroads deposit or in areas being condemned for waste dump and processing facilities. Core tools were used to complete the bedrock sections of these holes. Drilling is initially carried out on a 400 ft square pattern, closing in the next stage to a 200 ft grid. Infill drilling is done on a five-spot pattern, resulting in an average hole spacing of 141 ft. Locally, X-shaped patterns of more closely spaced hole are drilled to provide information on gold variography. This locally decreases the hole spacing to about 70 ft. The Cortez Hills and Pediment deposits are drilled on nominal 100 ft centres. Stepout drilling on the west side of the Cortez Hills deposit is being done with RC methods to define the limits of deep mineralization in the Roberts Mountains Formation. This is followed with core holes at 100 ft centres for the purposes of final resource estimation. Drill hole locations for Pipeline/South Pipeline, Crossroads, Gap, NW Deep, Pediment- Cortez Hills, and Hilltop, with outlines of ultimate pit designs, are shown as Figures 11-1 to Project No.: Page 11-1

91 11-6. Drill holes are shown relative to local coordinates and with the present ultimate pit design outlines. Holes are drilled vertical in most cases. Angle core holes were recently drilled at Cortez Hills to confirm the orientation of relatively high-grade ore zones and to obtain geotechnical information for the Cortez Hills pit. Several angle core holes were drilled at Pipeline and South Pipeline to provide geotechnical data. Table 11-1 lists the number of holes and total footage by deposit area. These numbers were derived by AMEC by tabulating hole types and footage from collar files in each database or from other sources as noted. Table 11-1: Drilling in CJV by Area Area Drilling No. Holes Feet Pipeline, S. Pipeline, Crossroads, Gap, Gold Acres Core ,295 RC Pilot ,429 RC ,628 Sub-Total 2,345 2,228,352 Cortez NW Deep Core ,000 Sub-Total ,000 Cortez Hills Core ,452 RC Pilot ,618 RC ,800 Sub-Total ,870 Pediment Core 94 52,432 RC Pilot 94 32,588 RC ,100 Sub-Total ,120 Hilltop Core + RC ,100 Sub-Total ,100 Total 3,506 3,371, Core and RC drilling are combined since split in drilling types is not readily available; source is CJV internal study, Reverse-Circulation Drilling RC drill rigs use pneumatic hammers to depths ranging from 600 ft to 750 ft. Centre-return hammers and bits were used for RC drilling at Pipeline and South Pipeline. Auxiliary compressors are used to increase the effectiveness of the down-hole hammers. Tri-cone rock bits were required to drill RC holes beyond a 750 ft depth. Project No.: Page 11-2

92 C O R T E Z P R O J E C T Figure 11-1: Hole Collar Map Pipeline and South Pipeline Deposits Project No.: Page 11-3

93 C O R T E Z P R O J E C T Figure 11-2: Drill Hole Collar Map Crossroads Deposit Project No.: Page 11-4

94 C O R T E Z P R O J E C T Figure 11-3: Drill Hole Collar Map Gap Deposit Project No.: Page 11-5

95 C O R T E Z P R O J E C T Figure 11-4: Drill Hole Collar Map Cortez NW Deep Deposit Project No.: Page 11-6

96 C O R T E Z P R O J E C T Figure 11-5: Drill Hole Collar Map Pediment and Cortez Hills Deposits, Showing Outline of Ultimate Design Pit Project No.: Page 11-7

97 C O R T E Z P R O J E C T Figure 11-6: Drill Hole Collar Map Hilltop Deposit Project No.: Page 11-8

98 The deepest RC hole at Pipeline reached a depth of 3280 ft. The deepest RC hole drilled at Cortez Hills has been 3500 ft. Sample recovery is not an issue for RC holes used as pilot holes above mineralization for core holes, but is important for RC holes initially penetrating mineralization. Sample recovery for RC holes used in resource estimates is discussed in Section 12 of this Technical Report Core Drilling CJV principally uses HQ-size (2.5" diameter) core tools for development drilling. Core recoveries are maximized by use of triple-tube core barrels, face-discharge bits and specialized drilling mud. CJV employs a full-time drilling supervisor to ensure that drilling contractors emphasize core recovery. Core runs are made on five-foot intervals or less, depending on drilling conditions. Core barrels are retrieved by wire line. Upon retrieval, the split tube is opened by the driller s helper, who transfers the core into a cardboard core box. The core is marked where it was manually broken to fit into the box. Drilled intervals are marked with wooden blocks. Every 50 ft in mineralization, the inner tube is replaced with a plastic liner. Similar procedures are used in waste-rock intervals above and below ore. The liner and core are retrieved from the core barrel and taken to a core processing facility. A one-inch-wide strip is cut along the core with a skill saw, exposing the core for geological and geotechnical logging. A representative one-foot section of the core is selected and cut, sealed with cellophane and sent for density measurements at the mine s process laboratory. Other samples are collected for shear testing. The core is logged by a geologist for geological and geotechnical elements. Logged attributes previously were either entered on paper sheets and then keypunched into a computer using GEOLOG, or entered directly at the logging site in GEOLOG. GEOLOG data were verified using the GEOCHCK program and converted into a text and graphics drill log using the LOG II program. Text files were then reviewed by geologists for errors and corrected where warranted, reprinted, and then electronically merged into the Master GEOLOG database by a computer administrator. With implementation of the aquire SQL Server database in 2004, logging was changed to an aquire data input form. This requires selection of attributes from a prescribed list, avoiding entry of non-standard symbols or qualifiers. Geotechnical data were also collected down-hole with Colog Optical (OTV) and Acoustic (ATV) Televiewer methods. The Colog OTV/ ATV method using IDS's MSRG gyroscopic surveys were utilized for 2005 Cortez Hills pit-wall geotech holes (ODC-023 through ODC- 029 and ODC-040) as well as exploration decline corridor geotech holes (ODC-030 through ODC-039 and ODC-041 through ODC-046) to collect down-hole oriented structural data. Geological information for Colog holes were collected at the drill site in split-tubes to ensure reliable collection of rock mass data prior to transportation to CJV core logging facilities. Project No.: Page 11-9

99 Core is digitally photographed. Prior to the availability of digital cameras, the core was photographed with a 35 mm single lense reflex camera. These earlier photographs have been scanned and electronically archived by each hole as jpeg images. Once photographed, core is transferred to a different facility for point load tests of selected intervals. Following this, the core is cut in half with a rock saw. Extremely hard intervals may be cut with a hydraulic splitter. The computerized geological logging format allows for recording mineralogy, structure, texture, alteration, rock type, colour, brightness, lightness, grain size, sorting, sphericity, shape, degree of decalcification and carbon content. Depending upon the deposit, alteration, structure and rock type appear to be the most dominant controls of mineralization. Alteration and structure are the key ore-controlling elements in the Pipeline, South Pipeline, Crossroads and Cortez NW Deep deposits. Structure and mineralogy (skarn and marble) control mineralization at Gap. Lithology (slide block units) is the main ore control at Pediment. Mineralization at Cortez Hills occurs preferentially along controlling structures in marble, associated with decalcification and argillization. AMEC found the logs to be reasonably detailed and suitable for development of geological models Blast Holes Variable patterns and hole size are employed depending on the bench height and material. Blast holes in rock on 20 ft benches are drilled on a square pattern of 20 ft x 20 ft with a 67/8" bit. This spacing has been decreased to 16 ft x 16 ft in carbonaceous ore. A subdrill of 2 to 3 ft is used. A blast hole spacing ranging from 24 ft x 24 ft up to 28 ft x 28 ft, with a subdrill of 5 to 7 ft, is used in rock on 40 ft benches. An 8¾" bit is used for these blast holes. Blast holes in alluvium employ an 8¾ to 12¾" bit and are spaced from 33 ft to 37 ft apart on a square grid. These holes have a 2 to 3 ft subdrill Surveying Drill Collars Drill hole collars are surveyed with either Total Station electronic distance measurement (EDM) or geodetic-grade global positioning system (GPS) instruments. Separate reference grids are maintained for each deposit area because survey coordinates have not yet been transformed into one universal system Down-Hole Surveys Down-hole surveying began with the first RC hole drilled on the Pipeline deposit in Significant deviations were shown; therefore, down-hole surveying was routinely done from Project No.: Page 11-10

100 that time on. For several reasons (unavailability of tools, drilling problems), 69 of 385 holes used in resource estimates of Pipeline-South Pipeline were not surveyed (Brunette, 2002). Subsequent to the early phases of Pipeline drilling, however, all holes were surveyed with a recording gyroscope by a commercial contractor. Readings are taken every 50 ft downhole and digitally transferred to the aquire database. Boyles Brothers Drilling used a multishot recording gyroscope (MSRG) tool until April Silver State Surveying later performed all MSRG surveys and now WelNav and IDS provide the surveys. Significant work was carried out to determine the accuracy of the instruments of each contractor Geotechnical holes have been drilled in each discovery to date using oriented tools. These normally use a plasticine, triple scribe, and downhole camera system. Surveying methods meet or exceed industry standard practices Core Recovery Core recovery averaged 93% for 314 holes used in the Pipeline and South Pipeline feasibility study (Placer Dome Technical Services, 1995). Core recovery for the Cortez Hills and Pediment deposits has averaged 94%. In general, core-drilling practices at Pipeline, South Pipeline, Crossroads, Gap, NW Deep, Cortez Hills and Pediment ensure a relatively high core recovery. Core recovery is sufficient to provide representative samples of a sedimentary rock-hosted gold deposit Reverse-Circulation Sample Recovery Samples were collected at five-foot intervals in drilling campaigns carried out at Gold Acres and the early stages of 1991 drilling at Pipeline. By late 1991, RC samples at Pipeline were collected on 10 ft intervals. Sampling was achieved with a hydraulic, rotary pie splitter mounted at the base of the sample cyclone. Two samples are collected in Micro Pore bags mounted in one-gallon metal tubes hung below the sample cyclone, with final 10 ft samples weighing from 10 lb to 15 lb. Drilling is almost always carried out with water injection. Drilling below elevations ranging from 5000 ft to 5700 ft at Cortez Hills is below the water table. Total sample weight cannot be measured because of wet drilling conditions; therefore, RC recovery cannot be calculated. RC sampling procedures were modified for drilling at the Pediment deposit in accordance with recommendations by F. Pitard (1999). Samples weighing from 35 lb to 40 lb are now collected from development RC holes at Pediment. Samples between 10 lb to 15 lb are collected in all other areas of mineralization drilled with RC tools. Project No.: Page 11-11

101 12.0 SAMPLING METHOD AND APPROACH 12.1 Introduction Core and RC sampling protocols were established during drilling of the Pipeline deposit. These have been only slightly modified to improve sample integrity or size. Sampling and analytical procedures were reviewed by Francis Pitard, an independent sampling expert, in 1992 and again in Protocols for sample collection, sample preparation, assaying generally meet industry standard practice for this type of gold deposit. Sample preparation protocols presently being practiced by ALS Chemex could be improved to provide a more homogenous first stage crush. All analytical data are verified by geologic staff prior to entry into the database used for modelling and resource estimation. Generally, RC drilling is used only in the early period of exploration drilling. RC holes in areas of mineralization at Cortez Hills and Pediment are gradually replaced with infill core holes. Drill sampling for Pipeline, South Pipeline, Crossroads, Gap and Cortez NW Deep is almost entirely core. The following descriptions of RC and core sampling procedures were obtained from the 1995 PDTS feasibility study and modified to reflect later changes. AMEC verified present procedures against these protocols and documented changes by interviewing CJV staff Sample Collection Reverse Circulation Drilling Two sample splits were collected for each RC sample, initially at 5 ft intervals. By late 1991, this was changed to 10 ft intervals. In RC drilling, air circulates the sample up through the inner tube of the drill rods and into a sampling cyclone at the surface. During sample collection, all wet samples exiting the cyclone were passed through a hydraulic, revolving wet sample splitter. The portion of the sample to be retained was divided into two parts by a Y-shaped pipe joint constructed of 5" diameter pipe. The remaining material was discharged through a separate pipe joint. The drill crew collected a geologic logging split from the discharged material and placed it into a plastic ore sample container; the container was later delivered to the logging shed. The two sample splits were collected simultaneously in two five-gallon plastic buckets lined with 19" x 22" Micro Pore sample bags previously numbered and tagged by geologic technicians. This was later changed to Micro Pore bags placed in one-gallon, metal sleaves hung beneath each arm in the Y-shaped pipe below the rotary splitter. Sample weights vary from 10 lb to 15 lb. Footage intervals were recorded by a technician on a Project No.: Page 12-1

102 separate shipment record from the corresponding sample numbers. Care was taken to fill the lined buckets at a similar rate, keeping both buckets as level as possible so that water overflowed evenly. When a sample interval was complete, a second pair of buckets with new bags replaced the filled buckets. The bags were carefully removed from the buckets by the drill crew and allowed to sit upright for a few minutes to allow further settling of fine particles. All bags were sealed with a plastic cable tie, with only a small amount of water decanted. The Micro Pore bags allow clear water to seep through the sides and seams, essentially filtering the sample particles and preventing cross-sample contamination yet still allowing partial drying in the field. Samples were picked up at the drill sites by geological technicians and taken to a heated warehouse attached to the logging facility to thaw and air dry the samples. Standards and blank check samples were inserted randomly into the numbering sequence prior to sample pickup. This procedure was modified in 2000 for RC drilling at the Pediment deposit. Mineralization there preferentially occurs in fines within the conglomerates. Based on recommendations by Francis Pitard, one RC sample weighing 35 lb to 40 lb was collected. This protocol is being retained for all Pediment RC holes that may be used in resource estimates Core Drilling Most cores were assayed at 10 ft intervals, though several holes were assayed at 5 ft or variable geological intervals early in the program. All cores were removed from the split core barrels by the drill crew and placed in wax-impregnated corrugated cardboard boxes. Each box contained approximately 10 ft of HQ core. Core runs of 5 ft were typical in waste rock zones, but the shattered and broken nature of the Pipeline and South Pipeline shear zone usually resulted in shorter runs. The drill crew inserted wooden blocks to mark the end of each core run. Manual versus natural breaks in the core were also clearly marked with a wax crayon. Core was delivered to the logging shed by technicians or the drilling foremen at least once per shift. All core was geologically and geotechnically logged by a geologist and then transferred to the processing area, where it was photographed with a Pentax 35 mm SLR camera (100 ASA Ektachrome slide film). The core then proceeded to a station for point-load testing by a trained technician. All point load data were recorded manually and later key-punched into spreadsheet format by the CJV geology department. Core was transferred to the cutting station after point lode testing was completed. In recent years, a digital camera was substituted for the SLR camera. Previous films were then scanned and an electronic database of all core images was developed. Project No.: Page 12-2

103 Almost all cores were split with a rock saw by a technician. Three rock saws were on site, operating two shifts per day. If extremely hard rock was encountered, a hydraulic splitter was used to maintain acceptable production rates. Any material less than 1" diameter was split through a riffle splitter. Typically, 200 ft to 350 ft of core were cut or split per shift. One-half of the core was placed back in the original box and the other half in 10" x 22" Micro Pore cloth sample bags with a numbered paper sample tag. This number was also hand-written on the exterior of the bag with a permanent marking pen, along with the drill hole number. A technician recorded footage intervals on a separate shipment record form with the corresponding sample number. Samples for measurement of in situ density are presently collected from core at 35 ft to 40 ft intervals in mineralization and less frequently in hangingwall and footwall lithologies. For the Pipeline and South Pipeline feasibility study, 243 samples were collected from representative intervals of mineralization and waste rock to develop a density model. The new system of sampling at 50 ft intervals was initiated after A total of 3,045 density measurements support tonnage estimates for ore and waste in the Cortez Hills and Pediment deposits Core and Reverse-Circulation Drilling Comparison Cortez Hills Deposit An internal study was undertaken in July 2004 to compare results from RC and core holes used in the Cortez Hills resource estimate. This was warranted because down-hole contamination was noted in at least three RC holes (CH03-43, 48 and 52). Results for three RC/core twin holes were reviewed. In addition, resources were estimated separately using RC holes and core holes. Preliminary results suggest that core holes on average are higher grade than RC holes, depending on the grade range. Resources estimated with core assays at a leach cutoff of oz/ton give an average grade 30% higher than resources estimated only with RC samples. Resources estimated with core assays at the mill cutoff grade of oz/ton give an average grade 15% higher than resources estimated with only RC assays. The core average is biased high because core holes are more common in the high-grade centre of the deposit. Individual RC/core twin holes compare reasonably well, showing less of a high bias in the core holes. Further study of this is warranted. AMEC does not anticipate that the differences between RC and core holes will materially affect resource estimates Blast Holes Samples are collected by placing a 6" diameter, 12" tall vertical cylinder near the drill hole. A rubber curtain surrounds the drill hole and cylinder to retain dust. Approximately 7 lb to 8 lb of material is collected. Project No.: Page 12-3

104 CJV reviewed the use of a pie sampler versus the cylinder sampler. CJV studies found no significant difference in assays obtained with a pie sampler and a cylinder sampler for 1900 blast holes. The cylinder sampler has been retained List of Significant Data Significant composited assays are shown in Appendix A. Listed values are from the Cortez Hills/Pediment mineralization which comprises a majority of the 1 September 2005 mineral resource and mineral reserve statement. Only values greater than oz/ton Au have been tabulated. Project No.: Page 12-4

105 13.0 SAMPLE PREPARATION, ANALYSES, AND SECURITY 13.1 Introduction Sample preparation and gold assays are conducted by the Cortez Gold Mines laboratory and by independent commercial laboratories. Sample preparation, assaying procedures and quality assurance/quality control measures were established as part of the development of the Pipeline and South Pipeline deposits in These protocols remained essentially the same since the 1995 feasibility study. Prior to construction of the Pipeline complex laboratory (CJV Laboratory #2) in 1998, mine assays were performed at the Cortez mill laboratory (CJV Laboratory #1). CJV Laboratory #2 recently acquired new preparation equipment and has improved its sample preparation protocols. Sample preparation, assaying procedures, and quality assurance/quality control measures are audited every two years by an internal (Placer Dome Inc.) audit team and less frequently by Francis Pitard of Francis Pitard Consultants. Drill samples collected for use in the geologic modelling and resource estimation are under the direct supervision of the geology department and are delivered to the assay laboratory under secure conditions. CJV geology staff deliver core in cardboard boxes to the CJV core logging facility. RC samples, collected in Micro Pore bags, are closed with security seals and delivered directly to either the CJV Laboratory or a commercial laboratory. The laboratories are required to notify the CJV geology staff if seals are compromised. Split core to be assayed at commercial laboratories are delivered in a similar manner. Prior to 2000, the CJV laboratory assayed a majority of exploration samples, principally those for Pipeline, South Pipeline, Crossroads, Gap, and Cortez NW Deep. Rocky Mountain Geochemical Laboratory, American Assay Laboratory, Chemex, Barringer Laboratories, the Placer Dome Research Centre and Monitor Geochemical Laboratory were used for check assays and other routine assays during the period of 1991 to An increased workload of ore-control sample preparation and assaying at the CJV laboratory has resulted in a majority of exploration samples now being sent to commercial laboratories. Approximately 85% of exploration samples from the Pediment and Cortez Hills deposits have been sent to outside laboratories for analysis. Between 1997 and 2004, CJV principally used Rocky Mountain Geochemical Laboratory and American Assay Laboratory (both in Reno, Nevada) for outside assays and checks of the mine laboratory assays. CJV switched to ALS Chemex and Inspectorate (both in Reno, Nevada) as the primary laboratories for outside assays and check assays in A majority of core and RC samples for Cortez Hills and Pediment were prepared by ALS Chemex s sample preparation facility in Reno, Nevada and assayed at their laboratory in Vancouver, B.C. Project No.: Page 13-1

106 13.2 Sample Preparation Sample preparation protocols were essentially the same from 1991 to 2000, when the mine laboratory acquired new preparation equipment. Core and RC samples are received in Micro Pore sample bags. Core samples weigh approximately 40 lb to 50 lb. RC samples weigh from 10 lb to 15 lb, or 35 lb to 40 lb if from the Pediment deposit. Commercial laboratory sample preparation protocols have been similar to those followed by the CJV laboratories #1 and #2. The initial sample preparation protocol in the Pipeline drilling campaign from 1991 to 1992 was: 1. sample bags were dried at 350 F for six to 12 hours 2. samples were weighed on a triple beam balance to an accuracy of 0.1 kg 3. samples were fed through a TM Engineering Rhino Jaw Crusher set at 1/8" 4. entire sample was screened to minus 10 mesh. Oversize was run through a Bico disc pulverizer to reduce the oversize to minus 10 mesh 5. entire samples were split to 500 gram with a Jones-type splitter. The 500 gram split was dried a second time gram aliquot was pulverized to 100% passing 150 mesh in a TM vibratory ring pulverizer. Pulverized sample was homogenized on a roll mat. Ring pulverizer was cleaned by pulverizing a crushed crucible between each sample. 7. Reject was retained and stored. The coarse-crush protocol was changed to 80% passing 10 mesh in late Sometime between 1992 and 1997, the coarse crush standard was changed to 95% passing 6 mesh. By 1998, the crushing protocol was changed to 1) entire sample crushed to minus ¼" in a jaw crusher, 2) entire sample crushed to 95% passing 8 mesh in a rolls crusher and 3) 500 gram aliquot split for pulverizing to minus 200 mesh in an automated pulverizer. This protocol was apparently maintained until 2000 when new crushing and grinding equipment was acquired by CJV Laboratory #2. The mine laboratory now uses a RockLabs crusher and rotary splitter and TM Engineering automated ring-and-puck pulverizer for exploration samples. The RockLabs splitter uses a two-stage process to crush the entire exploration sample to 95% passing 10 mesh and produce a 500 gram sample aliquot. The 500 gram is pulverized for 75 seconds in the automated pulverizer, producing a product of 95% passing 175 mesh. Gravel is pulverized between each run of the 24-compartment pulverizer to clean the unit. Crush and pulverizer specifications are checked once weekly. Balances are calibrated every six months. Project No.: Page 13-2

107 Blast hole sample preparation protocols are somewhat different. Blast hole samples from 3 lb to 20 lb and are crushed to 95% passing 6 mesh in a TM Engineering Rhino jaw crusher. A 250 gram to 300 gram aliquot is split with a Jones-type riffle splitter. No reject is retained. The 250 gram to 300 gram aliquot is then pulverized for 150 seconds in a manual ring-and-puck pulverizer or for 75 seconds in the TM Engineering automated pulverizer. Sample preparation protocols meet or exceed industry standard practices for this type of gold deposit. CJV has studied the effects of improving sample preparation further (90% passing 24 mesh) and found no material improvement in assays. AMEC found that 2004 Cortez Hills samples submitted to outside laboratories are not being prepared using the same protocol as those samples prepared at the CJV. Sample preparation protocol for samples submitted to ALSChemex (75% of all samples) is to crush samples to 70% passing a 2 mm screen, take a 250 gram split with a riffle splitter, and pulverize the split to 85% passing a 75 µm screen. AMEC recommends that CJV ensure that all outside laboratories temporarily performing as the primary laboratory conform to the sample preparation protocol being employed by the CMG laboratory Gold Assays A standard fire assay with gravimetric finish is performed on one-assay ton (29.18 g) aliquots of fine pulverized material for all core and RC samples analyzed by the CJV laboratory. If the initial fire assay is greater than 0.1 oz/ton Au, an additional fire assay is performed. If the initial fire assay is greater than 0.2 oz/ton Au, two additional fire assays are performed. The mean value of the two or three assays was used for resource estimation in the Pipeline feasibility study resource model. Current practice is to use the first assay when the range of the repeat assay falls within 10% of their mean. ALS Chemex assayed 2004 Cortez Hills and Pediment samples by fire assay and an atomic absorption finish, using a 30-gram sample. All samples reporting greater than 0.1 oz/ton Au on the initial assay were reassayed by fire assay on a 30 gram sample with a gravimetric finish. No additional assays were performed for initial assays greater than 0.2 oz/ton Au such as at the CMG laboratory. Cyanide leach gold assays were performed for initial assays reporting greater than oz/ton Au. A cold cyanide shake leach, analyzed with an Atomic Absorption Spectrometer (AA), is performed if the initial fire assay is greater than oz/ton Au. The cyanide shake leach is derived by mixing a 10 gram sample from the pulp with 20 ml of 5 lb/ton cyanide solution and agitating for 8 to 10 minutes. If the initial fire assay is greater than 0.04 oz/ton and less than 0.15 oz/ton, a preg rob test is performed to identify metallurgical concerns. This is done by combining 10 gram of pulp with 20 ml of a 0.05 oz/ton Au cyanide solution an agitating for 8 to 10 minutes, then assaying the sample with an AA. Project No.: Page 13-3

108 Samples with an AA/Fire assay ratio of less than 0.3 are routinely assayed for sulphur and total carbon in a Leco furnace. Laboratory analyses at the CJV laboratories were manually entered into spreadsheets until a Laboratory Information Management System (LIMS) was set up at CJV Laboratory #2 in CJV Laboratory #2 now uses a sample bar code system and transfers all information to the mine database electronically via the LIMS. ALS Chemex assay certificates are downloaded from the ALS Chemex website and loaded directly into the mine database using acquire. AMEC recommends that CJV ensure that outside laboratories are following assay protocols established and used by the CMG laboratory Trace Element Analysis Core and RC samples are routinely analyzed for a 32-element suite by ACME Geochemical Laboratory of Vancouver, British Columbia. The trace-element suite is obtained by Induced Coupled Plasma-arc atomic absorption spectroscopy (ICP) following an aqua regia digestion of the sample pulp. Trace elements include Sb, Hg, Tl, As, Fe, and Ca, which in association with Au show a correlation with mineralized areas Assay Quality Assurance and Quality Control Introduction Quality assurance and quality control for sampling, sample preparation, and assaying have evolved since discovery of the Pipeline deposit in Procedures include submissions of blanks and mine-derived standards into sample streams to the mine laboratories and commercial laboratories, check assays of pulp duplicates by commercial laboratories, and assaying of coarse reject duplicates. Starting with the Pipeline deposit, CJV submitted one blank and one standard sample with every ten core and RC samples. A check sequence typically consisted of a standard followed by a blank. Checks of the mine laboratory (CJV Laboratory #1) assays were made for the 1995 feasibility study. A pulp duplicate was prepared for every 5 th Pipeline core sample and every 10 th South Pipeline core sample. A pulp duplicate was prepared for every 10 th RC sample for Pipeline and every 20 th RC sample for South Pipeline. These were assayed by Monitor Geochemical Laboratory and the Placer Dome Research Centre. Since 1995, this procedure of checking the mine laboratory assays (CJV Laboratories #1 and #2) has continued using Rocky Mountain Geochemical Laboratory, American Assay Laboratory, Barringer Laboratories (now Inspectorate), and Monitor Geochemical Laboratory. Project No.: Page 13-4

109 A coarse-reject duplicate was prepared for every 10 th core sample and every 20 th RC sample to provide information on combined sample preparation and assay precision. These are assayed by the CJV laboratory or a commercial laboratory if the primary assay was by the mine laboratory or by a second commercial laboratory if the primary assay was another commercial laboratory. The CJV laboratories also prepare three pulp duplicates for each tray of 30 samples for maintaining information on analytical precision. This is a routine procedure for most commercial laboratories and the information could be used for estimation of analytical precision. Standards are made from stockpile materials at the mine. Blank material is made from unmineralized core from Gold Acres, waste rock from the Cortez pit, or alluvial gravel taken from a pit near the Gold Acres haulage road. Accepted values for each standard were determined by having the mine laboratory assay splits from the ore samples several times (ranging from twice to 40 times) following homogenization of the sample in a cement mixer. The average grade from the first six 50-gallon barrels of standard collected for the Pipeline drilling campaign was oz Au/ton with a standard deviation of (Placer Dome Technical Services Ltd, 1995). When the material was consumed, six additional 50-gallon barrels of standard materials were collected. The average grade was oz Au/ton with a standard deviation of (op cit). Blanks were typically below the CJV lab detection limit (<0.002 oz Au/ton). Leach material grading oz Au/ton was implemented later. CJV has developed at least 48 mine standards with this method (Table 13-1). When barrels of standard material are consumed, new samples are collected from the mine stockpiles. Table 13-1: Mine Analytical Standards Standard 5CC 6CC 7CC 8CC 19CC 20CC Mean St Dev Max Min Standard 21CC 22CC 23CC 30CC 31CC 32CC Mean St Dev Max Min Standard 33CC 36CC 37CC 38CC 39CC 43CC Mean St Dev Max Min Project No.: Page 13-5

110 Standard 44CC 45CC 46CC 47CC 47CC 48CC Mean St Dev Max Min Standard 49CC 51CC 52CC 53CC 54CC 55CC Mean St Dev Max Min Standard 56CC 57CC 58CC 59CC 60CC 63CC Mean St Dev Max Min Standard 64CC 65CC 66CC 67CC 68CC PIT79 Mean St Dev Max Min Standard PIT80 BRL81 BRL82 BRL83 BRL84 BRL85 Mean St Dev Max Min Standards Quality control efforts on a routine basis are limited to checking the assays of standards against accepted values. Generally, assay batches are rejected if the assay of a standard is outside the range of assay values originally returned by the mine laboratory during initially assaying of the standard. AMEC checked printouts and electronic files of standard assays provided by CJV and this practice appears to have been adhered to. The pass/fail criterion is approximately equivalent to one standard deviations from the mean. Generally accepted practice is to set acceptable limits at two standard deviations from the mean for homogenous pulp standards. However, CJV mine standards have not been developed in a rigorous manner because of the need for a significant volume of reference material. The more stringent fail limits are more appropriate given a large standard deviation in assays on the standards. Presently, reference material is obtained from working benches where blast hole assays show consistent grades between multiple holes. This material is scooped out with a frontend loader, placed at a storage area, then cone and quartered as needed. At least 20 Project No.: Page 13-6

111 samples are collected from each pile, then the remaining material is placed in a 55-gallon drum. The drum is sent to the mine laboratory where the ore is crushed to minus quarter inch and an additional 20 samples collected for assay. Crushed material is put back in the drums and moved to the Geology Department. The material is very similar in appearance to RC drill cuttings of material, River gravel is used for blank material. Assay results for the Cortez laboratories and commercial laboratories will include variability introduced by sampling biases, natural variability in the geological materials (heterogeneity), variations in the quality of sample preparation, variations in laboratory accuracy (relative to the true value) and laboratory imprecision (relative range in assay values). Standards should be used to determine the absolute accuracy of a specific laboratory and the highest quality standard is desirable in this regard. AMEC recommends that CJV determine the accepted value for each of its standards by having at least ten splits assayed by five or more reputable laboratories. In this manner, specific control limits can be established for each standard and accuracy biases by laboratories can be more confidently determined. AMEC plotted Round Robin results for standards used in 2004/2005 and found the mean value for some standards to be adversely affected by outliers. Relative standard deviations for the standards range between 10.7% and 33.2%, where 5% is typically used as the upper limit for a well behaved standard. This underlines the need to more thoroughly homogenize bulk standard material prior to determining the accepted values. AMEC also plotted control charts for standards submitted with 2004/2005 Cortez Hills and Pediment drill holes and found gold assays to be generally within CJV s acceptable limits. SRM insertion rates were 2.5% for standards and 2.5% for blanks. AMEC reviewed cases where standards fell outside acceptable limits and found that the established protocol of reassaying drill holes for failed standards is not strictly being adhered to. AMEC recommends, especially with these poorly developed standards, that drill holes be reassayed which contain quality control failures. The Geology staff employ real-time plotting of standard assays versus accepted values using acquire to control assay quality Check Assays Results of check assays, pulp duplicates (same laboratory CJV) and coarse reject duplicates (external laboratory) are not routinely evaluated. Instead, the check assays were used intermittently to evaluate biases between the CJV laboratories and commercial laboratories. In 2003, CJV investigated these biases in detail and adjusted historical Project No.: Page 13-7

112 assays for the Pipeline, South Pipeline, Crossroads, and Gap deposits for laboratory biases and sampling biases. These bias adjustments are discussed in Section AMEC plotted core reject check assays of the CJV laboratory assays by ALS Chemex for the 2004 Cortez Hills and Pediment drilling program. The CJV assays were found to be biased low by approximately 8%. AMEC also plotted pulp check assays of the CJV laboratory assays by ALS Chemex and Inspectorate for Cortez Hills and Pediment drill holes. The CJV assays were found to be biased low by approximately 5% compared to ALS Chemex and 6.5% low compared to Inspectorate. AMEC plotted check assays by Rocky Mountain Geochemical Laboratory (RMG) and Acem Assay Laboratory (AAL) for pulps of the 1997 through 2003 drill samples originally assayed by the CJV laboratory. AAL was the primary laboratory for Cortez Hills and Pediment drilling samples in RMG was the primary laboratory for exploration drilling samples in In these cases, the CJV laboratory was used as the check laboratory. Check assay plots show a relatively high variability between the CJV laboratory and commercial laboratories for 1997 through Normally, a check assay should be within ±10% of the first assay as long as the sample size, preparation protocol and assay method is ideally matched to the homogeneity of the gold occurrence. Within the grade range of interest (>0.01 oz/ton), a majority of check assays are within ±20% to 30% of the original value. Check assays by RMG and AAL in 2000 to 2003 show less variability, with most checks within ±10% of the original value. These years represent primarily drill samples from the Pediment and Cortez Hills deposits. Gold production from the Pipeline mill and leach heap exceeded resources predicted in the resource model between start up in 1996 and early In some years, actual production has exceeded the resource model prediction by as much as 20%. The positive reconciliation is the result of an historical low bias in assays by the CJV laboratories, sampling biases (losses of gold during coring or core sampling), and possible modelling biases. Given this, the relative high variability in check assays, although undesirable, has not been shown to jeopardize the resource and reserve estimates. Production of mill ore has been less and leach ore has been more than model predictions for 2004 and This appears to be the result of some oversmoothing in ordinary kriging of the Pipeline/South Pipeline resource estimate. Plots of check assays for the period of 1992 to 1996 are not readily available. In this period, a large number of commercial laboratories were used to check assays by CJV Laboratory #1 (at Cortez mill). The CJV did not keep a record of the source laboratories for each check in all cases; therefore, some of the data cannot be separated by laboratory. A detailed review of check and duplicate assay records in 2003 reduced the number of unidentified laboratory assays to about 4%. No significant bias was detected between CJV and the commercial laboratories Project No.: Page 13-8

113 Analytical Precision AMEC plotted CJV pulp duplicate assays for 2004 Cortez Hills and Pediment drill holes. The calculated precision of these gold assays is ±40% at the 90% confidence limit, compared with the generally acceptable threshold of ±10% at the 90% confidence limit. These results show that the precision of the CJV laboratory gold assays is poor. AMEC recommends that CJV perform metallic screen tests for samples showing poor agreement in the pulp duplicate assays. Coarse gold in Cortez Hills and Pediment mineralization could be contributing to the poor precision of the CJV gold assays. CJV does not plot the relative differences between same-laboratory pulp duplicates. These assays can provide information regarding the precision of assays over time. AMEC recommends that CJV routinely plot the relative differences in pulp duplicates so that the relative precision of each laboratory can be routinely assessed Bulk Density Whole core sampling for measurement of bulk density was initiated in April 1992 during the commencement of Phase III drilling of the Pipeline deposit. A total of 243 samples of waste material and ore from Pipeline were measured. CJV collected an additional 224 core samples from the South Pipeline deposit in subsequent drilling campaigns. Starting in 1999, standard practice has been to collect core samples at 35 ft to 40 ft intervals in mineralized rock and less frequently in hangingwall and footwall lithologies. This has resulted in development of a reasonably comprehensive density database for the Pediment and Cortez Hills deposits. The method of core sampling for density measurements has evolved since Prior to drilling the Cortez Hills deposit, core for density measurements at Pipeline were collected in a plastic sleeve substituting for the triple tube in the core barrel. Core inside the sleeve was retrieved from the core barrel and taken to a core processing facility. A one-inch opening was cut the length of the core with a skill saw. A geologist logged the core for geological and geotechnical attributes, and then wrapped the core and plastic sleeve in cellophane and aluminium foil. The core was then transported to the CJV metallurgical laboratory for density measurements. Because of the relative competence of Cortez Hills core, samples for density measurements are now extracted from the core boxes at the logging facility (rather than collected from the core barrel), wrapped in cellophane with an outer layer of aluminium foil. Samples are sent to the CJV analytical laboratory for measurement. Density is presently measured by one of five methods: 1. Fragment displacement (lacquer coated fragments are immersed in water) 2. Core displacement (lacquer coated core is immersed in water) Project No.: Page 13-9

114 3. Core axis length and diameter is measured and applied to dry weight of sample 4. PVC (poor quality core in PVC pipe is wrapped and immersed in water) 5. Buoyancy (competent core is wrapped in cellophane and immersed in water). The laboratory attempts to measure competent core with at least three methods (numbers 2, 3, and 5 above). At least two methods are used to derive the bulk density, dry tonnage factor, and percent moisture for each sample. The buoyancy method is the most accurate and is used in most cases. After two or more methods are used, the results are compared. If the dry tonnage factor is within ±0.5 ft 3 /ton with both methods, the results are accepted. Several measurements may be required. Table 13-3 lists specific gravity and bulk densities used for Pipeline, South Pipeline, Crossroads, and Gap and Table 13-4 lists specific gravity and bulk densities used for the Pediment and Cortez Hills deposits. Table 13-2: Bulk Densities - Pipeline, South Pipeline, Crossroads, and Gap Deposits Bulk Density Lithology Rock Code S.G. (ft 3 /ton) Alluvium Unaltered carbonate wallrock 2, Shear Zone 4, Carbonaceous ore 5, Oxidized carbonaceous ore 6, O-zone 7, Gossan Marble Skarn Table 13-3: Bulk Densities Pediment and Cortez Hills Deposits Lithology Rock Code No. Samples S.G. Bulk Density (ft 3 /ton) Alluvium Limestone conglomerate Siltstone conglomerate Tertiary Caetano Tuff Quartz porphyry dike Breccia Jurassic quartz monzonite Undifferentiated Upper Plate RMT Wenban Formation Horse Canyon member Wenban Formation limestone 11 2, Roberts Mountains Formation Hanson Creek dolomite & limestone Eureka quartzite Hamburg limestone Altered marble 1, Project No.: Page 13-10

115 AMEC checked the density database against values used in resource estimates and found them to generally agree. Coefficients of variation (CV) of measured values are reasonably small for each unit. CVs range from a low of 0.07 for mineralized Wenban Limestone to 0.17 for limestone conglomerate. In part, this is a function of the number of measurements. Density measurement techniques and sample coverage are acceptable to support resource and reserve estimates Assay Adjustments 2003 Since the start of production at the Crescent pit at South Pipeline in 1994 until 2003, mill production on an annual basis had always exceeded mine production reports and the prediction of recoverable ounces from resource models. Mine production nearly always exceeded predicted contained ounces based on the long-term resource model. For instance, mine production in 2001 exceeded the resource model by 7.3% on a contained ounces basis. The model overestimated ore tons by 15.3% and underestimated ore grade by 26.8%. In 2002, the resource model relative to the blast hole model underestimated tons by 12% and underestimated the grade by 3.2%, for a total underestimation of contained ounces of 15.7%. The reasons for these differences have been the subject of speculation and study for several years. The consensus is that the difference between mill production and the blast hole model is largely the result of a consistent low bias in assays by the mine laboratory. In addition, it has been determined that historical blast hole assays obtained by atomic absorption methods are consistently biased low relative to assays obtained by fire assay. In the past, only blast hole assays exceeding 0.01 oz/t were reassayed by fire assay. All blast holes are now fire assayed. Although reconciliation through 2003 was always positive (the mill always delivered more gold than predicted by the resource model), a poor reconciliation is not desirable because of the potential influence on mine planning. There is a potential for low-grade resources that are economic not being included in pit designs, although this potential is low due to the geometry of the deposits. Historically, CJV has accounted for the underestimation of ounces by factoring the resource model at each update. Percentage adjustments based on actual production of the preceding year have the undesirable affect in that too many tons and ounces of marginal grade, leach ore (near the internal cutoff) are added using one percentage adjustment factor. This requires additional adjustments to leach tonnages. In 2003, CJV commissioned an internal study to determine the causes of historical biases between resource estimates made with exploration drill hole assays, blast hole models, and mill production. The work focussed principally on differences between exploration assays and blast hole assays, but also addressed potential smoothing effects in resource estimation an influences of drill hole spacing ( bad luck ). The following biases were found to exist in blast hole and exploration drill hole assays: Project No.: Page 13-11

116 blast hole assays assayed by atomic absorption are biased low blast hole and exploration hole fire assays performed by CJV laboratories (CJV #1 and CJV #2) are biased low relative to fire assays by commercial laboratories there are sampling losses in exploration holes which results in a low bias, even though core recovery is very high there are smoothing effects in resource estimation procedures that result in lower average grades some aspect of bad luck (higher grade zones present between holes) may exist. The relative low bias of fire assays by CJV laboratories relative to commercial laboratories was readily apparent from the large number of check assays performed since Quantile-Quantile plots, log-scale x-y plots and log-scale relative difference plots were used by CJV and its consultants to assess relationships between AA and fire assays of blast holes, fire assays by CJV laboratories versus commercial laboratories (overall) and fire assays by CJV laboratories versus commercial laboratories for specific ore zones (such as shear-hosted mineralization). Similar plots were used to evaluate the differences between blast hole assays adjusted for the AA/fire assay bias and assays from adjacent exploration core holes. Quantile-Quantile plots do not display the relationship of specific sample pairs; rather emphasize the grade trend of the entire population. In addition, Q-Q plots require that both populations have the same distribution. Blast hole assays will have a more narrow distribution than the distribution of exploration sample assays, which should have long low-grade and high-grade tails. Log-scale x-y plots and log-scale relative difference plots create some autocorrelation that may not actually exist. Regression equations derived from log-log plots are not valid and instead should be estimated with linear plots. Normal presentations of comparison data, such as linear-scale relative difference plots and x-y pair plots were not used presumably because of the large variability in the data. Adjustment factors were developed by CJV for the apparent low bias of exploration fire assays relative to fire assays of adjacent blast holes. These sampling bias adjustments account for a yet understood loss of gold in assays of exploration core. Core drilling methods were highly professional and core recovery was generally high (>90%), therefore it is a surprise that sampling losses occurred in the core drilling. However, a 10% loss of gold might occur in a 5% or less loss of core if the most altered and mineralized material is preferentially susceptible to loss. The datasets used for this evaluation contain a large amount of variation. Blast hole assays were selected for core pairs if within 30 ft of the core hole. A large variation in grade can occur in this distance. The high variability in relative differences does not negate the conclusion that assays of core are generally biased low relative to blast hole fire assays. The Q-Q plots show that the blast hole assay population is overall higher grade than the exploration core hole assay Project No.: Page 13-12

117 population for the same area. The variability in pair values instead give the regression function derived from the pairs a low confidence level. Adjustments to the core assays produce similar assay populations between core and blast holes. Final correction factors were produced for removing biases between blast holes with fire assays and atomic absorption assays, between fire assays by the mine s laboratories and commercial laboratories and between blast holes and core hole assays (sampling bias). Adjustments are summarized in Table Assays for the Pipeline, South Pipeline, Crossroads, and Gap deposits were then modified using a series of regression formulas dependent on the assay material (blast hole or core), geological domain (Pipeline shear or non shear) and source laboratory (CJV #1, CJV #2 or outside laboratory). Assays for Cortez NW Deep, Pediment, and Cortez Hills were not adjusted. Table 13-5 presents an average for each sample type (core and blast hole). Table 13-4: Assay Adjustments Used in 2003 and 2004 Resource Models for Pipeline, South Pipeline, Crossroads and Gap Deposits Sample Type Bias Adjustment (%) Cumulative Adjustment (%) BH AA lower than FA BH Mine lab FA lower than commercial labs Core Mine lab FA lower than commercial labs Core Sampling BH higher than core Comparison between estimates of Pipeline/South Pipeline resources using adjusted drill hole assays against an estimate using blast hole assays tested the assay adjustments. Blast hole assays with AA assays were first adjusted upward 1% for AA/fire assay bias and 8% for CJV laboratory/commercial laboratory fire assay bias. Table 13-6 presents comparisons of tons, grade and contained ounces for each model. Table 13-5: Comparison of Adjusted and Unadjusted Models for Pipeline/South Pipeline Model BH Corrected DH Unadjusted DH Adjusted 2002 Factored Tons 118,157, ,387, ,485,233 98,426,736 - Grade Ounces 8,674,611 7,495,938 8,512,805 7,994,385 - Comparison DH Unadjusted vs. BH Corrected DH Adjusted vs. BH Corrected 2002 Factored vs. BH Corrected DH Adjusted vs Factored Diff. Tons - -12,770,391-4,672,164-19,730,661 15,058,497 Diff. Tons % - -12% -4% -20% 13% Diff. Grade Diff. Grade % % 2.13% 9.61% -8.28% Diff. Oz - -1,178, , , ,420 Diff. Oz % % -1.90% -8.51% 6.09% Project No.: Page 13-13

118 The blast hole corrected model is used as the baseline since this model is closest to actual mine production. The comparison shows that on a global basis, the resource model with adjusted drill hole assays (highlighted in bold italics) is within 4% in tons and 2% in grade and contained ounces from the corrected blast hole model. This comparison does not show how close the models will be on a local basis (within specific grade-control panels). A second test of the adjusted assays is CJV s comparison of actual 2003 production and the year-end 2003 resource model. This model uses adjusted drill hole assays. Actual production in 2003 was 1,065,000 oz. Applying a year-to-date average recovery of 70.8%, the production required a total of 1,505,000 oz of in situ resources. For the same pit volume, the year-end 2003 resource model estimates 1,378,000 contained ounces, or 8% less. This suggests that the adjusted assays and new resource model is still conservative relative to actual production. The rolling average reconciliation for the period between 01 August 2003 and 31 July 2004 shows that production exceeds the prediction of the resource model by 9% on tons, 2% on gold grade and 11% on contained gold ounces. This suggests that the adjusted assays and new resource model is still conservative relative to actual production. In January 2004, the mine also started tracking reconciliation of ore control perimeters (blast hole blockouts) to long-term resource model blocks on a monthly basis. From January through July of 2004, the resource model under predicted, on average, 5% on tonnage for both the mill ore and leach ore. The model under predicted the mill grade by 28% and over predicted the leach grade by 17%. On average, the grade is under predicted by 4% resulting in an average under prediction of gold ounces of 8.5%. Reconciliation trends changed markedly in the remainder of 2004 and to date in For the past 15 months (June 2004 to August 2005), the resource model has overpredicted the mill ore tonnage an average of 19% and underpredicted the mill grade by 12%. Global contained ounces are the same, although more ounces are in material that will have a lower recovered ounce percentage (leach material). This change has coincided with millgrade mineralization being less contained within the well-defined Pipeline duplex zone and more prevalent in disseminated zones and multiple structures. The preliminary consensus is that ordinary kriging of mineralization outside the thrust duplex has oversmoothed grade estimates, creating a bias in tons and grade at the mill cutoff. Global tons and contained ounces are similar between the model and mill/leach production. This bias will be addressed in a model update scheduled for the fourth quarter of The use of adjustment factors does not appear to have caused the reconciliation shortfall in mill tons and grade. Project No.: Page 13-14

119 14.0 DATA VERIFICATION The CJV technical database has evolved from the Informix database architecture used during exploration and development of the Pipeline and South Pipeline deposits to the present acquire system, first implemented in Exploration data from a variety of sources are now imported into acquire and then re-exported for use by either the Placer Dome OP software system for resource estimation and mine designs or by other commercial software packages. Prior to 2004, geological and geotechnical data logged by CJV geologists were recorded in the GEOLOG program using GEOENTRY. All entries were checked for proper format, coding and numerical continuity using GEOCHCK. Once reviewed by GEOCHCK, the data were converted to a text and graphics log using LOGII software. After was visually checked by the geologist and logging coordinator, the final GEOLOG was provided to the computer systems administrator to be merged into acquire. Some data were stored in Microsoft Access prior to storage in acquire. Since 2004, geological and geotechnical logs have been entered directly into acquire using a custom data entry program. Data input is controlled by use of pick boxes which only allow the user to select valid values for each field. Data files include: geological log attributes assays assay quality assurance/quality control information geotechnical logging attributes density measurements geological model polygons collar and down-hole surveys topography. Data are exported to Placer Dome s OP software system for processing. This system has the following subroutines: OP1: Drillhole database checking OP4: Drill hole compositor OP5: Composites split by geological model units OP27: Surface modelling OP29: Resource estimation OP31: Trimming model to topography Project No.: Page 14-1

120 OP37: Compression of block model OP46: Profit matrix development OP49: Pit slope parameters OP59: Pit optimization preparation OP60: Lerches Grossman pit optimization OP61: Reserve tabulation OP75: Geological modelling. CJV presently uses Maptek Vulcan for development of three-dimensional geological models. Variograms are calculated with Snowden's VISOR software. Whittle 4X and OptiCut are periodically used for pit designs. Whittle Express is sometimes used to assist in optimization of ramp designs. Input of exploration data is largely electronic since geological and geotechnical logs, collar surveys, down-hole surveys, assays and topography are derived digitally from the start. Some staff geologists still use paper log forms prior to keypunching information into the aquire entry form. Geological and geotechnical logs hand keyed during logging are reportedly checked by two geologists prior to being imported into the master database. Integrity subroutines in acquire check for anomalous numerical coding such as mismatched from and to, unique geological or geotechnical codes, and anomalous bends in downhole surveys. These procedures produce high quality databases. The Pipeline, South Pipeline, Crossroads, Gap, and Gold Acres database was audited by internal Placer Dome corporate audit teams in 1996, 1998, 2001, and These reviews indicated a low error rate. In 2004, AMEC selected 21 drill holes from the 556 drill holes used in the Pediment and Cortez Hills resource model and obtained an export of all information for these holes from the acquire database. Gold assays, from, to, key, alteration, lithology, formation and rock code were compared to original documents. Downhole surveys were checked for anomalous kinks. Other than a few differences in how gold assays at detection limit or below are reported, no errors were found. The Pediment and Cortez Hills database is of high quality and suitable to support resource estimates. During its site visit in September, 2005, AMEC audited the updated 2004 Cortez Hills and Pediment drill database by comparing assay and lithology information against original documents. Lithology fields audited included rock type, alteration, formation name, and the keyflag and geocode fields. Assay fields audited included the gold fire assay and cyanide fields. The lithology audit found only minor errors (0.68% error rate) which will not adversely affect the geologic model. The assay audit found no errors except in the way that ALS Chemex cyanide gold overlimit assays are handled. The upper detection limit for cyanide gold assays using the Au-AA13 method is 1.46 oz/ton Au. Cyanide assays Project No.: Page 14-2

121 exceeding this limit are automatically substituted with the fire assay value. This, in effect, makes all intervals with cyanide overlimits assays have a AA/FA ratio of 1.0. While one could argue that intervals reporting greater than 1.46 oz/ton in the cyanide assay are likely not refractory, replacing the cyanide assay value with the fire assay value is not a good practice. AMEC recommends that CJV instruct ALS Chemex (and all other outside laboratories) to reassay the cyanide overlimits assays by a suitable method to arrive at a value within the detection limits. AMEC also performed database integrity checks (check for overlapping intervals, missing collars/surveys/assays/lithology, calculation errors, etc.) on the Cortez Hills and Pediment database. Several errors were found in calculated fields (aa_fa contained several negative values) and 14 drill holes were missing lithology data, but overall the database is in excellent condition and is suitable to support resource estimates. Project No.: Page 14-3

122 15.0 ADJACENT PROPERTIES There are no adjacent properties that are of a concern to resources and reserves in the CJV. Project No.: Page 15-1

123 16.0 MINERAL PROCESSING AND METALLURGICAL TESTING The metallurgical process has been well established and developed over an operating period of more than 30 years. The CJV has a number of processing facilities: Mill No. 1, the Cortez mill (inactive) Mill No. 2, the Pipeline mill Heap leaching at Cortez (inactive), Pipeline, Gold Acres, and the South Area facility Dry grinding and roasting plant at Cortez (inactive). Mill No. 1 was placed on care and maintenance at the end of October The roaster has been inactive since 1995 pending the stockpiling of sufficient carbonaceous ore to justify a continuous campaign or a decision on alternative processing. Some stockpiled ore is being sold for outside processing. Details on the mill flowsheets are discussed in Section 19.3, Process Operations. The majority of metallurgical testwork on ore zones currently being mined and those targeted for future consideration are conducted in-house at the mine site or at Placer Dome's Vancouver laboratory. Independent outside laboratories are used on occasion where specialized equipment or facilities are required. Sample selection, collection, and compositing required for testing of new ore types and ore zones is conducted under the direction of the site geology department. Samples are comprised of drill core and RC drill cutting rejects. All assaying for tests conducted on site is performed by the site assay lab using standard accepted practices Pipeline and South Pipeline The metallurgical characteristics of the South Pipeline and Pipeline deposits have been developed through extensive mill and heap leach experience and ongoing testwork at site. AMEC reviewed the mill operating statistics for 1998, 1999, 2000, 2001, and 2002, and as well the operating performance in October and November of Results show stable metallurgical performance consistent with ongoing in-house test programs. Metallurgical recoveries are discussed in Section 19.5 of this technical report. Pipeline and South Pipeline contain low and high-grade oxide and O-Zone materials. O-Zone ore is an oxidized material that contains higher silica content that results in lower recoveries. Low-grade oxide and O-Zone materials are heap leached; high-grade materials are milled in Mill No. 2. Metallurgical performance of both oxides and O-Zone materials are well established through heap leach and milling experience. Metallurgical projections are consistent with historical performance and ongoing testwork. Project No.: Page 16-1

124 Carbonaceous materials are also contained in the Pipeline and South Pipeline deposits. Currently, carbonaceous materials are stockpiled for future processing through the Cortez roasting plant or potential treatment through new proprietary processes being developed by PDTS. Some of the stockpiled carbonaceous ores are sold for outside roaster processing. Some pilot scale testwork has been completed on the two new proprietary processes to support predictions for metallurgical performance. Implementation of these processes would require some modifications to the existing mill and heap leach facilities. Metallurgical prediction for carbonaceous ore response to roasting is based on roaster recovery performance over the last three years. Predictions are in the range of actual roaster reported recoveries for Cortez treated ores Crossroads and Gap Spatially, the Crossroads deposit is an extension of the South Pipeline deposit. Mineralization at Gap shows similarities to oxide mineralization within Pipeline and South Pipeline, although the host rock (Wenban Limestone) is different. As such, the metallurgy has been predicted to be similar to that of South Pipeline. This is a reasonable assumption. Crossroads and Gap contain oxide materials of which the low grade will be heap leached with the higher grades reporting to Mill No. 2. Column and bottle roll testwork results show the Crossroads and Gap ore to be amenable to heap leaching and milling as configured in Mill No. 2. The projected metallurgy for Crossroads and Gap ores are consistent with the testwork done. Crossroads contain some carbonaceous ores. Alternative treatment processes are assumed to be the same as those proposed for Pipeline and South Pipeline ores. This is a reasonable assumption Pediment The Pediment deposit primary consists of oxides ore and contains little to no sulphide components. The majority of the deposit is low grade heap leach material. Lab scale column heap leach testwork was conducted on Pediment samples in A total of 13 tests were performed on composite samples representing three separate grade ranges, low (0.01 oz/t to 0.03 oz/t), medium (0.03 oz/t to 0.05 oz/t), and high (0.05 oz/t to 0.08 oz/t). Lab results demonstrated that a primary leach cycle resulting in a solution to ore mass ratio of 2.7 is necessary for optimum recovery. The primary leach cycle is 90 days with a typical solution application rate of gpm/ft 2. Project No.: Page 16-2

125 Bench scale test results indicate that major reagent consumption, sodium cyanide and lime, will be similar to that for Pipeline/South Pipeline leach ores. Testwork on Pediment performance in milling is limited; however, results to date indicate that the ore is reasonably amenable to milling. Hardness testwork indicates a Bond work index in the order of This is softer than the South Pipeline ore at 13.5 kwh/ton and harder than Pipeline ore at 11 to 11.5 kwh/ton Cortez Hills The Cortez Hills ore is a mixture of high grade oxide, low grade oxide and refractory ore. The high and low grade material will serve as feed to the mill and heap leach respectively. The refractory material is primarily located in deeper areas of the pit and represents only about 5% of the potential net revenue from the pit. Within the Cortez Hills deposit, three primary ore types have been identified: marble, limestone and breccia. Combination of the marble and limestone ore types comprises about 75% of the Cortez Hills reserve. The remaining 25% of the reserve is the breccia ore type. In the fall of 2003, five composite samples of oxide material from the Cortez Hills deposit were tested. Tests included standard bottle roll tests to determine leach residence time, sensitivity to grind particle size and reagent consumption. Metallurgical performance of the Cortez Hills oxide material is consistent with feed materials processed at Mill No. 2. Subsequent testwork completed in 2005 indicate a potential upside in a 1% increase in recovery indicated by larger scale bottle roll tests. These higher recoveries were not incorporated into CJV s internal feasibility study or revised pit designs. Four out of five of the composite samples tested had high carbonate contents at approximately 35%. One sample had 9% carbonate. All samples indicated 0.1% or less total organic carbon content and trace to 0.1 % total sulphur. In 2004, bench scale testwork was conducted on composite samples prepared from PQ drill core representing the three ore types. Tests included Bond work hardness testing, JK breakage tests (comminution parameters), determination of gravity recoverable gold, sedimentation and rheology testwork Highlights of the test results include: Comminution characterization tests showed the ores to be of medium hardness and relatively easy to mill, although the breccia appears to be slightly harder than Pipeline ores. Project No.: Page 16-3

126 Modelling of the crushing and grinding circuit predicts a mill throughput of 10,000 tpd is achievable using the current mill configuration and is consistent with the current throughput capacity of the mill with Pipeline ore. Gravity gold recovery testwork showed a minimal proportion of the contained gold would be directly recoverable as concentrate from gravity processes. Small amounts of graphitic preg-robbing components were found. These tests confirm that a CIL configuration of the leach circuit should be contained as per the current flowsheet used for Pipeline ores. Major reagent consumption, sodium cyanide and lime, is consistent with Pipeline ore consumption rates. No viscosity concerns were identified at the current operating solids concentration with Pipeline ore. Lab scale column heap leach testwork was conducted on RC or PQ samples of Cortez Hills ore drilled in 2002 and A total of 8 tests were performed on composite samples representing three separate grade ranges, low (0.01 oz/t to 0.03 oz/t), medium (0.03 oz/t to 0.05 oz/t), and high (0.05 oz/t to 0.08 oz/t). Lab results demonstrated that a primary leach cycle resulting in a solution to ore mass ratio of 3.6 to 4.5 is necessary for optimum recovery. The primary leach cycle ranges between 120 to 150 days with a typical solution application rate of gpm/ft 2. Bench scale test results indicate that major reagent consumption for the heap leach circuit, sodium cyanide, and lime, will be similar to that for Pipeline/South Pipeline leach ores. Ten samples of refractory ore were selected for diagnostic leach testing followed by process amenability testing. In total, seven different processes known to be applicable for the treatment of refractory type ores were tested. Of the processes tested pressure oxidation and roasting yielded the best results with 92% and 86% gold recovery respectively. New composite samples have been selected for metallurgical testing in the second half of These tests will allow for a more definitive determination to be made for the preferred processing route for refractory ore Cortez NW Deep Gold in the Cortez NW Deep zone is extremely fine grained and is associated with quartz, pyrite, and arsenopyrite. In 1993 and 1994, a number of preliminary roasting and bottle roll tests were conducted on ore from the Cortez NW Deep zone. Results showed that roasting followed by leaching would result in reasonable recovery. Leaching alone resulted in poor recovery. Project No.: Page 16-4

127 The Bass Pond zone is contained within the area referred to as Cortez NW Deep. This zone contains both oxide and carbonaceous materials. Preliminary testwork has shown that the oxide material is amenable to heap leaching and milling Hilltop The Hilltop deposit includes both sulphide and oxide material. Preliminary tests have been conducted including, flotation, bottle rolls, leach columns, and bioxidation/leach columns. Potential flowsheet options include heap leach, flotation, bioxidation, roasting, and various combinations thereof to optimize oxide and sulphide recoveries. Project No.: Page 16-5

128 17.0 MINERAL RESOURCE AND MINERAL RESERVE ESTIMATES 17.1 Introduction The mineral resource and reserve estimates for the CJV are a joint effort of the mine staff. R.C. Hays, Exploration and Development Superintendent and K. Hart, Senior Mine Geologist are responsible for geological modelling. Andrew Issel, Resource Estimation Specialist, is responsible for resource estimation. W.M. Martinich, Mine and Technical Services Superintendent, and T.L. Dyer, Mine Engineer, are responsible for mine designs and estimation of reserves. Mr. Martinich is the mine s Qualified Person in regards to the 1 September 2005 resource and reserve estimates. Resource and reserve estimates are developed using Placer Dome Inc. in-house OP and commercially available VULCAN and VISOR software. Whittle 4X, Whittle OptiCut and Whittle Express are used in various capacities to assist in the design and optimization of pits. The Pipeline resource model, which includes the spatially related Pipeline, South Pipeline, Crossroads and Gap deposits, has evolved from the feasibility study model created in 1995 through annual resource model updates. Two updates to variography were conducted during the period 1998 to During the Fall 2001 resource estimation update process, various models were created to assess the impact of a number of different estimation parameters. In 2003, the resource estimation was updated using a new assay database with historical assays adjusted for laboratory and sampling biases. In addition, new estimation parameters were developed to improve local estimates. Resource classification was changed from one dependent on the average distance from block centroids to the nearest drill hole to one using kriging variance. A new small-block resource model for the portion of mineralization at Cortez Hills beneath the present design pit was developed to better support evaluations of an underground mining option. The four resource models and the deposits included within each are listed in Table In addition, reserves are contained in various stockpiles. Table 17-1: CJV Resource Models Model Deposits Resource Reserve Pipeline Pipeline South Pipeline Crossroads Gap Cortez Hills / Pediment/ Cortez Northwest Deep Cortez Hills Pediment Northwest Deep Cortez Hills Underground Cortez Hills Hilltop Hilltop Project No.: Page 17-6

129 The coordinate systems used for all of the models are based on a local grid and do not tie to any state plane or UTM coordinate system. The Pipeline model and the surrounding area are on one coordinate system while the Cortez Hills, Pediment, and Northwest Deep are on a second system and Hilltop is on a third. Topographic control is provided by aerial survey with conventional surveying updates in active mining areas Geological Models Pipeline/South Pipeline/Crossroads/Gap/Cortez NW Deep Deposits All geologic data used for modelling were collected, reviewed, and verified by CJV geology staff. Data are stored as acquire SQL server databases and imported into Vulcan for 3D visualization and interpretation. CJV geology staff complete geologic interpretation polygons for all rock types in sectional views constructed at 100 ft intervals. Rock type polygons are constructed by snapping contacts to drill hole pierce points. Plan sections are cut at mid-bench for 40 ft bench heights. Triangulations for each rock type were built from sectional polygons and reconciled against drilling in plan, cross section, long section, and oblique views. Extensions of 50 ft were used to close triangulations where rock types ended between sections. The triangulations were prioritized and used to create a geological block model in the Pipeline mine grid with dimensions 11,240 ft east-west, 11,480 ft north-south, and 2,500 ft vertically. The block dimensions are 40 ft x 40 ft in plan view by 20 ft thick. The block model contains 281 columns by 287 rows by 125 levels. The block model was exported from Vulcan in an ASCII format and converted to the Placer Dome format. AMEC reviewed preliminary geological interpretations on paper for the Pipeline, South Pipeline, Crossroads, Gap, Pediment, and Cortez Hills deposits. AMEC also reviewed all final interpretations on computer screen in Vulcan, which was able to display attributes of each deposit in three-dimensions. Sixteen rock types are contained in the resource block model. Tonnage factors were assigned to each block in the model based on the assigned rock type. The geological models of Pipeline, South Pipeline, Crossroads, and Cortez NW Deep are essentially models of alteration, since all of these deposits are hosted by the Roberts Mountains Formation. Important model units include: alluvium oxidized rock, less altered or waste material oxidized and argillized rock oxidized and silicified rock oxidized shear carbonaceous rock, less altered Project No.: Page 17-7

130 carbonaceous rock, partly oxidized on fractures carbonaceous rock, argillized. AMEC found that the geological models reasonably represent geological controls of mineralization and CJV interpretations honour drill hole data. An anisotropy model was also created as part of the geological modelling. This model was used to orient the search and variogram ellipsoids during estimation. Form lines were digitized on every 100 ft section of the geological model. There was a minimum of one form line per section with additional form lines as warranted. The form lines are generally parallel or sub-parallel to the orientation of the shear zone, which represents the fabric controlling the mineralization. The azimuth and plunge of the orientation of the mineralization was assigned using a nearest-neighbour assignment with an isotropic search with a radius of 600 ft. The long range of search was used to ensure that estimations of azimuth and plunges were completed in all blocks. An assay data file was exported from the SQL database using all core holes and any reverse circulation holes supported by core data on all sides. The drill hole selection list and assay file were checked and verified by CJV geology staff prior to export to the Placer Dome assay file format used to create composite files Pediment and Cortez Hills Deposits CJV geologists merged geological interpretations and databases for these deposits because of their proximity and because the in situ footwall of the Pediment deposit resembles mineralization at Cortez Hills. Geological interpretations were developed on east-west cross sections and north-south longitudinal sections spaced at 100 ft intervals. Triangulations for each rock type were built from sectional polygons and reconciled against drilling in plan, cross section, long section, and oblique views. Extensions of 50 ft were used to close triangulations where rock types ended between sections. The triangulations were prioritized and used to assign rock codes to the block model. The block model was expanded north to include the area of the historical Cortez mine and the Cortez Northwest Deeps deposit. The combined model 16,000 ft east-west (21,000-37,000E, 20,000 ft north-south (21,000-41,000N and 6,000 ft vertically (2,000-8,000 ASL). The model blocks are 30 ft x 30 ft x 15 ft vertically. The block model was exported from Vulcan in an ASCII format and converted to the Placer Dome OP software format. The capacity to view geological attributes in three-dimensions in Vulcan greatly assisted the development of a final interpretation. The Pediment geological model is primarily a lithological model, since mineralization is generally constrained by geological units. Cortez Hills mineralization is controlled by lithology, alteration, and structure. Fourteen rock units used in the combined Pediment and Cortez models are listed in Table Project No.: Page 17-8

131 Table 17-2: Cortez Hills Pediment Rock Types Rock Code Lithology Symbol 1 Alluvium QAL 2 Limestone conglomerate QCS 3 Siltstone conglomerate QCL 4 Tertiary Caetano Tuff TC 5 Quartz porphyry dike TQP 7 Breccia BRXX 8 Jurassic quartz monzonite QM 9 Undifferentiated Upper Plate RMT DS 10 Wenban Limestone Horse Canyon Member DWH 11 Wenban Limestone DW 12 Roberts Mountains Formation SRM 13 Hanson Creek dolomite & limestone OHC 14 Eureka quartzite OE 15 Hamburg limestone HAM An assay data file was exported from the database using all core holes and any reverse circulation holes supported by core data on all sides. The drill hole selection list and assay file were checked and verified by CJV geology staff prior to export to the Placer Dome assay file format used to create composite files. A specific gravity block model was created by retrieving data by rock type from the geology model. The specific gravities used were developed from laboratory testing. The model does not include a water table surface since this feature is at a depth of approximately 1,100 ft at the Cortez Hills deposit and approximately 500 ft at the Pediment deposit. These model development procedures for Pediment have been reviewed and/or audited multiple times since 1998 by Placer Dome. AMEC reviewed the geological interpretations and found them to be professionally constructed and representative of drill hole data. CJV understanding of the geology and geological controls of mineralization is good and suitable to support resource estimates Cortez NW Deep Deposit The Cortez NW Deep area stratigraphy is dominated by laminated, calcareous siltstones of Silurian Roberts Mountains Formation (SRM) and underlying Hansen Creek Dolomite (OHC). The Eureka Quartzite (OE) occurs below the Hansen Creek Dolomite and has been intersected in several holes throughout the project area. The resource is divided between oxidized and altered, low angle duplex zones in the Roberts Mountain Formation Project No.: Page 17-9

132 and what appears to be a low angle duplex zone with refractory sulphide mineralization occurring at the top of the Hansen Creek Dolomite. The resource is structurally complex. High-angle NNW-striking faults appear to have served as the primary mineralization conduits. NE-striking faults were secondary conduits. Low-angle thrust duplex zones were the primary hosts of mineralization. At least four phases of igneous activity are evident. The most common phase is represented by Tertiary quartz porphyry dikes. A rock type model was constructed from the drilling information by the CJV geologists and incorporated into the resource model to control the estimation of the resource. Six rock types were modelled. These consist of: alluvium, siltstone, quartzite, dolomite, Tertiary dikes, and quartz porphyry dikes. The ore is primarily restricted to the siltstone, quartzite and dolomite Hilltop Deposit The Hilltop main zone gold deposit is hosted in metasedimentary rocks within the upper plate of the Roberts Mountains Thrust and in Tertiary age intrusive porphyries and breccias. Most of the mineralization is contained within a tabular lens-shaped body of siliceous and locally sulphidic megabreccia, which is bounded by the Hilltop mine fault (floor) and the Independence fault, which dip 20 and 30 west respectively. A series of porphyritic, calc-alkaline stocks, plugs and dikes were intruded into this thrust regime. The principal episode of gold mineralization probably occurred late in the intrusive history and during reactivation of the thrust faults. Drill hole data from 392 holes was compiled by Placer Dome Exploration Inc. The drilling information was passed on to the CJV for the resource estimation. Down-hole survey information was not available, thus it was assumed the holes had a straight trace with the dip and the azimuths applied at the collar elevation. Six primary rock types were logged with the drilling: siltstone, argillite, quartzite, breccia, intrusive and Hilltop Main Zone. The Hilltop Main Zone is the primary zone of mineralization. The upper 150 to 250 ft of the deposit is oxidized. The bulk of the Main Zone mineralization is unoxidized. Project No.: Page 17-10

133 17.3 Pipeline/South Pipeline/Crossroads/Gap Mineral Resource Estimates Introduction The Pipeline resource model, which includes the spatially related Pipeline, South Pipeline, Crossroads, and Gap deposits, has evolved from the feasibility study model created in 1995 to the present model. The modelling methods and parameters have been updated annually. The resources and reserves have been audited internally by Placer Dome in 1996, 1998, 2001, and With each of the audits, a number of suggestions were made that could potentially improve the resource model. The CJV has been very diligent about following up on the various suggestions and adopting the ones that improved the models. Some of the improvements incorporated since the early estimation of Pipeline resources include: indicator kriging of the shear zone incorporation of a local anisotropy model improvements in the density model use of spatial statistics (estimation variance) for classification analyzing and adjusting for sample bias. One of the changes in the 2003 model represents a significant departure from previous models. Historically, all of the models produced have significantly underestimated the resource when compared to the actual production. In the past, this has been compensated for by factoring of the estimated grades in the model. CJV recently completed an in-depth study examining data biases, which derived various assay adjustment factors (Section 13.7). The adjusted assays have been used in the 2003 model without the use of additional factors. The resource was updated in May of 2004 using an additional 14 drillholes. The holes were drilled specifically to test the bottom of the pit in a number of areas. This, combined with an increase in the gold price from $325 to $350/oz, resulted in a significant expansion of the Pipeline pit to the west Resource Model Resource estimation was completed using two interpolation methods: ordinary kriging for all domains except for shear zone, and indicator kriging for the shear zone rock type. Estimation of mineralized groups is done with soft boundaries between all domains, except the shear zone, which is estimated with a hard boundary. Sixteen rock types are contained in the resource block model. These consist of alluvium, four rock types for the Gap area and two sets of six rock types for the remaining areas. These rock types are broken into two groups of similar lithology and alteration distinguished as either flat laying or steep dipping. The flat laying are parallel or sub- Project No.: Page 17-11

134 parallel to the main shear zone while the steep dipping are more steep laying away from the main sheer zone. The rock types were assigned to the block model from the geologic model based on the block centre. The searches and the variograms were different for each of the rock types based on the block designations. All of the boundaries between the rock types were treated as soft boundaries except for the shear zone. That is, for all except the shear zone, any data that fell within the search was considered for use within the estimate regardless of the rock type of the block being estimated or the data found. The shear zone was estimated separately, exclusively using shear zone data. The shear zone was estimated using indicator kriging. Only an e-type estimate of the average block grade was used for the resource summation. No further post-processing of the indicator inferred distribution was considered. The values for the density model were assigned according to the bulk density factors and rock types from the geological model. An anisotropy model was created and used to align the search ellipsoid for estimation. The OP estimation program OP29 was used to estimate the angles into a block model based on an isotropic search with a radius of 600 ft. The long range of search was used to ensure that estimations of azimuth and plunges were completed in all blocks. Descriptive statistics were generated for data in all geological domains. General estimation parameters are detailed in Table Table 17-3: Gold Estimation Parameter Summary Parameter Unaltered Alteration Shear Carbon Ozone Trimming Values (oz Au/ton) 0.35 / / / / 0.3 Min. # of Samples Max. # of Samples Search Radius (ft) Search Azimuth (degrees) 160 / / / / Search Dip (degrees) Search Plunge (degrees) 0 / / 0 0 / / / -15 Main Search Anisotropy 1.0 / / / / / 1.0 Minor Search Anisotropy 1.0 / / / / / 1.31 Vertical Search Anisotropy 3.06 / / / / / 2.23 Max Samples per DH Max Samples per Octant Min. # of Informed Octants Min. # of Holes # of Indicator Classes Note: Parameters are shown for the various rock types as flat/steep Table 17-3 shows that seven indicator classes used for the shear zone rock type. These classes were based on gold grade. The flat and steep zones were estimated separately. Project No.: Page 17-12

135 The indicator classes and their associated grades are given in Table The indicator classes were chosen to best represent equal numbers of composites in the lower grades while maintaining equivalent metal content in higher grades. To accomplish this, indicator cutoff graphs were computed within the shear zone. It should be noted that it is customary to use the upper class median during estimation; however, the upper class mean is used at Pipeline because of the need to increase grade for better reconciliation with high-grade zones. Table 17-4: Indicator Classes for Shear Zone Rock Type Flat Cutoff (oz/t) Mean (oz/t) Steep Cutoff (oz/t) Mean (oz/t) Table 17-5 summarizes the variogram parameters used for the Fall 2003 and 2004 update ordinary kriging estimation. All variograms were calculated as correlograms and modelled with exponential models. Correlograms are scaled such that the variogram model will have a unit sill. In most cases, the variogram never reached the unit sill within the range that the data was examined, resulting in variogram models that have an apparent sill less than 1.0. Table 17-6 summarizes the shear zone indicator variograms for the flat zone region, and Table 17-7 summarizes the shear zone variograms for the steep zone region. Note that the azimuth reported in these tables shows a trend from northeast to southwest. This is also consistent with the ordinary kriging orthogonal found in Table Table 17-5: Pipeline Variogram Summary Ordinary Kriging Flat Zone Rock Types Steep Zone Rock Types Variable Unaltered Altered Carbon Ozone Unaltered Altered Carbon Ozone Azimuth Dip Plunge Number of Structures Range (ft) 35 / / / / / / / / 335 Maj. Anisotropy 1.4 / / / / / / 1.0 Min. Anisotropy / / / / / / / 1.31 Ver. Anisotropy 1.75 / / / / / / / / 2.23 Sill 0.47 / / / / / / / / 0.10 Nugget Note: Variogram parameters are entered as 1 st structure / 2 nd structure, in accordance with OP conventions. Project No.: Page 17-13

136 Table 17-6: Pipeline Variogram Summary, Shear Zone Indicator Kriging Flat Zone Indicator Threshold Variable Azimuth Dip Plunge Maj. Anisotropy / Min. Anisotropy 1.33 / / / / / / / 1.55 Ver. Anisotropy 1.6 / / / / / / / 3.1 Number Structures Range 40 / / / / / / / 155 Sill 0.39 / / / / / / / 0.10 Nugget Note: Variogram parameters are entered as 1 st structure / 2 nd structure, in accordance with OP conventions. Table 17-7: Pipeline Variogram Summary, Shear Zone Indicator Kriging Steep Zone Indicator Threshold Variable Azimuth Dip Plunge Maj. Anisotropy 1.0 / / / / / / / 1.0 Min. Anisotropy 1.43 / / / / / / / 1.29 Ver. Anisotropy 1.67 / / / / / / / 3.0 Number Structures Range 50 / / / / / / / 180 Sill 0.47 / / / / / / / 0.19 Nugget Note: Variogram parameters are entered as 1 st structure / 2 nd structure, in accordance with OP conventions Cross Validation The general descriptive statistics of the model were checked by domain and compared to the drill hole values (Table 17-8). The global statistics (rock from mineralized EDA) show a very good relationship overall. There is a slight negative bias in some of the higher-grade zones, which would make the model slightly conservative. Project No.: Page 17-14

137 Table 17-8: Drill Hole vs. Model Statistics Parameter Unaltered Altered Shear Carbon OxCarbon Ozone No. of Data Est. Mean DH Mean Est. Std. Dev DH Std. Dev Mine to Model Reconciliation The mine currently collects mine to model reconciliation data on a monthly basis. Data from the last 15 months (June 2004 through August 2005) were examined. Within this timeframe, the model performance is summarized in Table The reconciliation shows that relative to mine production records, the model is unbiased at the heap leach cutoff. However, at the mill cutoff there is conditional bias within the model. The model has over predicted the mill tonnage on an average of 19% and under predicted the contained ounces by 12%. This implies that the model is generally over smoothed. The standard deviation of the errors is within acceptable limits overall, but is somewhat excessive for the mill ore. Table 17-9: Pipeline Monthly Reconciliation Summary Tonnage Error Ounce Error Mean Std Dev Mean Std Dev Mill Ore 19% 30% -12% 21% Leach -1% 10% 11% 9% Total Ore 1% 11% 0% 9% This condition did not appear in past evaluations of the mine-model comparisons. In the past, the primary ore source for Pipeline was contained with the duplex shear zone. This zone was estimated with very tightly controlled interpolation. The shear zone is nearing exhaustion and the primary ore source for both recent production and the remaining reserve has shifted to the more disseminated mineralization. This would imply that the the observed conditional bias could persist through the remaining reserve. Shortfalls in predicted mill tons and resulting reduced revenues from higher grade and higher recovery mill ore may financially impact Phases 8 and 9. AMEC recommends this effect be examined by the CJV in the next reserve update by using a new resource estimate with less conditional bias to develop a revised mine design. Project No.: Page 17-15

138 Sample Block Model Sections and Plans Sample cross sections, longitudinal sections and plan sections of the Pipeline-South Pipeline, Crossroads and Gap deposits are provided as Figures 17-2 to 17-21, with outlines of the ultimate pits. All figures were supplied by CJV. It can be seen that there exists somewhat of a conditional bias in the estimate. The estimate is too smooth. The resource model shows more low grade tons and less high grade tons than the production model. The estimates cross very near the mill cutoff. Therefore, at the mill cutoff the resource estimate is approximately unbiased. To compensate for the bias in the leach tons, the resource has been summarized at a higher cutoff than the operating cutoff. The cutoff was chosen such that the leach tonnage matched the production Conclusions and Recommendations Estimation for the year-end 2003 mineral resources and the June 2004 update is the culmination of previous work integrated with updated data and revised statistics. The modelling effort continues to improve annually as more data become available. The resource model appears to be relative robust on a global basis. The model appears to be over smoothed away from the shear zone. This over-smoothing should be addressed as soon as possible to ensure the continued viability of the mine plan. Project No.: Page 17-16

139 Figure 17-1: East-West Cross Section of Pipeline-South Pipeline Block Model at 57000N, Looking North Project No.: Page 17-17

140 Figure 17-2: North-South Longitudinal Section of Pipeline-South Pipeline Block Model at E, Looking West Project No.: Page 17-18

141 Figure 17-3: Level Plan of Pipeline-South Pipeline Block Model at 4670 ft ASL Project No.: Page 17-19

142 Figure 17-4: East- West Cross Section of Crossroads Block Model, Looking North Project No.: Page 17-20

143 Figure 17-5: North-South Longitudinal Section of Crossroads Block Model, Looking West Project No.: Page 17-21

144 Figure 17-6: Level Plan of Crossroads Block Model at 4270 ft ASL Elevation Project No.: Page 17-22

145 Figure 17-7: East-West Cross Section of Gap Deposit Block Model at 57400N, Looking North Project No.: Page 17-23

146 Figure 17-8: North-South Longitudinal Section of Gap Deposit Block Model at 99300E, Looking West Project No.: Page 17-24

147 Figure 17-9: Level Plan of Gap Deposit Block Model at 5010 ft ASL Elevation Project No.: Page 17-30

148 17.4 Pediment and Cortez Hills Mineral Resource Model Introduction The Pediment and Cortez Hills deposits are in close proximity of each other and contain similar stratigraphic sections. Although the Pediment deposit is comprised mostly of mineralization in Roberts Mountains Formation displaced in a slide block, mineralized Wenban Limestone similar to mineralization at Cortez Hills exists beneath the Pediment deposit. Because of this, the deposits were modelled jointly. The Pediment deposit was discovered in 1998 with the discovery followed by an extensive drilling program. The deposit has been evaluated on a stand-alone basis and as providing supplementary feed to the current operations. The Cortez Hills deposit was initially discovered in After the completion of slightly more than 40 drill holes, a preliminary evaluation of the deposit was completed and a press release was issued disclosing the discovery of the Cortez Hills deposit in April The June 2004 resource model has been completed using data from 513 drill holes covering both deposits. Cortez Hills was estimated using assays from 67 RC holes and 100 core holes. Since mid-2004, additional drilling has been completed. This additional drilling was primarily for geotechnical, hydrological and condemnation information. The model used for the open pit evaluation has not been further updated. Drill sample assays have been combined into 10 ft down-the-hole length composites. As the original samples are generally 10 ft in length, the composites are essentially the original samples. The model block dimensions were set to 30 ft x 30 ft x 15 ft. Based on a midyear, 2004 update to the geological model of the Cortez Hills and Pediment deposits, lithological domains were split into discrete mineralized and unmineralized zones. Mineralized zones in the Cortez Hills deposit are contained within two oz/ton grade shells, one for the Wenban Formation and the other for mineralization in the underlying Roberts Mountains Formation. This was to allow use of either hard (no sharing of composites) or soft (sharing of composites allowed) boundaries in estimation. One grade domain was created for the Pediment deposit. The following domains were established within the grade shells: Cortez Hills Deposit - EST_DMN 2 = MIN DWH - Mineralized Horse Canyon Member of Wenban Limestone - EST_DMN 3 = MIN DW - Mineralized lower Wenban Limestone - EST_DMN 4 = MIN SRM - Mineralized Roberts Mountains Formation Pediment Deposit - EST_DMN 6 = PED_MIN - Pediment Mineralized Domain mostly QCS Project No.: Page 17-26

149 Both Deposits - EST_DMN 5 = TQP- Dikes not estimated - EST_DMN 8 = Out of Mineralized Domains Resource Model The resource model was built using regular 10 ft length composites created from the exploration data set. The composite dataset for Cortez Hills and Pediment consisted of 513 holes with 67,638 gold values. The maximum fire assay grade was oz/ton and the mean grade was oz/ton. A comparison of core and RC sample assays revealed that down-hole contamination locally occurred in RC holes. Core hole results were used to trim RC assays up hole. Trimmed assays were replaced with no sample designations. Composite gold values were trimmed to limit the influence of anomalous high grades in the estimate. The trimming limits were determined separately for each rock type in the model. Trimming limits were determined by examining the correlation of adjacent composites. The trimming limit was set at the point that the correlation went to zero. Trimming limits for each of the rock types are listed in Table Sample cross sections, longitudinal sections and level plans for the Pediment and Cortez Hills deposits, with ultimate pit outlines, are provided as Figures to Table 17-10: Cortez Hills Pediment Composite Trimming Limits Estimation Domain Trimming Limit (oz/ton) 2 Wenban Horse Cr. Member Wenban limestone Roberts Mountains Formation Pediment Deposit (QCS, QCL) Out of mineralization 1.0 Resources were estimated using ordinary kriging within the following domains and boundary conditions: All material outside mineralized zones in both the Cortez Hills and Pediment deposits were set to a code of 8 and the contact between domain 8 and other domains was treated as a hard boundary. Inside the mineralized zones the following boundary conditions were observed: - Rock codes DWH=2 and DW=3 were estimated with a soft boundary - Rock code SRM=4 was estimated with a hard boundary Project No.: Page 17-27

150 - Code Dike=5 was not estimated and grade was set to Rock code Ped_min=6 was estimated with a hard boundary - Samples from dikes were treated as internal waste and were used for estimation of DWH, DW and SRM. Project No.: Page 17-28

151 C O R T E Z P R O J E C T Figure 17-10: Plan Map of Cortez Hills and Pediment Deposits at 5750 ft Elevation Showing Block Model Grades Note: Figure supplied by CJV. Project No.: Page 17-29

152 Figure 17-11: East-West Cross Section of Cortez Hills Deposit at 28600N (Looking North), Showing Block Model Grades Note: Figure supplied by CJV. Project No.: Page 17-30

153 Figure 17-12: East-West Cross Section of Pediment Deposit at 26000N (Looking North), Showing Block Model Grades Project No.: Page 17-31

154 Figure 17-13: Longitudinal Section of Cortez Hills and Pediment Deposits (Looking East Southeast), Showing Block Model Grades Project No.: Page 17-32

155 Variogram analysis and modelling were performed to model the spatial continuity and distribution of gold grades. For the purposes of the variograms and modelling statistics, a broad outer boundary was placed around the mineralized portion of the deposit. This boundary is referred to as the EDA zone. All of the variograms are modelled with exponential variogram models. Variogram parameters for the mineralized zones are listed in Table Table 17-11: Variogram Summary Cortez Hills and Pediment Cortez Hills Pediment Domain 2 Domain 3 Domain 4 Domain 6 Ped Nugget Sill 0.33 / / / / 0.27 Range 135 / / / / 210 Azimuth Dip Plunge Prim. Aniso Sec. Aniso 1.0/ / / / 1.35 Vert. Aniso 1.59 / / / / 1.40 Note: Variogram parameters shown as 1 st structure / 2 nd structure, in accordance with OP conventions. The model was estimated with a minimum of four composites and a maximum of 16 composites. The estimate was limited to a maximum of eight samples per drill hole and a maximum of four samples per quadrant. The primary ore zones were estimated with a 220 ft search with the search ellipse oriented the same as the variograms for each zone Estimation of the Underground Resource Model A second model was estimated for the purposes of evaluating the underground resource associated with Cortez Hills. This model was built using a 10 ft x 10 ft x 10 ft block size. The smaller block size was chosen to allow a little higher resolution in the resource for assessment of potential underground mining of the deeper mineralization. The underground model was also estimated with a minimum of four composites and a maximum of 16 composites. The estimate was limited to a maximum of eight samples per drill hole and a maximum of four samples per quadrant. The primary ore zones were estimated with a 220 ft search with the search ellipse oriented the same as the variograms for each zone. The variograms were refitted for the underground model with three nested structures as opposed to two for the original model. The confidence limits for the estimated underground resource were estimated using conditional simulation. The objective of the simulation was to assess the kriging variance Project No.: Page 17-33

156 that would be equivalent to a year s worth of underground production (480 x 480 x 160 ft panel) known within ±20% with a 90% confidence. An estimation variance of 0.27 was chosen. The underground resource was summarized from the portion of the small block model under the open pit limits using a 0.2 oz/t cutoff and the 0.27 estimation variance limit. All of the underground resource was classified as Indicated. Comment Preliminary underground evaluations have been performed by CJV with the assistance of Placer Dome. These evaluations are sufficient to support the declaration of an underground resource. The preliminary evaluations were done using the large block open pit model. The resource has been summarized using the small block resource model. No engineering evaluations have been done using the small block model. The magnitude of the tons and grade of the two models are very similar. Therefore, it is believed that the small block model summary represents a reasonable estimate of the underground resource for Cortez Hills Estimation Validation The resource model was validated in a number of ways. The composites were compared to the blocks into which they fell. This provides a basic statistical validation of the model. These statistics are summarized in Table These statistics show that there is a slight low bias in the model in domains 2 (Horse Canyon member of Wenban Formation) and 3 (Wenban Formation limestones). Table 17-12: Cortez Hills Pediment Model Validation Cortez Hills Pediment Domain 2 DWH Domain 3 DW Domain 4 SRM Domain 6 Ped DH Mean DH Variance DH Coefficient of Var Model Mean Model Variance Model Coefficient of Var Theoretical Variance % Difference Model/Theoretical Coeff. Var. -30% 3% 4% -14% A second check was to calculate the amount of variance reduction observed within the model (Table 17-11). The theoretical variance was calculated assuming a 30 x 30 x 15 ft SMU. This comparison shows that Domain 2 (Horse Canyon member of Wenban Formation) is significantly oversmoothed, whereas Domains 3 (Wenban Formation Project No.: Page 17-34

157 limestone) and 4 (Roberts Mountains Formation) are undersmoothed. This can lead to a conditional bias in the reserve, especially in the presence of high-grade data. The model was also checked statistically to see if there was any excessive spatial smoothing within the model by comparing the ordinary kriged model to a nearest neighbour model within regular swaths. The check was run three times checking the model with eastwest oriented swaths, north-south swaths and horizontal swaths. In all cases, the amount of spatial smoothing of the estimate was minimal. The final check made to validate the reserve was to visually examine the model relative to the drilling. This was done in cross-section and in plan. The model appears to reasonably represent the data Conclusions and Recommendations The resource model for Cortez Hills and Pediment appears to provide a reasonable representation of the drill hole information. Standard industry practices were used in the estimation of the model. There is no production history to use to validate the model, but it has been statistically validated. These statistical validations show that the model should provide a reasonable estimate of the resource on a global basis. Domain 2 of Pipeline/South Pipeline and the Pediment model appears to be overly smoothed. As recent experience at Pipeline has shown, this can be problematical and lead to a significant over prediction of mill tons. AMEC recommends that future models attempt to provide a better match between the theoretical variance reduction and the model variance. This would minimize any problems that could arise for conditional biases in the estimate Cortez NW Deep Mineral Resource Estimate Introduction The Cortez NW Deep deposit is located in the historic Cortez Mining District among the pre-existing Cortez pit workings. These pits consist of small open pits, dumps, and stockpiles. Approximately one-half mile south of the Cortez #1 mill facilities, which were used to process production from the Cortez pit. Only drilling that was completed since 1989 was considered accurate enough to use in this evaluation. This drilling consists of 134 drill holes. The Cortez NW Deep resource was remodelled and evaluated in the first quarter of Previous evaluations had examined the resource as a combined open pit and underground operation. The current evaluation calls for open pit mining only. The resources quoted are based on a $450 per troy ounce gold price. The economic evaluation completed in 2003 Project No.: Page 17-35

158 showed that the Cortez NW Deep deposit would be economic at a $385 per troy ounce gold price Resource Model A total of 12,754 composites (10 ft intervals) were created from the drill hole assay data and were used to estimate the resource. The Cortez NW Deep model extends 2,500 ft east-west, 2,000 ft north-south, and 1,520 ft vertically. The model block size is 20 x 20 ft in plan by 20 ft vertically. Gold was estimated into the model using ordinary kriging. High-grade values were cut to 0.6 oz/ton. This affected nine composites, which had a maximum value of 0.3 oz/ton. Estimates were made using a minimum of four and a maximum of eight composites with a maximum of four composites per drill hole, a maximum of two composites per octant and a minimum of two informed octants. A sample cross-section, longitudinal section and level plan of the NW Deep block model are provided as Figures to The resource pit was designed using a gold price of US$450/oz. Project No.: Page 17-36

159 Figure 17-14: Southwest-Northeast Cross Section of Cortez NW Deep Deposit Block Model, Looking Northwest Project No.: Page 17-37

160 Figure 17-15: Southeast-Northwest Longitudinal Section of Cortez NW Deep Deposit Block Model, Looking Northeast Project No.: Page 17-38

161 Figure 17-16: Level Plan of Cortez NW Deep Deposit Block Model Project No.: Page 17-39

162 The boundaries between the siltstone, carbonaceous siltstone and dolomite have been treated as soft boundaries. The boundaries between all of the other rock types and the dikes are treated as hard boundaries. The search parameters used are summarized in Table The variogram parameters used for the estimate are shown in Table Table 17-13: Cortez NW Deep Search Parameters Siltstone Carbonaceous Dolomite Tertiary Dikes Sulphide Search Radius (ft) Azimuth (degrees) Dip (degrees) Plunge (degrees) Primary Anisotropy Secondary Anisotropy Vertical Anisotropy Table 17-14: Cortez NW Deep Variogram Parameters Siltstone Carbonaceous Dolomite Tertiary Dikes Sulphide Nugget Effect No. of Structures Ranges (ft) 95 / / / / / 320 Sills 0.65 / / / / / 0.04 Azimuth (degrees) Dip (degrees) Plunge Degrees) Primary Anisotropy / Secondary Anisotropy 1.90/ / / / / 1.21 Vertical Anisotropy 3.17 / / / / / 3.05 Note: Tabulated variogram parameters show 1 st structure / 2 nd structure, in accordance with OP conventions Model Validation No model validation statistics are available. The model was examined in cross-section and plan relative to the drilling. It appears that the model does a reasonable job of representing the drilling Recommendations and Conclusions The Cortez NW Deep resource model provides a reasonable estimate sufficient for the declaration of resources. It would be necessary to refine the model and the economic evaluation of the deposit prior to the declaration of a reserve for the deposit. Project No.: Page 17-40

163 The previous evaluations of the Cortez NW Deep zone examined both underground and open pit mining. The current evaluation calls for open pit mining only. The average strip ratio for the NW Deep resource is in excess of 5:1, with the marginal strip ratio certainly much greater. It may be reasonable to consider an underground option for the deposit Hilltop Mineral Resource Estimate Introduction The Hilltop deposit is controlled by the CJV and is located 12 miles north of the Cortez administrative and Mill #2 facilities. The main zone of the deposit is located on a hill and is surrounded by mountainous terrain in the central portion of the Shoshone Range. The Hilltop mine was first prospected in the 1860s and was actively mined between 1909 and The deposit was further explored by various companies in the 1960s, 1970s and 1980s. The CJV acquired the property in The CJV actively explored the deposit from the time of acquisition through 1997 at which time a resource model was produced and the deposit economically evaluated. Only minimal effort has been expended on the deposit since the 1997 evaluation. A new pit shell was produced using a $450 per troy ounce gold price for the summation of the resource Resource Model A total of 13,301 composites (10 ft intervals) were created from the drill hole assay data and were used to estimate the resource. The Hilltop model extends 5,360 ft east-west, 4,800 ft north-south, and 2,320 ft vertically. The model block size is 40 by 40 ft in plan by 20 ft vertically. Gold was estimated into the model using ordinary kriging. High-grade values were cut to 1.0 oz/ton, but this only affected one siltstone composite. Estimates were made using a minimum of five and a maximum of twelve composites with a maximum of six composites per drill hole, a maximum of three composites per octant and a minimum of two informed octants. The boundary between the Hilltop Main Zone and the other rock types was treated as a hard boundary with the other five rock types treated as a single unit. The search parameters used are summarized in Table The variogram parameters used for the estimate are shown in Table A sample cross-section, longitudinal section and level plan of the Hilltop resource block model are provided as Figures to Project No.: Page 17-41

164 C O R T E Z P R O J E C T Figure 17-17: East-West Cross Section of Hilltop Deposit Block Model, Looking North Project No.: Page 17-42

165 C O R T E Z P R O J E C T Figure 17-18: North-South Longitudinal Section of Hilltop Deposit Block Model, Looking West Project No.: Page 17-43

166 C O R T E Z P R O J E C T Figure 17-19: Level Plan of Hilltop Deposit Block Model Project No.: Page 17-44

167 Table 17-15: Hilltop Search Parameters Non Main Zone Main Zone Search Radius (ft) Azimuth (degrees) Dip (degrees) Plunge (degrees) Primary Anisotropy Secondary Anisotropy Vertical Anisotropy Table 17-16: Hilltop Variogram Parameters Non Main Zone Main Zone Nugget Effect No. of Structures 2 2 Ranges (ft) 72.4 / / Sills 0.28 / / Azimuth (degrees) Dip (degrees) Plunge Degrees) Primary Anisotropy Secondary Anisotropy Vertical Anisotropy Note: Tabulated variogram parameters show 1 st structure / 2 nd structure, in accordance with OP conventions Model Validation No model validation statistics are available. The model was examined in cross-section and plan relative to the drilling. It appears that the model does a reasonable job of representing the drilling Recommendations and Conclusions The Hilltop resource model provides a reasonable estimate sufficient for the declaration of an Indicated or Inferred resource. It would be necessary to refine the model and the economic evaluation of the deposit prior to the declaration of a reserve. Project No.: Page 17-45

168 17.7 Mineral Resource Classification Classification Parameters The classification of the mineral resource and reserves for the CJV was based primarily on the kriging estimation variance derived in the estimation of each particular blocks. The kriging estimation variance was used because it has a number of advantages compared to schemes such as distance to composites. The estimation variance is a function of the spatial configuration of the data used in the estimate. If the data are well distributed spatially, the estimation variance will be lower than is the data are clustered. Also, if the estimate is extrapolation away from data the estimation variance will quickly rise while if the estimate is interpolating between data the estimation variance will be stable. The absolute magnitude of the estimation variance will be a function of the variogram parameters used in the estimate. Therefore, a single estimation variance threshold cannot be chosen to be universally applied to all deposits. It is necessary to calibrate the estimation variance to a standard that will provide the level of confidence consistent with the classification of the resource. By reviewing cross sections and plans, geology and engineering personnel determined that Measured Resources are supported by assay composites no more than 80 ft from the estimated resource block. Indicated Resources are generally more than 80 ft but less than 150 ft from assay composites supporting the estimation. Any block with an average composite distance greater than 150 ft would be Inferred Resources. The estimation variance was examined in cross-section and plan view relative to the composite data used for the estimates and the thresholds chosen that would be relatively consistent with the distance criteria. Estimation variances are summarized in Table Table 17-17: Estimation Variance Thresholds for Classification of 2003 Mineral Resource Model Resource Category Estimation Variance Pipeline Measured 0.0 to 0.25 Indicated 0.26 to 0.55 Inferred Greater than 0.55 Cortez Hills /Pediment Measured 0.0 to 0.20 Indicated 0.21 to 0.45 Inferred Greater than 0.45 Northwest Deep Measured 0.0 to 0.60 Indicated 0.61 to 0.80 Inferred Greater than 0.80 The only exception to the use of estimation variance for classification is in the Hilltop resource. This model was built in 1997, prior to CJV adopting estimation variance as a classification criterion. For the Hilltop model, the classification was based on the search radii used with a two-pass kriging plan. Anything estimated using the initial pass was Project No.: Page 17-46

169 classified as Inferred. The search radii were expanded by 50 ft, and the additional blocks estimated were classified as Inferred Comments The classification parameters used by CJV have been reviewed by examining the models in cross-section and plan. AMEC believes that the mineral resource classification logic defined for CJV deposits to be sound and consistent with the CIM definitions referred to in National Instrument Its implementation at CJV were reviewed and found to be appropriately applied Mineral Reserve Estimation Pit optimization at the CJV is achieved using the routine OP60 (an implementation of the Lerchs-Grossmann Algorithm) within Placer Dome s in-house OP software system. OP60 allows the use of multiple slope domains based on the geology and a pre-determined profit/cost block model to estimate an optimal pit shell. The profit/cost block model is based on grade, recovery, and economic data, including: Gold resource model Different recovery models for each processing method (CIP milling, leaching, and roasting) and the distinctly different geological domains. Estimates of the block revenue are based on the block value less the estimated costs associated to produce the gold product and less the royalties due to others. The factors considered in establishing a block value are summarized in Table Table 17-18: Factors Considered in Establishing Individual Block Value Component Elements Considered Block Value Block Revenue Block Costs Royalties Block Revenue Grade x Volume x SG x Recovery x Gold Price Block Costs Mining + Processing + Overhead Royalties Idaho Mining Company 1.5% Gross Smelter Return: Subject to all production Royal Gold Inc. 0.4% to 5.0% Gross Smelter Return: Gold price dependent on and subject to Pipeline/South Pipeline production ECM Inc. 5.0% net value royalty, approximated by assuming 3.9% of gold sales from all South Pipeline production A cutoff grade is applied at a zero profit breakeven, and block profit or cost is attributed accordingly. Operating costs are dependent on the lithology and/or the ore/waste classification, and mining costs are incremented with depth below the pit rim. Project No.: Page 17-47

170 The optimal pit shell is smoothed to produce an operationally viable design using the VULCAN software package. Golder Associates has conducted extensive geotechnical studies on the Pipeline, South Pipeline, Crossroads, and Gap deposits. All four deposits are overlain with up to 100 m of alluvium material. The inter-ramp angles for alluvium are 49 at Pipeline and 50 at Cortez Hills/Pediment. In the Pipeline and South Pipeline deposits, final wall slopes in rock are designed with inter-ramp angles ranging from 34 to 50 depending on rock type and wall orientation. The geotechnical work on Crossroads and Gap in 2001 concluded that similar slope design criteria could be applied to these deposits. BGC Engineering Inc. (BGC) conducted a Feasibility Geotechnical Assessment of the Pediment pit in Detailed geotechnical and hydrological assessments of Cortez Hills were completed in 2004 and These recent assessments showed that the pit slopes for Cortez Hills would have to be much shallower than previously anticipated. Also, extensive dewatering of the pit walls would be necessary to maintain even the shallower slopes. Slope design and dewatering criteria were developed in support of the internally developed Cortez Hills feasibility study. The inter-ramp slope angles range from 28 to 45 depending on rock type and wall orientation. Currently, mine designs for all deposits include the following criteria: 10% maximum haul road grade 40 ft bench height on primary stripping benches, 50 ft in Cortez Hills and Pediment 20 ft bench height on ore benches, 25 ft in Cortez Hills and Pediment 110 ft wide haul roads bench face angles ranging from 50 to 70 depending on material type minimum mining width of 300 ft, although narrower widths can be mined over short distances. All pit optimizations were based on resource models developed during the fall of 2003 for Gap, Cortez NW Deep and Hilltop. Pit optimizations for Pipeline, South Pipeline, Cortez Hills and Pediment used resource models made in June The recovery and cost models were developed in conjunction with the 2003 budget plan and the life of mine (LOM) plan using a long-term gold price of US$350/oz. for the Pipeline complex. The recovery and cost models were developed in conjunction with the 2004 Feasibility Study using a long-term gold price of US$375/oz for Cortex Hills and Pediment Mineral Resource and Mineral Reserve Statements The CJV Mineral Reserves were established within pits using a 350 US$/oz gold price. Owing to the Reserve cut-off grade being close to analytical limits routinely achieved in a production setting, mine management has set the leach cut-off grade at oz/ton which sets the cutoff grade at a price much less than the present price or a three-year backward Project No.: Page 17-48

171 Table 17-19: Category average price. This results in a global reserve that is robust with respect to gold price. The CJV open pit mineral reserves for 1 September 2005 are shown in Table The cutoff grades and metallurgical recoveries are summarized in Table The mineral resources were summarized within pit shells generated at $450/oz. The Measured and Indicated Mineral Resources are summarized in Table and the Inferred Mineral Resources are summarized in Table All mineral resources are exclusive of mineral reserves. 1 September 2005 Proven and Probable Mineral Reserve Estimates for Cortez Joint Venture at $350 Gold Price Tons (000) Gold Grade (oz/ton) Tonnes (000) Gold Grade (g/t) Contained Troy Ounces (000) Proven Mineral Reserves Pipeline 54, , ,498 South Pipeline 64, , ,050 Gap 17, , Pediment 16, , Cortez Hills 25, , ,472 Stockpiles 2, , Total Proven Mineral Reserves 180, , ,193 Probable Mineral Reserves Pipeline 24, , South Pipeline 26, , Gap 14, , Pediment 21, , Cortez Hills 8, , Stockpiles Total Probable Mineral Reserves 95, , ,875 Proven & Probable Mineral Reserves Pipeline 78, , ,072 South Pipeline 90, , ,555 Gap 32, , Pediment 37, , ,238 Cortez Hills 33, , ,307 Stockpiles 2, , Total Proven & Probable Mineral Reserves 275, , ,068 Note: Figures for tons and tonnes are rounded to nearest thousands, therefore columns and rows may not total exactly. See table for cutoff grades used for each deposit and ore type. Project No.: Page 17-49

172 Table 17-20: Cutoff Grades and Recoveries Used in Mineral Resource and Mineral Reserve Estimates by Zone and Ore Type Area Zone Cutoff Grade (oz/ton) Cutoff Grade (g/t) Metallurgical Recovery (%) Pipeline/S. Pipeline Pipeline Oxide Leach Crossroads S. Pipeline Oxide Leach Crossroads Oxide Leach S. Pipeline O-zone Leach Gap Leach Gap Gossan/Marble Leach Pipeline Refractory S. Pipeline Refractory Crossroads Refractory Gap Gossan Mill S. Pipeline O-Zone Mill Pipeline Oxide Mill S. Pipeline Oxide Mill Crossroads Oxide Mill Gap Oxide Mill Roast Sales Pediment/Cortez Hills Pediment Leach Cortez Hills Leach Cortez Hills Mill Cortez Hills Mill underground Pediment Mill underground Pediment Mill Cortez Hills Refractory Pediment Refractory Cortez Hills Refractory UG Pediment Refractory UG Cortez NW Deep Mill Leach Roast Hilltop Oxide Leach Sulphide Leach Bio-Ox Leach Project No.: Page 17-50

173 Table 17-21: 1 September 2005 Measured + Indicated Mineral Resource Estimates for Cortez Joint Venture at $425 Gold Price 1 Area Tons (000) Gold Grade (oz/ton) Tonnes (000) Gold Grade (g/t) Contained Troy Ounces (000) Measured Mineral Resources Pipeline 8, , South Pipeline 22, , Gap 12, , Crossroads 81, , ,965 Cortez NW Deep 2, , ,000 Hilltop Total Measured Mineral Resources 128, , ,209 Indicated Mineral Resources Pipeline 6, , South Pipeline 11, , Gap 8, , Crossroads 26, , Cortez Hills underground 5, , ,422 Cortez NW Deep 2, , Hilltop 121, , ,292 Total Indicated Mineral Resources 180, , ,091 Measured + Indicated Resources Pipeline 15, , South Pipeline 33, , Gap 21, , Crossroads 107, , ,622 Cortez Hills underground 5, , ,422 Cortez NW Deep 4, , Hilltop 121, , ,292 Total Measured + Indicated Resources 309, , ,300 Notes: Mineral resources are exclusive to mineral reserves. Open pit resources are estimated within ultimate pits developed with a $425/oz gold price and a leach ore cutoff grade of oz/t. Underground resources are defined using cutoff grades for oxide and refractory gold calculated at a gold price of $425/oz and are bound by the outer limit of the resource model envelope. Columns do not total exactly due to rounding. Project No.: Page 17-51

174 Table 17-22: 1 September 2005 Inferred Mineral Resource Estimates for Cortez Joint Venture at $425 Gold Price 1 Contained Tons Gold Grade Tonnes Gold Grade Troy Ounces Area (000) (oz/ton) (000) (g/t) (000) Pipeline 2, , South Pipeline 2, , Gap Crossroads 1, , Pediment 3, , Cortez Hills 6, , Cortez Hills underground 4, , ,492 Cortez NW Deep Hilltop 18, , Total Inferred Mineral Resources 39, , , Mineral resources are contained within a preliminary pit designed at $450/oz gold price and cutoff grades noted in Table Mineral Resources are exclusive to mineral reserves. Figures for tons and tonnes are rounded to nearest thousand; therefore, columns may not total exactly. Project No.: Page 17-52

175 18.0 OTHER RELEVANT DATA AND INFORMATION There are no other data and information that are relevant to the Cortez Joint Venture. Project No.: Page 18-1

176 19.0 REQUIREMENTS FOR TECHNICAL REPORTS ON PRODUCTION AND DEVELOPMENT PROPERTIES 19.1 Open Pit Mining Operations All mining from currently scheduled ore reserves will be conducted by open pit methods, except for the lower portion of the Cortez Hills deposit. Mineralization beneath the 2005 design pit of Cortez Hills is being assessed for the potential for underground mining. This material is presently classified as an Indicated and Inferred Mineral Resource. The reserves will be mined from four separate open pits, namely: Pipeline pit, containing the Pipeline and South Pipeline ore bodies Gap pit Pediment pit, containing the Pediment ore body Cortez Hills/Pediment pit, containing the Cortez Hills and Pediment ore bodies The following pit design criteria are used for Pipeline and South Pipeline: 40 ft bench height on primary stripping benches and final walls 20 ft bench height on ore benches, 15 ft for Cortez Hills and Pediment alluvium inter-ramp wall slope angles are 49 at Pipeline and 50 at Cortez Hills/Pediment fresh rock inter-ramp wall slope angles range from 34 to 50 depending on material type and wall orientation bench face angles ranging from 50 to 70 depending on material type 10% maximum haul road grade 110 ft wide haul roads minimum mining width of 300 ft, but narrower widths are mined over short distances when unavoidable. The design criteria for Cortez Hills and Pediment are similar. The bench heights are designed at 50 ft for primary waste stripping and 25 ft for ore. The slope angles are generally much shallower at Cortez Hills because of the very fractured nature of the rock. Extensive geotechnical and hydrological studies have been carried out on Cortez Hills to establish the design criteria for the mining limits. The current criteria are significantly shallower than previously used. Also, extensive dewatering of the pit walls is called for. This redesign of the Cortez Hills pit has led to a net loss of reserves relative to previous disclosures. There is potential to recover the deeper mineralization with underground mining. The CJV is currently operating the Pipeline/South Pipeline open pit as using conventional open pit mining techniques. The pit has been mined since 1997 in several logical phases. Project No.: Page 19-1

177 Presently, a combination of stages 3, 5, 7, and 8 are being mined. Phase 9 remains to be mined in the Pipeline and South Pipeline deposits. The Cortez Hills, Pediment, and Gap reserves currently remain to be mined. Waste stripping in Phase 8 is currently being mined on 50 ft benches and it is anticipated that the ore will be mined in 25 ft benches. This is being done to improve mining costs but also to demonstrate the feasibility of converting to the larger benches. The bulk of the mining equipment used by the CJV was purchased in 1996 for use in the mining the Pipeline and South Pipeline deposits. An additional shovel, additional trucks and support equipment were purchased in late 2004 and early 2005 to facilitate the mining of Phases 8 and 9. Table 19-1 is a summary of the equipment currently in use. Table 19-1: Current Mining Equipment Quantity Equipment Description Year of Purchase 15 Komatsu 830E Trucks Komatsu 930E Truck Komatsu 903E II Trucks Liebherr 282B Trucks P&H 2800 Electric Shovels 1996, Demag 285S Hydraulic Shovel LeTourneau 1850 Loader (leased) Driltech DM75 Drills Drilltech D55K Komatsu DZ475 Dozer Caterpillar D10 Dozer 1998, Caterpillar D9 Dozer 1996, Caterpillar Tiger Rubber Tired Dozer Caterpillar 854 RTD Caterpillar 16H Motor Grader Caterpillar 24G Motor Grader Komatsu 630E Water Truck Komatsu 330M Water Truck Caterpillar 777C Water Truck 2002 The mining is accomplished with a typical drill, blast, load, and haul cycle. All mine material is blasted. The mill ore is hauled and direct dumped into the primary crusher. All leach material is placed directly on the leach pad. A small portion of the ore is stockpiled to ensure consistent crusher feed. Refractory ore is also stockpiled and sold for processing off site. The waste is hauled and placed in permanent waste dumps. At the time of mining, ore and waste are segregated based on modelling of blast hole assays. A production block model is built using ordinary kriging of the blast hole data. The ore and waste zones are flagged in the field to provide visual production control for the equipment operators. Mine plans consist of monthly plans for the following two years Project No.: Page 19-2

178 followed by quarterly plans for the next two years, and annual plans for the remainder of the mine life. The detailed planning process includes scheduling of major equipment moves and equipment hours to ensure the viability of the plans. Mining operations are conducted 24 hours per day, 7 days per week. Total mine production was 70 M tons in 2004 and is on a pace for a total of 90 M tons in Average annual mine production tonnage is 93 Mt ore and waste. Waste is dumped in large waste dumps up to 250 ft in height outside potential open pit limits. Mill-grade ore is either dumped directly into a primary crusher or stockpiled for later rehandling. Leach grade ore is placed directly on heap leach pads, and roast ore is stockpiled for processing at third-party facilities. Lower-grade stockpiles are also maintained to allow for processing if commodity prices escalate. The Pipeline pit and site facilities are illustrated in Figure Mining phases for Pipeline are shown in Figure An outline of the Pipeline ultimate pit is illustrated in Figure The Pipeline pit is currently producing ore from Phase 3 and the pit will be completed in Phase 9. The Pediment pit and adjacent Cortez pit will be mined in multiple phases. CJV and Placer Dome personnel recently completed an internal Feasibility Study for the surface mining of the Cortez Hills and Pediment deposits. The feasibility study was completed to a level of detail consistent with industry practices. The Cortez Hills and Pediment ultimate pit is shown in Figure Because of adverse geotechnical constraints on the open pit, a significant portion of the high grade at Cortez Hills is not amenable to surface mining and, if to be extracted, this mineralization must be mined from underground. CJV has completed preliminary assessments of the amenability to underground mining of the high grade material located below the open pit. This work demonstrated that there is potential for economic extraction of the resource. The CJV intends to develop a decline under the Cortez Hills open pit in order to more fully explore the underground potential of the deposit. In addition to exploration, the adit may be utilized to develop an underground drainage system for the use in open pit slope depressurization. The Gap deposit will be mined in two phases. The Gap ultimate pit outline is provided as Figure The remaining mine life is 13 years (9 years of mining and 13 years of processing, to 2018). Project No.: Page 19-3

179 Comment The Pipeline Reserve contains Mill and Heap Leach components with the majority of the remaining contained ounces and tons being attributable to the Heap Leach. Consistent with long term planning since its discovery, as the amount of Mill Reserve decreases mine management is dynamically managing the Mill:Heap Leach cut-off to optimize gold recovery and economic value. To this end, low grade material, historically designated as (better grade) Heap Leach material, is currently being stockpiled for mill processing in The performance of the deposit relative to the Reserve estimate is an important issue in estimating when the Pipeline deposit will exhaust its Mill Reserve. Underperformance of the high value Mill Reserve could impact the economics of the Stage 8 and 9 pit stages. Because of its significance the matter of Reserve performance should be re-examined in the context of new resource estimates and mine designs at year end. A substantial portion of the economic value of Phase 8 and a much more significant portion of the value of Phase 9 are predicated on the processing of refractory ores using an alternative mill process for which considerable bench tests have been undertaken. The process is presently proprietary to Placer Dome. Pilot-scale tests have not yet been performed at site using Pipeline or South Pipeline refractory ore. The lack of comprehensive, pilot-scale tests with this proprietary technology and the uncertainty of the performance of the present resource model with respect to predicting mill tonnes and grade places in Phases 8 and 9 lowers the confidence in these reserves. These modifying factors may justify a reclassification of Proven Mineral Reserves to Probable Mineral Reserves for the two phases. This affects approximately 118 million tons (107 million tonnes) of ore containing 3.5 million ounces gold. AMEC recommends that this adjustment be made in the next update of reserves. The net effect would be only a reclassification and not a reduction in reserves. Project No.: Page 19-4

180 Pipe Legend 16" LINE CONTINUES TO MILL AND PROCESS 6" LINE CONTINUES TO CRUSHER AREA 24" Reducer Water Truck Stand-Pipe P LACER D OME I NC. C O R T E Z P R O J E C T Figure 19-1: Layout of Pipeline Mining Operations Tailing Facilities Exfiltration Area Exfiltration Area Gold Acres Pit Pipeline Mill Site Pipeline Leach Pads Exfiltration Area Gold Acres Leach Pad Pipeline Pit Pipeline Waste Dump Kilometers 3 Exfiltration Area Exfiltration Area Exfiltration Area Exfiltration Area Cortez Mine Site ) October Placer Dome Inc. Cortez Mine Scale 1mm=125m 1999 Project No.: Page 19-5

181 C O R T E Z P R O J E C T Figure 19-2: Pipeline Mining Phases Project No.: Page 19-6

182 C O R T E Z P R O J E C T Figure 19-3: Pipeline and Gap Ultimate Pit Outlines Project No.: Page 19-7

183 C O R T E Z P R O J E C T Figure 19-4: Layout of Infrastructure for Cortez Hills and Pediment Pits Project No.: Page 19-8

184 C O R T E Z P R O J E C T Figure 19-5: Pediment and Cortez Hills Ultimate Pits Project No.: Page 19-9