Date: May 3/96

The ore zone was mined along a straight length of 1,200 feet and also to the same depth. The mine was operated on a salvage basis and at closure in 1971 the workings were still in ore with widths up to 30 feet being encountered and grades up to 6% copper and over 11% zinc.

A Geophysical report along with plot maps of Magnetometer and VLF-Electromagnetic results have been received and are being studied in conjunction with available geological information. Five Magnetic Anomalous zones were detected and appear to outline ultramafic units helping to define the underlying geology. Seven zones containing VLF-Electromagnetic conductors were outlined and the following highlights are excerpted from the report:

• A very strong conductor extends southeast from L1200W, 750S. The conductor crosses several magnetic anomalies and in part flanks the high values. It is probable that this conductor is caused by sulphide mineralization.
• A set of strong conductors extends from L"0" to L2050W (metres). For the most part they flank magnetic highs. Near the minesite it passes very near the known massive sulfide horizon. It is probable that the cause of these conductors is the sulfide horizon located at the top of the felsic lapilli tuff and below the peridotite.
• A conductor located in the south central part of the property trends northwesterly and is located near the ‘Centre Hill Fault’. It is probable that this conductor is caused from the fault and possibly in part due to sulfides within the fault.
• A series of east-west trending conductors are located in the northern portion of the property. The cause of these conductors may be due in part to serpentinization of the ultramafic and in part to disseminated sulfides. In some locations the conductors are very strong which may indicate sulfides.
• The conductors that flank the magnetic anomalies east and west of the mine area appear to be in the same geological horizon that the potential to encounter more volcanogenic massive sulphides is extremely high.
• The strong conductors outside of the mine area and located in ultramafic intrusive to extrusive rocks have good potential to host nickel copper-p.q.e. orebodies.
• Others conductors should also be tested as to their gold potential.

A drill program is being planned to test the strike extensions, parallel zones, and additional targets. Follow up drilling will test depth extensions and delineate ore zones. An initial program of 2,000 to 3,000 metres will begin as soon as possible.

- 30 -