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Dalradian Resources Inc. a Preliminary Economic D A L R A DI A N R ESO UR C ES IN C. A PR E L I M IN A R Y E C O N O M I C ASSESSM E N T O F T H E C URR A G H IN A L T G O L D D EPOSI T, T Y R O N E PR OJE C T, N O R T H E RN IR E L A ND SEPT E M B E R 6, 2012 E F F E C T I V E D A T E (R ESO UR C E): N O V E M B E R 30, 2011 E F F E C T I V E D A T E (PE A): JU L Y 25, 2012 B. T E RR E N C E H E NNESSE Y, P.G E O. B A RN A RD F O O, P.E N G. B O G D A N '$0-$129,û3(1* A NDR É V I L L E N E U V E, P.E N G. C H RIST OPH E R JA C O BS, C Eng M I M M M Final SUITE 900 - 390 BAY STREET, TORONTO ONTARIO, CANADA M5H 2Y2 Telephone (1) (416) 362-5135 Fax (1) (416) 362 5763 Table of Contents Page 1.0 SU M M A R Y ................................................................................................................... 1 1.1 SCOPE OF WORK .......................................................................................................... 1 1.2 LOCATION AND DESCRIPTION ...................................................................................... 1 1.3 GEOLOGY AND MINERALIZATION ................................................................................ 3 1.4 HISTORY ...................................................................................................................... 5 1.5 EXPLORATION .............................................................................................................. 6 1.6 MINERAL RESOURCES .................................................................................................. 6 1.7 MINING ........................................................................................................................ 8 1.8 METALLURGY AND PROCESSING ................................................................................ 13 1.8.1 Mineralogy and Metallurgical Testing .............................................................. 13 1.8.2 Process Flowsheets Considered ........................................................................ 13 1.8.3 Process Description (Option A) ........................................................................ 15 1.8.4 Process Description (Option D) ........................................................................ 16 1.8.5 Process Manpower ............................................................................................ 16 1.9 INFRASTRUCTURE ...................................................................................................... 17 1.9.1 Access and Site Roads ...................................................................................... 17 1.9.2 Power Supply .................................................................................................... 18 1.9.3 Water Supply ..................................................................................................... 18 1.9.4 Tailings Storage Facility ................................................................................... 18 1.10 ENVIRONMENTAL, PERMITTING AND SOCIAL ............................................................. 18 1.10.1 Studies and Issues ............................................................................................. 18 1.10.2 Waste and Water Management ......................................................................... 19 1.10.3 Social Management ........................................................................................... 20 1.10.4 Permits .............................................................................................................. 20 1.10.5 Closure .............................................................................................................. 21 1.11 CAPITAL AND OPERATING COST ESTIMATES .............................................................. 22 1.11.1 Capital Costs ..................................................................................................... 22 1.11.2 Operating Costs ................................................................................................. 23 1.12 ECONOMIC ANALYSIS AND SENSITIVITY STUDIES ...................................................... 23 1.12.1 Basis of Evaluation ........................................................................................... 23 1.12.2 Macro-economic Assumptions ......................................................................... 24 1.12.3 Technical Assumptions ..................................................................................... 26 1.12.4 Sensitivity Study ............................................................................................... 32 1.13 CONCLUSIONS ............................................................................................................ 35 1.14 RECOMMENDATIONS .................................................................................................. 36 2.0 IN T R O DU C T I O N ....................................................................................................... 39 3.0 R E L I A N C E O N O T H E R E XPE R TS ........................................................................ 41 4.0 PR OPE R T Y D ESC RIPT I O N A ND L O C A T I O N ................................................... 42 ii 4.1 LOCATION .................................................................................................................. 42 4.2 DESCRIPTION ............................................................................................................. 43 4.3 LOCATION OF MINERALIZED ZONES .......................................................................... 46 4.4 PERMITS ..................................................................................................................... 48 4.5 ENVIRONMENTAL CONSIDERATIONS .......................................................................... 48 5.0 A C C ESSIBI L I T Y, C L I M A T E, L O C A L R ESO UR C ES, IN FR AST RU C T UR E A ND PH YSI O G R APH Y ...................................................... 49 6.0 H IST O R Y .................................................................................................................... 51 6.1 ACQUISITION HISTORY............................................................................................... 51 6.2 EXPLORATION HISTORY ............................................................................................. 52 6.3 HISTORICAL MINERAL RESOURCE ESTIMATES ........................................................... 56 6.4 HISTORICAL PRODUCTION .......................................................................................... 57 7.0 G E O L O G I C A L SE T T IN G A ND M IN E R A L I Z A T I O N ......................................... 58 7.1 REGIONAL GEOLOGY ................................................................................................. 58 7.2 PROPERTY GEOLOGY ................................................................................................. 59 7.2.1 Curraghinalt Gold Deposit Area - Licence DG1............................................... 59 7.2.2 Licence DG2 - Tyrone Volcanic Group ............................................................ 67 7.2.3 DG3 and DG4 Licences .................................................................................... 70 7.3 MINERALIZATION ....................................................................................................... 74 7.3.1 The Curraghinalt deposit ................................................................................... 74 7.3.2 The Tyrone Volcanic Group ............................................................................. 78 8.0 D EPOSI T T YPES ....................................................................................................... 82 8.1 THE CURRAGHINALT DEPOSIT ................................................................................... 82 8.2 THE TYRONE IGNEOUS COMPLEX .............................................................................. 83 9.0 E XPL O R A T I O N ......................................................................................................... 85 9.1 NICKELODEON/NAVIGATOR/STRONGBOW 1997 - 2003 ............................................. 85 9.2 TOURNIGAN EXPLORATION, 2003 - JANUARY, 2005 .................................................. 86 9.3 TOURNIGAN EXPLORATION FROM JANUARY, 2005 .................................................... 87 9.4 TOURNIGAN EXPLORATION 2007 TO 2009 ................................................................. 88 9.5 DALRADIAN RESOURCES EXPLORATION .................................................................... 90 10.0 DRI L L IN G .................................................................................................................. 97 10.1 TOURNIGAN DRILL PROGRAMS .................................................................................. 97 10.2 DALRADIAN RESOURCES DRILLING ........................................................................... 99 10.3 CORE LOGGING ........................................................................................................ 106 11.0 SA MPL E PR EPA R A T I O N, A N A L YSES A ND SE C URI T Y ............................... 109 11.1 SAMPLING ................................................................................................................ 109 11.2 SAMPLE ANALYSES .................................................................................................. 110 iii 11.3 SAMPLE SECURITY ..................................................................................................
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