Although the Ministry of the Economy has exercised all reasonable care in the compilation, interpretation, and production of this report, it is not possible to ensure total accuracy, and all persons who rely on the information contained herein do so at their own risk. The Ministry of the Economy and the Government of Saskatchewan do not accept liability for any errors, omissions or inaccuracies that may be included in, or derived from, this report.

Information from this publication may be used if credit is given. It is recommended that reference to this publication be made in the following form: Saskatchewan Ministry of the Economy (2017): Saskatchewan Exploration and Development Highlights 2017; Saskatchewan Geological Survey, Saskatchewan Ministry of the Economy, Miscellaneous Report 2017-2, 16p.

To use information from one of the tables, reference to the table should be made in the following form: Saskatchewan Ministry of the Economy (2017): Production totals for current gold mining operations and published Reserves/Resources for selected gold deposits in Saskatchewan; Table 4 in Exploration and Development Highlights 2017, Saskatchewan Geological Survey, Saskatchewan Ministry of the Economy, Miscellaneous Report 2017-2, p.10.

Cover photo courtesy of K+S Corp.: Aerial view of the new K+S Bethune potash mine (formerly Legacy Project), northwest of Regina, commissioned in May 2017.

This volume may be downloaded from: http://www.publications.gov.sk.ca/deplist.cfm?d=310&c=4896

Saskatchewan Exploration and Development Highlights 2017 Compiled by Staff of the Saskatchewan Ministry of the Economy

1. GENERAL OVERVIEW In 2016, Saskatchewan remained a global mining leader, retaining its positions as the world’s top potash mining jurisdiction and the second-largest producer of primary uranium. Saskatchewan’s unique geology and mineral endowment continue to draw international attention from major mining companies, and the province is quickly gaining recognition as a destination to do business.

In its 2016 Annual Survey of Mining Companies, the Fraser Institute, a Canadian public policy think tank, declared Saskatchewan the world’s most attractive jurisdiction for mineral exploration investment. Saskatchewan ranked first out of 104 global mining jurisdictions in the survey’s Investment Attractiveness Index, which rates mining jurisdictions based on a combination of their geologic attractiveness and their Policy Perception Index, a composite measure of the effects of government policy on attitudes toward exploration investment.

In a similar vote of confidence, The Mining Journal, a global mining business magazine that has been in circulation since the mid 1800s, recently released its World Risk Report for security of investments in resource capital. The survey compared 85 jurisdictions around the Value of 2016 Mineral Sales = $6.4 Cdn world and ranked Saskatchewan first in its Investment Billion Risk Index. The index reflects hard risk factors such as mining codes, taxes and regulations, infrastructure $0.3 and energy security, along with public perception $1.9 factors such as ease of doing business, political transparency and social stability.

The value of mineral sales in Saskatchewan, mostly from potash and uranium, was approximately $6.4 billion (B) in 2016 (Figure 1), down from $8.2 B in $4.2 2015 and $7.3 B in 2014. The decrease can be Potash Uranium Other primarily attributed to lower realized potash prices. The province also had production of coal, gold, base metals, sodium and potassium sulfate, kaolin and Figure 1 – Value of mineral sales in other clay products. Natural Resources Canada Saskatchewan for 2016. (NRCan) estimated that Saskatchewan accounted for 13.6% of national mineral sales value in 2016, fourth highest in the country.

In its annual survey of mining companies active in the province, the Saskatchewan Ministry of the Economy determined that an estimated $177 million (M) was planned on mineral exploration programs in 2017. This compares to actual confirmed expenditures of $199 M in 2016, $211 M in 2015 and $216 M in 2014 (Table 1). Most of the 2017 expenditures were planned for uranium and potash, but also reflect a renewed interest in base and precious metals. It is anticipated that provincial expenditures will continue to decline over the coming years as a number of potash projects move past the capital-intensive exploration/evaluation phases. In a separate Canada-wide survey, NRCan found that national expenditures for mineral exploration plus deposit appraisals would be approximately $1.85 B in 2017, down significantly from $4.23 B in 2011. NRCan estimated that Saskatchewan’s portion of these expenditures will constitute approximately 10.5%, the fourth-highest total in the country, behind Ontario, Quebec and British Columbia. NRCan also reported that Saskatchewan continued to lead all provinces in 2016 with capital investments in the mineral extraction sector, representing nearly 26% of national expenditures.

Saskatchewan Exploration and 1 Saskatchewan Geological Survey Development Highlights 2017 Saskatchewan Ministry of the Economy Table 1 – Mineral exploration expenditures in Saskatchewan. Data in the histogram compare actual historical expenditures to estimates (e) for 2017, compiled from the annual survey of exploration expenditures by the Ministry of the Economy’s Saskatchewan Geological Survey. Tabulated data are from the same survey. All values are in millions of Canadian dollars ($M).

180.0

160.0 2012 140.0 2013 2014 120.0 2015 100.0 2016

$M 80.0 2017e

60.0

40.0

20.0

0.0 Uranium Diamonds Gold Base Metals/PGM Industrial Minerals

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017e Uranium 204.4 108.6 103.2 101.2 115.8 143.8 138.7 136.1 156.1 132.4 Diamonds 73.2 10.9 17.3 7.9 5.2 4.2 3.6 17.3 9.2 3.8 Gold 8.9 3.0 9.5 10.5 13.1 6.3 6.0 2.2 6.2 4.9 Base Metals/PGM 1,3 6.8 3.0 6.5 13.3 13.0 7.8 2.9 3.8 0.5 6.4 Industrial Minerals 2 180.7 151.2 184.0 160.3 176.5 74.3 64.6 51.5 26.7 29.4

Total 473.9 276.6 320.5 293.2 323.6 236.4 215.7 211.0 198.8 176.9

1 Platinum group metals

2 Includes rare earth elements, potash and clays.

3 Base metals and platinum group metals combined to maintain confidentiality standards.

In the spring of 2017 the Ministry of the Economy completed an initiative to digitize all publicly available mineral assessment files. As a result of this large scanning project, clients now have digital access to over 11 000 historical work assessment reports from across the province. The initial response from industry has been quite positive, with downloads from the Saskatchewan Mineral Assessment Database (SMAD) increasing dramatically over the past several months.

As of the end of September 2017, active mineral dispositions in the province (issued pursuant to The Mineral Tenure Registry Regulations) totalled 5.6 M hectares (ha), down from the 8.1 M ha held at the same time one year ago. A moratorium on staking lapsed mineral claims has now been lifted in the province, and disposition numbers are once again on the rise. Over 300 000 ha have been staked through the province’s online Mineral Administration Registry Saskatchewan (MARS) since the re-openings began in July, 2017. Total active potash dispositions (comprising permits and leases issued pursuant to The Subsurface Mineral Tenure Regulations) remained steady at 116 dispositions, totalling ~2.8 M ha, compared to 118 dispositions, totalling 2.9 M ha, one year ago. In total more than 8.5 M ha of land is currently held in the province under the mineral, potash, coal, quarry and alkali disposition regulations.

Saskatchewan remained the world’s second-largest primary uranium producer in 2016, contributing approximately 22.5% of the global supply. The majority of the 36.4 million pounds (M lb) U3O8 came from the world’s two largest uranium mines, McArthur River and Cigar Lake, with a minor contribution from the Eagle Point mine at Rabbit Lake, which was placed on care and maintenance in April 2016. Forecasts for 2017 suggest production will remain steady, with approximately 34.4 M lb anticipated from the two active operations. Heading into 2018, production is expected to decrease significantly as recently announced a 10 month inventory-control shutdown of the McArthur River / Key Lake operation. Robust exploration programs are ongoing in the eastern and southwestern parts of the Athabasca Basin, where companies are anticipated to spend over $130 M in 2017 on a variety of uranium projects.

Saskatchewan Exploration and 2 Saskatchewan Geological Survey Development Highlights 2017 Saskatchewan Ministry of the Economy SSR Mining Inc. (SSR) recorded its third straight year of record production at the Seabee mining operation, which includes the Seabee and Santoy underground mines, producing 77,650 Troy ounces of gold in 2016. Through the first three quarters of 2017 the company continued to have strong production and SSR recently announced plans to invest $90 M to boost production at the facility by an average of about 30% over the next seven years. A number of junior companies are also advancing gold projects in the Seabee region, as well as other parts of the province. Nearly $5 M will be spent on gold exploration projects in 2017 with an additional $6 M directed towards base metal and platinum group metal projects.

The most advanced diamond play in Saskatchewan continues to be the Star-Orion South kimberlite project, which has been subject to about half a billion dollars worth of exploration and evaluation over the years. Shore Gold Inc. (Shore) is continuing to advance the project through environmental approvals while conducting additional drilling to shore up confidence in its geological modelling and resource estimates. In June of 2017, Shore acquired all of Newmont Canada FN Holdings ULC’s (Newmont) remaining interest (31%) in the project and at the same time entered into an option to joint venture agreement with Exploration Canada Inc. (RTEC). Under this agreement, RTEC has the option to earn up to a 60% interest in the project by investing approximately $70 M over the next 7.5 years. North Arrow Minerals Inc. is continuing work on its Pikoo project, while a number of other companies are undertaking grassroots diamond exploration.

Saskatchewan retained its position as the world’s largest potash jurisdiction in 2016, producing about 17.9 million tonnes (Mt) KCl, which accounted for approximately 28% of the world’s supply. Average realized potash prices have shown some signs of improvement in 2017, and the volume of potash sales has continued to be strong throughout the year. Thanks in large part to stronger offshore sales, potash production in the province is expected to meet or exceed record levels in 2017. The landscape of the potash production industry in Saskatchewan continues to evolve, most notably with the announcement of a planned merger betwen Potash Corporation of Saskatchewan (PotashCorp) and Agrium Inc. (Agrium). Pending approvals, the resulting company, to be named , will be a global agricultural giant worth an estimated US$36 B. Saskatchewan also welcomed its first new potash mine in nearly 50 years, as K+S Potash Canada Inc. commissioned the Bethune mine (formerly called the Legacy project) in May of 2017. A number of other companies, both major and junior, are continuing to advance potash projects through the feasibility stages as they search for development capital.

2. INTRODUCTION This report is a review of current activity only. Geology, and Mineral and Petroleum Resources of Saskatchewan (Saskatchewan Geological Survey, 2003) provides a more comprehensive summary of the economic geology of the province, including historical reserve and production data. For up-to-date information on all Saskatchewan mineral occurrences, refer to the Saskatchewan Mining and Petroleum GeoAtlas (http://publications.gov.sk.ca/details.cfm? p=83518) and the Saskatchewan Mineral Deposits Index (http://applications.saskatchewan.ca/mineral-deposit- index).

All information contained in this document is from publicly available sources. Exploration expenditure forecasts are compiled from an annual survey conducted by geologists of the Saskatchewan Geological Survey, Saskatchewan Ministry of the Economy. Actual annual expenditures for previous years are from the same survey. Grade, tonnage, reserve, and resource data reported herein are from a variety of public sources including: published reports, public records, corporate websites, securities filings, and Saskatchewan Mining Association facts sheets. These data may not necessarily conform to the current Canadian Institute of Mining and Metallurgy and NI 43-101 standards required by Canadian securities regulators for publicly reporting companies. Although the contained information has been carefully compiled, the Saskatchewan Ministry of the Economy and the Government of Saskatchewan do not accept liability for any errors, omissions or inaccuracies that may be included in, or derived from, this report. Nor does the Saskatchewan Ministry of the Economy and the Government of Saskatchewan recommend or endorse any of the projects described in this document.

This document is an attempt to capture relevant information current as of October 10, 2017. Information released after this date may or may not be present in the document. Only active exploration and development projects are

Saskatchewan Exploration and 3 Saskatchewan Geological Survey Development Highlights 2017 Saskatchewan Ministry of the Economy included. Due to the current rapid pace of exploration, it is inevitable that significant new activities have occurred since printing.

Tables 3 and 4 contain data on the current mineable reserves and geologic resources for the active uranium and gold properties in the province, respectively. The last page is a colour map, showing the locations of properties discussed herein. The map also outlines the general mineral and hydrocarbon potential of the province and shows the lithotectonic elements of the Canadian Shield in northern Saskatchewan.

3. THE ENERGY AND MINERALS SECTOR The energy and mineral extraction sectors are critical components of the Saskatchewan economy, accounting for 20.5% of the provincial Saskatchewan Real Gross Domestic Product Gross Domestic Product (GDP) ($58.9 B) in 2016 (Figure 2). The at Basic Price, by Industry, 2016

natural resource sectors’ share of the provincial GDP has increased Agriculture, Other Forestry, annually from 13.3% of the provincial GDP in 2010 to 21.8% in 2014, Services Fishing & Industries, Hunting, then dipping slightly to 20.5% in 2016. Increased production levels 6% 7.2% Education & have allowed energy and mineral extraction’s share of GDP to stay Healthcare, 11.1% steady in the face of decreasing prices. Government Services, Mining & The oil and gas industry in Saskatchewan is the largest contributor 5.5% Petroleum, 20.5% among primary industries to the provincial GDP at an estimated Business Services, 4.3% 15.3%. In 2016, the oil and gas industry in Saskatchewan accounted Manufacturing, 6.6% for approximately 32 000 direct and indirect jobs, $2.8 B in capital Finance, Insurance & Real Estate , 14.3%

investment, and over $600 M in provincial revenues. Construction, 6.9%

Saskatchewan produced 168.2 million barrels of crude oil in 2016, Wholesale & Transp, Retail Trade, 10.8% Warehousing which makes it the sixth-largest onshore oil-producing jurisdiction in & Utility, Canada and the United States. A total of 1664 oil wells were drilled in 7.1% 2016, of which 1491 were horizontal. Figure 2 – 2016 percentage of GDP by sector Saskatchewan is the third largest producer of natural gas in Canada, ($58.9 B, CANSIM Table 379-0030, Statistics Canada, 2017). behind Alberta and British Columbia. In 2016 Saskatchewan produced 189.4 billion cubic feet of natural gas.

The majority of Saskatchewan mineral production in 2016 included metallic mineral production of uranium and gold, and industrial mineral production of potash, silica sand, salt and sodium sulfate, bentonite, Industrial Oil and gas Minerals clay, and coal. There was also some zinc and copper produced in the $M6,940 $M4,092 Flin Flon area but levels were low and the resource is expected to be exhausted in the near future. The value of non-renewable resource production in 2016 totalled just over $13.3 B (Figure 3).

The mines of the Athabasca Basin in northern Saskatchewan and the Other Minerals $M2,287 Prairie Evaporite Formation in central Saskatchewan continue to be among the world’s most important suppliers of uranium and potash, Figure 3 – Value of non-renewable resources in 2016 ($M, Saskatchewan Ministry of the respectively. In 2016, Saskatchewan produced 100% of Canada’s Economy). uranium from three operations, and accounted for over 22% of world output. The province also produced almost all of Canada’s potash from 10 facilities, accounting for nearly 30% of world production. Market fundamentals indicate strong future demand for both commodities. The Saskatchewan potash and uranium sectors have responded by investing billions of dollars in expansions and, with more investments planned, both sectors are expected to increase production over the next 10 years.

The energy and minerals sectors have increased prosperity in Saskatchewan by creating high-paying direct and indirect jobs (over 30 000 in mineral production and 32 000 in oil and gas) and contributing over $900 M in royalties

Saskatchewan Exploration and 4 Saskatchewan Geological Survey Development Highlights 2017 Saskatchewan Ministry of the Economy in 2016. These sectors will continue to make significant contributions to the Saskatchewan economy for many generations.

Table 2 – Statistical summary of major Saskatchewan resource industries – minerals. Value in millions of dollars (CAD) unless otherwise noted. Data compiled by the Saskatchewan Ministry of the Economy unless otherwise noted. Major Saskatchewan Resource Industries Statistical Summary - Minerals (Millions of Dollars unless otherwise noted) POTASH 2012 2013 2014 2015 2016 Production (k tonnes K2O) 8,826 9,738 10,274 11,125 10,966 Value of sales (million $) $ 5,972 $ 5,609 $ 5,700 $ 6,097 $ 4,092.00 Royalty/Tax (See Note 1) $ 364.50 $ 346.00 $ 546.30 $ 566.40 $ 241.03 Direct employment 4,995 5,277 4,921 5,118 5,081 Capital spending $ 2,973 $ 3,701 $ 2,977 $ 2,898 $ 2,018 URANIUM 2012 2013 2014 2015 2016 Production (k tonnes U3O8) 15.5 16.0 Value of sales (million $) $ 1,789.20 $ 1,888.40 Royalty/Tax (See Note 1) See Note 2 $ 152.80 $ 100.94 Direct employment 3,904 3,904 Capital spending $ 448.10 $ 303.00 SALT 2012 2013 2014 2015 2016 Production (k tonnes) 1,280 1,330 1,395 1,388 1,335 Value of sales $ 30.50 $ 24.70 $ 26.90 $ 26.40 $ 25.53 Royalty/Tax (See Note 1) $ 1.30 $ 1.30 $ 1.40 $ 1.40 $ 1.38 Direct employment 129 130 130 130 130 Other (See Note 2) 2012 2013 2014 2015 2016 Production ( M tonnes) 9.6 9.1 8.8 9.3 9.2 Value of sales $ 1,448.00 $ 1,485.00 $ 1,612.00 $ 324.50 $ 372.59 Royalty/Tax (See Note 1) $ 146.90 $ 97.40 $ 127.30 $ 46.60 $ 31.53 Direct employment (See Note 3) 4,359 4,200 4,250 350 350 Capital spending n/a n/a n/a n/a n/a Note 1: Royalty/Tax are reported for fiscal year, remaining entries are calendar year.

Note 2: Confidentiality requirements pursuant to The Crown Mineral Act do not permit commodity-specific information to be released where there are fewer than three producing companies. This information is aggregated and presented in the "Other" category which includes Bentonite, Quarriable Materials, Coal, Sodium Sulphate, Uranium and Precious and Base Metals.

Note 3: Approximately 300 additional Saskatchewan residents are employed at the Hudbay operations in Flin Flon, Manitoba. Non-Ministry Data Sources: Employment information was derived from information from the Ministry of Labour Relations and Workplace Safety(annual average). Some Capital Spending figures were derived from Natural resources Canada Expenditure Survey.

Saskatchewan Exploration and 5 Saskatchewan Geological Survey Development Highlights 2017 Saskatchewan Ministry of the Economy 4. URANIUM OPERATIONS AND MAJOR DEPOSITS Saskatchewan was responsible for about 22.5% of the world’s uranium production in 2016 according to the World Nuclear Association. Production came from three mines in the Athabasca Basin, operated by Cameco Corporation (Cameco). The McArthur River mine led the world by producing 18.0 M lb U3O8 in 2016 (Table 3). The Cigar Lake mine nearly matched this total with production of 17.3 M lb U3O8 (Table 3), good enough for second place globally by a substantial margin. The Eagle Point mine at Rabbit Lake produced a further 1.1 M lb U3O8 (Table 3). Saskatchewan’s total production in 2016 was 36.4 M lb U3O8. Expected production in 2017 is 34.4 M lb U3O8, all of which will be derived from McArthur River and Cigar Lake (Table 3).

Table 3 – Published Ni 43-101–compliant Reserves and Resources for uranium deposits in Saskatchewan.

Reserves Grade Production2 1 Owner(s) Property/Deposit (M lb U3O8) (% U3O8) (M lb U3O8) 3 RESERVES 2016 2017 (e) AREVA Resources Canada Inc. – Denison Mines Corp. – OURD McClean Lake 0.76 0.38 – – (Canada) Co. Ltd. ore stockpile Cameco Corporation – AREVA Resources Canada Inc. McArthur River 369.7 9.60 18.0 16.4 Key Lake 0.7 0.50 – – Cameco Corporation – AREVA Resources Canada Inc. – Idemitsu Cigar Lake 215.0 15.90 17.3 18.0 Uranium Exploration Canada – TEPCO Resources Inc. McClean Lake Cameco Corporation Eagle Point – – 1.1 – Rabbit Lake Measured & Indicated Grade Inferred Grade 3 RESOURCES (M lb U3O8) (% U3O8) (M lb U3O8) (% U3O8) AREVA Resources Canada Inc. – Denison Mines Corp. – OURD Caribou 2.7 3.13 – – (Canada) Co. Ltd. McClean North 12.5 2.75 0.1 0.79 Midwest 42.9 5.50 0.4 0.80 Midwest A 5.8 0.57 4.3 21.23 Sue D 2.8 1.05 0.2 0.39 Sue E – – 7.3 0.69 AREVA Resources Canada Inc. – UEX Corporation Anne 24.8 1.99 2.6 0.88 Colette 5.7 0.79 7.8 0.72 Kianna 34.8 1.53 16.9 1.36 58B 2.4 0.77 0.9 0.51 Cameco Corporation – AREVA Resources Canada Inc. Fox Lake − − 68.1 7.99 Cameco Corporation – AREVA Resources Canada Inc. – Idemitsu Uranium Exploration Canada – TEPCO Resources Inc. Cigar Lake 84.5 16.17 20.8 7.36 Cameco Corporation Eagle Point 39.7 0.79 33.6 0.58 Cameco Corporation – AREVA Resources Canada Inc. McArthur River 4.8 3.62 11.0 5.20 Cameco Corporation – JCU Exploration (Canada) Co., Ltd. Millennium 75.9 2.39 29.0 3.19 Cameco Corporation – AREVA Resources Canada Inc. – JCU 4.42 1.0 1.02 Exploration (Canada) Co., Ltd. Tamarack 17.9 Denison Mines Corp. – Korea Waterbury Uranium Limited Partnership J Zone 12.8 2.00 – – Denison Mines Corp. – Cameco Corporation – JCU Exploration Gryphon deposit – – 43.0 2.30 (Canada) Co., Ltd. Phoenix deposit 70.2 19.13 1.1 5.80 Fission Uranium Corp. Triple R 81.1 1.83 27.2 1.57 NexGen Energy Ltd. Arrow 179.5 6.88 122.1 1.30 4 Rio Tinto PLC Roughrider 17.2 1.98 40.7 11.5 5 Skyharbour Resources Ltd. Fraser Lakes Zone B − − 6.96 0.03 UEX Corporation Horseshoe 22.9 0.203 1.05 0.17 Raven 12.2 0.107 1.7 0.09 West Bear 1.579 0.91 – –

Notes: 1. Operator first. Deposits in the Reserve and Resource sections are sorted alphabetically based on ownership breakdown, and then by deposit name. 2. 2016 and 2017 production figures and estimates are from company releases; e, estimated. 3. Total Reserves (Proven and Probable) are reported. Measured and Indicated Resources have been combined and are reported separately from Inferred Resources. Both Reserves and Resources reflect the U3O8 content of the ore body. Reserve and Resource data are from company releases. 4. Originally published by Hathor Exploration in 2010. 5. Originally published by JNR Resources in 2012.

Saskatchewan Exploration and 6 Saskatchewan Geological Survey Development Highlights 2017 Saskatchewan Ministry of the Economy McArthur River Mine–Key Lake Mill McArthur River mine: Cameco Corporation, operator (69.805%) and AREVA Resources Canada Inc. (30.195%) Key Lake mill: Cameco Corporation, operator (83%) and AREVA Resources Canada Inc. (17%)

For the first time since production began, the Reserves at McArthur River have a grade below 10% U3O8 (Table 3). Although the current overall grade of the deposit remains extraordinary, the Reserves grade peaked at the end of 2005, at an astonishing 24.6% U3O8. The McArthur River Mine has consistently been the world’s largest producer over the last several years, with the 2016 total of 18 M lb U3O8 representing 11.1% of global supply. By the end of 2016, McArthur River had produced over 310 M lb U3O8 since opening in 1999, and maintained a Reserve of 369.7 M lb U3O8 (Table 3). Cameco forecasts production in 2017 to be 16.4 M lb U3O8; with Cigar Lake expected to yield 18 M lb U3O8, the top step of the producer’s podium will change. Moreover, after a late-2017 announcement of an anticipated ten-month shutdown, McArthur River will likely see significantly curtailed production in 2018. The shutdown is necessitated by continued weak uranium prices, which are being driven by market oversupply.

Ore from McArthur River is processed underground and then blended and thickened to produce a slurry with an average grade of 15% U3O8. The slurry is pumped to surface and into transport containers before being hauled to the Key Lake Mill, some 80 km to the southwest. The mill is licensed to produce 25 M lb U3O8 annually. Tailings capacity at Key Lake has been expanded over the past several years and it is now sufficient to mill all known Reserves and Resources at McArthur River with capacity remaining. Due to the current low uranium prices, the operators of the McArthur River mine–Key Lake mill have been looking for effective ways to reduce costs. Among these was an extended shutdown in the third quarter that would reduce costs for crew changes. The shutdown included a four- week vacation period, followed by two weeks of maintenance at McArthur River and a further four weeks of maintenance at Key Lake. Although these shutdowns were not anticipated to impact 2017 production, difficulties with the mill’s calciner circuit have resulted in a reduced forecast for the year, from 18 to 16.4 M lb U3O8. Furthermore, suspension of mining at McArthur River for much of 2018 will result in the milling operation at Key Lake being placed under care and maintenance for much of the year.

Cigar Lake Mine–McClean Lake Mill Cigar Lake mine: Cameco Corporation, operator (50.025%); AREVA Resources Canada Inc. (37.100%); Idemitsu Uranium Exploration Canada (7.875%); and TEPCO Resources Inc. (5.0%) McClean Lake mill: AREVA Resources Canada Inc., operator (70%); Denison Mines Corp. (22.5%); and OURD (Canada) Co. Ltd. (7.5%)

The Cigar Lake mine produced 17.3 M lb U3O8 in 2016 and although anticipated production was only 16 M lb U3O8 as the mine ramped up, the licensed annual production (18 M lb U3O8) was nearly achieved. Full production is expected in 2017. Reserves at Cigar Lake are 215 M lb U3O8 with an average grade of 15.9%, making it the world’s highest- grade producing uranium mine. Total production at the mine since inception in 2014 is 28.9 M lb U3O8.

The Cigar Lake mine uses a fully contained production system in which the ore is mined, processed underground and pumped to surface as a slurry (average grade is 16% U3O8) without any worker exposure to the ore. Ore from Cigar Lake is hauled 69 km to AREVA Resources Canada Inc.’s (AREVA) McClean Lake Mill. AREVA’s initial operational license for the mill was renewed in June for a further 10 years, expiring June 30, 2027. Current licensed capacity is 24 M lb U3O8 annually. A cost savings plan similar to the one at McArthur River has also been undertaken at the Cigar Lake mine. In addition to shutdowns, an additional workforce reduction of 10% was also applied.

Eagle Point Mine–Rabbit Lake Mill Cameco Corporation, operator (100%) Production at the Eagle Point Mine was suspended in June 2016 due to challenging uranium market conditions. Final production for the year was 1.1 M lb U3O8, significantly less than the planned 3.6 M lb U3O8. The entire mining and milling operation remained under care and maintenance during 2017, with 120 employees maintaining the facilities.

Saskatchewan Exploration and 7 Saskatchewan Geological Survey Development Highlights 2017 Saskatchewan Ministry of the Economy Arrow Deposit NexGen Energy Ltd. (100%) NexGen Energy Ltd.’s (NexGen) Arrow deposit lies in the Patterson Lake corridor. NexGen has been exploring deep into the mineralized structures and has encountered uranium intersections at depths below 900 m—all in basement rocks. NexGen announced a maiden Inferred Resource estimate in March 2016 and since that time has worked to increase the confidence of its model. A second Resource estimate, released in March 2017, converted much of the original 201.9 M lb of contained U3O8 into the Indicated Resource category. The new estimate contains 179.5 M lb U3O8 in 1.18 Mt of ore equating to a grade of 6.88%. A further 122.1 M lb U3O8 is in an Inferred Resource comprising 4.25 Mt of rock grading 1.30%.

NexGen followed up its Resource estimate with a Preliminary Economic Assessment. The model suggests that a low-cost, conventional long-stope mining process could support a mine life of 15 years with an on-site mill. Rather than an open-pit tailings facility, NexGen envisions back-filling the mine workings with tailings reduced to paste and treated with a cement additive, resulting in a significant decrease in the project’s surface footprint.

Triple R Deposit Fission Uranium Corp. (100%) Fission Uranium Corp. (Fission) continued exploration and expansion of the Triple R deposit in the southwestern Athabasca Basin since publishing a maiden Resource estimate and a Preliminary Economic Assessment for the project in 2015. The Resource currently contains 81.1 M lb U3O8 in the Indicated category and 27.2 M lb U3O8 in the Inferred category; however, drilling over the last two years has expanded the Triple R deposit’s footprint and extended it to a depth greater than 350 m. In addition to Triple R, which is mainly below Patterson Lake, Fission has been exploring to the southwest. It has now defined two areas of mineralization, the R840W and R1515W zones, of which the former has a larger surface footprint. Altogether, the defined areas of mineralization now have a strike length of over three kilometres.

Fission envisions mining the Triple R deposit via an openpit. To achieve this, a dike would be built around the mining area in Patterson Lake and the pit area drained. The deposit would be extracted over a 14-year period and milled at the site.

Wheeler River Property Denison Mines Corp. (60%); Cameco Corporation (30%); and JCU Exploration (Canada) Co., Ltd. (10%) Denison Mines Corp. (Denison) has continued work on the Wheeler River property southwest of McArthur River. The property contains two defined uranium deposits. The original discovery, Phoenix, lies about 400 m below the surface at the basal Athabasca unconformity. The deposit has an Indicated Resource that contains 70.2 M lb U3O8 grading 19.1%, the highest grade of any deposit currently defined in Saskatchewan. An additional 1.1 M lb U3O8 resides in an Inferred Resource. The second defined uranium deposit is three kilometres northwest of Phoenix, called Gryphon. A Resource estimate for Gryphon, which is hosted by basement rocks nearly 200 m below the Athabasca unconformity, suggested the deposit contains 43 M lb U3O8 grading 2.3%, all in the Inferred category. Over the last year Denison has focused on delineation of the A, B and C lenses of Gryphon with the hope of both expanding the deposit and improving the confidence of the Mineral Resource estimate to the Indicated category. In addition, Denison has been defining the D-series mineralized lenses that lie outside the current footprint of Gryphon. Exploration has also intersected mineralization at the basal Athabasca unconformity (~540 m depth) about 250 m to the northeast of Gryphon, along strike.

EXPLORATION OVERVIEW In spite of difficult economic times, uranium exploration remains robust in Saskatchewan, with anticipated spending of $156.1 million in 2017. Major programs have continued in both the eastern and southwestern Athabasca Basin. In the southwest, activity is mainly focused in the Patterson Lake region with NexGen, Fission and Purepoint Uranium Group Inc. (Purepoint) advancing significant deposits. Just to the northeast of NexGen’s Rook I property, Purepoint, operator of the Hook Lake joint venture (JV; partners Cameco and AREVA), continues to explore the Spitfire deposit some 4.5 km northeast of the Arrow deposit. Recent work has determined that Spitfire and NexGen’s Harpoon

Saskatchewan Exploration and 8 Saskatchewan Geological Survey Development Highlights 2017 Saskatchewan Ministry of the Economy deposits are contiguous, with a total strike length of more than 550 m. Purepoint’s work has also confirmed many of the key attributes at its Spitfire deposit to be present at the Dragon Zone, a further 5 km toward the northeast.

In the eastern Athabasca Basin, UEX Corporation (UEX; JV partner JCU Exploration (Canada) Co., Ltd.) is actively exploring the Christie Lake property, which is located 9 km northeast of McArthur River mine, and hosts the historical Ken Pen and Paul Bay deposits. These two deposits have a combined, historical resource of 20.87 M lb U3O8 at a grade of 3.22%. Recent exploration by UEX has confirmed mineralization at these deposits and identified a new deposit, Ōrora, which has a strike length of about 150 m. One of the drillhole intersections at Ōrora returned 20.00% U3O8 over 8.5 m. All three deposits are at depths around 480 m and are situated along the 1.5 km Yalowega Trend. UEX has suggested that the northeast extension of the P2 Fault, the fault that controls mineralization at the McArthur River deposit, also controls the three uranium deposits at Christie Lake. Northeast of Christie Lake, Denison (JV partner Waterbury Lake Uranium Limited Partnership) has reported significant increases in uranium grades for the ‘Huskie zone’ at the Waterbury Lake project. The Huskie zone is basement-hosted, measures approximately 100 m in strike length, and is located nearly 1.5 km to the northeast of the property’s J zone (Table 3) uranium deposit. One of the highlighted drillholes returned 9.1% U3O8 over 3.7 m, including 16.8% U3O8 over 2 m. West of McArthur River mine, operator Cameco and JV partner CanAlaska Uranium Ltd. have encouraging results at the West McArthur project. Following up on Cameco’s success at the Fox Lake deposit (Table 3), they continue to pursue the C10 conductor onto the adjacent West McArthur project. The uranium mineralization is disseminated within the sandstone and down to the unconformity, commonly associated with brittle faults at depths near 780 m.

5. GOLD The Seabee gold operation, owned by SSR Mining Inc. (SSR; formerly Silver Standard Resources Inc.), remains Saskatchewan’s sole gold producer. The Seabee operation, comprising both the Seabee and Santoy underground mines, achieved a new annual production record in 2016 of 77,640 Troy ounces (oz) of gold from 312 679 tonnes of ore grading 7.91 grams per tonne Au. Strong production levels were maintained at the operation into 2017, with production of 59,771 oz Au through the first three quarters of the year. Due to this strong performance, SSR has increased production guidance for the year to between 75,000 and 85,000 oz. SSR has also recently completed a Preliminary Economic Assessment for its planned mine expansion to a sustained mining and milling rate of 1050 tonnes per day for a seven-year period. Results of the study included estimated average gold production of 100,000 ounces of gold per year over the period from 2018 to 2023, including peak production of 120,000 ounces in 2020, with a total capital expenditure of $90 M and an all-in sustaining cost of $682 per payable ounce of gold sold.

Gold exploration is ongoing at several locations in northern Saskatchewan. Estimated gold exploration expenditures in the province are $4.9 M for 2017, compared to actual expenditures of $6.2 M in 2016 (Table 4). Much of this exploration is taking place in the vicinity of the Seabee operations. SSR undertook 20 938 m of underground drilling at the Santoy 8A and Santoy Gap areas of the Santoy mine and at the Seabee mine, in order to convert and expand existing Resources. SSR also undertook 7727 m of surface drilling to explore for extensions of mineralization close to both mines, as well as on near-surface targets up to several kilometres distant from the underground infrastructure. The latter yielded a high-grade intercept at the Carr target, located 4 km north of Santoy Gap, which will be further explored during an upcoming winter drill program.

As part of a joint venture with Eagle Plains Resources Ltd. (Eagle Plains), SSR is also undertaking exploration at the Fisher property, located along the southern extension of the Santoy shear zone. Work to date included rock and soil sampling, mapping, and prospecting over a 12 by 2 km area in order to identify and prioritize future drill targets. Eagle Plains also conducted rock and soil geochemical exploration at its nearby Orchid property in 2017, and completed airborne geophysical surveying, mapping, trenching and soil geochemical sampling at its Chico property. Eagle Plains has entered into an option agreement with Aben Resources Ltd. to conduct further exploration at Chico.

Comstock Metals Ltd. (Comstock) is undertaking gold exploration at its Preview SW deposit, located just 40 km north of Lac La Ronge. Since acquiring the project in 2016, Comstock has completed ~3900 metres of surface drilling during two drill campaigns, which included step-out drilling around the deposit and drilling at the proximal Preview North zone. Comstock has also completed ground geophysical surveys, humus sampling, high resolution drone surveys, and structural studies on the property.

Saskatchewan Exploration and 9 Saskatchewan Geological Survey Development Highlights 2017 Saskatchewan Ministry of the Economy Table 4 – Production totals for current gold mining operations and published Reserves/Resources for selected gold deposits in Saskatchewan.

Au Au Grade Total Au Years Ore Milled Grade (Troy Production Ownership (%) Operated Mine/Deposit (t) (g/t) oz/ton) (Troy oz) PRODUCTION (recent operations) 1991 to Seabee gold 6 044 295 7.47 0.218 1,347,233 SSR Mining Inc. (100) present operation 1

2011 to La Ronge gold 323 491 8.55 0.250 77,118 Golden Band Resources Ltd. (100) 2014 project 2

Effective Au Au Grade Date Tonnes of Cut Off Grade (Troy oz/ In Situ Au Ownership (%) (dd/mm/yr) Mine/Deposit Ore (g/t) (g/t) ton) (Troy oz) RESERVES (Proven + Probable) SSR Mining Inc. (100) 31/12/16 Seabee 130 000 4.92 7.13 0.208 29,000 SSR Mining Inc. (100) 31/12/16 Santoy + Stockpile 1 241 000 3.65 8.67 0.253 331,000 Fortune Bay Corp. (100) 6/10/11 Box 16 502 247 0.72 1.51 0.044 800,000 Fortune Bay Corp. (100) 6/10/11 Athona 5 830 798 0.72 1.17 0.034 220,000 RESOURCES (Measured + Indicated) SSR Mining Inc. (100) 31/03/11 Amisk Gold3 30 150 000 0.40 0.950 0.028 921,000 SSR Mining Inc. (100) 31/12/16 Seabee4 286 000 4.40 7.48 0.218 68,000 SSR Mining Inc. (100) 31/12/16 Santoy 84 400 000 3.26 9.13 0.267 118,000 SSR Mining Inc. (100) 31/12/16 Santoy Gap4 1 286 000 3.26 8.18 0.239 338,000 SSR Mining Inc. (100) 31/12/16 Porky West 101 000 3.26 3.57 0.104 12,000 Golden Band Resources Ltd. (100) 19/03/13 Roy Lloyd 155 383 5.00 12.60 0.368 62,947 Golden Band Resources Ltd. (100) 30/04/12 Golden Heart 492 800 4.00 6.60 0.193 104,800 Golden Band Resources Ltd. (100) 30/04/12 Komis 191 740 4.00 7.85 0.229 48,398 Golden Band Resources Ltd. (100) 30/04/12 Memorial 288 400 1.00 2.83 0.083 26,220 Golden Band Resources Ltd. (100) 30/04/12 Tower East 5 019 080 1.00 1.86 0.054 299,835 Masuparia Gold Corp. (51) / 01/06/16 Greywacke Lake 255 500 5.00 9.92 0.290 81,500 Golden Band Resources Ltd. (49) (North deposit) Wescan Goldfields Inc. (100) 04/02/10 Jojay 420 000 2.00 3.70 0.108 50,000 Comstock Metals Ltd. (100) 27/09/16 Preview SW 2 607 900 0.50 1.89 0.055 158,300 RESOURCES (Inferred) Silver Standard Resources Inc. (100) 31/03/11 Amisk Gold 3 28 653 000 0.40 0.700 0.020 645,000 Silver Standard Resources Inc. (100) 30/11/14 Seabee 356 000 4.40 8.62 0.252 99,000 Silver Standard Resources Inc. (100) 30/11/14 Santoy 8 1 344 300 3.26 7.14 0.208 334,000 Silver Standard Resources Inc. (100) 30/11/14 Santoy Gap 510 000 3.26 9.23 0.270 151,000 Silver Standard Resources Inc. (100) 30/11/14 Porky West 175 000 3.26 5.48 0.160 31,000 Golden Band Resources Ltd. (100) 19/03/13 Roy Lloyd 91 888 5.00 10.78 0.315 31,843 Golden Band Resources Ltd. (100) 30/04/12 Golden Heart 10 500 4.00 4.95 0.145 1,672 Golden Band Resources Ltd. (100) 30/04/12 Komis 10 746 4.00 7.91 0.231 2,731 Golden Band Resources Ltd. (100) 30/04/12 Memorial 90 900 1.00 2.49 0.073 7,272 Golden Band Resources Ltd. (100) 30/04/12 Tower East 902 020 1.00 1.52 0.044 43,965 Masuparia Gold Corp. (51) / 01/06/16 Greywacke Lake 59 130 5.00 7.42 0.217 14,100 Golden Band Resources Ltd. (49) (North zone) Wescan Goldfields Inc. 04/02/10 Jojay 630 000 2.00 4.30 0.126 87,000 Comstock Metals Ltd. (100) 27/09/16 Preview SW 5 697 100 0.50 1.48 0.043 270,800

Notes: Data in this table are intended to reflect NI 43-101–compliant standards, but do not all necessarily conform to the current legal definition of reserves and resources by CIM. 1 All values are approximate; includes production from the Seabee mine, Santoy mining complex and the Porky West and Santoy 7 bulk samples. 2 Operation suspended in 2014; values are approximate; includes production from the Roy Lloyd, EP, and Komis mines. 3 Mineral Resource includes Ag as 'Au equivalent'. 4 Mineral Reserves are included in Mineral Resources.

Saskatchewan Exploration and 10 Saskatchewan Geological Survey Development Highlights 2017 Saskatchewan Ministry of the Economy 6. BASE METALS Base metal exploration expenditures for Saskatchewan are forecast to be just over $6 M in 2017, up considerably from last year’s actual expenditures of $539 000 (Table 1). This reflects improved base metal prices over the last 12 months (Table 5).

Table 5 – Comparison of base metal prices over the past 12 months.

Sept/16 Oct/16 Nov/16 Dec/16 Jan/17 Feb/17 Mar/17 Apr/17 May/17 Jun/17 July/17 Aug/17

Copper 2.20 2.20 2.64 2.50 2.71 2.71 2.64 2.59 2.57 2.68 2.86 3.07 (USD/lb) Lead 0.96 0.94 1.07 0.91 1.08 1.02 1.05 1.03 0.96 1.03 1.05 1.07 (USD/lb) Zinc 1.08 1.13 1.23 1.16 1.30 1.28 1.24 1.19 1.17 1.25 1.26 1.42 (USD/lb) Nickel 4.79 4.71 5.05 4.53 4.82 4.94 4.52 4.26 4.04 4.24 4.65 5.30 (USD/lb) Cobalt 12.47 12.87 13.38 14.83 16.67 22.57 24.90 25.06 25.63 26.7 26.1 27.70 (USD/lb)

One dramatic exception to this has been the price of cobalt, which has more than doubled since September 2016, from a low of US$12/lb to about US$27/lb in August of 2017. This is mainly due to the rising demand for electrical vehicles, which are powered by lithium-ion batteries that generally contain large amounts of cobalt. A supply shortage further contributes to the rising prices, with 60% of the world’s cobalt production coming from a region in the Democratic Republic of the Congo where the political landscape is uncertain. As a corollary to the increasing price of cobalt, some analysts are predicting that the price of nickel will also rise as Chinese battery makers may look at changing the formula of lithium-ion batteries from the traditional ratio of 6:2:2 (nickel:manganese:cobalt) to a ratio of 8:1:1.

Due to the increased price of cobalt, there have been several news releases relating to exploration for base metals in Saskatchewan. Canadian Platinum Corp. announced that review of historical assay data from its Swan Lake platinum-palladium-nickel-copper showing in the Peter Lake Domain revealed elevated cobalt concentrations. One historical drill intersection assayed 0.02% Co over a width of 71.6 m, including one higher-grade intersection of up to 0.21% Co over a width of 1.0 m. Cobalt exploration is also being undertaken by U.S. Lithium Resources Inc., which announced that it entered into an agreement with Diamond Hunters Ltd. to acquire 100% of the Gochagar Lake nickel-copper-cobalt project claims, approximately 75 km north of La Ronge. The initial work plan for the project will involve a digital compilation of available data, reprocessing of all geophysical data, and reinterpretation of the geology of the deposit. Similarly, Fathom Minerals Ltd. (Fathom) report on their website that recent assaying from their Rottenstone nickel-copper-platinum group elements property, 130 km north-northeast of La Ronge, suggests the presence of up to 900 ppm Co. Since acquiring the property in 2015, Fathom has completed a small diamond-drill program and compiled historical geophysical, geochemical and diamond-drill hole data into a comprehensive database. The Rottenstone nickel-copper-platinum group element deposit was mined between 1965 and 1968 and produced 26 000 tons of ore grading 3.23% Ni, 1.83% Cu, 9.63 g/t combined Pt-Pd-Au.

Once again though, the bulk of Saskatchewan’s projected 2017 base metals exploration expenditures will be focused on two projects, Foran Mining Corporation’s (Foran) McIlvenna Bay projects and Murchison Minerals Ltd.’s (Murchsion) Brabant-McKenzie project. In March, Foran had started a winter drilling program to test a deep EM conductor (Target A), 1.5 km southeast of their zinc-copper McIlvenna Bay deposit, which is 60 km southwest of Flin Flon. The Target A conductor is similar in size and strength to the EM conductor associated with the McIlvenna Bay deposit. A previously completed borehole (drilled in 2014; MR-14-08) was interpreted to have passed over the top of the source conductor. Due to an earlier than anticipated spring thaw, the drilling program had to be interrupted and it was anticipated that drilling would resume later in 2017. Foran has also engaged Micon International Limited to conduct a detailed technical review of the previously completed Preliminary Economic Assessment of the McIlvenna Bay project. On the neighbouring 100% owned Bigstone project, Foran had announced that it was finalizing plans for a summer drill program.

Saskatchewan Exploration and 11 Saskatchewan Geological Survey Development Highlights 2017 Saskatchewan Ministry of the Economy Just north of McIlvenna Bay, privately-owned BFR Copper and Gold Inc. reported in an abstract prepared for the 2017 Saskatchewan Geological Open House that it had intersected mineralization on the Botham Bay North block of their Flin Flon project east of Hanson Lake. They reported that all five drill holes completed on the north block intersected interlayered granodiorite and migmatite gneiss containing massive sulfide mineralization of up to 2.09% Cu, 3.12% Zn and 6.86 g/t Ag over 2.9 m.

In January, Murchison commenced a 10-hole diamond-drill program and ground geophysical survey on its wholly- owned zinc-copper-lead-silver Brabant-McKenzie project, 175 km northeast of La Ronge. The 5653 metre drill program was focused on expanding the tonnage of the deposit and was completed by May. The two historic mineralized zones constituting the deposit (upper main zone and lower main zone) were both intersected and, because of a few step-outs and deeper drill intersections, these new results have led to the announcement of a new mineral resource. The updated mineral resource, performed by Finley Bakker Consulting from Campbell River, BC, includes an Indicated Mineral Resource of 1.5 Mt at 7.46% Zn, 0.70% Cu, 0.39% Pb and 31.16 g/t Ag, and an Inferred Mineral Resources of 4.5 Mt at 5.99% Zn, 0.62% Cu, 0.39% Pb and 19.39 g/t Ag. This compares with the previous resource estimate on the deposit, reported by Manicouagan Minerals Inc. (now Murchison) in 2008, which showed an Indicated Resource of 1.5 Mt grading 9.2% Zn and 0.89% Cu, and Inferred Resource of 3.0 Mt grading 5.6% Zn and 0.6% Cu. The company stated that the deposit remains open at depth and plans to continue exploration to test the down-plunge extent, as well as test other geophysical targets along strike. Murchison also announced, based on previously completed geophysical surveys, that a number of new VTEM and Mag anomalies warrant follow- up exploration.

7. DIAMONDS In 2016, actual expenditures for diamond exploration projects were approximately $9.2 M. Spending in 2017 is anticipated to be $3.8 M and focused on the Star-Orion South project about 65 km east of Prince Albert, and on grassroots activity in the Deschambault Lake area about 290 km northeast of Prince Albert.

Over the past year, Shore Gold Inc. (Shore) has completed test work and geotechnical investigations, working toward an updated Feasibility Study on the Star-Orion South diamond project. Work included X-ray transmissivity recovery of diamonds from the Star pyroclastic kimberlite, ore-processing data review, diamond parcel characterization, kimberlite particle-size analysis, and overburden removal investigations. This work also investigated the use of new technology for the efficient excavation of the open pit, improvements to the flowsheet of the diamond processing plant, and reduction of pre-production capital costs and time to initial diamond production. In January 2017, Shore was informed by the Saskatchewan Minister of Environment (the Ministry) that additional consultation was required between the government and First Nation and Métis communities for the government to meet its legal obligation with respect to the duty to consult and accommodate process. The Ministry has subsequently proceeded with a work plan and anticipates completion of this required consultation process during the third quarter of 2017. Once consultations are completed, all pertinent information will be reviewed before a decision is made under The Environmental Assessment Act. In June 2017, Shore acquired all of Newmont Canada FN Holdings ULC’s (Newmont) remaining 31% participating interest in the Fort à la Corne joint venture, resulting in Shore owning 100% of the Star-Orion South diamond project. Shore concurrently entered into an option to joint venture agreement with Rio Tinto Exploration Canada Inc. (RTEC) for the Fort à la Corne mineral properties, including the Star-Orion South diamond project; Shore has granted RTEC an option to earn up to 60% interest in the Star-Orion project by investing approximately $70 M over the next 7.5 years.

In the Deschambault Lake area, North Arrow Minerals Inc. (North Arrow) continued work on its Pikoo diamond project and acquired Stornoway Diamond Corporation’s remaining 15% interest in the project. North Arrow conducted ground geophysical surveys to outline future drilling targets, and additional till sampling to further delineate prospective indicator mineral trains.

In late 2016, De Beers Canada Inc. (De Beers) drilled seven magnetic anomalies on its West Athabasca property, which was under an option-participation agreement with CanAlaska Uranium Ltd. (CanAlaska). Drill targets were based on a detailed, low-level airborne survey flown earlier in the year, but drilling did not intersect kimberlite. Consequently, De Beers interpreted the 85 large anomalies discovered by the airborne survey to be associated with

Saskatchewan Exploration and 12 Saskatchewan Geological Survey Development Highlights 2017 Saskatchewan Ministry of the Economy magnetic minerals within organic material in the overburden. De Beers subsequently terminated its option agreement, returning 100% interest in the project to CanAlaska. CanAlaska believes that many of the remaining targets in the area are not attributable to these organic-rich magnetic horizons, and that many of the anomalies are generated by deep-rooted magnetic bodies that fit the geometry expected from kimberlite pipes or dykes.

8. POTASH Saskatchewan continued to be the world’s leading potash-producing jurisdiction in 2016, producing 17.9 Mt KCl (Table 6), about 28% of total global output, with an estimated sales value of $4.2 B. The Saskatchewan potash industry is nearing the completion of expansions collectively valued at $13.5 B, which have substantially increased productive capacity at existing operations in preparation for future growth in the market. In the first half of 2017, Saskatchewan’s three potash producers each reported strong potash sales volumes, combined with modest increases in realized sales prices. While domestic sales have been slow, international markets, particularly South America, have strengthened demand.

Table 6 – Saskatchewan’s potash production levels over the past 7 years. 2010 2011 2012 2013 2014 2015 2016 Production Production Production Production Production Production Production Company Mine (Mt KCl) (Mt KCl) (Mt KCl) (Mt KCl) (Mt KCl) (Mt KCl) (Mt KCl) Agrium Vanscoy 1.78 1.74 1.40 1.70 1.10 1.97 2.20 Mosaic Esterhazy (K-1/ 2.30 3.90 4.00 4.00 4.00 4.30 4.20 K-2) Belle Plaine 1.50 2.20 2.30 2.10 2.20 2.10 2.40 Colonsay 0.80 1.10 1.10 1.10 1.40 1.40 0.50 PotashCorp Lanigan 2.37 3.04 1.65 2.24 1.68 1.83 2.03 Rocanville 2.18 2.34 1.57 1.99 2.49 2.48 2.72 Allan 1.10 1.02 1.17 1.18 2.47 2.38 2.38 Cory 0.55 0.78 1.29 1.49 1.18 1.51 1.24 Patience Lake 0.37 0.39 0.29 0.27 0.30 0.26 0.23 Production Totals 12.95 16.51 14.77 16.07 16.82 18.23 17.90 Production values are from each company’s annual information forms, which are reported by fiscal year and do not correspond to calendar year values discussed in this report.

In the fall of 2016, Potash Corporation of Saskatchewan (PotashCorp), the world’s largest potash producer, and Agrium Inc. (Agrium), one of the world’s leading supply companies, announced a proposed ‘merger of equals’. The business combination will create a global agricultural giant, to be named Nutrien, worth an estimated US$36 B, with about 20 000 employees at operations in 18 countries. The proposed merger is supported unanimously by the boards of directors and by the majority of shareholders of both companies. While the arrangement received unconditional regulatory approval from the Canadian Competition Bureau, the companies are still addressing issues raised by China’s Ministry of Commerce and the Competition Commission of India, which have delayed the merger until the end of 2017. PotashCorp also celebrated the completion of a $3 B expansion at its Rocanville mine, which includes a new mill and the first completed potash production shaft in the province since 1979. The expansion raises Rocanville’s mill capacity from 3.0 to 6.5 Mt KCl per year, making it the largest current producing potash mine in the world.

In December of 2016, (Mosaic) announced a $2.5 B acquisition of Vale Fertilizantes, which included a number of phosphate and potash operations. Through the deal Mosaic was to acquire five established phosphate mines, four chemical and fertilizer facilities, and one potash operation in Brazil. Mosaic also acquires a 40% interest in the Miski Mayo phosphate mine in Peru, the Kronau potash project in Saskatchewan, and an option to include the Rio Colorado potash project in Argentina. Mosaic is poised to become one of the leading fertilizer producers and distributors in Brazil, and has received approval from Brazilian regulators to complete the acquisition. Mosaic also announced that two new shafts have been completed to 3,350 feet (1021 m) at the K3 mine expansion

Saskatchewan Exploration and 13 Saskatchewan Geological Survey Development Highlights 2017 Saskatchewan Ministry of the Economy at Esterhazy. The company can now begin mine development in the potash horizon while continuing to construct the overland conveyor system that will carry the ore to the processing facility.

On May 2nd, 2017, K+S Potash Canada Inc (K+S Potash) held a grand opening for the company’s newly constructed Bethune solution mine. The commissioning of the Bethune mine (formerly Legacy project) creates more than 400 permanent jobs and marked the commencement of the first new potash mine in Saskatchewan in nearly 50 years. K+S Potash intends to produce 600 000 tonnes of KCl in 2017 and 1.7 to 1.8 Mt in 2018, as the mine gradually ramps up to the desired capacity of 2 Mt per year.

A number of companies, both major and junior, are continuing to evaluate projects that range from early exploration to advanced development. Giles Hellyer, President of BHP Potash Canada (BHP), is optimistic about the future of the Jansen project, noting that the work to sink the two shafts on this property is 70% complete. The company believes in the long-term fundamentals of the industry but does not have an urgency to bring the project to production under current market conditions. BHP has stated that directors will not push for a production decision in the near future and that BHP is considering its options, which include waiting for a change in market conditions, diluting its interest in the project by bringing on a partner, or potentially selling the project. BHP has already committed US$3.8 B to the project, including US$2.6 B currently allotted for finishing excavation of the two main shafts.

In 2011, the Yankuang Group Company Limited (Yankuang), through a wholly-owned subsidiary—Yancoal Canada Resources Ltd. (Yancoal)—spent $260 M to acquire a group of 19 potash permits from North Atlantic Potash. Subsequent to this purchase, Yancoal has spent $30 to $50 M evaluating the potential of these permits and continues to advance work on one of the permits towards the Feasibility stage of evaluation. Yancoal has completed a Preliminary Economic Assessment as well as Prefeasibility and full Feasibility studies on the Southey project, and the company has received a conditional approval of its Environmental Impact Assessment (EIA) from the Saskatchewan Ministry of Environment. Yancoal continues to work on meeting the terms of the EIA, while awaiting a decision on financial investment from its board of directors.

Western Potash Corp. (Western), which recently completed a corporate reorganization and is now a wholly-owned subsidiary of Western Resources Corp., held a technical review meeting in Beijing with Chinese potash industry experts, with the aim of evaluating the proposed horizontal selective solution mining method to be implemented at the company’s Milestone project. Horizontal selective solution mining would be new to Saskatchewan’s potash industry and Western believes it could create a scalable operation that would have an initial annual production of 146 000 t KCl with an estimated capital cost of $80.6 M. Western stated that the expert group has affirmed the potash deposit is suitable for solution mining and suggested further testing be completed to optimize the project plan. In 2015, Beijing Tairui Innovation Capital Management Ltd invested $80 M for a 51% share of Western. Western also announced it has received provincial approvals for its Environmental Assessment on the Milestone solution mining project.

Encanto Potash Corp. (Encanto) finished a Preliminary Economic Assessment (PEA) for its proposed solution mining project on the Muskowekwan First Nation. The PEA estimates an initial capital mine expense of $3.73 B for a 3.4 M tonnes-per-year solution operation. Encanto announced it has reached a financing agreement with Taylor-Dejongh, an independent energy and infrastructure investment-banking firm, which would provide an initial investment of $10 M to support the Muskowekwan potash project through completion of a bankable Feasibility Study, and the potential for an additional $60 M toward mine development at a later date. Encanto also signed an agreement with the National Federation of Farmers’ Procurement, Processing and Retailing Cooperatives of India Ltd, to supply 5 Mt of potash annually for a minimum of 20 years. Encanto recently signed an agreement with GEM Investments America, LLC and GEM Yield LLC SCS, which could provide $100 M in funding over the next three years.

Gensource Potash Corp. (Gensource) announced results of a Feasibility Study completed on the company’s Vanguard project, approximately 125 km northwest of Regina, which estimated the company could build a 250 000 tonnes-per-year facility that would use selective solution mining techniques, for an initial capital expenditure of $279 M.

Saskatchewan Exploration and 14 Saskatchewan Geological Survey Development Highlights 2017 Saskatchewan Ministry of the Economy North Atlantic Potash Inc. (a subsidiary of Russia’s JSC Acron) and Rio Tinto Potash Management Inc. created the CanPacific Potash Joint Venture to advance the Albany project, 30 km southeast of Regina. The partners have conducted extensive exploration and are proposing to build a 3.25 M tonne-per-year solution mine with an anticipated commissioning date of 2024.

9. INDUSTRIAL MINERALS Although exploration for industrial mineral deposit types in 2017 was quiet, there was significant production. There are four current salt operations, three as byproduct from potash production and one primary producer. K+S Windsor Salt Ltd. produces byproduct salt at Belle Plaine in south-central Saskatchewan. Compass Minerals Canada Corp. mines primary salt at the Unity solution operation in west-central Saskatchewan. NSC Minerals produces byproduct salt at Rocanville and Vanscoy. ERCO Worldwide processes value-added chlorine-alkali chemicals from salt at its operation.

Saskatchewan Mining and Minerals Inc.’s long-standing operation at Chaplin in south-central Saskatchewan remains the only primary sodium sulfate producer in the province. Sodium sulfate is used in a variety of products, including detergents, textiles and carpet deodorizers. In addition, Compass Minerals Wynyard Inc. produces value-added potassium sulfate, which is mainly used in specialty , at a plant near Wynyard in east-central Saskatchewan.

Westmoreland Coal Company (Westmoreland) acquired the Boundary Dam, Bienfait, and Poplar River coal mines in southern Saskatchewan in 2014 from Prairie Mines & Royalty Ltd. Since acquiring the Saskatchewan operations, Westmoreland has signed new, long-term supply agreements with Crown Corporation SaskPower and announced it was amalgamating the Bienfait and Boundary Dam mines of southeastern Saskatchewan into one operation, named the Estevan mine.

Saskatchewan also produced a number of industrial mineral commodities that have varied uses. Canadian Clay Products Inc. excavates and processes bentonite at an operation near Wilcox, about 41 km south of Regina. Colored Shale Products Inc. mines clinker, a stony product formed from naturally coal-fired clay, from quarries near Willow Bunch, roughly 190 km southwest of Regina, on an ‘as-needed’ basis for use as landscaping material. Premier Tech Horticulture Ltd. excavates horticultural peat from bogs in the Carrot River region of east-central Saskatchewan and processes it at a plant near the town. They are developing the new Smokey Ridge Bog that lies 21 km northeast of the town of Hudson Bay. Two other companies, Berger Peat Moss Ltd. and Sunterra Horticulture Inc., are also actively exploring for horticultural peat in the central part of the province. Wapa Bay Resources produces leonardite on a campaign basis from a small quarry near Wapawekka Lake in northern Saskatchewan. Leonardite is used as an organic soil additive and fertilizer. Weil Group Resources, LLC opened a helium processing plant near Mankota in southwest Saskatchewan in August, 2016 and plans to produce 40 million cubic feet of helium per year.

10. REFERENCES Saskatchewan Geological Survey (2003): Geology, and mineral and petroleum resources of Saskatchewan; Saskatchewan Industry and Resources, Miscellaneous Report 2003-7, 173p. Saskatchewan Ministry of the Economy. Saskatchewan Mining and Petroleum GeoAtlas: http://publications.gov.sk.ca/details.cfm?p=83518

Saskatchewan Exploration and 15 Saskatchewan Geological Survey Development Highlights 2017 Saskatchewan Ministry of the Economy

Saskatchewan Exploration and 16 Saskatchewan Geological Survey Development Highlights 2017 Saskatchewan Ministry of the Economy