Feasibility Study Yukon, Canada Prepared By: Conrad Huss, P.E
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M3-PN120001 25 January 2013 Casino Project Form 43-101F1 Technical Report Feasibility Study Yukon, Canada Prepared by: Conrad Huss, P.E. Thomas Drielick, P.E. Jeff Austin, P.Eng. Gary Giroux, P.Eng. Scott Casselman, P. Geo. Graham Greenaway, P.Eng. Mike Hester, F Aus IMM Jesse Duke, P. Geo. Revision 1 Prepared For: M3 Engineering & Technology Corporation ● 2051 West Sunset Road, Tucson, AZ 85704 ● 520.293.1488 CASINO PROJECT FEASIBILITY STUDY DATE AND SIGNATURES PAGE This report is current as of 25 January 2013. “Conrad Huss, P.E.” 25 January 2013 Signature Date The Certificates of Qualified Persons are included in Appendix A. M3-PN120001 25 January 2013 Revision 1 i CASINO PROJECT FEASIBILITY STUDY CASINO PROJECT FORM 43-101F1 TECHNICAL REPORT FEASIBILITY STUDY TABLE OF CONTENTS SECTION PAGE DATE AND SIGNATURES PAGE .................................................................................................. I TABLE OF CONTENTS................................................................................................................... II LIST OF FIGURES AND ILLUSTRATIONS ............................................................................. XI LIST OF TABLES ........................................................................................................................ XIII 1 SUMMARY ............................................................................................................................. 1 1.1 KEY DATA .................................................................................................................... 1 1.2 PROPERTY DESCRIPTION AND OWNERSHIP ............................................................... 2 1.3 GEOLOGY ..................................................................................................................... 2 1.4 MINERALIZATION ........................................................................................................ 3 1.5 EXPLORATION STATUS ................................................................................................ 4 1.6 DEVELOPMENT AND OPERATIONS .............................................................................. 4 1.6.1 Mining and Processing ........................................................................... 4 1.6.2 Metallurgical Testing and Metal Recoveries ....................................... 5 1.6.3 Infrastructure .......................................................................................... 5 1.6.4 Permits ..................................................................................................... 7 1.7 MINERAL RESOURCE AND MINERAL RESERVE ESTIMATES ..................................... 7 1.7.1 Metal Pricing ........................................................................................... 7 1.7.2 Mineral Resource.................................................................................... 8 1.7.3 Mineral Reserve ...................................................................................... 8 1.8 COSTS AND FINANCIAL DATA...................................................................................... 9 1.8.1 Capital Cost Estimate ............................................................................ 9 1.8.2 Operating Cost Estimate...................................................................... 10 1.8.3 Financial Analysis ................................................................................. 10 1.9 CONCLUSIONS AND RECOMMENDATIONS................................................................. 11 2 INTRODUCTION ................................................................................................................ 15 2.1 ISSUER AND PURPOSE OF ISSUE ................................................................................. 15 2.2 SOURCES OF INFORMATION ...................................................................................... 15 2.3 PERSONAL INSPECTIONS ............................................................................................ 16 2.4 UNITS .......................................................................................................................... 17 M3-PN120001 25 January 2013 Revision 1 ii CASINO PROJECT FEASIBILITY STUDY 3 RELIANCE ON OTHER EXPERTS ................................................................................. 19 3.1 METALLURGY AND PROCESS ENGINEERING ............................................................ 19 3.2 TRANSPORTATION...................................................................................................... 20 4 PROPERTY DESCRIPTION AND LOCATION ............................................................ 21 4.1 LOCATION .................................................................................................................. 21 4.2 LAND POSITION AND STATUS .................................................................................... 22 4.2.1 Property Description ............................................................................ 22 4.2.2 Environmental ...................................................................................... 22 4.2.3 Mineral Tenure ..................................................................................... 22 4.2.4 Option Agreements ............................................................................... 23 4.2.5 Agreements and Royalties ................................................................... 23 4.2.6 Placer Claims ........................................................................................ 24 5 ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE AND PHYSIOGRAPHY ...................................................................................................... 26 5.1 ACCESSIBILITY ........................................................................................................... 26 5.2 PHYSIOGRAPHY .......................................................................................................... 26 5.3 CLIMATE .................................................................................................................... 26 5.4 TRANSPORTATION AND SHIPPING ............................................................................. 27 5.5 WATER RIGHTS.......................................................................................................... 28 5.6 POWER AVAILABILITY .............................................................................................. 28 5.7 MINING PERSONNEL .................................................................................................. 28 5.8 AVAILABLE LAND AND RIGHTS OF WAY .................................................................. 28 6 HISTORY .............................................................................................................................. 29 7 GEOLOGICAL SETTING AND MINERALIZATION ................................................. 32 7.1 GEOLOGICAL SETTING .............................................................................................. 32 7.2 MINERALIZATION ...................................................................................................... 35 7.2.1 Hydrothermal Alteration ..................................................................... 35 7.2.2 Supergene Mineralization .................................................................... 36 7.2.3 Hypogene Mineralization .................................................................... 37 8 DEPOSIT TYPES ................................................................................................................. 39 8.1 GEOLOGY OF THE CASINO DEPOSIT ......................................................................... 39 8.2 LOCAL GEOLOGY ...................................................................................................... 40 8.2.1 Yukon Metamorphic Complex, Wolverine Creek Metamorphic Suite (YM) ..................................................................... 42 8.2.2 Dawson Range Batholith ..................................................................... 43 M3-PN120001 25 January 2013 Revision 1 iii CASINO PROJECT FEASIBILITY STUDY 8.2.3 Prospector Mountain Plutonic Suite – Casino Plutonic Suite ......... 43 8.2.4 Property-Scale Structure ..................................................................... 45 9 EXPLORATION ................................................................................................................... 47 9.1 EXPLORATION TECHNIQUES ..................................................................................... 47 9.2 2008-2012 EXPLORATION PROGRAM ....................................................................... 47 9.2.1 2008 Drilling Program ......................................................................... 47 9.2.2 2009 Titan TM Geophysical Survey ................................................... 47 9.2.3 2009 Drilling Program ......................................................................... 48 9.2.4 2010 Drilling Program ......................................................................... 48 9.2.5 2010 Re-logging Program .................................................................... 48 9.2.6 2011 Exploration / Geotechnical Program ........................................ 50 9.2.7 2012 Metallurgical Sampling and Geotechnical Program ............... 50 10 DRILLING ...........................................................................................................................