Report to: TREVALI MINING CORP. Halfmile Lake-Stratmat Preliminary Economic Assessment Document No. 0987190100-REP-R0003-00 0987190100-REP-R0003-00 Report to: TREVALI MINING CORP. HALFMILE LAKE - STRATMAT PRELIMINARY ECONOMIC ASSESSMENT EFFECTIVE DATE: OCTOBER 18, 2010 FILING DATE: OCTOBER 4, 2011 Prepared by Mike McLaughlin, P.Eng. Paul Daigle, P.Eng. David Tyson, M.Sc., R.P. Bio. Peter Broad, P.Eng. Pacifico Corpuz, P.Eng. Daniel Sweeney, P.Eng. Aleksandar Zivkovix, P.Eng. MM/vc Suite 900, 330 Bay Street, Toronto, Ontario M5H 2S8 Phone: 416-368-9080 Fax: 416-368-1963 0987190100-REP-R0003-00 TREVALI MINING CORP. HALFMILE LAKE - STRATMAT PRELIMINARY ECONOMIC ASSESSMENT EFFECTIVE DATE: OCTOBER 18, 2010 FILING DATE: OCTOBER 4, 2011 "Original document signed by Mike Prepared by Date October 4, 2011 McLaughlin, P. Eng." Mike McLaughlin, P. Eng. "Original document signed by Peter Reviewed by Date October 4, 2011 Broad, P. Eng." Peter Broad, P. Eng. "Original document signed by Mike Authorized by Date October 4, 2011 McLaughlin, P. Eng." Mike McLaughlin, P. Eng. MM/vc Suite 900, 330 Bay Street, Toronto, Ontario, M5H 2S8 Phone: 416-368-9080 Fax: 416-368-1963 0987190100-REP-R0003-00 REVISION HISTORY REV. PREPARED BY REVIEWED BY APPROVED BY NO ISSUE DATE AND DATE AND DATE AND DATE DESCRIPTION OF REVISION Original technical report readdressed to Trevali 00 2011/10/04 Mike McLaughlin Peter Broad Mike McLaughlin Mining Corp. 0987190100-REP-R0003-00 TABLE OF CONTENTS 1.0 SUMMARY ....................................................................................................................... 1-1 1.1 LOCATION AND REGIONAL GEOLOGY .................................................................................. 1-1 1.2 RESOURCE ESTIMATE ........................................................................................................ 1-2 1.3 HALFMILE LAKE .................................................................................................................. 1-2 1.3.1 STRATMAT ........................................................................................................ 1-3 1.4 MINING .............................................................................................................................. 1-4 1.4.1 HALFMILE LAKE ................................................................................................ 1-4 1.4.2 STRATMAT ........................................................................................................ 1-5 1.4.3 TAILINGS MANAGEMENT FACILITY ...................................................................... 1-9 1.5 MINERAL PROCESSING AND METALLURGICAL TESTING ...................................................... 1-10 1.5.1 METALLURGICAL TEST PROGRAMS .................................................................. 1-10 1.5.2 MILL TONNAGE ............................................................................................... 1-11 1.5.3 MILL LOCATION ............................................................................................... 1-11 1.5.4 PROCESS FLOW SHEET .................................................................................. 1-12 1.6 MARKETS AND CONTRACTS .............................................................................................. 1-13 1.7 ENVIRONMENTAL ............................................................................................................. 1-14 1.7.1 GEOCHEM ...................................................................................................... 1-15 1.7.2 WATER QUALITY ............................................................................................. 1-15 1.7.3 HYDROGEOLOGY ............................................................................................ 1-15 1.7.4 MINE CLOSURE ............................................................................................... 1-15 1.8 FINANCIAL ANALYSIS ........................................................................................................ 1-16 1.8.1 CAPITAL AND OPERATING COSTS .................................................................... 1-17 1.9 RISKS AND OPPORTUNITIES .............................................................................................. 1-18 1.9.1 UNDERGROUND MINING .................................................................................. 1-18 1.9.2 METALLURGY .................................................................................................. 1-19 1.9.3 ENVIRONMENTAL ............................................................................................ 1-19 1.10 RECOMMENDATIONS ........................................................................................................ 1-19 1.11 CONCLUSIONS ................................................................................................................. 1-19 2.0 INTRODUCTION .............................................................................................................. 2-1 3.0 TERMS OF REFERENCE ................................................................................................ 3-1 3.1 TERMS OF REFERENCE ...................................................................................................... 3-1 4.0 PROPERTY DESCRIPTION AND LOCATION ................................................................ 4-1 4.1 LOCATION .......................................................................................................................... 4-1 4.2 PROPERTY DESCRIPTION ................................................................................................... 4-4 5.0 ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE AND PHYSIOGRAPHY ............................................................................................................. 5-1 ii 0987190100-REP-R0003-00 5.1 ACCESSIBILITY ................................................................................................................... 5-1 5.2 CLIMATE ............................................................................................................................ 5-2 5.3 LOCAL RESOURCES ........................................................................................................... 5-2 5.4 INFRASTRUCTURE .............................................................................................................. 5-3 5.5 PHYSIOGRAPHY ................................................................................................................. 5-3 6.0 HISTORY .......................................................................................................................... 6-1 6.1 HISTORICAL PROPERTY OWNERSHIP .................................................................................. 6-1 6.1.1 HALFMILE LAKE ................................................................................................ 6-1 6.1.2 STRATMAT ........................................................................................................ 6-2 6.2 HISTORICAL WORK COMPLETED ......................................................................................... 6-3 6.2.1 HALFMILE LAKE ................................................................................................ 6-3 6.2.2 STRATMAT ...................................................................................................... 6-10 6.3 HISTORICAL RESOURCE ESTIMATE ................................................................................... 6-11 6.3.1 HALFMILE LAKE .............................................................................................. 6-11 6.3.2 STRATMAT ...................................................................................................... 6-11 7.0 GEOLOGICAL SETTING ................................................................................................. 7-1 7.1 REGIONAL GEOLOGY.......................................................................................................... 7-1 7.2 PROPERTY GEOLOGY ......................................................................................................... 7-3 7.2.1 HALFMILE LAKE ................................................................................................ 7-3 7.2.2 STRATMAT ........................................................................................................ 7-7 8.0 DEPOSIT TYPE................................................................................................................ 8-1 9.0 MINERALIZATION ........................................................................................................... 9-1 9.1 HALFMILE LAKE .................................................................................................................. 9-1 9.2 STRATMAT ......................................................................................................................... 9-1 10.0 EXPLORATION .............................................................................................................. 10-1 10.1 INTRODUCTION ................................................................................................................ 10-1 10.2 EXPLORATION EXPENDITURES .......................................................................................... 10-1 11.0 DRILLING ....................................................................................................................... 11-1 11.1 HALFMILE LAKE ...............................................................................................................