InnovExplo Inc. Consultants–Mines–Exploration 560, 3e Avenue, Val-d’Or (Québec) J9P 1S4 Telephone: 819.874-0447 Facsimile: 819.874-0379 Toll-free: 866.749-8140 Email: [email protected] Web site: www.innovexplo.com TECHNICAL REPORT AND MINERAL RESOURCE ESTIMATE FOR THE GRASSET Ni-Cu-PGE DEPOSIT (according to National Instrument 43 101 and Form 43 101F1) Project Location Latitude 49º58’09’’ North and Longitude 78º20’20’’ West Province of Québec, Canada Prepared for Balmoral Resources Ltd Suite 2300 - 1177 West Hastings Street Vancouver, British Columbia Canada V6E 2K3 Prepared by: Pierre-Luc Richard, P. Geo. Bruno Turcotte, P. Geo InnovExplo – Consulting Firm Effective Date: January 12th, 2016 Signature Date: March 30th, 2016 www.innovexplo.com TABLE OF CONTENTS SIGNATURE PAGE – INNOVEXPLO ........................................................................................................ 10 CERTIFICATE OF AUTHOR – PIERRE-LUC RICHARD .......................................................................... 11 CERTIFICATE OF AUTHOR – BRUNO TURCOTTE ................................................................................ 12 1. SUMMARY .......................................................................................................................................... 13 Introduction .................................................................................................................................. 13 Property Description and Location .............................................................................................. 13 Geological Setting ....................................................................................................................... 13 Mineralization............................................................................................................................... 14 Gold ..................................................................................................................................... 14 Nickel-Copper-PGE ............................................................................................................. 15 Data Verification .......................................................................................................................... 15 Metallurgical Testing .................................................................................................................... 15 Mineral Resource Estimate ......................................................................................................... 16 Interpretations and Conclusions .................................................................................................. 18 Recommendations ....................................................................................................................... 18 2. INTRODUCTION ................................................................................................................................. 19 Issuers ......................................................................................................................................... 19 Terms of Reference ..................................................................................................................... 19 Principal Sources of Information.................................................................................................. 20 Qualified Persons ........................................................................................................................ 21 Inspection of the Property ............................................................................................................ 22 Effective Date .............................................................................................................................. 22 Units and Currencies ................................................................................................................... 22 3. RELIANCE ON OTHER EXPERTS .................................................................................................... 23 4. PROPERTY DESCRIPTION AND LOCATION .................................................................................. 24 Location ....................................................................................................................................... 24 Mining Rights in the Province of Québec .................................................................................... 25 The Claim ............................................................................................................................ 25 The Mining Lease ................................................................................................................ 25 The Mining Concession ....................................................................................................... 26 Mining Title Status ....................................................................................................................... 26 Acquisition of the Grasset Property ............................................................................................. 28 Access to the Property ................................................................................................................ 28 Permits ......................................................................................................................................... 28 Environment................................................................................................................................. 28 5. ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE AND PHYSIOGRAPHY .. ............................................................................................................................................................. 29 Accessibility ................................................................................................................................. 29 Climate ......................................................................................................................................... 29 Local Resources .......................................................................................................................... 31 Infrastructure................................................................................................................................ 31 Physiography ............................................................................................................................... 31 6. HISTORY ............................................................................................................................................. 33 1956–1964 ................................................................................................................................... 33 1974–1978 ................................................................................................................................... 36 1981–1989 ................................................................................................................................... 38 1996–1998 ................................................................................................................................... 39 Technical Report and Mineral Resource Estimate for the Grasset Ni-Cu-PGE Deposit 2 www.innovexplo.com Exploration Work by Balmoral from 2011 to 2014 ....................................................................... 40 2011 exploration work ......................................................................................................... 40 2012 exploration work ......................................................................................................... 41 2013 exploration work ......................................................................................................... 41 Induced polarization and resistivity surveys ................................................................................... 41 HLEM and magnetic survey ........................................................................................................... 41 Soil geochemistry survey ............................................................................................................... 42 2014 exploration work ......................................................................................................... 42 Airborne survey .............................................................................................................................. 42 Induced polarization and resistivity surveys ................................................................................... 43 Borehole Pulse EM Surveys .......................................................................................................... 43 7. GEOLOGICAL SETTING AND MINERALIZATION ........................................................................... 45 The Abitibi Terrane (Abitibi Subprovince) .................................................................................... 45 New Abitibi Greenstone Belt Subdivisions .................................................................................. 45 Regional Geology ........................................................................................................................ 48 Grasset Property Geology ........................................................................................................... 51 Mineralization..............................................................................................................................