Savant Lake Area Ni-Cu Sulphide Exploration: Field Investigation of AeroTEM Anomalies

for:

MMG Canada Exploration, Inc. 555-999Canada Place

Vancouver, BC V6C 3E1

located in: District of Patricia

Jabez Lake, Endogoki Lake & Savant Areas on:

NTS Map Sheet 52J/09 (Neverfreeze Lake) at:

50°36’ N Latitude, 90°21’ W Longitude

report by: Robert A. Brozdowski, Ph.D., P. Geo.

date:

March 31, 2012

Table of Contents 1. INTRODUCTION AND TERMS OF REFERENCE………………………………………………………………………………1 2. LOCATION, ACCESS, LOGISTICS, INFRASTRUCTURE, PHYSIOGRAPHY & CLAIMS DESCRIPTION…….1 3. REGIONAL GEOLOGICAL SETTING……………………………………………………………………………………………….2 4. PROPERTY GEOLOGY…………………………………………………………………………………………………………………..2 5. DEPOSIT TYPE SOUGHT: MAFIC INTRUSION HOSTED NI-CU MAGMATIC SULPHIDES……………………3 6. EXPLORATION HISTORY……………………………………………………………………………………………………………….3 7. SELECTION OF SPECIFIC AeroTEM ANOMALIES FOR FIELD FOLLOW-UP……………………………………….6 8. FIELD CHECKING OF SELECTED AeroTEM ANOMALIES………………………………………………………………….7 9. MAXWELL MODELLING OF FIELD-VETTED AeroTEM ANOMALIES…………………………………………………8 10. SAMPLE SECURITY, PREPARATION, ANALYSES AND DATA VERIFICATION……………………………………8 11. INTERPRETATIONS & CONCLUSIONS…………………………………………………………………………………………..9 12. RECOMMENDATION………………………………………………………………………………………………………………….10 13. REFERENCES……………………………………………………………………………………………………………………………….10 List of Figures Figure 1. Location Map of the MMG Canada Exploration Inc. Savant Lake Property. Figure 2. Claim Map of the MMG Canada Exploration Inc. Savant Lake Property. Figure 3. Compilation of Historical Drill Hole Collar Locations on MMG Savant Lake Property Figure 4. Selected AeroTEM Conductors Field Checked in September 2011 Figure 5. Rock Sample Locations from September 2011 Field Program Figure 6. Map of Field Traverses, September 2011 Field Program Figure 7. Map of Field Stations, September 2011Field Program Figure 8. Map of Rock Types at Field Stations Figure 9. Proposed Drill Hole at T2 Conductor Figure 10. Proposed Drill Holes at J6 North and J6 South Conductors List of Tables Table 1. Claims Comprising the MMG Canada Exploration Inc. Savant Lake Property Table 2. List of Historical Drill Holes on MMG Savant Lake Property Table 3. Summary Characteristics of Selected Conductors Field Checked in September 2011 Table 4. Table of Rock Types Identified During September 2011 Field Program. Table 5. Plate Models and Recommended Drill Tests for T2 Conductor and J6 N & J6 S Conductors List of Appendices Appendix 1. Assay Certificates for Rock Samples, Standard and Blank Appendix 2. Qa /Qc Plots for OREAS 73a Standard Included in Assay Certificate Appendix 3. Geological Data for Field Stations Appendix 4. Rock Sample Descriptions Appendix 5. Cost Statement Appendix 6. Petrographic Descriptions (from: Shannon, 2009) Appendix 7. Statement of Qualifications of Author Appendix 8. Interpretation of 2011 Savant AeroTEM Airborne TDEM data, Report by: J. Silic Appendix 9. Maxwell Modeling of EM Anomalies T2 & J6; Report by: T. Grant

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1. INTRODUCTION AND TERMS OF REFERENCE Detailed processing, anomaly selection and interpretation of the vendor-provided data from an Aeroquest Airborne (helicopter) AeroTEM-IV EM-magnetic survey (Aeroquest, 2011) conducted over the Savant Lake Property was performed by Jovan Silic, PhD., Jovan Silic & Associates (JSA Pty Ltd), South Yarra, Victoria, Australia, with further anomaly selection, prioritization and modelling of EM anomalies by Todd Grant, Principal Geophysicist, MMG, Lakewood, CO., USA., in order to define EM anomalies for field follow-up. The selected anomalies were then field-vetted in September 2011. Subsequent to field investigation of the selected EM anomalies in September, 2011, Todd Grant conducted Maxwell modelling of two of the EM anomalies that appeared to be spatially related to mafic or ultramafic intrusive rocks and prepared an additional report with specific geometric plate models and recommendations for drill testing the two anomalies. One of the anomalies, upon further modelling, resolved into 2 segments, so a total of three diamond drill holes are recommended. Field work was conducted, and this resulting report prepared, at the request of Katherine Smuk, M.Sc., P. Geo., Principal Geoscientist-Project Generation, MMG Canada Exploration, Inc. (“MMG”), 555-999 Canada Place, Vancouver, BC, V6C 3E1 The specific objective of the September 13 through 16, 2011 field program on the Savant Lake Property (“Property”) was to evaluate selected electromagnetic anomalies, defined from the AeroTEM-IV survey flown by Aeroquest in February 2011 for MMG, in a geological context, to determine if they warranted drill testing for Ni-Cu magmatic sulphide deposits. The field crew for the project comprised Robert A. Brozdowski, Ph.D., P. Geo., Consulting Geologist, Victoria, BC, Canada; and Tim Weigel, Geospatial Analyst, MMG Denver, USA. 2. LOCATION, ACCESS, LOGISTICS, INFRASTRUCTURE, PHYSIOGRAPHY & CLAIMS DESCRIPTION The Savant Lake Property is in the Jabez Lake, Endogoki Lake and Savant areas, District of Patricia, located on NTS 1:50,000-scale Map Sheet 52J09, centered at 50°36’N latitude, 90°21’W longitude. The Property is located approximately 190-kilometers northeast of Ignace, Ontario on the Trans-Canada Highway, along the general direction of paved highway #599, but in detail the Property is approximately 20 kilometers east of the highway, along the central part of the north arm of Savant Lake (Figure 1 and Figure 2). The town of Savant Lake is located 50-kilometers southeast of the Property at the junction of Highway 599 and the Canadian National Railway. A float plane base operated by West Caribou Air, with helicopter fuel also available, is located 35-kilometers southeast of the property on Staunton Lake along Highway 599. Access to the Property is generally by helicopter or float plane. The topography of the Property is characterized by gently rolling north-south elongate hills that are typically less than 100-meters in height, along with numerous lakes, creeks and marshy areas in the intervening valleys. Elevations range from 398-meters at Savant Lake to approximately 460-meters above sea level on the higher ridges. The project area is located within the Arctic Watershed and local drainage is eventually to the Albany River. The climate is typical of northern areas within the Canadian Shield with long winters and short but warm to hot summers. Temperatures range from 30°C in the summer to -30°C in the winter. Mean annual rainfall is approximately 50-centimeters and mean annual snowfall is approximately 265-centimeters. Vegetation comprises dense mature stands of black and white spruce with minor balsam and poplar. Glacial overburden is predominantly heterolithic boulder till, and typically varies from 0- to 50-meters thick. Typically sparse, but locally abundant, bedrock outcrops occur primarily along lake shores, ridges

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and as isolated rock knobs. Wildlife includes black bear, wolves, moose, rabbits, various migratory birds and various species of fish including lake trout and pickerel. Forestry, tourism (primarily fishing, hunting & snowmobiling) and mining are the main industries in the region. The 21 Savant Lake claims (Figure 2 and Table 1) are held by MMG Canada Exploration, Inc., 555-999 Canada Place, Vancouver, BC, V6C 3E1. The claims are in good standing until April 9, 2012. Banked assessment credits total $21,867. This current Assessment filing totals $52,462 (Table 5). Therefore, total available assessment credits, contingent on acceptance of this submission, would be $74,329, sufficient to hold 11 selected claims [$70,400 credits required] through April 9, 2013, with an excess of $3929 Banked credits, as per the accompanying Assessment Work filing. 3. REGIONAL GEOLOGICAL SETTING The project area is located in the northwestern part of the Superior Province of the Canadian Shield. In this region, metasedimentary and metavolcanic rocks of Archean age form generally east-northeast trending, but locally highly variable, linear regional belts, which alternate with areas of tonalitic basement and syn- to post- tectonic granitoid intrusions. The metasedimentary and metavolcanic rocks, as well as the granitoid rocks, were folded, faulted, and metamorphosed during various orogenic periods. Protoliths of the Archean metavolcanic rocks include basalt, intermediate to felsic volcanic rocks and volcanic breccias. Protoliths of the associated metasedimentary rocks include interbedded greywacke, shale, conglomerate and chert-magnetite iron formation. The Savant Lake and Sturgeon Lake greenstone belts [alternatively named the Savant Lake-Crow Lake greenstone belts (Trowell, 1980)] are within the Archean Wabigoon Subprovince of the Canadian Shield, and lie along the boundary of the Western Wabigoon and Winnipeg River terranes, south of the English River Subprovince (Trowell, 1988).The Savant Lake Greenstone Belt (Sanborn-Barrie, 2000) extends approximately 80-kilometers in a northeasterly direction and is approximately 30-kilometers wide. It is generally at higher metamorphic grade and more deformed than the Sturgeon Lake Greenstone Belt to the south (Sanborn-Barrie, 2000). The MMG Savant Lake Property lies in a narrow north-northeast trending arm of the greenstone belt, along the north arm of Savant Lake. The area was selected for exploration work by MMG based on tectonic position, anomalous lake sediment geochemistry (Russell, 2003), the reported presence of ultramafic intrusive rocks (Sanborn-Barrie, 2000) and Sm-Nd isotopic results (Tomlinson and others, 2004) suggesting that the area lies on a major suture between two different aged lithospheric blocks. 4. PROPERTY GEOLOGY In the southeastern part of the MMG Savant Lake Property, the lowermost clastic quartz grit and conglomerate of the Jutten Group are mapped (Sanborn-Barrie, 2000.) These rocks possibly represent the weathered detritus of adjacent older granitoid terrain (Sanborn-Barrie, 2000). The metasedimentary rocks are locally cut by strongly magnetic, dark green-black, white weathering intrusive peridotite. At one locality, the peridotite reportedly has a 10-centimeter finer-grained chilled margin. (Sanborn-Barrie, 2000). A narrow arm of the lowermost tholeiitic basalt flows of the Jutten Group (Trowell and others, 1980) trends north-northeast through the Property. The mafic metavolcanic rocks are bounded to the east by pre- to syn-tectonic granodiorite, quartz monzonite and tonalite, and to the west by the late- to

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post- tectonic North Arm Pluton comprising granodiorite, tonalite and quartz diorite (Sanborn-Barrie, 2000) The basalts are dominantly pillowed, but a minor proportion are massive. The mafic volcanic rocks host subordinate metasedimentary wacke and phyllite along narrow trends (Trowell, 1980). Felsic to intermediate volcanic rocks, graphitic-sulphidic metapelite and thin quartz-magnetite-sulphide iron formation are also known on the Property from sparse outcrops and from historical drilling (Trowell, 1980; Palonen and Speed, 1977) Some gabbro is mapped in the southern portion of the Property (Sanborn-Barrie, 2000).Trowell (1988) mapped felsic to intermediate intrusive rocks along the west side of the north arm of Savant Lake, some outcrops of rhyodacite to dacite tuffs on islands in the lake, and mafic to intermediate metavolcanic rocks along the east shore of the lake. It is uncertain whether the rhyodacite and dacite are cogenetic with the basalts. Foliation in the metavolcanic and metasedimentary rocks along the north arm of Savant Lake is penetrative, moderately- to well-developed, generally strikes north-northeast and dips sub-vertically (Sanborn-Barrie, 2000). In detail, Sanborn-Barrie (1990) mapped generally north-northeasterly trending, steeply east-dipping foliation at several locations along the north arm of Savant Lake in the area of the MMG claims. 5. DEPOSIT TYPE SOUGHT: MAFIC INTRUSION - HOSTED NI-CU MAGMATIC SULPHIDES General characteristics of nickel-sulphide deposits associated with mafic magmatic systems include: regional-scale association of districts and deposits with sub-vertical, trans-lithospheric structural zones; originally sulphur-undersaturated mafic magmas and mafic large igneous provinces (LIPS). At the deposit scale, formation of nickel-sulphide deposits is favored in magma conduits that represent zones of high magma flux, resulting in a wide variety of intrusive features consistent with multiple intrusive events, formation of strongly differentiated intrusions, and active, pulsed magma flux. Local assimilation of country rock sulphides or emplacement of late magmatic sulphide-laden melts from deeper staging chambers represent additional factors in the formation of magmatic sulphide deposits. In mafic systems (as opposed to ultramafic, komatiitic systems), magmatic sulphides are commonly emplaced dynamically rather than settling as basal accumulations. Presence of primary biotite, amphibole, and vari-textured rocks indicates the importance of volatiles. Presence of olivine, orthopyroxene and melanocratic rocks are considered favorable indicators of mafic magmas with relatively high MgO concentrations. Tectonic settings are interpreted to span a range of tectonic environments, from: the root zones of continental flood basalt provinces (Norilsk, Russia; Wellgreen, Yukon Territory, Canada); to settings associated with trans-tensional or incipient extensional regimes, including post-orogenic deposits (Hongqiling, Jilin, China; Aguablanca, Spain); to deposits in AMCG* settings [*Anorthosite-Mangerite-Charnockite-Granite] provinces (Voisey’s Bay, Labrador, Canada); or more rarely, syn-orogenic settings (Giant Mascot, British Columbia, Canada). 6. EXPLORATION HISTORY The region surrounding Savant Lake has been prospected since the early 1900s for gold and iron deposits. The discovery in 1969 of the Mattabi zinc-copper-silver-lead deposit (≈13.7 million tonnes at 7.55% Zn, 0.8% Cu, 0.77% Pb & 3.1 opt Ag; Trowell and others, 1980) located 100 kilometers to the south-southeast at Sturgeon Lake led to greatly increased detailed geological mapping by the Ontario

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Division of Mines (Trowell, 1988) and increased exploration activity in the region (Palonen and Speed, 1977). Considerable historical drilling has been conducted by a number of entities in portions of the MMG Savant Lake Property (Figure 3 and Table 2.) Most of the drilling appears to have been targeted for volcanogenic massive sulphide deposits in a greenstone belt environment comprising felsic to mafic metavolcanic rocks, black sulphidic-graphitic phyllite and local thin quartz-magnetite-sulphide iron formation. However, some historical drilling by the Canadian Nickel Company Ltd. was likely targeted specifically for magmatic Ni-Cu sulphide deposits. Palonen and Speed (1977) compiled a significant portion of the previous exploration work, particularly drilling, in the Endogoki Lake area (the central portion of MMG Savant Property. Comments on individual historical drill holes and other work on the MMG Savant Lake Property follow. For purposes of discussion, locations of historical drill holes are referenced relative to the present-day MMG claim numbers. Historical drilling on MMG claim 4247066 intersected greenstone with pegmatite, argillite with pyrrhotite, quartzite, coarse-grained gabbroic greenstone and amphibole gneiss in drill hole 34491.To the immediate south on MMG claim 4247065 greenstone, “amphibole gneiss” and iron formation were intersected in drill holes 34459 & 34460 (Canadian Nickel Company Ltd., 1967-68, Assessment Report 52J09SW9030). In Savant Lake to the immediate west, on MMG claim 4247065, two drill holes by D. W. Gordon in 1970 intersected basalt and rhyodacite to dacite with pyrrhotite, pyrite and trace chalcopyrite (Palonen and Speed, 1977.) On MMG claim 4247064 to the immediate east, meta-basalt to -andesite and argillite with bands of pyrrhotite & pyrite were intersected in drill hole 34458 (Canadian Nickel Company Ltd., 1967-68, Assessment Report 52J09SW9030.) Seven historical drill holes (34453, 34454, 34455, 34456, 34457, 34474 & 34476) are situated along two NNE-oriented conductive trends in the central part of the property on MMG claim 4247064.Most of the drill holes intersected some argillite, commonly sulphidic, and one of the drill holes (34457) intersected gabbro. In detail, drill hole 34453 intersected metavolcanic rocks, graphite schist, greywacke, greenstone and quartzite; drill hole 34454 intersected greenstone, two minor intervals of amphibole gneiss, minor quartzite and minor argillite; drill hole 34455 intersected greenstone and a 19-ft interval of argillite with pyrite & pyrrhotite, locally massive over 1-ft; drill hole 34456 intersected greenstone and amphibole gneiss; drill hole 34457 intersected greenstone with minor intervals of argillite and quartzite, with 167-ft of amphibole gneiss and 55-ft of gabbro; drill hole 34474 intersected basalt and minor dacite, locally with minor pyrrhotite & pyrite; and drill hole 34476 intersected metavolcanic rocks (Canadian Nickel Company, 1967-68, Ontario DDH digital database & Assessment Report 52J09SW009.) In the northern part of the MMG claim block, on MMG claim 4247069, drill hole DDH-19-17-34-1, targeted to test a conductor, intersected siliceous gneiss with up to 50% pyrite and pyrrhotite over 20-ft, intermediate volcanic rocks, and 32-ft of serpentinized ultrabasic rock (Dome Exploration Canada Ltd., 1970, Ontario digital DDH database & Assessment Report 52J09NW002.) At one location in the southwestern part of the Property on MMG claim 4247051, outcropping siliceous magnetite-pyrite iron formation occurs along a conductive and magnetic trend. Historical drill hole DDH 37647 intersected greywacke and iron formation within a sulphidic black phyllite sequence, including a 1-ft interval with 20% pyrite (Canadian Nickel Company Ltd., 1968, Ontario digital DDH database &

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Assessment Report 52J07NW2634.) A cluster of three drill holes to the north of drill hole 37647, just off the present MMG Property intersected rhyolite with minor pyrrhotite and pyrite, including a 3-ft interval with 20% pyrite & pyrrhotite & trace chalcopyrite (GR-36-1) and andesite, locally with minor pyrite & pyrrhotite (GR-36-2 & GR-36-2A) (D.W. Gordon, 1970, ON digital DDH database and Assessment Report 52J09SW0007.) Historical drilling on MMG claim 4247657 in the southern portion of the property intersected rhyodacite to andesite and rhyolite interlayered with black magnetic, conductive argillite with 10-15% pyrrhotite and locally 20-50% pyrite (DDH STIN-74-1); rhyodacite to andesite with a local 1.2-ft massive pyrrhotite interval and minor quartzite (DDH STIN-74-2) and rhyolite, dacite and black siliceous-graphitic argillite with up to 10% pyrrhotite & pyrite & trace chalcopyrite(DDH STIN-74-3)(HBOG Mining , 1974, Assessment Report 52J09SW9129.) Drill hole 37648 intersected andesite with a 1.8-ft interval of pyrrhotite sulfide breccia with trace chalcopyrite, and interlayered graphitic phyllite and andesite with up to 10% pyrite and pyrrhotite and trace chalcopyrite (Canadian Nickel Company, 1968, Assessment Report 52J09SW9119.) Other drill holes intersected conductive graphitic pelite with pyrite and quartzite (DDH-19-17-43-1, targeted to test a conductor), intermediate volcanic rocks, conductive pyritic- graphitic phyllite and gabbro (DDH 19-17-46-1) and grey-green to conductive graphitic-pyritic phyllite (DDH 19-17-46-2) (Dome Exploration Canada Ltd., 1970, Assessment Report 52J09SW9121.) Drill hole S-TIN-73-1 intersected dacite, black conductive graphitic-sulfidic argillite and quartzite (Hudson Bay Oil & Gas Company Ltd., 1973, Assessment Report 52J09SW9128.) Palonen and Speed (1977) interpreted three northwest-trending conductive horizons on Treasure Island, located on present-day MMG claim 4247657, from their compilation of assessment data. Significant clusters of historical drill holes, mostly form the 1960s to 1970s, occur outside of the present MMG property, including four kilometers to the south, to the west of Shore Lake, where extensive exploration for Pb-Zn-Cu volcanogenic massive sulphide deposits was carried out by a succession of companies, including New Cinch Uranium, and seven-kilometers to the west, east of Neverfreeze Lake, where considerable drilling was carried out, also presumably for volcanogenic massive sulphide deposits. Many of the geophysical surveys conducted to target the drilling work in the 1960s and 1970s appear to have been ground magnetic and VLF-EM surveys. However, none of the historic drill holes specifically targeted the two AeroTEM conductors of present interest (T2 and J6) discussed in subsequent sections of this report. The Savant Lake area was flown as part of a regional survey system funded by the Ontario Geological Survey, utilizing a helicopter-borne Aerodat frequency domain electromagnetic system that measured in-phase and quadrature components of the electromagnetic field at four frequencies (Ontario Geological Survey [OGS], 1990, Maps M81462 & M81468.) Data are presented by the OGS as contoured total magnetic field with selected electromagnetic anomalies classified according to conductance. There are a number of clusters and linear trends of conductors, ranging from 4 to >32 Siemens, displayed on Map M81462 in the area of the Canadian Nickel Company’s historical drilling during 1967-68, on what are now MMG claims 4247066, 4247067 and 4247064, but from a search of the Ontario MNDM assessment files, there does not appear to have been any significant follow-up work or drilling targeted on the conductors after they were identified by the 1990 OGS airborne survey. The area of the Property was included in a regional lake sediment survey of the Savant Lake Greenstone Belt (Russell, 2003.) Only one 90-95%tile Cu anomaly occurs in the central part of the Property, whereas one group of higher Ni anomalies (90-98%tile) cluster in the southeastern-most portion of the Property,

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in an area known to contain peridotite and pyroxenite, but these Ni anomalies are not supported by anomalous Cu. Newgenco (2008) prospected and conducted rock sampling and limited soil sampling in the area, and identified a number of outcrops of mafic-ultramafic intrusions, including leucogabbro, gabbro, pyroxenite and peridotite. The gabbro and pyroxenite are described as medium to coarse grained, ranging from equigranular to poikilitic textures. Peridotite is medium grained orthocumulate with intercumulus pyroxene and minor plagioclase. Olivine is replaced by serpentine. Newgenco noted fine disseminated to locally blebby-textured pyrrhotite and minor chalcopyrite (up to 2% total sulphides) in gabbro and peridotite. One rock sample returned values of up to 2025 ppm Ni, from a barren peridotite with no sulphide mineralization. Various other rock samples contained up to 621 ppm Cu, 38 ppb Pt and 36 ppb Pd. A single angular gabbro boulder with sulphides present as small pyrrhotite-chalcopyrite blebs up to 1-cm in size was noted in till. In summary, numerous outcrops of gabbro were noted, with lesser pyroxenite outcrops and one area of peridotite (Shannon, 2009). Shannon (2009) provided thin section petrographic descriptions and whole rock and trace element chemistry of two rock samples collected by Newgenco from the Savant Lake Property. Sample 08-SAV-007 (Appendix 6) is medium grained hypidiomorphic-granular leucogabbro with trace remobilized pyrrhotite and chalcopyrite, metamorphosed to lower amphibolite grade. Sample 08-SAV-018 (Appendix 6) is medium grained melagabbro with trace pyrrhotite and chalcopyrite, both as remobilized sulphides and also as early microscopic immiscible blebs in mafic minerals, metamorphosed to lower amphibolite facies. Trace elements reported by Shannon (2009) for Co, Cr and V in the Savant Lake samples support mafic compositions. Cu and Ni concentrations included154 ppm Ni and 58 ppm Cu in sample 08-SAV-007 and 409 ppm Ni and 233 ppm Cu in sample 08-SAV-018. Platinum and palladium are 14 ppb Pt and 11.1 ppb Pd in sample 08-SAV-007 and 38.6 ppb Pt and 17.2 ppb Pd in sample 08-SAV-018.) Whole rock MgO is 8.61% in sample 08-SAV-007 and 12.19% in sample 08-SAV-018. 7. SELECTION OF SPECIFIC AeroTEM ANOMALIES FOR FIELD FOLLOW-UP The objective of the September 2011 field program was to evaluate the Property for its potential to host Ni-Cu sulfide deposits, by evaluating selected EM conductors, with or without associated magnetic responses, via geological field traverses. Conductors selected from the AeroTEM IV TDEM survey flown in February 2011 (Aeroquest, 2011) were those that were deemed to have the best possibilities of representing discrete bedrock conductor sources. A 1301 line-kilometer AeroTEM-IV TDEM survey was flown by Aeroquest in early Feb 2011 (Aeroquest, 2011[previously reported for Assessment credit].) Jovan Silic (Consulting Geophysicist to MMG) interpreted the majority of the conductors within the survey as lying mainly within regional conductive trends. In the interest of conducting a thorough evaluation of the data, he selected 69 conductive responses to analyze in detail (Appendix 8.) He concluded that 62 of the 69 selected responses were indeed parts of regional conductor trends. He considered target quality (time constant), anomalous component, geometry & whether the target conductor was sufficiently unique vs. its surroundings. None of the 69 conductors analyzed exhibit long time constants or significant along-strike conductivity variations.

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However, seven of the 69 conductors (J2, J3, J4, J5, J6, J7 & J23), which may not be part of the regional trends, were recommended for follow-up by Jovan Silic (Appendix 8.) These seven conductors did not exhibit long time constants, but were considered sufficiently unique, that is, potentially not part of the regional trends. Upon further analysis of the data, Todd Grant (Principal Geophysicist, MMG Denver) selected four additional conductors (T1, T2, T3 and T4) to investigate, based on criteria similar to those used by Jovan Silic. These eleven conductors are summarized on Figure 4 and in Table 3. 8. FIELD CHECKING OF SELECTED AeroTEM ANOMALIES The selected conductors were checked by field traverses from September 13 through 16, 2011 by Robert Brozdowski (Consulting Geologist to MMG, 2560 Nottingham Road, Victoria, BC, V8R 6C5;Tel: 250-896-0223; Email: brozdowski@aol.com) & Tim Weigel (Geospatial Analyst, MMG USA Ltd., 390 Union Blvd., Suite 200, Lakewood, CO, USA, 80228, Tel: 720-881-6966; Email tim.weigel@mmg.com). Access to the field area was by Hughes 500 helicopter operated by Superior Helicopters, Dryden, Ontario. The helicopter pilot for the project was Bob Moody, Superior Helicopters, 102 Hwy. 601 Unit 10, Dryden, ON, P8N 2Y4; Tel: 807-937-4962; Email: bobmoody07@hotmail.com) out of Superior’s Dryden, Ontario helicopter base. Accommodation, meals and communications were provided at the Silver Dollar Inn, located at Silver Dollar, Ontario, located approximately 110-kilometers southwest of the Project area along Highway 599. Helicopter fuel was available and utilized at West Caribou Air’s “Savant Lake” base, actually located at Staunton Lake, just east of Highway 599 approximately 35-kilometers southwest of the Project area. Ten rock samples were collected (Figure 5 and Appendix 4) from outcrops and float to evaluate any potential Ni-Cu-PGE trace metals geochemistry along the traverses in the vicinity of the selected conductors (Appendix 1). Approximately 1-kilogram rock samples were collected from outcrop. Where possible, a relatively even distribution of 5 to 10 rock chips was collected from various parts of the outcrop. Where this was not possible, a grab sample was taken from one accessible location on an outcrop. Samples were collected in heavy duty plastic sample bags and sealed with locking zip-ties. Data, including descriptive information for all outcrops encountered and rock samples (Figure 5 and Appendix 4), and UTM coordinates, were recorded in the field using Mobile Data Studio and ArcPAD software on a Trimble Juno Pocket-PC., Field data were then imported into ArcGIS to create shapefiles containing all descriptive and locational attributes. Geological observations (Figure 8, Table 4 and Appendix 3) were made at 37 stations (Figure 7 and Appendix 3). Traverses (Figure 6) were recorded on a Garmin GPSMap76CSx GPS and imported into ArcGIS. The conductors selected from the February 2011 AeroTEM survey for follow-up during the September 2011 field program were not in general coincident with historical drill holes (Figure 4), and so represented potential new exploration targets. The exception was one location in the southwestern part of the property on MMG claim 4247051 where outcropping siliceous magnetite-pyrite iron formation occurs along a conductive and magnetic trend. Historical drill hole DDH 37647 intersected greywacke and iron formation within a sulphidic black phyllite sequence, including a 1-ft. interval with 20% pyrite (Canadian Nickel Company Ltd., 1968, Ontario digital DDH database & Assessment Report 52J07NW2634.)

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Based on field checking of the selected AeroTEM conductive anomalies, two anomalies, T2 and J6 were selected for follow-up Maxwell modelling. One conductor of interest (T2) is spatially associated with melagabbro and feldspathic pyroxenite outcrops with up to 1% pyrrhotite plus trace chalcopyrite. Another conductor of interest (J6) is spatially associated with pyroxenite outcrops. The J6 conductor, upon further modelling, resolved into Northern (J6 N) and Southern (J6 S) segments with slightly different characteristics. These conductors are of interest as potential follow-up drill targets for Ni-Cu sulphides, since they appear to occur within, or at the margins of, melagabbro and pyroxenite that locally contains minor magmatic sulfides. The best analytical results from the 2011 rock samples were from the area of conductor T2 (Cu to 186 ppm, Ni to 61 ppm.). 9. MAXWELL MODELLING OF FIELD-VETTED AeroTEM ANOMALIES Based on the field vetting of the selected AeroTEM anomalies discussed in Section 7 of this report, conductive anomalies T2 and J6 were chosen for Maxwell plate modelling (Table 5 and Appendix 9.) Maxwell modelling of the T2 conductor suggests two closely-spaced conductive plates dipping -40° toward 300° Azimuth (Figure 9 and Table 5 and Appendix 9.) Maxwell modeling of two slightly different parts of the J6 conductor suggests that the Northern portion models as a plate dipping -60° toward 270°azimuth, whereas the Southern portion models as a plate dipping -60° toward 90° Azimuth (Figure 10 and Table 5 and Appendix 9.) 10. SAMPLE SECURITY, PREPARATION, ANALYSES AND DATA VERIFICATION Pre-printed sample tags were inserted in each rock sample bag, and additionally the same sample numbers were written on both sides of the sample bags using a permanent marker. Sample bags were sealed with locking plastic zip-ties, and kept in possession of the field crew until submitted to ALS Laboratory, Thunder Bay, via Greyhound Express Bus shipment. At ALS, rock samples were logged in and tagged with a bar code, weighed in, crushed to 70% <2 mm, split with a riffle splitter, and a 250 gram pulp was pulverized to 85% < 75 µm. Aliquots from the pulps were analyzed at ALS-Laboratory in Vancouver for 48 trace element geochemical analyses by 4-acid digestion followed by ICP-MS analysis (ALS code ME-MS61); for 51 trace elements by aqua regia digestion followed by ICP-MS or ICP-AES analysis depending on the specific element (ALS code ME-MS41L); for rare earth elements and trace elements by lithium borate fusion prior to 4-acid digestion followed by ICP-MS analysis (ALS code ME-MS81); for 13 whole rock major and trace elements by lithium borate fusion followed by XRF analysis (ALS code ME-XRF06); for LOI (loss on ignition) (ALS code OA-GRA06); for low-level Pt, Pd & Au by 30-gram fire-assay followed by ICP-MS (ALS code PGM-MS23); and for ore-grade metals as necessary by 4-acid digestion followed by ICP-AES or other instrument (ALS code ME-OG62 and Ni-ME-OG62.) An OREAS73a commercially available analytical rock sample standard was included with the rock samples submitted to ALS (as sample number R-132205 in Appendix 1) as a quality control check. For elements of interest in this report, the 4-acid digestion, ICP-MS finish values for the aliquot of OREAS73a standard submitted to ALS along with the batch of rock samples from the Savant Lake Property were all within acceptable limits, namely: 860 ppm Cu (vs. a mean certified value of 877 ppm for the standard);

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1340 ppm Cr (vs. 1668 ppm Cr for standard); 259 ppm Co (vs. 286 ppm Co for standard); 1.37% Ni (vs. 1.41% Ni for standard); 17 ppb Au (vs. 14 ppb Au for standard); 78 ppb Pd (vs. 78 ppb Pd for standard) and 72.9 ppb Pt (vs. 64 ppb Pt for standard) (Appendix 2.) A silica sand blank (no certified values) was also submitted (as sample number R-132210 in Appendix 2.) Selected major and trace element values obtained for the silica sand blank include: 98.28% SiO2 (whole rock XRF analysis), and 6.9 ppm Cu, 0.5 ppm Co, 7 ppm Cr and 0.7 ppm Ni (by 4-acid digestion, ICP-MS finish.) 11. INTERPRETATIONS & CONCLUSIONS Most of the conductors investigated in the field appear to be spatially related to variably pyritic metapelite and psammopelite, with local lean quartz-magnetite-pyrite iron formation, within a more widespread sequence of pillowed to massive metabasalt However, one conductor of interest (T2) is spatially associated with melagabbro and feldspathic pyroxenite outcrops with up to 1% pyrrhotite plus trace chalcopyrite. Another conductor of interest (J6) is spatially associated with pyroxenite outcrops. These two conductors are of interest as potential follow-up drill targets for Ni-Cu sulphides, since they appear to occur within, or at the margins of, melagabbro and pyroxenite that locally contains minor magmatic sulfides. The best analytical results from the 2011 rock samples were from the area of conductor T2 (Cu to 186 ppm, Ni to 61 ppm). Maxwell modelling of the T2 conductor by Todd Grant (Appendix 9) recommends details of a drill hole that would test the center of the modelled plate (Figure 9):

Proposed DDH Collar Coordinates (UTM Zone 15, NAD83): 687,150 E, 5,611,050 N Azimuth: 90° Inclination: -60° Total Depth: 200 meters

Maxwell modelling of the J6 conductor by Todd Grant (Appendix 9) recommends 2 drill holes to test slightly different parts of the J6conductor (J6 North and J6 South) (Figure 10.): Northern Part of J6 Conductor: Proposed DDH Collar Coordinates (UTM Zone 15N, NAD83): 687,120 E, 5,607750 N

Azimuth: 270° Inclination: -60° Total Depth: 150 meters

Southern Part of J6 Conductor: Proposed DDH Collar Coordinates (UTM Zone 15N, NAD83): 687,030E, 5,607,470N Azimuth: 90° Inclination: -60°

Total depth: 150 meters Newgenco (2008) rock samples on the Property, although not located on conductors based on the subsequent AeroTEM survey (Aeroquest, 2011), included nine grab samples with 146 to 621 ppm Cu & 53 to 411 ppm Ni, in gabbros & pyroxenites, lending additional support to the occurrence of weakly Cu- and Ni- anomalous mafic-ultramafic intrusive rocks in the area.

10

Most areas investigated during 2011 are at greenschist-lower amphibolite facies. It was not possible to distinguish mafic-ultramafic intrusions that may be part of greenstone belt volcanism and plutonism from those potentially associated with later mafic-ultramafic intrusive events. Most outcropping rocks (basalt, metasedimentary rocks, melagabbro & pyroxenite) have low to moderate magnetic susceptibilities (up to 4 x 10-3SI), but siliceous magnetite-pyrite iron formation in the southwestern part of the claims has a magnetic susceptibility of up to 400 x 10-3SI. 12. RECOMMENDATIONS A diamond drill hole with parameters as follows is recommended to test the T2 conductor target (Figure 9 and Table 5.):

Proposed DDH Collar Coordinates (UTM Zone 15, NAD83): 687,150 E, 5,611,050 N Azimuth: 90° Inclination: -60° Total Depth: 200 meters

Two diamond drill holes with parameters as follows are recommended to test slightly different parts of the J6 conductor (Figure 10 and Table 5.): Northern Part of J6 conductor: Proposed DDH Collar Coordinates (UTM Zone 15N, NAD83): 687,120 E, 5,607750 N

Azimuth: 270° Inclination: -60° Total Depth: 150 meters

Southern Part of J6 Conductor: Proposed DDH Collar Coordinates (UTM Zone 15N, NAD83): 687,030E, 5,607,470N Azimuth: 90° Inclination: -60°

Total depth: 150 meters 13. REFERENCES Aeroquest (2011) Report on a helicopter-borne AeroTEM System electromagnetic and magnetic survey, Aeroquest Job # 11017, Savant Lake Property, Northern Ontario, NTS 052J09, By: Aeroquest Airborne, Mississauga, Ontario, For: MMG Resources, March 2011, 23 pages plus 3 maps. Ontario Geological Survey (1990) Airborne electromagnetic and total intensity magnetic survey, Sturgeon Lake-Savant Lake area (helicopter-borne Aerodat frequency domain electromagnetic system, 200-meter flight line spacing, survey flown N-S), Ontario Geological Survey, Map 81462, scale 1:20,000. Ontario Geological Survey (1990) Airborne electromagnetic and total intensity magnetic survey, Sturgeon Lake-Savant Lake area, (helicopter-borne Aerodat frequency domain electromagnetic system, 200-meter flight line spacing, survey flown N-S) Ontario Geological Survey, Map 81468, scale 1:20,000.

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Palonen, P. A., and Speed, A.A. (1977) Elwood-Endogoki Lakes area, District of Thunder Bay: Ontario Division of Mines, Preliminary Map P1164, Sioux Lookout Data Series, scale 1:15,840 or 1 inch to ¼ mile, Data compiled 1975 & 1976. Russell, D. F. (2003) Savant Lake Area high density regional lake sediment and water geochemical survey, northwestern Ontario: Ontario Geological Survey Open File report 6118, 82 pages. Sanborn-Barrie, M. (1990) Geology of the Savant Lake area: Ontario Geological Survey, Open File Map 137, scale 1:50:000. Sanborn-Barrie, M. (2000) Structural geology, Savant Lake greenstone belt, western Superior Province, Ontario: Geological Survey of Canada, Open File 3947, compilation map at 1:100,000 scale, and 1 CD-ROM. Shannon, J., (2009) Petrographic / petrologic summary of samples* collected by Newgenco (from Savant Lake and other Ontario properties): Unpublished report for OZ Minerals Ltd., by: James Shannon, 2 April 2009, 29 pages [*NOTE: the petrographic descriptions of the two samples from Savant Lake are reproduced in this report as Appendix 6.] Silic, J. (2011) Interpretation of 2011 Savant and Sumach* AeroTEM Airborne TDEM data: Unpublished report for MMG Resources, Inc., by: Jovan Silic, Ph.D., Jovan Silic and Associates (JSA Pty Ltd), South Yarra, Victoria, Australia, 11 September 2011, 56 pages (*NOTE: 69 of 71 conductors evaluated and documented in this report were from the Savant Lake Project, only 3 conductors were evaluated on the Sumach Lake Project) Sproule, R. (2008) Savant Lake Ontario, Target parameter definition document: Unpublished memorandum to OZ Minerals, 20 pages, by: Newgenco Exploration (North America) Limited. October 2008. Tomlinson, K.Y., Stone, D. Stott, G.M. and Percival, J.A. (2004) Basement terranes and crustal recycling in the western Superior Province: Nd isotopic character of granitoid and felsic volcanic rocks in the Wabigoon Subprovince, Northern Ontario, Canada: Precambrian Research, v. 132, p. 245-274. Trowell, N.F. (1988) Precambrian geology of the Savant Lake area, Districts of Thunder Bay and Kenora: Ontario Geological Survey Map P0399, Geological Series Preliminary Map, Scale 1:50,000. Geology 1976 & 1977. Trowell, N.F., Blackburn, C.E., and Edwards, G.R. (1980) Preliminary synthesis of the Savant Lake- Crow Lake metavolcanic – metasedimentary belt, Northwestern Ontario, and it bearing upon mineral exploration: Ontario Geological Survey, Miscellaneous Paper 89, 30 pp., accompanied by Chart A (Geological Map).

FIGURES

Figure 1: Location Map of the MMG Canada Exploration Inc. Savant Lake Property.

Figure 2: Claim Map of the MMG Canada Exploration Inc. Savant Lake Property.

Figure 3: Compilation of Historical Drill Hole Collar Locations on MMG Savant Lake Property. Grid is NAD83 UTM Z15N. Arrow is oriented true North. Pink symbols denote drill hole collar locations compiled from historical assessment reports. See Table 2 for summary of drill holes by Company and date. See Section 6 of this report for detailed discussion of historical exploration.

Figure 4: Selected AeroTEM Conductors Field Checked in September 2011. Grid is NAD83 UTM Z15N. Arrow is oriented true North. Color background is Z-off Channel 10 image from Aeroquest (2011); warmer colors are more conductive areas. Green triangles with blue labels denote selected AeroTEM conductors field checked in September 2011. See Table 3 for summary characteristics of selected conductors. See Section 7 of this report and Appendix 8 for detailed discussion of selected conductors Pink symbols denote drill hole collar locations from historical assessment reports, to emphasize that most of the selected conductor localities were not tested by previous drilling.

Figure 5: Rock Sample Locations from September 2011 Field Program. Rock sample locations denoted by black triangles. Grid is NAD83 UTM Z15N. Arrow is oriented true North. See Appendix 1 for laboratory certificates for rock sample geochemical data. See Appendix 4 for field descriptions of rock samples, associated field data and appended geochemical analyses.

Figure 6: Map of Field Traverses, September 2011 Field Program. Grid is NAD83 UTM Z15N. Arrow is oriented true North. Pink lines indicate filed traverses. Black arrows indicate direction of traverse. Black dots indicate beginning of traverse (if only black dot is shown, then the “traverse” was just a local helicopter-supported outcrop stop. Field station points are shown separately on Figure 7 for increased clarity.

Figure 7: Map of Field Stations, September 2011 Field Program. Grid is NAD83 UTM Z15N. Arrow is oriented true North. Field Stations are numbered with the last digit or two digits of the field station (for example: W216001 = 1 on this figure; Station W216015 = 15 on this figure). See Appendix 3 for detailed table of field data corresponding to each station.

Figure 8: Map of Rock Types at Field Stations. Grid is NAD83 UTM Z15N. Arrow is oriented true North. Rock Type Abbreviations: G = melagabbro, U = pyroxenite, D = granodiorite, B = metabasalt, S = psammopelite, P = metapelite, I = iron formation. Other abbreviations used: T = boulder till, W = bog.

Figure 9: Proposed Drill Hole at T2 Conductor. Grid is NAD83 UTM Z15N. Arrow is oriented true North. Claims are numbered; claim boundary is heavy brown line. Background image is Z on-time Channel 16 from Aeroquest (2011) survey. Heavy black trace is surface projection of proposed diamond drill hole. See Table 5 for details of the northwest-dipping Main (upper, pink outline) and Subsidiary (lower, blue outline) conductive plates.

Figure 10: Proposed Drill Holes at J6 North and J6 South Conductors. Grid is NAD83 UTM Z15N. Arrow is oriented true North. Claims are numbered; claim boundaries are heavy brown lines. Background image is Z on-time Channel 16 from Aeroquest (2011) survey. Heavy black trace is surface projection of proposed diamond drill hole. See Table 5 for details of the Northwest-dipping Main (pink outline) and Subsidiary (blue outline) conductive plates.

TABLES

Table 1: Claims Comprising the MMG Canada Exploration Inc. Savant Lake Property

Table 2: List of Historical Drill Holes on MMG Savant Lake Property

Table 3: Summary Characteristics of Selected Conductors Field Checked in September 2011 [as originally estimated by J. Silic (for “J” anomalies) and T. Grant (for “T” anomalies), prior to field checking and Maxwell modelling of T2 & J6.

Table 4: Table of Rock Types Identified During September 2011Program.

Table 5: Plate Models and Recommended Drill Tests for T2 Conductor and J6 N & J6 S Conductors (See Appendix 9 for details of modelling)

APPENDICES Appendix 1: Assay Certificates for Rock Samples from Savant Lake Property. NOTE: Sample R132205 is an OREAS-73a analytical standard (see Appendix 2 for Qa/Qc) and Sample R13210 is a silica sand blank.

Appendix 2: Qa/Qc Plots for Sample Standard R132205 Included in the Assay Certificates (Appendix 1.)

Note: The Standard OREAS-73a is only certified by 4 acid digestion. The ME-MS41L Co result of 244 is out of range and appears to be under reported due to it being an aqua regia digest.

Appendix 3 -Geological Data for Field Stations.

Appendix 4: Rock Sample Descriptions w

ith Appended Analytical Data (from Appendix 1. N

OTE:

analytical codes for the various elements and oxides are sam

e as in Appendix 1, Certificates.)

Appendix 5 -Cost Statement.

Appendix 6: Petrographic Descriptions from Shannon (2009).

OZ MINERALS LIMITED: PETROGRAPHIC REPORT

PROGRAM: NEWGENCO Ni-Cu BY: James R. Shannon PROJECT: Savant Lake DATE: February 12, 2009 SAMPLE NUMBER: 08-SAV-007 SAMPLE TYPE: Polished Thin Section HAND SAMPLE DESCRIPTION: Polished grain mount of crushed rock material. The sample is non magnetic with a hand magnet. THINSECTION DESCRIPTION: MINERAL EST % SIZEmm COMMENTS PRIMARY (95) Plagioclase 45 Mafic 50 Remnants of original hbde xtals to 1.5 mm may be

replacements of pyroxene? ACCESSORY (1.0) Sphene 0.5 Rutile 0.5 METAMOR/ALT (51) Actinolite 35 Replaces mafic sites Zoisite 8 Epidote 2 Chlorite 8 Carbonate 2 Quartz 1 MICROBRECCIA (5) MICROVEINS (Tr) Suggestions of irregular, discontinuous epidote-

quartz and quartz-carb microveinlets SULFIDE (0.4) Disseminated sulfide generally associated with

epidote and carbonate Pyrrhotite 0.3 Chalcopyrite 0.1 Pyrite Tr TEXTURES Most fragments have remnant, medium-grained igneous textures with tabular plagioclase grains with twinning and suggestions of normal zoning. Textures suggest hypidiomorphic granular texture with subhedral plagioclase and remnant mafic mineral sites. Larger amphibole grains may be remnants of original pyroxene or hornblende grains. Almost all amphibole is recrystallized to lt green to bluegreen actinolitic amphibole. Zoisite, epidote, chlorite, carbonate and quartz are also interpreted to be related to amphibolite grade metamorphic overprinting. There are very minor preferred metamorphic fabrics (alignment of actinolite) developed in quartz-rich fragments. About 5 percent of the fragments have a microbreccia texture with cataclastic deformation of amphibole and epidote crystals and some weak foliations. Minor disseminated pyrrhotite, chalcopyrite and pyrite are irregularly distributed and are concentrated with epidote and carbonate.

COMMENTS The lack of biotite and abundant actinolitic amphibole suggest a lower amphibolite grade metamorphic overprint. Zoisite, epidote, quartz, and carbonate may also be part of the metamorphic assemblage. However, the presence of relatively abundant chlorite may indicate a retrograde metamorphic event. Disseminated sulfides are spatially associated with epidote and carbonate and are interpreted to be remobilized during metamorphic overprinting. The presence of minor irregular microveinlets also supports remobilization of metamorphic and alteration components. ROCK NAME: Actinolite-Zoisite-Chlorite Amphibolite (Leucogabbro/Diorite)

Sample 08-SAV-007. Remnant medium-grained igneous texture with tabular plagioclase and actinolitic amphibole. Crossed polarizers; 2.4 mm across.

Sample 08-SAV-007. Quartz-rich fragment with moderate foliation of actinolite. Crossed polarizers; 2.4 mm across.

Sample 08-SAV-007. Disseminated sulfide associated with carbonate and zoisite. Crossed polarizers; 1.25 mm across.

Sample 08-SAV-007. Same view as above with reflected light. Disseminated coarser pyrrhotite (whitish) and finer chalcopyrite are associated with carbonate and epidote.

OZ MINERALS LIMITED: PETROGRAPHIC REPORT

PROGRAM: NEWGENCO Ni-Cu BY: James R. Shannon PROJECT: Savant Lake DATE: February 12, 2009 SAMPLE NUMBER: 08-SAV-018 SAMPLE TYPE: Polished Thin Section HAND SAMPLE DESCRIPTION: Polished grain mount of crushed rock material. THINSECTION DESCRIPTION: MINERAL EST % SIZEmm COMMENTS PRIMARY (98) Mafic 75 Green to bluegreen actinolitic amphibole after

original mafic sites Plagioclase 23 ACCESSORY (2) Ilmenite 2 METAMOR/ALT (72) Actinolite 70 Biotite Tr Epidote 0.5 Carbonate 0.1 Chlorite 0.5 MICROBRECCIA (15) Cataclastic microbreccias with fragmented

amphibole and some banding SULFIDES (0.2) Disseminated sulfides mostly associated with

fibrous actinolite; some with epidote Chalcopyrite 0.1 Pyrrhotite 0.1 TEXTURES Most fragments are amphibole rich. Some have medium grained igneous textures with remnants of tabular plagioclase with twinning and zoning. Most fragments have weak to moderate foliation due to alignment of actinolitic amphibole and minor biotite. About 15 percent of the clasts have well-developed moderate metamorphic foliation. Minor disseminated chalcopyrite and pyrrhotite are usually associated with fibrous actinolite and sometimes with epidote. There are trace, tiny (0.02 mm), rounded sulfide blebs in amphibole that could be remnant immiscible sulfide grains. There are about 15 percent fragments of microbreccia with cataclastized amphibole and pyrrhotite grains. COMMENTS This sample is more mafic than sample 08-SAV-007 and the protolith may have been mafic-rich mela-gabbro or mela-diorite. There is a stronger metamorphic overprint with more extensive recrystallization of primary minerals (both mafic sites and plagioclase) and development of weak to moderate metamorphic fabrics-foliations. Abundant actinolitic amphibole, minor epidote, and trace biotite suggest upper greenschist to lower amphibolite metamorphic grade. ROCK NAME: Actinolite-Epidote-Chlorite Mafic-Rich Amphibolite (Melagabbro/ Meladiorite)

Sample 08-SAV-018. Wide-field, full thin-section view of grain mount. Plane light; 3.6 mm across. Fragments are actinolite rich.

Sample 08-SAV-018. Same wide-field view as above with crossed polarizers.

Sample 08-SAV-018. Metamorphic recrystallization of large amphibole grains to moderate foliated actinolite. Crossed polarizers;

Sample 08-SAV-018. Mafic-rich igneous texture with remnant tabular plagioclase and abundant actinolitic amphibole. Both plagioclase and amphibole are locally recrystallized. Crossed polarizers; 2.4 mm across.

Sample 08-SAV-018. Remnant amphibole replaced by fine-grained, foliated actinolite with remnant plagioclase (brownish white). Plane light; 2.4 mm across.

Sample 08-SAV-018. Disseminated chalcopyrite (yellowish, left) and pyrrhotite (whitish, right) associated with actinolite. Reflected light; 1.25 mm across.

Sample 08-SAV-018. Microbreccia fragment with cataclastized pyrrhotite grain. Reflected light; 1.25 mm across.

Appendix 7: Statement of Qualifications of Author

CERTIFICATE OF QUALIFIED PERSON

I, Robert A. Brozdowski, of Victoria British Columbia, hereby certify that:

• I am a consulting exploration geologist residing and with an office at 2560 Nottingham Road, Victoria, British Columbia, V8R 6C5, Canada.

• This certificate applies to the technical report titled "Savant lake Area Ni-Cu Sulphide Exploration: Field investigation of AeroTEM Anomalies, for MMG Canada Exploration, Inc." dated 31 March 2012.

• I am a graduate of Pennsylvania State University, University Park, PA., USA (B.Sc. Geoscience, 1980), Temple University, Philadelphia, PA., USA (M.A. Geology, 1983) and the University of Western Ontario, london, Ontario, Canada (Ph.D. Geology, 1990).

• I have been a practicing exploration geologist in various capacities since 1980, initially as an employee of various mineral exploration companies, and subsequently since 1998 as a self· employed consulting exploration geologist, working in North America, Asia, South America and Europe.

• I am a member of the Society of Economic Geologists, SME (Society for Mining and Exploration), Prospectors & Developers Association of Canada, Association of Applied Geochemists, Geological Society of America, and Fellow of the Geological Association of Canada.

• I am a member in good standing of the Association of Professional Engineers and Geoscientists of British Columbia, licence# 34687.

• I have read the definition of "qualified person" set out in National Instrument 43-101 ("NI 43-101") and certify that by reason of my education, affiliation with a professional association (as defined in Nl 43-101) and past relevant work experience, that I fulfill the requirements to be a "qualified person".

• I directed and participated in geological reconnaissance and field checking of AeroTEM conductive anomalies on the Savant Lake Property during September 2011.

• I am responsible authoring this report. • As at the date hereof, I am not aware of any material fact or material change with respect to the

subject matter of the Report that is not reflected in the Report.

A~~"Esslo>~ . Dated and signed i~'~\Q, Columbia, this 31-h day of March, 2012

~'~l. ~ Dr. R. A. 3RDZDOWSKI ~ ~ 34687 '

31 March 2012 Date

Appendix 8: Interpretation of 2011 Savant AeroTEM Airborne TDEM data; Report by: J. Silic.

Interpretation of 2011 Savant and Sumach

AeroTEM Airborne TDEM data

For

MMG Resources Inc

By

Jovan Silic Ph. D.

Jovan Silic and Associates

(JSA Pty Ltd) September 2011

1

DISCLAIMER Confidentiality This document and its contents are confidential and may not be disclosed or published in any manner (except in its entirety to a government department as part of the statutory reporting requirements and as may otherwise be required by law) unless Jovan Silic and Associates Pty Ltd [”JSA”] has given its prior written consent to the form and context of the disclosure or publication. Disclaimer JSA has prepared this report based upon information believed to be accurate at the time of completion, but which is not guaranteed. JSA makes no representation or warranty as to the accuracy, reliability or completeness of the information contained in this report and will not accept liability to any person for any errors or omissions or for losses or damages claimed as a result, directly or indirectly, or items discussed, opinions rendered or recommendations made in this report, except for statutory liability which may not be excluded.

2

LIST OF CONTENTS Disclaimer............................................................................................................................... 1 List of Contents ...................................................................................................................... 2 List of figures ......................................................................................................................... 3 Summary................................................................................................................................. 5 1. Introduction ....................................................................................................................... 6 2. Survey equipment .............................................................................................................. 7 3. Data Quality and Processing .......................................................................................... 11

3.1. Survey Noise Levels ............................................................................................................. 11 3.2 AeroEM response over 3D conductive targets ................................................................. 12

3.2.1. In-Time vs Off-Time Response from a 3D Target ............................................................. 12 3.2.2. Response of 5.0 millisecond time-constant conductor at varying depth s and dips ............ 17 3.2.3. Comparison of AeroTEM Response with Other Airborne EM Platforms .......................... 24

4 AEROTEM Data interpretation .................................................................................... 26 4.1 Analysis of AEROTEM Data ............................................................................................ 26 4.2 Identification of Conductive Targets. ................................................................................ 34

Conclusion ............................................................................................................................ 37 References: ........................................................................................................................... 38 SAV 02 – 05 .......................................................................................................................... 40 SAV 06 .................................................................................................................................. 44 SAV 07 .................................................................................................................................. 47 SAV 23 .................................................................................................................................. 50 SUM 01 and 02 ..................................................................................................................... 53

3

LIST OF FIGURES Figure 1. Savant Survey Area . ........................................................................................................... 6 Figure 1a. Sumach Survey Area . ......................................................................................................... 7 Figure 2: AeroTEM Transmitter Receiver Waveforms ........................................................................ 9 Figure 3. AeroTEM (Z nT/s) On Time: Vertical Dip 2.5 ms time constant target at 50 meter

depth .................................................................................................................................. 13 Figure 3a. AeroTEM (Z nT/s) Off Time : Vertical Dip 2.5 ms time constant target at 50 meters

depth .................................................................................................................................. 14 Figure 3b. AeroTEM (Z nT/s) On Time : Vertical Dip 5.0 ms time constant target at 50 meters

depth .................................................................................................................................. 14 Figure 3c. AeroTEM (Z nT/s) Off Time : Vertical Dip 5.0 ms time constant target at 50 meters

depth .................................................................................................................................. 15 Figure 3d. AeroTEM (Z nT/s) On Time : Vertical Dip 10.0 ms time constant target at 50 meters

depth .................................................................................................................................. 15 Figure 3e. AeroTEM (Z nT/s) Off Time : Vertical Dip 10.0 ms time constant target at 50 meters

depth .................................................................................................................................. 16 Figure 3f. AeroTEM (Z nT/s) Off Time : Vertical Dip 20.0 ms time constant target at 50 meters

depth .................................................................................................................................. 16 Figure 3h. AeroTEM (Z nT/s) Off Time : Vertical Dip 20.0 ms time constant target at 50 meters

depth .................................................................................................................................. 17 Figure 4. AeroTEM (Z nT/s) On Time : Vertical Dip 5.0 ms time constant target at 50 meters

depth .................................................................................................................................. 18 Figure 4a. AeroTEM (Z nT/s) Off Time : Vertical Dip 5.0 ms time constant target at 50 meters

depth .................................................................................................................................. 18 Figure 4b. AeroTEM (Z nT/s) On Time : Vertical Dip 5.0 ms time constant target at 50 meters

depth .................................................................................................................................. 19 Figure 4c. AeroTEM (Z nT/s) On Time : Vertical Dip 5.0 ms time constant target at 100 meters

depth .................................................................................................................................. 19 Figure 4d. AeroTEM (Z nT/s) Off Time : Vertical Dip 5.0 ms time constant target at 100 meters

depth .................................................................................................................................. 20 Figure 4e. AeroTEM (Z nT/s) On Time : Vertical Dip 5.0 ms time constant target at 150 meters

depth .................................................................................................................................. 20 Figure 4f. AeroTEM (Z nT/s) Off Time : Vertical Dip 5.0 ms time constant target at 150 meters

depth .................................................................................................................................. 21 Figure 4g. AeroTEM (Z nT/s) On Time : 45 degree Dip 5.0 ms time constant target at 150

meters depth ...................................................................................................................... 21 Figure 4h. AeroTEM (Z nT/s) Off Time : 45 degree Dip 5.0 ms time constant target at 150

meters depth ...................................................................................................................... 22 Figure 4i. AeroTEM (Z nT/s) On Time : 45 degree Dip 5.0 ms time constant target at 200

meters depth ...................................................................................................................... 22 Figure 4j. AeroTEM (Z nT/s) On Time : 45 degree Dip 5.0 ms time constant target at 200

meters depth ...................................................................................................................... 23 Figure 4k. AeroTEM (Z nT/s) On Time : Zero degree Dip 5.0 ms time constant target at 200

meters depth ...................................................................................................................... 23 Figure 4l. AeroTEM (Z nT/s) Of Time : Zero degree Dip 5.0 ms time constant target at 200

meters depth ...................................................................................................................... 24 Figure 5. AeroTEM (Z nT/s) Off Time : 45 degree Dip 5.0 ms time constant target at 150

meters depth ...................................................................................................................... 25 Figure 5a. HeliTEM (Geotem)(Z nT/s) Off Time : 45 degree Dip 5.0 ms time constant target at

150 meters depth ............................................................................................................... 26 Figure 6. Savant Z Channel 10 On Time and Off Time . ................................................................. 27 Figure 6a. Savant Z Channel 3 : Ratio of On-time and Off-Time Data . ............................................. 28 Figure 6b. Savant Z Time Constant . .................................................................................................. 29 Figure 6c. Savant Z Time Constant and Channel 17 Off-Time ........................................................ 30 Figure 6d. Savant Total Magnetic Intensity ( TMI ) .......................................................................... 31 Figure 7. Savant Z Channel 10 ( Off-Time ) and Location of Target Areas Analyzed . .................... 32 Figure 7a. Savant Z Time Constant and Location of Target Areas Analyzed . .................................. 33 Figure 8. Sumach Z Channel 10 ( Off-Time ) and Location of Target Areas Analyzed . .................. 34

4

Figure 9. Savant Z Time Constants and Location of Recommended Targets . ............................... 35 Figure 9a. Sumach Z Channel 10 ( Off-Time ) and Location of Recommended Targets . ................ 36 Figure SAV_02_05_01. Z Channel 10 (Off-Time ) ............................................................................. 40 Figure SAV_02_05_02. Total Magnetic Intensity . ............................................................................. 41 Figure SAV_02_05_03. AeroTEM ( Z nT/s ) Off Time : SAV 02 Line 5605900 N . ............................ 42 Figure SAV_02_05_03a. AeroTEM ( Z nT/s ) Off Time : SAV 05 Line 5606650 N . .......................... 43 Figure SAV_06_01. Z Channel 10 ( Off-Time ) ................................................................................. 44 Figure SAV_06_02. Total Magnetic Intensity . ................................................................................... 45 Figure SAV_06_03. AeroTEM ( Z nT/s ) Off Time : SAV 06 Line 5607750 N . ................................. 46 Figure SAV_07_01. Z Channel 10 ( Off-Time ) . .............................................................................. 47 Figure SAV_07_02. Total Magnetic Intensity . ................................................................................... 48 Figure SAV_07_03. AeroTEM ( Z nT/s ) Off Time : SAV 07 Line 5608800 N . ................................. 49 Figure SAV_23_01. Z Channel 10 ( Off-Time ) ................................................................................. 50 Figure SAV_23_02. Total Magnetic Intensity . .................................................................................. 51 Figure SAV_23_03. AeroTEM ( Z nT/s ) Off Time : SAV 23 Line 5611950 N . ................................. 52 Figure SUM_01_02_01. Z Channel 10 ( Off Time ) . .......................................................................... 53 Figure SUM_01_02_02. Total Magnetic Intensity . ............................................................................. 54 Figure SUM_01_02_03a. AeroTEM ( Z nT/s ) Off Time : SUM 01 Line 427950 E . .......................... 55 Figure SUM_01_02_01. AeroTEM ( Z nT/s ) Off Time : SUM 02 428150 E . .................................. 56

5

SUMMARY

AeroTEM airborne TDEM data mainly identifies regional conductive trends which do not appear to contain long time constant targets or significant along strike conductivity variations . Five target areas which may not be part of the regional conductive features are however recommended for follow up . Most of these conductors are associated with discreet magnetic bodies

6

1. INTRODUCTION

In February 2011 a 1301 kilometres AeroTEM IV TDEM data set was collected over the Savant Lake Property , Northern Ontario (Figure 1 and 1a ). Aeroquest Airborne performed the survey on behalf of MMG Resources . The purpose of the survey was to detect conductive bedrock targets possibly related to Nickel sulphide deposits within the survey area. The purpose of this report is to present analysis of this data and to discuss in detail the EM responses of any targets identified as possibly being sourced within the bedrock.

Figure 1. Savant Survey Area .

7

Figure 1a. Sumach Survey Area .

2. SURVEY EQUIPMENT

Airborne EM data was collected using the AeroTEM Hz electromagnetic and magnetic system, with a base operating frequency of 30 Hz. Real time differential GPS was used for navigation and the data was collected at a nominal 50 meter line spacing

8

Table 1: Airborne Equipment Specifications

System Parameters AeroTEM 30 Hz Specifications

Navigation Real time Differential GPS

Nominal aircraft speed (m/s) 35

Geometry Transmitter height Above ground level (m agl) (Nominal terrain clearance)

30

Receiver Bird Height (agl, m) 30

Tx-Rx horizontal separation (m) 0.0

Transmitter Coil Axis Vertical

Signal Triangular wave current pulse

Base frequency (Hz) 30

Repetition rate (pulses per second) 30

Pulse width (microseconds) 2716

Loop area (square metres) 271

Number of turns 6

Peak Current (amps) 210

Tx loop dipole moment (Am2) 3.310 x 105

Receiver Coil Axes Z,X

Sample Interval (seconds) 0.10

Channel times see Table 2

9

Figure 2: AeroTEM Transmitter Receiver Waveforms

10

Table 2: Receiver Channel Positions

Chanel Chanel Chanel Centre Chanel Width msec after Tx

Msec

On-Time 1 1.499 0.055 2 1.554 0.055 3 1.610 0.055 4 1.666 0.055 5 1.772 0.055 6 1.777 0.055 7 1.832 0.055 8 1.888 0.055 9 1.943 0.083 10 2.013 0.083 11 2.096 0.083 12 2.180 0.083 13 2.263 0.111 14 2.360 0.111 15 2.471 0.111 16 2.594 0.139

Chanel Chanel Chanel Centre Chanel Width

msec after Tx

Msec

Off Time 1 2.792 0.055 2 2.820 0.055 3 2.861 0.055 4 2.916 0.083 5 2.986 0.111 6 3.083 0.111 7 3.083 0.138 8 3.208 0.194 9 3.375 0.278 10 3.611 0.389 11 3.944 0.527 12 4.402 0.722 13 5.027 1.027 14 5.902 1.444 15 8.860 2.000 16 11.230 2.750 17 14.470 3.722

11

3. DATA QUALITY AND PROCESSING

3.1. Survey Noise Levels

By analysing the spatial characteristics of the data over areas with relatively flat background response estimates of standard deviation (SD ) of the noise levels (envelopes) for various time channels were derived .They are shown in Table 3 and 3a and quoted in units of nT/s ( nanoTeslas/second ) . These data noise estimate values were then used in all subsequent data analysis, time constant calculations and estimates of the system’s depth of penetration.

Table 3: Estimated Noise Levels Off Time

Channel Number System Noise SD Off Time nT/s

1 20.7 2 12.9 3 10.9 4 9.7 5 9.4 6 9.4 7 9.3 8 9.4 9 9.4

10 9.3 11 9.4 12 9.4 13 9.5 14 9.5 15 9.4 16 9.7 17 9.2

12

Table 3a: Estimated Noise Levels On Time

Channel Number System Noise SD On Time nT/s

1 27.8 2 21.0 3 20.7 4 20.7 5 20.8 6 21.1 7 21.1 8 21.0 9 20.8

10 21.0 11 20.9 12 20.9 13 21.2 14 21.4 15 21.7 16 23.5

3.2 AeroEM response over 3D conductive targets

To illustrate the characteristics of the AeroTEM 30 Hz system a number of theoretical model responses were generated for a 300 by 200 meter sheet ( thin plate ) conductor with a variable conductivity-thickness product and dips at depths of 50 , 100 .150 and 200 meters , set within a highly resistive background typical for the survey area .

3.2.1. In-Time vs Off-Time Response from a 3D Target

As shown in Table 1 and Figure 2 AeroTEM transmitter on time a triangular wave form is some 2.7 milliseconds long. The on-time measurements of a conductors response are sampled some 1.5 milliseconds after the current is turned on (Figure 2 and Table 3), whereas the off-time sampling of the EM response commences 2.8 milliseconds after the transmitter current turn on time.

The relatively short transmitter on-time will however “downgrade” the amplitude of a conductors response whose time constant (decay rate ) is greater than half on-time of the transmitters current waveform or much greater that 1.5 milliseconds . This is essentially due to the changing polarity (see Figure 2) of the time derivative of the transmitter waveform generating current systems within the conductive target of alternating polarity, which interfere with or subtract each other's EM fields.

Profiles of modelled response over targets at depth of 50 meters with time-constant from 2.5 – 20 milliseconds shown that (Figure 3 – 3f) ,

13

(i) Amplitudes of on-time signals will invariably be higher than the off-time EM response. For early and off-times this ratio varies from 3-4 times for “short” time constants, to about 6-7 times for “longer” times constant

(ii) For targets with time constant significantly greater than the transmitter current on time, the on-time response essentially “saturates” and there is very little variation of the on-time response with the conductors time constant.

Figure 3. AeroTEM (Z nT/s) On Time: Vertical Dip 2.5 ms time constant target at 50 meter depth

14

Figure 3a. AeroTEM (Z nT/s) Off Time : Vertical Dip 2.5 ms time constant target at 50 meters depth

Figure 3b. AeroTEM (Z nT/s) On Time : Vertical Dip 5.0 ms time constant target at 50 meters depth

15

Figure 3c. AeroTEM (Z nT/s) Off Time : Vertical Dip 5.0 ms time constant target at 50 meters depth

Figure 3d. AeroTEM (Z nT/s) On Time : Vertical Dip 10.0 ms time constant target at 50 meters depth

16

Figure 3e. AeroTEM (Z nT/s) Off Time : Vertical Dip 10.0 ms time constant target at 50 meters depth

Figure 3f. AeroTEM (Z nT/s) Off Time : Vertical Dip 20.0 ms time constant target at 50 meters depth

17

Figure 3h. AeroTEM (Z nT/s) Off Time : Vertical Dip 20.0 ms time constant target at 50 meters depth

It is apparent from the previous discussion and presented results that ,

(i) It may be advantages to search for long time constant targets by analysing the on-time data although this may not result in reliable estimate of the time-constant.

(ii) Ratio of early on-time off-time channel amplitudes can be an indication of targets time constant.

3.2.2. Response of 5.0 millisecond time-constant conductor at varying depth s and dips

Modelled results for the expected response from an 300 x 200 meters plate like thin sheet conductor with a 5 milliseconds time constant are presented in profile from in Figures 4 – 4e. To analyse the effectiveness of the AeroTEM system in detecting these targets noise levels (envelopes ) of +- 20 nT/s for off-time and +- 50 nT/s for on-time data (Tables 3 and 3a in pervious section) are used to eliminate the recognition of any response with amplitudes below the system noise envelope values.

18

Figure 4. AeroTEM (Z nT/s) On Time : Vertical Dip 5.0 ms time constant target at 50 meters depth

Figure 4a. AeroTEM (Z nT/s) Off Time : Vertical Dip 5.0 ms time constant target at 50 meters depth

19

Figure 4b. AeroTEM (Z nT/s) On Time : Vertical Dip 5.0 ms time constant target at 50 meters depth

Figure 4c. AeroTEM (Z nT/s) On Time : Vertical Dip 5.0 ms time constant target at 100 meters depth

20

Figure 4d. AeroTEM (Z nT/s) Off Time : Vertical Dip 5.0 ms time constant target at 100 meters depth

Figure 4e. AeroTEM (Z nT/s) On Time : Vertical Dip 5.0 ms time constant target at 150 meters depth

21

Figure 4f. AeroTEM (Z nT/s) Off Time : Vertical Dip 5.0 ms time constant target at 150 meters depth

Figure 4g. AeroTEM (Z nT/s) On Time : 45 degree Dip 5.0 ms time constant target at 150 meters depth

22

Figure 4h. AeroTEM (Z nT/s) Off Time : 45 degree Dip 5.0 ms time constant target at 150 meters depth

Figure 4i. AeroTEM (Z nT/s) On Time : 45 degree Dip 5.0 ms time constant target at 200 meters depth

23

Figure 4j. AeroTEM (Z nT/s) On Time : 45 degree Dip 5.0 ms time constant target at 200 meters depth

Figure 4k. AeroTEM (Z nT/s) On Time : Zero degree Dip 5.0 ms time constant target at 200 meters depth

24

Figure 4l. AeroTEM (Z nT/s) Of Time : Zero degree Dip 5.0 ms time constant target at 200 meters depth

From the presented data it is apparent that ,

(i) Some of the deeper targets may be recognisable in the on-time data but not in the off-time response.

(ii) Vertical dip target may not be detected if at depths of 100 meters and greater.

(iii) Flatter dip targets may be detected at depths 150-200 meters, although their response may only be apparent in the on-time data.

3.2.3. Comparison of AeroTEM Response with Other Airborne EM Platforms

As discussions and results from previous sections have shown detecting a conductor at depth is crucially dependent on

(i) Transmitter moment in relation to the system noise levels

(ii) The ration of transmitter on-time and conductors time constant.

The preceding conclusions for the effectiveness of the AeroTEM system were the result of a relatively “small’ transmitter dipole moment at 310,000 NIA and relatively high system noise levels of between +-20 nT/s for off-time data, to +- 50 nT/s for on-time data.

Increasing the transmitter moment and reducing the system noise levels will significantly increase the effectiveness of the system to detect deep targets.

25

HeliTEM airborne EM platform (Fugro system) with a transmitter moment of 1,850,000 NIA (six times larger than that of AeroTEM IV ) ) and system noise levels of approximately +- 1nT/s ( known to the author ) will for example more easily recognise the effects of a target from depths in excess of 150 meters (Figure 5 – 5a).

Figure 5. AeroTEM (Z nT/s) Off Time : 45 degree Dip 5.0 ms time constant target at 150 meters depth

26

Figure 5a. HeliTEM (Geotem)(Z nT/s) Off Time : 45 degree Dip 5.0 ms time constant target at 150 meters depth

4 AEROTEM DATA INTERPRETATION

4.1 Analysis of AEROTEM Data

Analysis of AeroTEM data proceded by considering both of the on-time and off-time response in particular the ratio of the two (see preceding section), time constant derivations and close analysis of chosen target areas.

Simple comparison of the on-time and off-time data (Figure 6), for example shows that there do no appear obvious on-time anomalies which are not to reflected in the off-time data (Figure 6).

27

Figure 6. Savant Z Channel 10 On Time and Off Time .

The ratio of the on-time channel 3 to the off-time channel 3 response (Figure 6a), supports the preceding observation with most of the ratios being between 2-3, indicating “small” time constant targets. The higher values which appear at the extremities of the active areas are however due to the inaccuracy in the ratio values, with system-noise levels impacting on the low amplitudes at the active zone extremities.

28

Figure 6a. Savant Z Channel 3 : Ratio of On-time and Off-Time Data .

Calculation of the time constants based on the off-time data shows that most of the time constants are between 1.5 – 2.0 milliseconds ( Figure 6b ) .

29

Figure 6b. Savant Z Time Constant .

This is hardly surprising considering that no anomalous response is evident at the late times (Figure 6c)

30

Figure 6c. Savant Z Time Constant and Channel 17 Off-Time .

TMI data however shows that a number of the conductive trends are associated with either discreet or regional magnetic trends (Figure 6d)

31

Figure 6d. Savant Total Magnetic Intensity ( TMI )

Nevertheless the analysis of the data proceeded by analysing in detail some sixty nine separate areas as shown in Figure 7, 7a and 8.

32

Figure 7. Savant Z Channel 10 ( Off-Time ) and Location of Target Areas Analyzed .

33

Figure 7a. Savant Z Time Constant and Location of Target Areas Analyzed .

34

Figure 8. Sumach Z Channel 10 ( Off-Time ) and Location of Target Areas Analyzed .

4.2 Identification of Conductive Targets.

Identification of targets proceeded by analyzing in detail some sixty nine responses within the Savant survey area and two within the Sumach area.

The choice of targets however did solely rely upon the time-constant estimates and nor could responses over wide targets be rejected as not being due to mineralized deposits. As a result in conjunction with the interpretation of target quality (time constant) , anomalous component and geometry, whether or not the target was sufficiently unique” for the area surrounding it was also an important consideration in choosing the targets that may be representative of conductive sulphide system systems (i.e. identifying “’isolated targets” was an important consideration).

Almost all of the responses analysed in detail and whose locations are shown in Figures 7 – 8 were interpreted as most likely not outlining discreet conductive bedrock targets but are part of the regional conductors with the survey area.

However some conductive features although not outlining conductors with high time - constants were interpreted as possibly being outside or not part of the regional trends . They are shown in Figures 9 and 9a and listed in Tables 4 and 4 a . Characteristics of these targets are discussed in Appendix I .

35

Figure 9. Savant Z Time Constants and Location of Recommended Targets .

36

Figure 9a. Sumach Z Channel 10 ( Off-Time ) and Location of Recommended Targets .

Table 4 : List of Savant Recommended Targets

Target Number East North NAD 83 UTM Zone 15 NAD 83 UTM Zone 15 2 684757 5605960 3 684544 5606344 4 684459 5606621 5 684225 5606621 6 687036 5607813 7 687110 5608845

23 688200 5611960

Table 4a : List of Sumach Recommended Targets

Target Number East North NAD 83 Zone 15 NAD 83 Zone 15 1 427921 5605920 2 428125 5606030

37

CONCLUSION AeroTEM airborne TDEM data mainly identifies regional conductive trends which do not appear to contain long time constant targets or significant along strike conductivity variations . Five target areas which may not be part of the regional conductive features are however recommended for follow up . Most of these conductors are associated with discreet magnetic bodies .

38

REFERENCES:

Silic J. (2004) : Discoveries through innovation in application of airborne and ground TDEM methods in very conductive environment: Extended Abstracts, ASEG 17Th Geophysical Conference and Exhibition, Sydney Australia,2004.

39

APPENDIX I

40

SAV 02 – 05

Target response SAV 2 -5 are a series of EM anomalies clustering within or coincident with a magnetic body (Figures SAV_01_05_01 and 02). They seem to be outlining a moderate most likely wide thick conductive bodies (Figure SAV_01_05_03 and 03a).

Figure SAV_02_05_01. Z Channel 10 (Off-Time )

41

Figure SAV_02_05_02. Total Magnetic Intensity .

42

Figure SAV_02_05_03. AeroTEM ( Z nT/s ) Off Time : SAV 02 Line 5605900 N .

43

Figure SAV_02_05_03a. AeroTEM ( Z nT/s ) Off Time : SAV 05 Line 5606650 N .

44

SAV 06

SAV 06 EM anomaly appear to be surrounded by but outside the regional conductive trends. It is coincident with a shallow magnetic body (Figure SAV_06_01-02). The EM profiles suggests that the target is a wide near surface conductor with a variable along strike conductivity (Figure SAV_06_03)

Figure SAV_06_01. Z Channel 10 ( Off-Time ) .

45

Figure SAV_06_02. Total Magnetic Intensity .

46

Figure SAV_06_03. AeroTEM ( Z nT/s ) Off Time : SAV 06 Line 5607750 N .

47

SAV 07

SAV 07 anomaly is at the southern end of a regional conductive trend (Figure SAV_07_01). It may be associated with a small amplitude magnetic anomaly (Figure SAV_07_02). Profile data suggests that at least on some lines at away be steeply dipping thin conductor (Figure SAV_07_03)

Figure SAV_07_01. Z Channel 10 ( Off-Time ) .

48

Figure SAV_07_02. Total Magnetic Intensity .

49

Figure SAV_07_03. AeroTEM ( Z nT/s ) Off Time : SAV 07 Line 5608800 N .

50

SAV 23

SAV EM anomaly is to the west and outside a main regional conductive feature (Figure SAV_23_01). It is associated with a discreet magnetic body (Figure SAV_23_02). Profile data implies that the conductor is an easterly dipping body coincident within a magnetic anomaly (Figure SAV_23_03).

Figure SAV_23_01. Z Channel 10 ( Off-Time ) .

51

Figure SAV_23_02. Total Magnetic Intensity .

52

Figure SAV_23_03. AeroTEM ( Z nT/s ) Off Time : SAV 23 Line 5611950 N .

53

SUM 01 AND 02

EM anomalies SUM 01 and 02 are the only two anomalous EM responses within the Sumach survey block (Figure SUM_01_01_02) but appear to be outlining small conductive body of variable conductivity.

Figure SUM_01_02_01. Z Channel 10 ( Off Time ) .

54

Figure SUM_01_02_02. Total Magnetic Intensity .

55

Figure SUM_01_02_03a. AeroTEM ( Z nT/s ) Off Time : SUM 01 Line 427950 E .

56

Figure SUM_01_02_01. AeroTEM ( Z nT/s ) Off Time : SUM 02 428150 E .

Appendix 9: Maxwell Modelling of AeroTEM Anomalies T2 & J6; Report by T. Grant.

Savant_AEM_modelling.doc

MEMORANDUM To Katherine Smuk, Robert Brozdowski cc From Todd Grant Date 7 March 2012 Subject MODELLING SAVANT AEROTEM RESPONSES

Introduction

The Savant AeroTEM survey was flown in February 2011. During acquisition, a few anomalies of interest were identified by T Grant from preliminary data, and subsequently, a few additional anomalies were selected by J Silic based on a review of the final data. Several of these features were field checked by R Brozdowski in Sep 2011, and as a result, anomalies informally referred to as “T2” and “J6” were considered sufficiently encouraging to warrant further analysis. This memo discusses Maxwell modelling of AeroTEM data around the T2 and J6 features (see Figure 1). The coordinate system used throughout is NAD83 Z15N.

Parameters for modelling the AeroTEM system

A Maxwell EM system configuration file for the Savant survey was received from Aeroquest and after some inspection, it was modified slightly based on information recorded in the logistics report and the final data files (e.g., adjust Tx waveform values and Rx channel times). The principal system parameters used for modelling are listed in Appendix A.

Model Results for Anomaly T2

At first glance, T2 appears to be an asymmetric double-peaked response in the Z-component, with an associated (albeit complicated) cross-over response in the X-component. It is most noticeable along the three lines 20870, 20880, & 20890 with the strongest response on the center line 20880 (see Figures T2-1 to T2-6). Several attempts were made to approximate the response with a single plate source, using both ‘brute-force’ forward modelling as well as ‘finer-tuning’ inverse modelling and experimenting with source plates of various sizes, shapes, and dips. However, a more satisfactory approximation to the asymmetric double-peak in Z and complex cross-over in X is obtained using two separate parallel plates. A ‘main’ target plate lies to the west of a ‘secondary plate and is situated at a more shallow depth (depth to top ~30m) , contributing to a stronger western ‘main’ peak lobe in Z and more dominant crossover in X.

While the model fitting illustrated in Figures T2-1 to T2-6 is not exceptional, much of the primary behaviour of the response is emulated – such as the general qualitative anomaly shapes in Z & X (for the most part), approximate match to the variation in amplitude along strike, and an approximate match to decay rates.

Unfortunately, a by-product of interpreting the response as two separate plates results in uncertainty and ambiguity about the individual dip of these plates. This is a fairly key parameter to lock down, not only for targeting a test hole, but also for determining overall anomaly amplitude and hence source depth. My best estimate has both plates dipping 40º towards the NW.

Page 2 of 22

A summary of the plate models is tabulated below and a 3D dxf file for the plates has been generated.

Table I. Anomaly T2 - Summary of model plate parameters (relative to center top edge of plate)

Plate Easting Northing Depth Elevation Strike Length Depth Extent Conductance Dip Dip Dir Plunge

Main 687200 5611040 31 370 200 75 70 40º 300º 0º

Secondary 687310 5611045 54 350 200 75 70 40º 300º 0º

Collar details for a drillhole that would test the center of the ‘main’ plate are tabulated below.

Table II. Details of a drillhole to test center of main T2 target plate

East North Elev Azim Incl Total Depth

687150 5611050 400 90º -60º

100m (adequate to test main plate)

200m (possibly test down dip extension of secondary plate)

Model Results for Anomaly J6

Responses for anomaly J6 were reviewed over the following 11 flight lines: L21510> L21530< L21550> L21570< L21590> L21610> L21520> L21540< L21560> L21580< L21600>

Model results for each line are shown in Figures J6-1 to J6-11. Note the flight direction is indicated in the line name by the use of the symbols ‘<’ and ‘>’.

My initial interpretation of the J6 anomaly is an asymmetric double-peaked Z-component response with associated cross-over in the X-component generated by a single conductive source. The X-component cross-over does exhibit slightly complex behaviour on some lines, hinting that this feature, like T-2, might be caused by two separate, side-by-side parallel sources (with the complexity in the X-component due to superposition of their responses). However, evidence is not convincing enough and interpretation of a single source is preferred.

Along the northern 8 lines (L21510 to L21580), the eastern lobe of the double-peak Z-component has higher amplitude, and for the southern 3 lines (L21590 to L21610), the western lobe is dominant. Again, model curve fits are not brilliant along the length of this feature, but best efforts were concentrated on simulating the overall behaviour of the responses. The single conductive plate source was split into two sections along its strike, both having different dip directions in order to emulate the change in dominance between the two Z-component peaks. A NE/SW oriented structural break/disruption is interpreted between the two plates, the existence of which is strongly supported by patterns seen in the magnetic data as well (not shown here).

Of the 11 lines comprising the J6 anomaly, 4 of them have been flown in the direction east to west (L21530<, L21540<, L21570<, and L21580<). For reasons that are unknown at the time of this writing, the x-component response for these 4 lines is inconsistent with the predicted model response. These lines are associated with acquisition flights 9 & 10 and the issue is being discussed with the acquisition contractor (Aeroquest) to determine potential causes (errors in lag values, or x-component polarities for westerly-flown lines of flights 9 & 10).

Page 3 of 22

In the meantime, a summary of the plate models is tabulated below and a 3D dxf file for the plates has been generated.

Table I. Anomaly J6 - Summary of model plate parameters (relative to center top edge of plate)

Plate Easting Northing Depth Elevation Strike Length Depth Extent Conductance Dip Dip Dir Plunge

Northern 687080 5607765 25 390 300 100 70 80º 100º 0º

Secondary 687080 5607470 27 390 100 100 70 70º 280º 0º

Collar details for a drillhole that would test the center of the ‘main’ plate are tabulated below.

Table II. Details of a drillholes to test the center of J6 target plates

Plate East North Elev Azim Incl Total Depth

Northern 687120 5607750 400 270º -60º 150m

Southern 687030 5607470 400 90 -60 150m

Todd Grant Exploration Geophysicist T 720 881 6980 F 720 881 6979 E todd.grant@mmg.com M 720 292 0170

Page 4 of 22

Figure 1. Location of T2 and J6 responses in Savant AeroTEM survey. Underlying image is of Ch16 Z-component On-Time Ch16

Page 5 of 22

Appendix A – Principal System Configuration Parameters used for Maxwell modelling

Configuration: Airborne

System Type: In-loop System

Tx Area: 113.1 m^2

Turns: 5

Level (system elevation): new data channel constructed as sum of ‘dtm’ + ‘bheight’ channels

Waveform: 30Hz triangular waveform with 2.745msec on-time / 13.921 msec off-time (totalling 16.667msec) with peak current ‘switch’ time of 1.443msec.

Timing Mark: 0

Tx Current (A): 553.5 (average in data file after original erroneous values from Aeroquest corrected)

On-Times (msec) Off-Times (msec) start center end width Channel start center end width

1.55639 1.58419 1.61199 0.0556 1 2.74538 2.75928 2.77318 0.0278

1.61199 1.63979 1.66759 0.0556 2 2.77308 2.78698 2.80088 0.0278

1.66749 1.69529 1.72309 0.0556 3 2.80088 2.82868 2.85648 0.0556

1.72309 1.75089 1.77869 0.0556 4 2.85648 2.88428 2.91208 0.0556

1.77859 1.80639 1.83419 0.0556 5 2.91203 2.95368 2.99533 0.0833

1.83419 1.86199 1.88979 0.0556 6 2.99533 3.05088 3.10643 0.1111

1.88969 1.91749 1.94529 0.0556 7 3.10643 3.17588 3.24533 0.1389

1.94529 1.97309 2.00089 0.0556 8 3.24538 3.34258 3.43978 0.1944

2.00079 2.02859 2.05639 0.0556 9 3.43978 3.57868 3.71758 0.2778

2.05644 2.09809 2.13974 0.0833 10 3.71753 3.91198 4.10643 0.3889

2.13974 2.18139 2.22304 0.0833 11 4.10648 4.37038 4.63428 0.5278

2.22314 2.26479 2.30644 0.0833 12 4.63428 4.99538 5.35648 0.7222

2.30644 2.34809 2.38974 0.0833 13 5.35648 5.87038 6.38428 1.0278

2.38974 2.44529 2.50084 0.1111 14 6.38428 7.10648 7.82868 1.4444

2.50084 2.55639 2.61194 0.1111 15 7.82868 8.82868 9.82868 2.0000

2.61194 2.68139 2.75084 0.1389 16 9.82868 11.20368 12.57868 2.7500

17 12.57868 14.43978 16.30088 3.7222

Savant_AEM_modelling.doc

Figure T2-1 Line 20850> over T2 response. Z-component and X-component profiles shown – measured response in black, modelled response in red. Lower right-hand panel shows profile of ground elevation and AEM system elevation. Two model plates, both dipping 40º towards NW are shown in the left-hand plan view.

Page 7 of 22

Figure T2-2 Line 20860> over T2 response. Z-component and X-component profiles shown – measured response in black, modelled response in red. Lower right-hand panel shows profile of ground elevation and AEM system elevation. Two model plates, both dipping 40º towards NW are shown in the left-hand plan view.

Page 8 of 22

Figure T2-3 Line 20870< over T2 response. Z-component and X-component profiles shown – measured response in black, modelled response in red. Lower right-hand panel shows profile of ground elevation and AEM system elevation. Two model plates, both dipping 40º towards NW are shown in the left-hand plan view.

Page 9 of 22

Figure T2-4 Line 20880< over T2 response. Z-component and X-component profiles shown – measured response in black, modelled response in red. Lower right-hand panel shows profile of ground elevation and AEM system elevation. Two model plates, both dipping 40º towards NW are shown in the left-hand plan view.

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Figure T2-5 Line 20890> over T2 response. Z-component and X-component profiles shown – measured response in black, modelled response in red. Lower right-hand panel shows profile of ground elevation and AEM system elevation. Two model plates, both dipping 40º towards NW are shown in the left-hand plan view.

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Figure T2-6 Line 20900> over T2 response. Z-component and X-component profiles shown – measured response in black, modelled response in red. Lower right-hand panel shows profile of ground elevation and AEM system elevation. Two model plates, both dipping 40º towards NW are shown in the left-hand plan view.

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Figure J6-1 Line 21510> over J6 response. Z-component and X-component profiles shown – measured response in black, modelled response in red. Lower right-hand panel shows profile of ground elevation and AEM system elevation. Botton right-hand panel shows profile of system height above ground. Two model plates shown in the left-hand plan view. Northern red plate dips 80º to ESE and southern cyan plate dips 70º to WNW.

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Figure J6-2 Line 21520> over J6 response. Z-component and X-component profiles shown – measured response in black, modelled response in red. Lower right-hand panel shows profile of ground elevation and AEM system elevation. Botton right-hand panel shows profile of system height above ground. Two model plates shown in the left-hand plan view. Northern red plate dips 80º to ESE and southern cyan plate dips 70º to WNW.

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Figure J6-3 Line 21530< over J6 response. Z-component and X-component profiles shown – measured response in black, modelled response in red. Lower right-hand panel shows profile of ground elevation and AEM system elevation. Botton right-hand panel shows profile of system height above ground. Two model plates shown in the left-hand plan view. Northern red plate dips 80º to ESE and southern cyan plate dips 70º to WNW.

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Figure J6-4 Line 21540< over J6 response. Z-component and X-component profiles shown – measured response in black, modelled response in red. Lower right-hand panel shows profile of ground elevation and AEM system elevation. Botton right-hand panel shows profile of system height above ground. Two model plates shown in the left-hand plan view. Northern red plate dips 80º to ESE and southern cyan plate dips 70º to WNW.

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Figure J6-5 Line 21550> over J6 response. Z-component and X-component profiles shown – measured response in black, modelled response in red. Lower right-hand panel shows profile of ground elevation and AEM system elevation. Botton right-hand panel shows profile of system height above ground. Two model plates shown in the left-hand plan view. Northern red plate dips 80º to ESE and southern cyan plate dips 70º to WNW.

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Figure J6-6 Line 21560> over J6 response. Z-component and X-component profiles shown – measured response in black, modelled response in red. Lower right-hand panel shows profile of ground elevation and AEM system elevation. Botton right-hand panel shows profile of system height above ground. Two model plates shown in the left-hand plan view. Northern red plate dips 80º to ESE and southern cyan plate dips 70º to WNW.

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Figure J6-7 Line 21570< over J6 response. Z-component and X-component profiles shown – measured response in black, modelled response in red. Lower right-hand panel shows profile of ground elevation and AEM system elevation. Botton right-hand panel shows profile of system height above ground. Two model plates shown in the left-hand plan view. Northern red plate dips 80º to ESE and southern cyan plate dips 70º to WNW.

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Figure J6-8 Line 21580< over J6 response. Z-component and X-component profiles shown – measured response in black, modelled response in red. Lower right-hand panel shows profile of ground elevation and AEM system elevation. Botton right-hand panel shows profile of system height above ground. Two model plates shown in the left-hand plan view. Northern red plate dips 80º to ESE and southern cyan plate dips 70º to WNW.

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Figure J6-9 Line 21590> over J6 response. Z-component and X-component profiles shown – measured response in black, modelled response in red. Lower right-hand panel shows profile of ground elevation and AEM system elevation. Botton right-hand panel shows profile of system height above ground. Two model plates shown in the left-hand plan view. Northern red plate dips 80º to ESE and southern cyan plate dips 70º to WNW.

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Figure J6-10 Line 21600> over J6 response. Z-component and X-component profiles shown – measured response in black, modelled response in red. Lower right-hand panel shows profile of ground elevation and AEM system elevation. Botton right-hand panel shows profile of system height above ground. Two model plates shown in the left-hand plan view. Northern red plate dips 80º to ESE and southern cyan plate dips 70º to WNW.

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Figure J6-11 Line 21610> over J6 response. Z-component and X-component profiles shown – measured response in black, modelled response in red. Lower right-hand panel shows profile of ground elevation and AEM system elevation. Botton right-hand panel shows profile of system height above ground. Two model plates shown in the left-hand plan view. Northern red plate dips 80º to ESE and southern cyan plate dips 70º to WNW.