2 .46.^0 8 Report on the Interpretation of the VTEM Airborne Electromagnetic Survey

Gaiashk Property, Elliot Lake Region, Ontario

SUMMARY This interpretation report was authored by L. Reed, geophysicist. The airborne electromagnetic and magnetic survey results were filed for assessment credit by Verbina Resources Inc. however the interpretation report was not submitted with the original survey results.

Current Ownership - Precambrian Resources Ltd. (50%), Dan Patrie Exploration (50%). The property was optioned by Verbina Resources Inc. but turned back to the current owners in 2010.

Survey Coverage - This report covers work on the following claims in Gaiashk Township, Sault Ste. Marie Mining Division. The claims survey are 4214924 (8 units), 3019225 (14 units), 3019226 (15 units), 3019227 (16 units), 3019228 (8 units), 3019229 (13 units) and 3019305 (15 units).

Location and Access - (NTS 41J/8) The Gaiashk Property formerly optioned by Verbina Resources is located about 25 road kilometers east of the town of Elliot Lake in northern Ontario on the south limb of the Quirke Lake syncline. Access is afforded by traveling on bush roads to the property. A high voltage Hydro transmission is located south of the claims.

Geology - The claims are underlain by quartz-rich Huronian sediments which in turn rest on the Whiskey Lake greenstone assemblage which consists of komatiitic, tholeiitic and calc-alkaline mafic to felsic metavolcanic rocks. The metavolcanics contain interflow metasedimentary units that include oxide-sulfide iron formation, chert, wacke, siltstone and graphitic sulfide units. The Archean-Proterozoic unconformity occurs on the property. Here, radioactive quartz pebble conglomerate beds in arkosic sandstones (Matinenda Fm) overiie older Huronian basalts, pyritic boulder conglomerate (Livingstone Creek Fm) and/or Archean rocks of the Whiskey Lake Greenstone belt. Thick mafic Nipissing diabase or gabbro sills and dykes intrude all the previous mentioned rock formations.

The western part of the claim group a portion of an intense magnetic and regional gravity anomaly. The source of this anomaly was thought to be iron formation but recent AEM surveys and ground work by the Ontario Geological Survey suggest the anomaly is caused by a large Proterozoic mafic intrusion beneath the Huronian sedimentary cover and as such is prospective for Ni-Cu-PGE (Platinum Group Elements. A recent lake sediment survey shows lake in the area anomalous in Ni, Or, U and REE's (Rare Earth Elements

Mineralization - The basal conglomerate units of the Huronian Matinenda formation are uraniferous. An Ore Estimates Map by Rio Algom (1977) indicates the Pecors East Uranium Zone has an "indicated" resource (non 43-101 compliant) of 18,000,000 tonnes (20,000,000 tons) grading 0.037% (0.74 Ibs/t) UsOsor 14,800,000 lbs UaOa. The Gaiashk Property covers approximately 10% of Pecors East Uranium Zone and as such may contain over 1,000,000 lbs of U3O8 with an unknown content of REE's. In addition to uranium and thorium, anomalously high levels of the Light Rare Earths, Y, Ce, La and Nd and the Heavy Rare Earths, Yb, Dy, Er and Tb, are also noted in the uranium ores. F ^ ^ O ^ S V I Z O

G. Campbell, MSc. and President, Precambrian Ventures Ltd.,October 1, 2010 0 6 2 0 1 0

GEOSCIEWCE ASSESSMENT OFFICE

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AEM Coverage

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Location of the Gaiashk Property with AEM Coverage formerly held by Verbina Resoreces

REPORT OF THE INTERPRETATION

OF THE VTEM

AIRBORNE ELECTROMAGNETIC SURVEY

GAIASHK PROPERTY

ELLIOT LAKE REGION, ONTARIO

FOR

VERBINA RESOURCES INC.

L.E. Reed Geophysical Consultant Inc. Rockwood, Ont. NOB 2K0, Canada January, 2009

INTERPRETATION OF THE VTEM AIRBORNE ELECTROMAGNETIC SURVEY GAIASHK PROPERTY

Introduction

A helicopter borne VTEM electromagnetic survey was flown by Geotech Ltd. For Verbina Resources Inc. in the Elliot Lake region in January 2008. The survey has been report by the contractor under the title "Report of the Helicopter Borne Versatile Time Domain Electromagnetic (VTEM) Geophysical Survey, Gaiashk Property, Elliot Lake, Ontario, Canada". This report provides the system and survey parameters. The principal targets in this exploration are structures that could control the emplacement of uranium mineralization. Conductors in the Athabaska basin are the starting model for this interpretation. This would seek out conductive material at or below an unconformity.

The present report presents interpretation of that survey. All maps attached to this report were developed by the author.

MAPS

These maps provide a reference between the EM anomalies and other grided images acquired with the survey. Especially useful is the map of anomalies drawn on the 1VD magnetics. The other maps have interest as well for comparative use.

1 ) VTEM Responses on Topography, Flight Lines, Scale 1:20,000 2) Total Field Magnetics grided, on Topography, with VTEM Responses and

Interpreted Trends, Scale 1:20,000 3) VTEM Responses with Interpreted EM trends, on Topography and grided 1 VD

Magnetics, Flight Lines, Scale 1:20,000 4) EM response for dB field component in early mid-time, grided; with VTEM

Responses, Scale 1:20,000 5) EM response for B field component in early time, grided; with VTEM Responses,

Scale 1:20,000 6) DEM, Digital Elevation Model (DEM) grided; with VTEM Responses, Scale

1:20,000

Gaiashk Property

Figure 1 : Property Location on Google Map product.

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Figure 2; Map of B field EM response.

COMMENTS ON INTERPRETATION

EM responses have been identified and placed on the maps as symbols identifying relative amplitude (size of the symbol), relative conductance (red - response into the latest time channel; orange - response into later time channels but not the last few; yellow - response into the mid time channels; green response into the early time channels, and blue into the earliest time charmels. Circles identify vertical or wide or deep source responses. No anomaly shapes suggest shallow or dipping events. While a guide to anomaly shapes is found in the Geotech report: Appendix E, Generalized Modeling Results of the VTEM System, all responses in these data are single peaked. These responses suggest deeper sources, as may come fi^om sources at the bottom of cover rocks.

Both the standard measured dB field and the calculated B field have been observed, and where the definition is clear and one field only, anomalies have been identified as either dB (marked as normal triangles) or B (marked as inverted triangles). Most anomalies however, show both response types and are marked as circles. In theory, the B field responses have greater source conductance. Not enough work on field data has been done to confirm this for the general case however. The reason for differences are not entirely clear, but single field responses suggest some differences in the source bodies, yet to be determined.

Anomalies and anomaly trends have been identified and numbered in the maps. Correlations among the conductors, as well as with other parameters, serve as a guide to the mineral potential of these conductors.

The EM responses for fairly early time channels have been gridded for both the dB and the B fields, as these products appear to provide the better identification of response. It is noted that large areas of high EM response in early time appear over lake areas. These responses are interpreted to arise from lake bed conductive clays and silts, and are not indicative of mineralization. A few of these are identified with anomaly identifiers and will be noted below. Much of this large response is not identified by anomaly indicators, but may be seen on the grided EM response maps by comparing responses to lake outlines on the attached topography.

It will be seen that various conductor horizons identify with interpreted structures and/or contacts. These would appear to be good targets for mineralization.

INTERPRETATION

Anomaly 1 - Intermediate size, poor conductors appear in a pond and are suggested to be surfical in origin.

Anomalies 2 and 3 - Small B field responses in a magnetic low (1VD map) with good conduction may represent weakly mineralized structures. The B field alone however may raise questions about the validity of the responses.

Anomaly 4 and 5 - Intermediate size responses with intermediate conduction may mark a structure seen as a contact on the north side a magnetic high (1 VD map).

Anomaly 6 and 7 - Intermediate to fairly large size intermediate to good conductivity responses mark a magnetic low or north contact of a magnetic high. These suggest a mineralized contact ot structure. These may be closest of any responses on this survey to the model of conductor in a magnetic low as suggested by the Athabaska model.

Anomaly 8 - This horizon show the largest, and most continuous strong conductivity responses on the survey. The west half of the conductor lies off the ends of the survey lines. Rising responses at the south ends of the lines were picked, but the peaks lie further south as indicated by the conductor trend line. The very broad character of these responses suggests a possible wide, flat, or gently dipping source. There is some correlation with the magnetics. The source appears to lie between two magnetic highs that trend east northeast. There is uncertainty if this horizon represents a target, but it may do. A weak amplitude, but moderate to good conductivity response continues the horizon to the east (anomaly 12)

Anomaly 9 - Anomaly 9 is indicated by partial responses at the ends of lines. The center of these fairly good responses lies off the survey to the south.

Anomalies 10, 11 and 12 - This is a series of short strike, fairly small, but good conductivity responses. Anomalies 10 and 11 lie directly on magnetic highs, while anomaly 12 lies in a low between two highs (1VD map).

Anomalies 13 and 14 - These two nearby responses may lie in somewhat different settings. The fairly good anomaly 13, although somewhat discordant to the magnetic trend, appears to be in a narrow magnetic low (1 VD map). Anomaly 14 appears as two fairly good conductivity B field responses on the same line, on and slightly off a magnetic high. South of anomaly 13 on the same line as 14, is a poor dB response having no immediate interest. 13 and 14, like 10, 11 and 12 to the west may be structurally related and have economic target interest.

Anomalies 15,16,17 and 18 - These anomalies are modest to small in size with moderate conductivity response. Anomalies 16, 17 and 18 lie on the south contacts of magnetic features (IVD map), and suggest structural possibilities. These are offset from anomalies 13, 14 and further west which have similar magnetic associations. A northerly trending break and/or dyke identifies this separation. Note anomaly 17 is a weak B field response. All of these have some interest, although they are not particularly strong, which may downgrade their level of interest.

Anomaly 19 - This anomaly is perhaps the most outstanding response on the survey. It is strong and quite conductive. It is however quite local. It is observed on both a survey line and a crossing tie line. It lies in the middle of a lake. There is no magnetic association. This anomaly would be a classic polymetallic target, as it is a good response and is isolated from other responses. It's limited dimension may limit it's potential however.

Anomaly 20 - Small moderate responses identify another of the potential structural sources.

Anomaly 21 - This isolated, better amplitude and conductance response, may identify with anomaly 19, although it is not as outstanding as 19.

Anomaly 22 - These fairly strong amplitude, but modest conductance responses appear to identify distinct bedrock sources, separate from the large overburden response (lake bed) in which they are imbedded. These would be of interest if anomalies 19 and 21 showed promise as polymetallic targets.

Anomaly 23 - Moderate response amplitude and conductance responses appear to mark a contact with magnetics high to the north. Like apparent structure/contact responses further south, there is potential for mineralization associated with these responses.

Anomaly 24 - This small amplitude, but good conductance anomaly lies in a quite different terrain that other responses fiirther west. This is seen by the 1 VD magnetics. It is also observed that the anomaly lies east of the identified unconformity (figure 2, and

maps). It is in a magnetic low. This could represent attractive mineralization but it would appear to have no immediate interest, as it lies outside the claim boundary.

Anomalies 25, 26 and 27 - Small, good conductivity responses lie in different terrain than responses to the west. These lie near the claim boundary to the northeast, and at or just within the unconformity line. These could represent mineral targets.

Anomalies 28 and 29 - Moderate to strong amplitude responses mark a magnetic low trend and would be good targets for uranium mineralization. These lie across the claim boundary at the north of the small isolated block however. The east end of 28 is within the claims and marks a contact seen in the magnetics with magnetics high to the south (IVD map).

Anomaly 30 - This anomaly also lies in a contact setting with moderate to good amplitude and conductance. This would be a good economic targt.

Anomaly 31 - This moderate to good amplitude and good conductance response marks the north edge of a magnetic high. This like anomalies just north appears as a good economic target.

Anomaly 32 - The anomaly is a single B field good conductivity response on a magnetic high. This might wait developments just north.

Anomaly 33 - Large poor conductance responses mark a lake bed source of no economic interest.

COMMENTARY AND CONCLUSIONS

The principal target for this survey has been uranium mineralization, possibly of a kind and character of that found in the Athabaska basin. There, uranium is associated with structure in Precambrian basement rocks which extend into overlying Athabaska sandstone rocks. One of the keys to structure there has been recognition of graphitic (with minor sulphide) horizons in the basement as defined by airborne and ground electromagnetic surveys. Often these structures are associated with magnetic lows, coincident with the graphitic events. This has not been a hardbound rule however, as structure may be expressed in more subtle ways, such as at McArthur River where one of the largest of the uranium orebodies has been developed. There the following of weakly defined EM responses on the ground became a method for focusing attention within an area of uranium highs in the surface boulders.

Structure seems necessary, and structure that provides pathways for uranium mineralizing fluids would be necessary. Identifying such structures becomes the problem. There are apparent structures identified in this survey, where EM responses form linear events coinciding with linear events in the magnetics. There are no obvious Athabaska style EM/magnetic responses in this survey, that is EM features coincident overall with

magnetic lows. The correlations appear more as EM responses on contacts suggested by the magnetics. These interpreted structures could be hosts to uranium mineralization.

A number of anomalies have been identified in the listing above. If fact many of the observed anomalies are found with correlations in the magnetics (2 to 18, 20, 23, 28 and to 31 ). Two or possibly 3 anomalies (19, 21 and 22) suggest the possibility of polymetallic base metal sulphides. Anomalies 24 to 27 and 32 lying in a different environment, may have potential, but are uncertain in their provenance.

Laurie E. Reed, P.Eng. (Ont.) Geophysical Consultant January 26, 2009

-82°26'

390000 -82-25' -82'24' -82°23' -82'22' -82°2r

392000 -82°20-

394000 396000 398000

390000 -82°26' -82°24' -S2°23' -82°22'

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398000 -82°20'

Anomaly îtmplitude Chaimels front ilB dt Numbers of Cliarader Both dB iSt B Response of Field • 3 • All A rfB only • 2 • 3/4 W BOiih-# 1 o 1/2 • 0.5 © 1/4 • 0.1 o A Few * <0.1

250 Scale 1:20000

250 500 750 1000 1250 1500

metres NAD83 / UTM zone 17N

m̂ tp I

VERBINA RESOURCES INC VTEM RESPONSES ON TOPOGRAPHY

INTERPRETED CONDUCTOR HORIZONS

L.E. Reed Geophysical Consultant Inc. 01/24/09

-82°26'

390000 -82°25' -82°24' -82°23' -82°22' .82°2f

392000 394000 396000 398000

Anoiiiatly a m p l i t u d e f r o m ( f E i l t

Both dB & B • 3

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w 250 Scale 1:20000

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metres

1250 1500

NA083 / UTM zone 17N

Total Wlag - nT

-82°2& -82°25' -82°24' -82''23' -82°22'

396000 -82°2r

398000 -82°20'

VERBINA RESOURCES INC TOTAL MAGNETICS VTEM RESPONSES INTERPRETED CONDUCTOR HORIZONS

Topography - Lakes, Rivers, Roads Unconformity - Green Line

L.E. Reed Geophysical Consultant Inc. 01/24/09

-82°20' 398000

390000 392000 -82°26' -82°25'

394000 -82°24' -82°23' -82° 22'

396000 -82°2r

398000 -82°20'

1 0 0 0 0 0 0 0 0 0 0 0 0 0 0

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Scale 1:20000 250 500 750 1000

metres NAD83 / UTM zone 17N

1250 1500

VERBINA RESOURCES INC 1VD MAGNETICS VTEM RESPONSES

INTERPRETED CONDUCTOR HORIZONS

L.E. Reed Geophysical Consultant Inc. 01/24/09

-82°26'

390000 -82''25' -82-24' -82°23' -82°22' -82-21' -82-20'

392000 394000 396000 398000

390000 -82-26' -82-25' -82-24' -82-23' -82-20'

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VERBINA RESOURCES INC VTEM dB RESPONSE, VTEM RESPONSES

INTERPRETED CONDUCTOR HORIZONS Topography - Lakes, Rivers, Roads

Unconformity - Green Line Early-Mid-Time

L.E. Reed Geophysical Consultant Inc. 01/24/09

- 8 2 ° 2 6 '

390000 -82°24' -82°23' -82'21' -S2°20'

392000 398000

/\ll0lllîll> aiiiptihirte Oiaiuifls IV oni cl B/dt Niiiribers of Cliarader BomtlB&B Response of Field

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0.0930 0.0389 • • • 1 0.0234 0.0173 0.0130 0.0103 0.0088 0.0079 0.0079 0.0072 0.0065 0.0058 ^m 0.0053 MR 0.0047 SMS 0.0042 p » 0.0038 0.0035 0.0032 f—H 0.0029 h—J 0.0026 0.0025 0.0023 0.0021 0.0020 «n-0.0018 I s a 0.0017 1 • H 0.00151 •M 0.0014! N 0.0013 i ̂ 0.0012 M 0.0010 H 0.0009 ml 0.0008 am

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250 Scale 1:20000

250 500 750 1000 1250 1500

metres NAD83 / UTM zone 17N

390000 398000 -82°26' -82''25' -82''24' -82°23' -82''22' -82°20'

VERBINA RESOURCES INC VTEM B RESPONSE, VTEM RESPONSES INTERPRETED CONDUCTOR HORIZONS

Topography - Lakes, Rivers, Roads Unconformity - Green Line

Early-Time

L.E. Reed Geophysical Consultant Inc. 01/24/09

- 8 2 ° 2 6 '

390000 -82°25' -82°24' -82°23'

392000

- 8 2 ° 2 6 ' -82°25' -82°24' -82°22' -82°20'

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Elevation Metres asl

250 0 250 Scale 1:20000

500 750 1000 —I—^

1250 1500

metres NADB3 / UTM zone 17N

VERBINA RESOURCES INC DIGITAL ELEVATION VTEM RESPONSES INTERPRETED CONDUCTOR HORIZONS

Topography - Lakes, Rivers, Roads Unconformity - Green Line

L.E. Reed Geophysical Consultant Inc. 01/24/09