REDROCK PROPERTY CSAMT SURVEY - … · within the CSAMT coverage. This intersection is the specific feature detailed by the survey. An initial gravity survey with CSAMT follow-up

REDROCK PROPERTY CSAMT SURVEY - I GIS COMPILATION

Inverted CSAMT Sections over Topography

James L. Wright M.Sc. June 14, 2011

TABLE OF CONTENTS

INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . 2 SURVEY PROCEDURE . . . . . . . . . . . . . . . . . . . . . . 3 DATA PROCESSING . . . . . . . . . . . . . . . . . . . . . . . 4 INTERPRETATION . . . . . . . . . . . . . . . . . . . . . . . 6 CONCLUSIONS AND RECOMMENDATIONS . . . . . . . . . . . . 16 REFERENCES APPENDIX A- CSAMT LOGISTICS APPENDIX B- PROPOSED DRILL HOLES, CSAMT SECTIONS DVD HOLDER- DATABASE DVD MAP POCKETS (1:6000 & 1:12000 Sets) -

CSAMT SURVEY, LINES GRAVITY SURVEY, CBA RESIDUAL, GRAVITY STRUCTURES

GRAVITY SURVEY, CBA RESIDUAL, CSAMT STRUCTURES CSAMT SURVEY, LINE 4459900N, INVERTED RESISTIVITY SECTION/ GRAVITY CSAMT SURVEY, LINE 4460200N, INVERTED RESISTIVITY SECTION / GRAVITY CSAMT SURVEY, LINE 4460500N, INVERTED RESISTIVITY SECTION / GRAVITY CSAMT SURVEY, LINE 4460800N, INVERTED RESISTIVITY SECTION / GRAVITY CSAMT SURVEY, LINE 4459900N, INVERTED RESISTIVITY SECTION / GEOLOGY CSAMT SURVEY, LINE 4460200N, INVERTED RESISTIVITY SECTION / GEOLOGY CSAMT SURVEY, LINE 4460500N, INVERTED RESISTIVITY SECTION / GEOLOGY CSAMT SURVEY, LINE 4460800N, INVERTED RESISTIVITY SECTION / GEOLOGY

J L WRIGHT GEOPHYSICS 1

INTRODUCTION A controlled source audio magneto-telluric (CSAMT) survey was completed over a portion of the REDROCK property with the objective of defining structures and lithologies associated with gold mineralization. Gravity work, reported upon by Wright (2010), indicates a structural intersection between north-south and northwest structures within the CSAMT coverage. This intersection is the specific feature detailed by the survey. An initial gravity survey with CSAMT follow-up is a standard technique applied with success in Nevada. Figure 1 shows the property outline relative to roads, county boundaries and topography.

FIGURE 1: Property Location Results of the survey are provided in digital and map formats. Digital products included all raw data and processed files, as well as MAPINFO and ARCGIS GIS files for the four (4) inverted resistivity sections. Also included are data and GIS files for a number of related data sets such as regional gravity, topography, geology, etc. The combined files constitute a complete GIS data base for the property. Maps include inversion plots with interpretive overlay for the four lines at both 1:6000 and 1:12000 scales. Also included are topographic and residual gravity plots with interpreted structures at the two scales. All plot files are also included in digital form as SURFER V9 SRF files. Files, both digital and map, are contained on a DVD located in a sleeve at the rear of the report. A README file on the DVD explains the folder / file organization. Survey procedures and data processing are first reviewed followed by an interpretation of the CSAMT survey with incorporation of multiple data sets. Finally, recommendations and conclusions are presented, along with several proposed holes.


SURVEY PROCEDURE Figure 2 shows a CSAMT line plot overlying topography. The lines are oriented east-west, spaced 300m and arranged to cut the northwest Caetano Break and north-south structures. Line numbers correspond to the NAD 27 / UTM 11N northing. Zonge Geosciences, Inc. based in Reno, Nevada conducted the data acquisition under Zonge job number 11090. The survey was conducted during the period of May 19 – 23, 2011 and covered a total of 8.8 line - km. The survey control was established by Zonge personnel using a Trimble PRO-XRS GPS receiver with real time differential corrections provided by OMNISTAR. CSAMT data were acquired using a 50 meter electric-field receiver dipole. Measurements were made in spreads consisting of four electric-field dipoles (4 Ex/1 Hy) with a magnetic-field antenna located in the center of the spread. The data were acquired in the broadside mode of operation with the electric-field dipoles oriented along the survey line and parallel to the transmitter dipole (x component). The magnetic antenna was oriented perpendicular to the survey line. Measurements were made at frequencies ranging from 1 Hz to 8192 Hz in binary steps. One CSAMT transmitter, of a grounded dipole configuration, was used for this survey.

FIGURE 2: CSAMT Lines over Topography

Data were acquired with a Zonge model GDP-32 receiver and Zonge GGT-30 transmitter. The GGT-30 is a constant-current 30 KVA transmitter. Power for the transmitter was provided by a Zonge ZMG-30 motor-generator with a VR-1 voltage regulator. The transmitter was controlled by an XMT-32 transmitter controller. Transmitter-receiver synchronization was maintained with identical crystal oscillators, synchronized each morning before data acquisition.


Data quality was monitored in the field by the operator. Real-time standard-error values are displayed during acquisition. In addition, multiple measurements at a range of frequencies are displayed graphically as resistivity versus frequency curves with error bars showing the data scatter. This allows a visual evaluation of the data quality and remedial action to be taken if necessary. Data quality is also evaluated during post-acquisition processing by reviewing data component plots. Data are edited to remove spurious data if necessary. As a whole, the data are of good quality typified by repeated measurements generally within 10 percent. The smooth nature of the curves and lack of noticeable error bars also demonstrates good data quality. Additional logistical details are available in Appendix A, where a more complete discussion of the various aspects of the survey are presented. DATA PROCESSING Zonge Geosciences provided averaged and edit files, along with station survey information, for each line in standard Zonge AVG and STN files. These data were processed with Zonge’s SCS2D two dimensional, smooth model, CSAMT inversion software version 3.20z. A variable cell size ranging from 25x20m to 25X40m was selected to better refine data fits. Prior to additional processing all inverted resistivities were converted to logarithms base ten. Gridding with a kriging algorithm using a five meter spacing was implemented. The grids were then mask to the topography, line limits and a depth extent of approximately 500m. Finally, the inverted sections were colored and contoured for map preparation. Contour interval on all plots is 0.05 log ohm-m. The resistivity color bar for all products, including GIS files, follows.

Complete Bouguer Anomaly (CBA) residual gravity data are included as a back-drop to the CSAMT results. Wright (2010) reports on the survey and the color scale used for the plots and figures follows.


FIGURE 3: Plot Example

As noted previously, paper plots are provided at two scales along with SRF plot files. Figure 3 shows an example of a CSAMT section with all plots located in the map pockets. The inverted data for all lines were merged and imported into the VOXLER 3D visualization program, an example image from the program follows.

FIGURE 4: VOXLER Inverted Sections


INTERPRETATION Rational for CSAMT line placements is reviewed by Figure 5, which shows the property scale residual gravity reported upon by Wright (2010). Structures interpreted from the gravity are identified with dashed lines of two weights. The Caetano Fault, which bounds the north side of the Caetano Trough, trends in a northwest orientation across most of the property’s southern edge. However, it is severely disrupted by a major north-south structural zone, as shown on the figure. The intersection of the Caetano Fault and north-south zone is the area of investigation for the CSAMT survey. It is important to note that a number of northeast directed structures also occur near the intersection.

FIGURE 5: Residual Gravity, Interpreted Structures and CSAMT Line Figures 6 to 9 show the inverted resistivity sections rotated to plan about the line. Underlying the sections is the property scale geology of Conway et. al. (2007). Overlying the section is an interpretation with structures depicted with dashed or barbed (thrusts) lines and contacts with dotted lines. Various interpreted rock units are labeled. Note a horizontal exaggeration of approximately 1.3 is imparted to the images by the rotation process. All four lines have a gross similarity. A somewhat layered geometry with conductive rocks dominates the western half of the lines and a similar layered geometry of resistive rocks on the far eastern portion. Line 4460800N is the best example of the two areas of layering. High angle structures occur within the layered areas, but are clearly concentrated between the two. This structural concentration correlates with the Caetano Faults and north-south structural zone. Indeed, the Caetano Fault, as mapped by Conway et. al. (2007), agrees very well with structures interpreted on the sections.


FIGURE 6: Line 4459900N Inverted Section over Geology








The conductive layered rocks to the west is interpreted as Quaternary colluvium (Qc) overlying alternating layers of material composed of volcanic rocks dominated by the Caetano tuff (Tct). More conductive layers are likely tuffs and more resistive layers intrusives or perhaps flows. The sequence of Qc and Tct pinches to the east and is terminated by the major structures. This pinching or thinning of individual layers is most developed on the southern lines. Beneath the Qc and Tct is a resistive half space, likely reflecting Paleozoic rocks.

FIGURE 10: Line 4460200N Inverted Section and Drill Traces

Figure 10 shows two drill holes located near Line 4460200N. The holes are projected on to the inverted resistivity section and color coded with the lithology. Hole RRC10-1 intersected Elder Formation (DSe) rocks in the upper portion and passed into Ordovician Valmy Formation (Ov) at 600’. Hole RRC07-08C started in Slaven Chert (Ds) progressed into DSe and also passed into Ov at either 850’ or 1650’. The shallower 850’ intercept is depicted in the figure. Considerable structural disruption is noted in the hole from 1300’ down. The marked offset in the DSe / Ov contact between the holes is a manifestation of the structures shown on the inverted section. In detail, it appears Hole RRC10-1 intersected a horsted block of Ov. The horst continues to the north-northwest and is noted on Line 4460500N (see Figure 8) with a similar resistivity signature. Hole RRC07-08C parallels a prominent structure and likely crossed it at a shallow angle, thus the structural disruption below 1300’. The conductive material logged as DSe, which should be resistive, has likely undergone considerable breakage and lowered the resistivity. Also, alteration within the structural zone could well be a contributing factor to lowering the resistivity. Line 4409900N exhibits the greatest density of structures on the eastern end. A complex pattern of high angle resistivity lows and highs correlates with the structural zone.


FIGURE 11: Res Gravity overlain by CSAMT (Upper) and Gravity (Lower) Structures Structures interpreted from the CSAMT and gravity are presented in Figure 11. Comparison between the two reveals good correlation with discrepancies noted in how the structures connect. Also more detail is present in the CSAMT interpretation. Two features of note are the aforementioned horst block and northeast structures interpreted in the gravity. The “Up Block” or horst block interpreted on Lines 4460200N and 4460500N correlates with a gravity high. Figure 12 presents the inverted sections for the two lines over residual gravity, which confirms the correlation. Ov and any underlying


carbonates are likely denser than DSe, which would be consistent with the gravity response.

FIGURE 12: Lines 4460200N and 4460500N over Residual Gravity The gravity indicates two northeast structures intersection Line 4460800N near the area of intense structures noted previously. Figure 13 confirms the correlation with the inverted resistivity section over the residual gravity. In fact, the structures interpreted from the gravity should have been classified as larger scale and received a heavy line designation. Intersection of the northeast structures with the northwest oriented Caetano


Fault structures would account for the profusion of structure noted in the CSAMT results, as well as the complex resistivity patterns.

FIGURE 13: Lines 4460800N over Residual Gravity Gold and arsenic geochemistry is presented along with the gravity and interpreted CSAMT structures in Figure 14. Both rock and soil samples are shown in color coded proportional dot formats with the explanation shown at the bottom of the figure. Anomalous gold and arsenic values fall near the eastern bounding structure to the up block. In fact, elevated values in both elements and sample types fall on and around the gravity high centered on the up block. Similarly, to the southeast elevated values also correlate with gravity highs. Such a correlation could indicate structures responsible for the horst also provided conduits for mineralizing fluids. Figure 15 shows four proposed holes over the residual gravity with gold geochemistry and CSAMT interpreted structures. Appendix B contains figures showing the proposed holes in section over the CSAMT inverted resistivity. Finally, Table 1 provides location and orientation details for the holes. Collar locations are in NAD 27 / UTM 11N coordinates. Holes P1 and P4 are intended to test the horst block and bounding structures. Specifically, Hole P1 cuts the west bounding structure and extends to depth with in the horst, while Hole P4 cuts across the entire horst block to test both bounding structures. It should be noted Hole P1 is located near Hole RRC10-1, which drilled vertically to only 1240’ within the horst and failed to test either bounding structure. However, prior to drilling P1 the exact location of Hole RRC10-1 should be confirmed. Holes P3 and P4 form a scissor to test the major structural intersection postulated on Line 4459900N. The zone’s width of 400m and varying dips on the structures requires two holes arranged in a scissor to cut all the structures, as well as investigate to depth.


FIGURE 14: Gold (Upper) and Arsenic (Lower) Geochemistry over Residual Gravity


FIGURE 15: Proposed Holes, Structures, Au Geochemistry over Residual Gravity

HOLE COLLAR_E COLLAR_N AZIMUTH INCL. TD (m) P1 497,085.00 4,460,200.00 90 -70 500 P2 497,560.00 4,459,900.00 270 -60 600 P3 497,105.00 4,459,900.00 90 -60 500 P4 496,990.00 4,460,500.00 270 -70 500

TABLE 1: Proposed Hole Locations and Orientations

CONCLUSIONS AND RECOMMNEDATIONS The CSAMT survey confirmed and refined locations on structures interpreted from an earlier gravity survey. Agreement between the two data sets is good. Northwest oriented structures related to the Caetano Fault appear to bend north and merge with north-south structures. However other elements of the northwest structural set continue to the northwest. The merging of the two structural directions is unexpected and suggests a genetic model. If the north-south structures predated development of the Caetano Trough, then as the trough developed it is reasonable to assume the north-south structures would accommodate some of the down-drop and merge with newer structures related to the trough. The development of a lens shaped horst block at the points of merger is open to speculation. Northeast structures noted in conjunction with the gravity survey also appear to have interacted with the Caetano Fault to produce an area of intense structural deformation on the southern most CSAMT line. Anomalous gold and arsenic geochemistry appears to correlate with the horst blocks and could well indicate the horst bounding structures serve as conduits for mineralized fluids. Based upon this, any proposed drilling should test the bounding structures. Four holes are proposed to test the


horst at two locations, as well as bounding structures. The major structural intersection on the southern most CSAMT line is also targeted with two holes. Prior to drilling, a ground examination to possibly confirm some of the interpreted structures is recommended. Also, the exact location of Hole RRC10-1 should be confirmed to determine the relationship to proposed Hole P1.

REFERENCES

Conway, K., Jones, W., Leger, A., Percival, T., Park, D and Dilles, P., 2007, 2007 Redrock Canyon Annual Report, Centerra (U.S.) Inc., Geologic map of the Redrock Canyon Property: Centerra (U.S.) Inc. company map. Wright, J. L., 2010, Redrock property, Gravity survey, GIS database: Challenger Deep Capital Corp. company report.


APPENDIX A

CSAMT SURVEY

ON THE

REDROCK PROJECT

LANDER COUNTY, NEVADA

FOR

VALOR GOLD CORP.

DATA ACQUISITION REPORT

ZONGE JOB# 11090

ISSUE DATE: 3 June 2011

ZONGE GEOSCIENCES INC.

924 Greg Street

Sparks, Nevada 89431

INTRODUCTION Zonge Geosciences, Inc. performed a controlled-source, audio-frequency, magnetotelluric (CSAMT) survey on the Redrock Project, located in Lander County, Nevada for Valor Gold Corp. This survey was conducted during the period of 19 May 2011 to 23 May 2011. The survey area is located in Township 28 North and Range 44 East, and lies within the Redrock Spring, Nevada 7.5-minute series topographic sheet. CSAMT data were acquired on four lines for a total of 8.8 line-kilometers of data coverage. This survey was supervised in the field by Mark Ziminsky, geophysicist, and Steve Zimmer, geophysical crew chief, for Zonge Geosciences, Inc. under Zonge job number 11090. Data files were provided to client representative, James L. Wright of Wright Geophysics, for quality control, modeling and interpretation. DATA ACQUISITION CSAMT data were acquired along four lines oriented east/west. Zonge personnel established survey control for this project using a Trimble PRO-XRS GPS receiver. The GPS data were differentially corrected in real-time using WAAS corrections. This system provides sub-meter accuracy under standard operating conditions. Line control in the field utilized UTM Zone 11N NAD27 (CONUS). CSAMT data were acquired using a 50-meter electric-field receiver dipole. Measurements were made in spreads consisting of four electric-field dipoles (4 Ex/1 Hy) with a magnetic-field antenna located in the center of the spread. The data were acquired in the broadside mode of operation with the electric-field dipoles oriented along the survey line and parallel to the transmitter dipole (x component). The magnetic antenna was oriented perpendicular to the survey line (y component). Measurements were made at frequencies ranging from 0.125 Hz to 8192 Hz in binary steps. One CSAMT transmitter, of a grounded dipole configuration, was used for this survey. The transmitter location is shown on Table 1 with coordinates in UTM Zone 11N NAD27 (CONUS), meters. Each current electrode site consisted of two pits lined with aluminum foil and soaked with salt water. The electrodes were connected to the transmitter with two lengths of insulated 14-gauge wire, separated by approximately two meters.

Transmitter # PID

NAD27 UTM East

NAD27 UTMNorth

Length

Bearing Lines

1 west 494200 4468730

1 center 494900 4468730

1 east 495600 4468730 1400 N90°E All

Table 1: CSAMT transmitter and associated survey lines

CSAMT MEASUREMENTS The CSAMT data are collected by measuring the magnitude and phase of the electric and magnetic fields. Measurements are made at discrete frequencies in binary steps. The receiver measures the magnitude of the received signal and the absolute phase difference between the received signal and the transmitted signal, which is known via synchronization of the transmitter and receiver. Figure 1 is an example of the log-log component plots for a single spread consisting of 4 E-field dipoles (Ex) and a central magnetic field (Hy). The upper left plot shows Cagniard resistivity versus frequency, the lower left plot shows the impedance phase versus frequency. The upper right plot shows the electric field (Ex) magnitude versus frequency and the lower right plot shows the magnetic field (Hy) magnitude versus frequency. These plots are included on the data CD and present a visual representation of the basic measured data that is useful for interpretation and analysis of data quality.

Figure 1: Example of log-log plots of CSAMT Cagniard Resistivity, impedance phase, electric and magnetic field magnitudes for frequencies of 0.125 Hz to 8192Hz.

INSTRUMENTATION Data were acquired with Zonge model GDP-32II receivers, serial numbers 3238 and 3220. These instruments are backpack-portable, 16 bit, microprocessor-controlled receivers that can gather data on as many as eight channels. The electric-field signal was measured at the receiver site using non-polarizing ceramic Cu-CuSO4 porous-pot electrodes connected to the receiver with insulated 14-gauge wire. CSAMT magnetic-field measurements were made with Zonge ANT/6 antenna coils, serial numbers 246 and 276. The signal source for the CSAMT measurements was a Zonge GGT-30 transmitter, serial number 2094. The GGT-30 is a constant-current 30 KVA transmitter. Power for the transmitter was provided by a Zonge ZMG-30DL motor-generator equipped with a built-in voltage regulator. An XMT-32 transmitter controller, serial number 4148, controlled the transmitter. Transmitter-receiver synchronization was maintained with identical crystal oscillators, synchronized each morning before data acquisition.

DATA PROCESSING Routine data processing consists of the following steps: 1) Initial log-log plots are reviewed to evaluate the data. 2) Data identified as spurious by the operator or individual measurements that are obvious outliers with respect to multiple repeat measurements are flagged and removed from further processing. 3) Raw data files (.raw) are processed via the CSAVGW program to produce an intermediate (.zdb) file. Corrections for polarity or calibration errors are made at this step. The output (.zdb) file has a single record containing all data for each individual stack or data block taken for each data channel. 4) The individual measurements (stacks) are averaged for each channel in the CSAVGW program and output in a column-based ASCII file (.avg) with a single averaged value for each parameter for each channel (station). 5) The average data are processed with the ASTATIC algorithm. Individual sounding curves are viewed and final removal of individual measurements that are considered to be affected by coherent noise is made. Log-log plots and the parametric pseudosections are generated at this step. DATA QUALITY Data quality is monitored in the field by the operator. Real-time standard-error values are displayed during acquisition. In addition, multiple measurements at a range of frequencies are displayed graphically as resistivity versus frequency curves with error bars showing the data scatter. This allows a visual evaluation of the data quality and remedial action to be taken if necessary.

Data quality is also evaluated during post-acquisition processing by reviewing data component plots as shown in Figure 1. Data are edited to remove spurious data if necessary. The data for this survey are of good quality, with repeated measurements generally within 5 percent. As illustrated in Figure 1, the smooth nature of the curves and lack of noticeable error bars, demonstrates good data quality.

SAFETY AND ENVIRONMENTAL ISSUES No health, safety incidents or accidents occurred during the course of this survey. No environmental damage was sustained as a direct result of the survey progress. Vehicle travel was kept to existing roads. PRODUCTION LOG:

Date Notes

5/16/2011 Mobilized from Sparks, Nevada to project. Setup transmitter bipole.

5/17/2011 GPS crew stake-out the grid.

5/18 - 5/19 Data were not acquired.

5/20/2011 L4459900N: 95700-97100

5/21/2011 L4459900N: 957100-97900; L4460200N: 97900-97100; L4460800N: 95700-97300

5/22/2011 L4460200N: 97100-95700; L 4460800N: 97300-97900; L4460500N: 97900-97100

5/23/2011 L4460500N: 97100-95700. Reclaimed transmitter bipole. End of project.

APPENDIX B

PROPOSED DRILL HOLES

CSAMT SECTIONS

FIGURE B1: L4460200N Inverted Section and Proposed Hole P1

FIGURE B2: L4459900N Inverted Section and Proposed Holes P2 & P3

FIGURE B3: L4460500N Inverted Section and Proposed Hole P4

Documents

REDROCK PROPERTY CSAMT SURVEY - … · within the CSAMT coverage. This intersection is the specific feature detailed by the survey. An initial gravity survey with CSAMT follow-up