AN UPDATE TO by wulinqing

VIEWS: 39 PAGES: 194

									                             A TECHNICAL REVIEW
                      OF THE MOUNT PLEASANT PROPERTY,
                   INCLUDING A MINERAL RESOURCE ESTIMATE
                          FOR THE FIRE TOWER ZONE
                       SOUTHWESTERN NEW BRUNSWICK
                                     FOR
                               ADEX MINING INC.




                                          prepared by

                      Paul Dunbar, P.Geo., Senior Associate Geologist
                   Andrew Hara, P.Eng., Senior Associate Mining Engineer
                  Robert de l'Etoile, M.Sc., P.Eng., Senior Associate Engineer
                   Dorota A. El-Rassi, M.Sc., P.Eng., Geological Engineer
                              Watt, Griffis and McOuat Limited

                                              and

                                  Trevor Boyd, Ph.D., P.Geo,
                                   Independent Consultant




August 1, 2006                                             Watts, Griffis and McOuat Limited
Toronto, Canada                                           Consulting Geologists and Engineers
                                                                                                           Watts, Griffis and McOuat

                                                    TABLE OF CONTENTS

                                                                                                                                   Page

H   1. SUMMARY ......................................................................................................................... 1 H




H   2. INTRODUCTION AND TERMS OF REFERENCE...................................................... 7                                         H




        2.1 INTRODUCTION ....................................................................................................... 7
         H                                                                                                                                 H




        2.2 TERMS OF REFERENCE .......................................................................................... 7
         H                                                                                                                                 H




        2.3 SOURCES OF INFORMATION ................................................................................ 8
         H                                                                                                                                 H




        2.4 UNITS AND CURRENCY ......................................................................................... 9
         H                                                                                                                                 H




H   3. RELIANCE ON OTHER EXPERTS.............................................................................. 11                      H




H   4. PROPERTY DESCRIPTION AND LOCATION ......................................................... 12                                  H




       4.1 GENERAL................................................................................................................. 12
         H                                                                                                                             H




       4.2 SURFACE RIGHTS .................................................................................................. 15
         H                                                                                                                             H




       4.3 ROYALTY PAYMENTS .......................................................................................... 16
             H                                                                                                                         H




       4.4 MINE/MILL BUILDING AND EQUIPMENT OWNERSHIP ................................ 16
             H                                                                                                                         H




    5. ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE AND
    H




       PHYSIOGRAPHY ........................................................................................................... 17     H




       5.1 ACCESS .................................................................................................................... 17
             H                                                                                                                         H




       5.2 CLIMATE.................................................................................................................. 17
             H                                                                                                                         H




       5.3 LOCAL RESOURCES AND INFRASTRUCTURE ................................................ 18
             H                                                                                                                         H




       5.4 PHYSIOGRAPHY..................................................................................................... 19
             H                                                                                                                         H




    6. HISTORY.......................................................................................................................... 21
    H                                                                                                                                  H




       6.1 GENERAL................................................................................................................. 21
             H                                                                                                                         H




       6.2 EXPLORATION AND DEVELOPMENT ............................................................... 21
             H                                                                                                                         H




       6.3 MINING/MILLING OPERATIONS......................................................................... 31
             H                                                                                                                         H




    7. GEOLOGICAL SETTING.............................................................................................. 34
    H                                                                                                                                  H




       7.1 REGIONAL GEOLOGY........................................................................................... 34
             H                                                                                                                         H




       7.2 LOCAL GEOLOGY .................................................................................................. 36
             H                                                                                                                         H




    8. DEPOSIT TYPES ............................................................................................................. 43
    H                                                                                                                                  H




       8.1 GENERAL................................................................................................................. 43
             H                                                                                                                         H




       8.2 PORPHYRY MOLYBDENUM-(±TUNGSTEN) DEPOSITS ................................. 44
             H                                                                                                                         H




       8.3 PORPHYRY TIN-(±INDIUM) DEPOSITS.............................................................. 45
             H                                                                                                                         H




                                                                  - ii -
                                                                                                      Watts, Griffis and McOuat

                                               TABLE OF CONTENTS
                                                   (continued)
                                                                                                                              Page

9. MINERALIZATION........................................................................................................ 48
H                                                                                                                                 H




   9.1 GENERAL................................................................................................................. 48
     H                                                                                                                            H




   9.2 FIRE TOWER ZONE ................................................................................................ 48
     H                                                                                                                            H




   9.3 SCOTIA ZONE ......................................................................................................... 52
     H                                                                                                                            H




   9.4 SADDLE ZONE ........................................................................................................ 52
     H                                                                                                                            H




   9.5 NORTH ZONE .......................................................................................................... 53
     H                                                                                                                            H




   9.6 HORNET HILL ......................................................................................................... 58
     H                                                                                                                            H




   9.7 URANIUM AND GOLD MINERALIZATION – MOUNT PLEASANT REGION 59
     H                                                                                                                            H




10. EXPLORATION............................................................................................................. 60
H                                                                                                                                 H




11. DRILLING ...................................................................................................................... 64
H                                                                                                                                 H




    11.1
     H     GENERAL ...................................................................................................... 64      H




    11.2
     H     TIN BASE METAL DEPOSITS .................................................................... 67                        H




    11.3
     H     PORPHYRY TUNGSTEN-MOLYBDENUM-BISMUTH DEPOSITS ........ 68                                                              H




    11.4
     H     PORPHYRY TIN DEPOSITS ........................................................................ 69                      H




    11.5
     H     TIN-INDIUM-BASE METAL DEPOSITS.................................................... 72                                  H




    11.6
     H     COMPUTERIZED DATABASE.................................................................... 74                           H




12. SAMPLING METHOD AND APPROACH ................................................................ 76
H                                                                                                                                 H




13. SAMPLE PREPARATION, ANALYSES AND SECURITY...................................... 79
H                                                                                                                                 H




    13.1 GENERAL.............................................................................................................. 79
     H                                                                                                                            H




    13.2 MOUNT PLEASANT MINES LIMITED ............................................................. 79
     H                                                                                                                            H




    13.3 SULLIVAN MINING GROUP AND BRUNSWICK TIN MINES ...................... 80
     H                                                                                                                            H




    13.4 BRUNSWICK TIN MINES ................................................................................... 80
     H                                                                                                                            H




    13.5 MOUNT PLEASANT TUNGSTEN MINE........................................................... 81
     H                                                                                                                            H




    13.6 LAC-BILLITON TIN PROJECT ........................................................................... 82
     H                                                                                                                            H




    13.7 NOVAGOLD RESOURCES INC.......................................................................... 82
     H                                                                                                                            H




    13.8 PISKEHEGAN RESOURCES LIMITED.............................................................. 83
     H                                                                                                                            H




    13.9 ADEX ..................................................................................................................... 83
     H                                                                                                                            H




    13.10 2005 WGM GRAB SAMPLING (ROCKS AND CORE) ..................................... 85
     H                                                                                                                            H




14. DATA CORROBORATION ......................................................................................... 87
H                                                                                                                                 H




15. ADJACENT PROPERTIES .......................................................................................... 92
H                                                                                                                                 H




                                                             - iii -
                                                                                                   Watts, Griffis and McOuat

                                              TABLE OF CONTENTS
                                                  (continued)
                                                                                                                           Page

16. MINERAL PROCESSING AND METALLURGICAL TESTING........................... 93
H                                                                                                                                H




    16.1 TIN BASE METAL DEPOSITS ............................................................................ 93
     H                                                                                                                           H




    16.2 PORPHYRY TUNGSTEN-MOLYBDENUM-BISMUTH DEPOSITS................ 93
     H                                                                                                                           H




    16.3 PORPHYRY TIN DEPOSITS................................................................................ 98
     H                                                                                                                           H




    16.4 TIN-INDIUM BASE METAL DEPOSITS.......................................................... 103
     H                                                                                                                       H




    16.5 METALLURGICAL PROCESSING AND TESTING BY ADEX ..................... 105
     H                                                                                                                       H




17. MINERAL RESOURCE AND MINERAL RESERVE ESTIMATES.................... 110
H                                                                                                                            H




    17.1 WGM MINERAL RESOURCE ESTIMATE STATEMENT ............................... 110
     H                                                                                                                       H




    17.2 GENERAL MINERAL RESOURCE ESTIMATION PROCEDURES................ 111
     H                                                                                                                       H




    17.3 DATABASE .......................................................................................................... 111
     H                                                                                                                       H




    17.4 GEOLOGICAL MODELLING PROCEDURES .................................................. 113
     H                                                                                                                       H




    17.5 DATABASE PREPARATION, STATISTICAL ANALYSIS AND
     H




         COMPOSITING ..................................................................................................... 120
                                                                                                                             H




    17.6 VARIOGRAPHY................................................................................................... 124
     H                                                                                                                       H




    17.7 MINERAL RESOURCE BLOCK MODELLING ................................................ 124
     H                                                                                                                       H




    17.8 MINERAL RESOURCE CLASSIFICATION AND TABULATION.................. 128
     H                                                                                                                       H




    17.9 HISTORIC MINERAL RESOURCE ESTIMATES ............................................. 132
     H                                                                                                                       H




18. OTHER RELEVANT DATA AND INFORMATION .............................................. 137
H                                                                                                                            H




    18.1 ENVIRONMENT .................................................................................................. 137
     H                                                                                                                       H




    18.2 PREVIOUS ENVIRONMENTAL STUDIES ....................................................... 137
     H                                                                                                                       H




    18.3 MINISTERIAL ORDER........................................................................................ 139
     H                                                                                                                       H




19. INTERPRETATION AND CONCLUSIONS ............................................................ 141
H                                                                                                                            H




    19.1 GENERAL ............................................................................................................. 141
     H                                                                                                                       H




    19.2 MINE FACILITIES AND INFRASTRUCTURE ................................................. 144
     H                                                                                                                       H




    19.3 KVAERNER FEASIBILITY STUDY, NORTH ZONE DEPOSITS ................... 145
     H                                                                                                                       H




    19.4 ANALYSIS ............................................................................................................ 149
     H                                                                                                                       H




20. RECOMMENDATIONS.............................................................................................. 150
H                                                                                                                            H




CERTIFICATES ................................................................................................................. 154
H                                                                                                                            H




REFERENCES..................................................................................................................... 164
H                                                                                                                            H




                                                            - iv -
                                                                                                                  Watts, Griffis and McOuat

                                                    TABLE OF CONTENTS
                                                        (continued)
                                                                                                                                             Page

APPENDICES...................................................................................................................... 170
H                                                                                                                                              H




APPENDIX 1: ORE CLASSIFICATIONS
APPENDIX 2: MINISTERIAL ORDER
APPENDIX 3: ADEX SUMMARY OF EXPLORATION POTENTIAL
APPENDIX 4: ASSAY CERTIFICATES


                                                          LIST OF TABLES

1.
H       Mount Pleasant Property Claims ........................................................................................... 15                  H




2.
H       History Of Work On The Mount Pleasant Property .............................................................. 22                               H




3.
H       Summary Of Mount Pleasant Drill Programs – Surface And Underground ......................... 65                                                H




4.
H       Examples Of Representative Drill Intersections - 1985 Billiton Drill Program (North
        Zone)...................................................................................................................................... 70 H




5.
H       Summary Of Representative Drill Intersections 1987-88 Lac Billiton Drill Program
        (Saddle Zone) ........................................................................................................................ 71      H




6.
H       Summary Of Representative Drill Intersections 1989 Novagold Drill Program (Saddle
        Zone)...................................................................................................................................... 72 H




7.
H       Adex 1996 Drilling Results For Tin And Indium, Deep Tin Zone ....................................... 73                                        H




8.
H       Gemcom Database, Lithological Unit Codes ........................................................................ 74                           H




9.
H       WGM Analytical Results (Mount Pleasant).......................................................................... 88                           H




10.
H       WGM Drill Core Sampling Mount Pleasant – Sample Descriptions .................................... 90                                           H




11.
H       Lac-Billiton Bulk Sample Test Results ............................................................................... 100                  H




12.
H       Summary Of Indium Assays, Mount Pleasant..................................................................... 104                          H




13.
H       Composition Of 1996 Bulk Metallurgical Sample .............................................................. 107                           H




14. H   Mineral Resource Estimate – Prepared By Wgm................................................................ 110                            H




15. H   Basic Statistics Of Drillhole Samples.................................................................................. 120                H




16. H   Basic Statistics Of 2.5 m Composites.................................................................................. 121                 H




17. H   Variogram Models............................................................................................................... 124        H




18. H   Block Model Grid Parameters ............................................................................................. 127              H




19. H   Fire Tower Zone .................................................................................................................. 129     H




20. H   1985 Billiton “Resource” Summary – North Zone ............................................................. 133                            H




21. H   Tin-Indium “Resources”, Kvaerner Study (1997)............................................................... 134                           H




22. H   Mount Pleasant - Proposed Work Plan And Budget ........................................................... 152                             H




                                                                    -v-
                                                                                                                Watts, Griffis and McOuat

                                                     TABLE OF CONTENTS
                                                         (continued)
                                                                                                                                          Page

                                                         LIST OF FIGURES

H   1.    Location Map........................................................................................................................ 13    H




H   2.    Claim Map ............................................................................................................................ 14  H




H   3.    Regional Geology ................................................................................................................. 35      H




H   4.    Property Geology.................................................................................................................. 37      H




H   5.    Cross Section of the Mount Pleasant Mine .......................................................................... 40                     H




H   6.    Geological Interpretation of the North Zone ........................................................................ 54                    H




H   7.    Mine Site Geology, Infrastructure and Surface Drillhole Locations.................................... 66                                   H




H   8.    Drillhole plan and section definitions................................................................................. 115        H




H   9.    Cross Section 12405N illustrating polylines for geological modelling.............................. 117                             H




H   10.   3-D geological model and mine workings of Fire Tower Zone ......................................... 119                            H




H   11.   3-D representation of the drillholes with respect to the Fire Tower mineralized envelope 121                                           H




H   12.   Cumulative frequency plot of MoS2 2.5 m composites above 0.01% in the West Zone..... 122                                               H




H   13.   Cumulative frequency plot of WO3 2.5 m composites above 0.01% in the West Zone...... 122                                               H




H   14.   Cumulative frequency plot of MoS2 2.5 m composites above 0.01% in the North Zone ... 123                                               H




H   15.   Cumulative frequency plot of WO3 2.5 m composites above 0.01% in the North Zone..... 123                                               H




H   16.   Variogram of MoS2 in the West Zone ................................................................................ 125            H




H   17.   Variogram of WO3 in the West Zone ................................................................................. 125            H




H   18.   Variogram of MoS2 in the North Zone............................................................................... 126             H




H   19.   Variogram of WO3 in the North Zone ................................................................................ 126            H




H   20.   Fire Tower Zone grade-tonnage curve based on Kriged model ......................................... 131                            H




                                                                    - vi -
                                                                       Watts, Griffis and McOuat

                                      1. SUMMARY



ADEX Mining Inc. (“ADEX”), a Toronto based Canadian junior mineral exploration
company, acquired the Mount Pleasant property in 1995. The property is located in Charlotte
County, New Brunswick, and is the site of the past producing Mount Pleasant Tungsten Mine
(“MPTM”) which produced 990,200 tonnes grading 0.35% WO3 between 1983 and 1985.
The company originally traded on the Toronto Stock Exchange (“TSX”) under the symbol
“AMG” but was de-listed from the TSX in 1998 for failure to meet minimum listing
requirements.

Watts, Griffis and McOuat Limited (“WGM”) was retained by ADEX to carry out a
technical review of their Mount Pleasant property.         This report has been prepared in
accordance with the Canadian Securities Administrators’ National Instrument 43-101
(“NI 43-101”) governing standards for disclosure for mineral projects as part of the
company’s effort to have the cease-trading order lifted and to engage in raising money to
further develop the property. The scope of this report is to assess the potential of the known
mineralized zones and prepare an NI 43-101-compliant Mineral Resource estimate for the
Fire Tower North and the Fire Tower West portions of the Fire Tower Zone, a WO3-MoS2
deposit, a small portion of which was exploited in the mid-1980s. The property hosts other
mineralized zones of interest, including the tin-indium-bearing North Zone. The 1996/97
Kvaerner Metals Davy Ltd. (“Kvaerner”) Feasibility Study and Mount Pleasant Tungsten
Mine 1985 Mothball Study were reviewed to determine what use could be made of them and
what additional scoping work would be required to allow ADEX to undertake preparation of a
new feasibility study.


The Mount Pleasant property consists of 102 contiguous mining claims totalling 1,600 ha,
located 60 km south of the city of Fredericton. ADEX holds the surface rights for some
405 hectares of the property. The surface rights for the northern part of the North Zone,
southern part of the Fire Tower Zone and eastern side of Mount Pleasant are owned by third
parties.


ADEX has retained 100% ownership of the buildings and equipment remaining on the
property with a $2.0 million mortgage on the buildings held by the Province of New
Brunswick to cover the cost of building removal and rehabilitation. The government also
holds a $0.5 million security bond for mine reclamation.

                                           -1-
                                                                       Watts, Griffis and McOuat


The Mount Pleasant property is located within the Appalachian Orogen of Atlantic Canada
just north of the Saint George Batholith. The eastern portion of the property is dominated by
the Mount Pleasant Caldera (“MPC”) and to the west by Silurian to Devonian age
metasedimentary rocks.     This caldera is comprised of a multi-layered granitic complex
(Granite I, II, III) and porphyries and breccias of Mississippian age. Porphyry-type tungsten-
molybdenum and tin deposits have been discovered along the southwestern margin of the
MPC.


Tungsten-molybdenum-(bismuth) deposits have been found beneath Mount Pleasant in both
the Fire Tower Zone and North Zone. All are hosted within Granite I. Younger indium-
bearing tin-base metal deposits superimpose the tungsten-molybdenum deposits hosted within
Granite II in both zones. No significant mineralization has been found within the underlying
Granite III although this granite has not been fully explored. All deposits occur within 400 m
from surface.


The Fire Tower Zone is dominated by tungsten-molybdenum mineralization occurring within
three distinct deposits, the Fire Tower North, the Fire Tower West and Fire Tower South.
Mineralization occurs as veinlets and as disseminated grains in the breccias hosted within the
Mount Pleasant Porphyry.      Fine-grained wolframite and molybdenite are the principal
minerals of economic interest.     Intense greisen-type alteration (quartz-topaz-fluorite) is
associated with higher grade tungsten-molybdenum zones.


The Saddle Zone is located between the Fire Tower Zone and North Zone. This zone
contains an irregular distribution of tin mineralization consisting of cassiterite with small
amounts of tungsten, molybdenite and bismuth hosted within Granite II.


The North Zone contains five distinct indium-bearing tin-base metal deposits named the
Contact deposit, contact Flank deposit, contact Crest deposit, Endogranitic Zone and the Deep
Tin Zone as well as six tin-lode deposits. The largest tin-base metal deposits occur along the
contact of the Granite I or within Granite II. These deposits superimpose older discontinuous
tungsten-molybdenum bodies found within Granite I and breccias. The shallowest deposit,
called the Deep Tin Zone, is hosted within brecciated Granite I.




                                           -2-
                                                                        Watts, Griffis and McOuat

Since 1954, the majority of the exploration work has focused on the development of the
tungsten-molybdenum deposits of the Fire Tower Zone and the indium-bearing tin-base metal
deposits of the North Zone. Some exploration activities were focused on exploring Hornet
Hill located 1.5 km west of the North Zone for tin and possible tungsten mineralization.
Hornet Hill is underlain by a fine-grained porphyritic granite that is similar in appearance to
the granite porphyry of the North Zone.


Work has consisted of extensive surface and underground drilling programs, bulk sampling
and metallurgical work to develop a “mineral resource” for the Fire Tower Zone and North
Zone deposits.    In total, 1,330 surface and underground diamond drillholes totalling
158,561 m have been drilled, most to delineate the Fire Tower Zone and North Zone. One of
the three holes drilled at Hornet Hill intersected a cassiterite-bearing chlorite vein assaying
0.89% tin over a core length of 3.0 m. Approximately 90% of this core is currently stored at
the minesite.


Surface exploration has included soil and bedrock sampling, ground geophysical surveying,
some geological mapping, stripping and trenching activities. Underground development has
included a 1,187 m long access ramp connecting the Fire Tower Zone with the North Zone as
well as the excavation of several adits. All drillhole information and assay results were
compiled into a GEMCOM database from 1995 to 1997. In 1996, Kvaerner was contracted to
conduct a Feasibility Study to explore the possibility of mining tin and indium from the North
Zone and prepare a “mineral resource” estimate, which included an audit and verification of
ADEX’s “reserve” estimates of the North Zone. Limited additional surface diamond drilling
was carried out to support this study. There has not been any active field exploration on the
property since 1996.


The Mount Pleasant Tungsten Mine, owned 50% by Billiton Exploration Canada Limited
(“Billiton”) (as operator) and 50% by Brunswick Tin Mines (“BTM”), was put into
production in September 1983 at a total construction cost of $150 million. Mining was done
by open stoping. The concentrator was designed to process 650,000 tonnes per year and
produce 2,000-2,500 tonnes per year of 70% WO3 tungsten concentrate (through tungsten
magnetic separation) and 700-1,000 tonnes per year of 85% MoS2 molybdenum concentrate
at 60% recovery through molybdenum leaching steps. Cost overruns, metallurgical problems
and falling tungsten prices led to mine closure in July 1985 after only 22 months of




                                           -3-
                                                                       Watts, Griffis and McOuat

production. The underground workings were allowed to flood and the mine was placed on
care and maintenance.


During the production period, the mine produced only 990,200 tonnes of tungsten ore, all
from the Fire Tower Zone, at an average grade of 0.35% WO3. There was no attempt to
extract molybdenum or any other metals. A total of 2,000 tonnes of tungsten concentrate
graded 70% WO3 was produced. At the time of closure, the mine reported a total recoverable
diluted “mineable ore reserve” of 6,863,300 tonnes at an average grade of 0.38% WO3 and
0.17% MoS2. Included in the “reserve” is an inventory of 800,000 tonnes of broken tungsten-
molybdenum material in stopes grading approximately 0.39% WO3 and 0.19% MoS2. The
Fire Tower Zone deposits have not been re-evaluated since the mines closure.


In 1997, Kvaerner estimated a total “mineable resource” of 3,718,338 tonnes with a grade of
0.662% Sn, 85.72 ppm In, 0.091% WO3, 0.044% MoS2, 0.150% Cu, 0.050% Pb, 0.089% Bi
and 0.695% Zn for the North Zone using a recovery factor of 85%, a dilution factor of
20% and a cutoff grade of 0.1% Sn.     The study concluded that the North Zone deposits were
uneconomic due to declining tin prices and high capital costs.


The historic “reserves and resource” estimates noted above were prepared prior to the
implementation of NI 43-101. WGM has neither audited these estimates nor made any
attempt to classify them according to NI 43-101 standards or the Council of the Canadian
Institute of Mining, Metallurgy and Petroleum definitions (“CIM Standards”). They are
presented because ADEX and WGM consider them to be relevant and of historic significance.
These estimates should not be relied on.


WGM carried out a site visit to the property, conducted a review of all available reports and
data and collected 14 grab samples of outcrop and core samples from the Fire Tower Zone
and North Zone. The independent WGM sampling confirmed the presence of surface and
underground tungsten, molybdenum, tin, indium, bismuth and silver mineralization and
outlined the most appropriate analytical methods to use in future programs. The drill core
analytical results were in good agreement with those obtained by previous operators.


WGM concluded that the historic drillhole and assay database for the Fire Tower Zone is
reliable and that it is suitable for use in the preparation of an NI 43-101and CIM Standards-
compliant Mineral Resource estimate.



                                           -4-
                                                                              Watts, Griffis and McOuat


WGM and independent geological consultant Trevor Boyd, Ph.D., P.Geo., have prepared
Mineral Resource estimates for the Mount Pleasant Fire Tower West Zone and Fire Tower
North Zone, which for the purposes of this report are collectively referred to as the Fire
Tower Zone. A summary of the Mineral Resource estimates is provided below.

                       Area                          Inferred Mineral Resource
                                                (using a 0.3% WO3 Eq* cutoff grade)
                                               Tonnes          %WO3          %MoS2
            Fire Tower West                   9,209,081         0.34           0.21
            Fire Tower North                  3,865,356         0.37           0.20
            Total Fire Tower Zone            13,074,438         0.35           0.21
            * WO3 Eq (equivalent) = %WO3 + 1.5 x %MoS2. The basis for the use of this form of
            cutoff and how it was derived are discussed later in the text.


In conjunction with the geologically oriented site visit, a WGM engineer examined all of the
existing surface mine/mill buildings and equipment. It was determined that the facilities are
in good condition and the underground mine had been stripped of all its infrastructure before
being allowed to flood. Most of the major mill and mine equipment was sold to cover costs
such as minesite care and maintenance and some environmental reclamation.


Order-of-magnitude evaluation studies by WGM have determined that the best initial property
development scenario would be to pursue development of the tungsten-molybdenum-bearing
Fire Tower Zone. WGM recommends that ADEX carry out a limited diamond drilling
program to gather material for metallurgical testwork and to enhance the Mineral Resource
estimate.


WGM reviewed the Kvaerner study of the North Zone and agrees with the proposed mining
methods for exploiting the deposits. No discussion of economics is possible at this time since
there is no defined Mineral Resource, however, at the least, the capital cost estimates used in
the Kvaerner study should be updated to reflect current market conditions. Based on present
knowledge, the North Zone appears to be composed of a series of scattered deposits that are
not fully understood and require additional definition drilling. Should a Mineral Resource be
determined for the North Zone in the future, a Fire Tower Zone tungsten circuit could be
designed to also produce tin and other metals from the North Zone provided a suitable market
is found for them.




                                                -5-
                                                                         Watts, Griffis and McOuat

ADEX is currently working with the Province of New Brunswick to revoke a Ministerial
Order issued in 1999 and re-instate their “Approval to Operate” (allowing water treatment,
discharge and monitoring). In early 2006, an independent engineering firm was engaged by
ADEX to conduct a tailings dam study, which is now almost complete.                It has been
determined that a new Environmental Impact Assessment (“EIA”) will be required if ADEX
wishes to apply for a mining lease to resume mine production.


WGM concludes that the property is one of merit and in collaboration with ADEX has
prepared and recommends a $1,100,000 work plan and budget for Mount Pleasant.


Initial work will consist of additional core splitting and assaying and completion of
environmental work the tailings dam study and steps will be taken to reinstate the Approval to
Operate.


The work plan includes a four-hole 1,600 m surface diamond drilling program on the Fire
Tower Zone to gather approximately 600 kg of representative material for metallurgical
testwork. Bench-scale testwork will be carried out to develop a preliminary flowsheet for
recovery of WO3 and MoS2. The metallurgical testwork and Mineral Resource estimate will
be incorporated into a Scoping Study to evaluate the feasibility of resuming tungsten-
molybdenum mining operations at Mount Pleasant.


In addition, the potential for near-surface tin-indium above the North Zone will be evaluated.
The North Zone drilling and assay database will also be reviewed to determine what
additional drilling is required to enable the preparation of a Mineral Resource estimate for the
zone.


Quantitative section (deep penetration) IP surveying is proposed to determine if the tungsten-
molybdenum mineralization is continuous between the Fire Tower Zone and Saddle Zone,
and to explore for deeper mineralization beneath Granite II. This surveying will also be used
to explore for additional mineralization at Hornet Hill. IP surveying may also be useful in
conjunction with the evaluation of near-surface tin-indium potential.


It is further recommended that ADEX implement a quality assurance/quality control program
for all future analytical programs, employing standardized analytical methods and check
assays to be completed at a second ISO-certified laboratory.



                                            -6-
                                                                           Watts, Griffis and McOuat

                  2. INTRODUCTION AND TERMS OF REFERENCE



2.1            INTRODUCTION


In 1992, ADEX Mining Inc. (“ADEX”) was formed as a junior mining company from the
amalgamation of Adonis Resources Inc. and Belex Mining Corp. after which it commenced
operations and began trading on the Toronto Stock Exchange (“TSX”). ADEX initially
focussed on properties located in the United States in search of oil and gas through a now
closed subsidiary ADEX Resources Corp. ADEX also owned the mining claims and mineral
rights to other Canadian properties in the Northwest Territories and Quebec as well as
international properties in the Philippines and Guyana. Since then, these properties have
either been sold or the licenses have been allowed to expire. At this time, ADEX still holds a
10% interest in two mining leases (F27153, F27159) at Aylmer Lake in the Northwest
Territories. These two mining leases are not the subject of this report.


ADEX acquired a 100% interest in the Mount Pleasant property from Piskahegan Resources
Limited (“Piskahegan”) in 1995. The property is located at Mount Pleasant, New Brunswick,
Canada, and is the site of the past producing Mount Pleasant Tungsten Mine. The mine
closed in 1985 due to dropping tungsten prices and metallurgical problems and was placed on
care and maintenance. There has been only sporadic exploration activity conducted since the
mine's closure as the company searched for strategic partners or development proposals.


There has not been any active field exploration on the property since 1996.


2.2            TERMS OF REFERENCE


Watts, Griffis and McOuat Limited (“WGM”) was retained by ADEX to carry out a
technical review of their Mount Pleasant property and to prepare a report in compliance with
Canadian Securities Administrators’ National Instrument 43-101 (“NI 43-101”). This report
has been prepared as part of ADEX’s effort to have a cease-trading order (dated
May 27, 1998) by the Ontario Securities Commission lifted and to engage in raising funds to
further develop the property. The Company was de-listed from the TSX for failure to meet
minimum listing requirements. Prior to the cease trade order, the shares traded under the
symbol “AMG”.



                                            -7-
                                                                         Watts, Griffis and McOuat

The scope of this report is to assess the potential of the known mineralized zones and prepare
an NI 43-101-compliant Mineral Resource estimate for the Fire Tower North and the Fire
Tower West portions of the Fire Tower Zone, a WO3-MoS2 deposit, a small portion of which
was exploited in the mid-1980s. In addition, this report is to provide an initial discussion of
the potential for development to restart the Mount Pleasant property as a producer of
tungsten-molybdenum and/or tin-indium. ADEX provided its GEMCOM database to assist
with the Mineral Resource estimate. It was also necessary to determine which one of the two
significant, but different, mineral deposits should be given the highest priority for future
exploration and, if feasible, mine development work.        Furthermore, it was necessary to
determine what preliminary scoping work would be required to enable ADEX to undertake
preparation of a feasibility study, whether it be a new one or an update of the ones carried out
by Mount Pleasant Tungsten Mine (“MPTM”) Mothball study prepared following the mine
closure or Kvaerner Metals Davy Ltd. (“Kvaerner”) for ADEX in 1996/97. This report
contains recommendations for a work program and budget to accomplish these objectives.


2.3            SOURCES OF INFORMATION


WGM Senior Associate Geologist, Paul Dunbar, P.Geo.; and Senior Associate Mining
Engineer, Andrew Hara, P.Eng.; visited the Mount Pleasant Tungsten Mine property between
November 8 and November 10, 2005. During this period, the authors carried out a review of
all available data and information on the property. All information, such as previous reports,
maps, assays and original data files, are currently stored at the minesite.          Additional
information was provided by Mr. Gustaaf Kooiman, Consulting Geologist to ADEX and by
independent geological consultant Dr. Trevor Boyd, who is currently supervising the
exploration activities for ADEX. Both Dr. Boyd and Mr. Kooiman attended the field visit by
WGM and Mr. Boyd has visited the site on other occasions. Mr. Kooiman lives nearby in the
town of St. George, New Brunswick, and has had more than 25 years of experience working
at Mount Pleasant. He was the geologist for previous operator and owner, Billiton and was
the contract geologist for Piskahegan. Kooiman has also published several papers on the
Mount Pleasant deposits (see References).


One day was spent touring the immediate minesite area visiting the main surface showings
and reviewing the geology exposed in outcrop at the Fire Tower and North Zones.
Mr. Andrew Hara also toured the mine buildings to review previous operations and to conduct
an overview of equipment still on the minesite. Mr. Paul Dunbar spent one day at the core



                                            -8-
                                                                        Watts, Griffis and McOuat

shack examining the drill core from previous drilling programs. Grab samples of surface
showings and mineralized core were collected to independently verify the nature of the
mineralization encountered.


ADEX provided a copy of the GEMCOM digital database containing all previous drillhole
data. They also provided claim status information, digital copies of their reports (when
available) and hard copies of various company/government correspondence.


A complete list of the material reviewed is provided under References at the end of this
report. Copies of selected reference material are available for review at the WGM office in
Toronto.


2.4            UNITS AND CURRENCY


Assay and analytical results for the precious metal silver (“Ag”) are quoted in grams per
metric tonne (“g/t”, “g Ag/t”), parts per million (“ppm Ag”) and gold (“Au”) is reported in
parts per billion (“ppb Au”). Analyses for tungsten (“W”), molybdenum (“Mo”), tin (“Sn”),
indium (“In”), bismuth (“Bi”), zinc (“Zn”), copper (“Cu”), lead (“Pb”) and (“As”) are
reported in parts per million (“ppm”) and/or weight percent as % WO3 (tungsten oxide),
% MoS2 (molybdenite), % W, % Mo, % Zn, % Cu, % Pb and % As. To obtain % WO3,
multiply the % W by the conversion factor 1.2611. The % Mo is calculated as 60% of the
% MoS2. Percent WO3 and MoS2 for all WGM analyses were calculated by the laboratory
using their conversion figures.


For some of the historical work, ounces per ton (“opt”) are quoted for various assay results.
In these cases, metric conversions have been applied to maintain consistent units when
possible using 1.0 troy ounce per short ton = 34.2857 grams per tonne (34.2857 ppm). When
previous drill data has been reported in imperial units, the drillhole measurements are
converted to metric units with lengths converted using 1.0 m = 3.28 feet.


Metric units are used throughout this report and all dollar amounts are expressed in Canadian
funds unless indicated otherwise.


Currency units are Canadian dollars (“C$”) unless noted otherwise. As of mid-June 2006, the
exchange rate was C$1.10/US$.



                                           -9-
                                                                          Watts, Griffis and McOuat


2.5            DISCLAIMER


This report or portions of this report are not to be reproduced or used for any purpose other
than to fulfil ADEX’s obligations pursuant to Canadian provincial securities legislation,
including disclosure on SEDAR, and if ADEX chooses to do so, to support a public financing,
without WGM’s prior written permission in each specific instance. WGM does not assume
any responsibility or liability for losses occasioned by any party as a result of the circulation,
publication or reproduction or use of this report contrary to the provisions of this paragraph.




                                             - 10 -
                                                                         Watts, Griffis and McOuat

                               3. RELIANCE ON OTHER EXPERTS



Currently, ADEX exploration activities are being carried out under the supervision of
independent consultant Dr. Trevor Boyd. Mr. G. Kooiman is a geological consultant working
on a monthly retainer to ADEX. Mr. Kooiman has worked on the Mount Pleasant property
over the last 25 years. WGM has relied on information and first hand accounts of previous
exploration activities provided by these individuals and Trevor Boyd has contributed directly
to the preparation of the Mineral Resource estimate.


The WGM site visit/tour was conducted by Mr. Kooiman. WGM has relied on information
provided by Mr. Kooiman as to the location of previous diamond drillholes and detailed
history of mining operations, bulk sampling, trenching and stripping activities.


WGM has relied on technical reports and data provided by ADEX as well as assessment
reports from companies that have previously explored the property; documents filed with the
government and hard copies of reports, maps and documents provided directly by some of the
previous operators. ADEX has reviewed a draft copy of this report for accuracy prior to the
finalization of this report.


WGM has not conducted a formal “title search” to verify the validity of the mineral claims
held by ADEX and has relied on data provided by ADEX for this purpose. These data are
presented for information purposes.




                                            - 11 -
                                                                     Watts, Griffis and McOuat

                    4. PROPERTY DESCRIPTION AND LOCATION



4.1           GENERAL


WGM has relied on the list of claims provided by ADEX and has relied on information about
the status of each claim from the New Brunswick Department of Natural Resources and
Energy website and correspondence from the Mining Recorders Office, Minerals and
Petroleum Development Branch.


The Mount Pleasant property is located in Charlotte County, New Brunswick, approximately
60 km south of Fredericton, 65 km northwest of Saint John and 35 km north of St. George at
latitude 45°26'Ν and longitude 66°49'W (Figure 1). The entire land package consists of
102 contiguous mining claims covering approximately 1,600 ha (Figure 2, Table 1).


The claims are held in two groups. Claim group 1505 (claim tags 337950-338014, 338019-
338051) consists of 98 claims and group 1510 (claim tags 338015-338018) consists of four
claims. The claims are held under prospecting license 14338 by ADEX Minerals Corp., a
100% owned subsidiary of ADEX. In January 1989, Hughes Surveys and Consultants legally
surveyed the perimeter of each of the two claim groups.


In New Brunswick, there are annual work requirements that must be completed on claims to
keep mining claims in good standing otherwise the claims lapse. All of the claims are
currently in good standing. Group 1505 has annual work requirements of $61,000 and
expires on February 2, 2007. ADEX reports that a reserve of $37,000 is available for future
renewals on this group. Claim group 1510 has annual work requirements of $2,400 and also
expires on February 2, 2007. ADEX reports that there is a reserve of $1,600 available for
future renewals on this group. Additional exploration expenditures will be required in 2006
for renewal in 2007 for both claim groups.


The annual renewal fee for the mining claims is $3,060. The fees are fully paid until
February 2, 2007.




                                             - 12 -
                                                                          Watts, Griffis and McOuat

                                  TABLE 1
                   MOUNT PLEASANT PROPERTY CLAIMS
                             CLAIM TAG NUMBERS
       Map Index No. 1505
       License Number: 14338     Expire Date: 2/2/2007
          337950      337967    337984     338001      338022                    338039
          337951      337968    337985     338002      338023                    338040
          337952      337969    337986     338003      338024                    338041
          337953      337970    337987     338004      338025                    338042
          337954      337971    337988     338005      338026                    338043
          337955      337972    337989     338006      338027                    338044
          337956      337973    337990     338007      338028                    338045
          337957      337974    337991     338008      338029                    338046
          337958      337975    337992     338009      338030                    338047
          337959      337976    337993     338010      338031                    338048
          337960      337977    337994     338011      338032                    338049
          337961      337978    337995     338012      338033                    338050
          337962      337979    337996     338013      338034                    338051
          337963      337980    337997     338014      338035
          337964      337981    337998     338019      338036
          337965      337982    337999     338020      338037
          337966      337983    338000     338021      338038

       Map Index No. 1510
       License Number: 14338            Expire Date: 2/2/2007
          338015      338016              338017       338018

4.2            SURFACE RIGHTS


ADEX no longer holds the surface rights for the entire property. The company currently
holds the surface rights covering approximately 405 hectares including the area of the
minesite and mill.     During late 2003 and 2004, surface rights covering approximately
800 hectares were sold to several new owners. ADEX provided a 1:10,000 scale surface
rights map to WGM for review covering the ground surrounding the immediate minesite area,
the tailings compound and western and central portions of Mount Pleasant itself and its
deposits. What is apparent from this map is that the surface rights held by others are tightly
truncated to the actual minesite and the surface rights to portions of the deposits are no longer
owned by ADEX. The surface rights for the Saddle Zone, the northern half of the Fire Tower
Zone and northern part of the North Zone are held by ADEX (see Figures 2 and 7). The rest
of the Fire Tower Zone, the North Zone and eastern side of Mount Pleasant are owned by
third parties including the province.


                                              - 15 -
                                                                         Watts, Griffis and McOuat


There is a right of way for the Province to have access to a fire tower, located at the top of
Mount Pleasant, and for New Brunswick Power for the power line. In addition, there is a
50-year lease to farm blueberries on the property held by Bridges Brothers Inc. (Piskahegan
Resources Limited, 1995, ADEX Mining Corp., 1995).


4.3            ROYALTY PAYMENTS


A document by D.M. Fraser Services Inc. (1994) indicates that a royalty payment in the
amount of $0.10 per ton of ore mined is payable to Mount Pleasant Mines Limited. This
royalty is payable yearly on a non-cumulative basis out of net net profits (the definition of
“net net profits” appears to be more or less the equivalent of industry standard “net profits”),
if and when net net profits are made. Adex has no original documentation to confirm or deny
the existence of this royalty.


4.4            MINE/MILL BUILDING AND EQUIPMENT OWNERSHIP


ADEX has 100% ownership of the buildings and equipment remaining on the property, which
changed ownership from Piskahegan in 1996. The Province of New Brunswick still holds a
$2.0 million mortgage on the buildings as security to cover the costs of building removal and
contouring (ADEX Mining Corp., 1995). In addition, ADEX has a $0.5 million security bond
posted with the New Brunswick government for mine reclamation.




                                            - 16 -
                                                                       Watts, Griffis and McOuat

 5. ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE AND
                                    PHYSIOGRAPHY



5.1           ACCESS


The Mount Pleasant property is located in southwestern New Brunswick The minesite is
accessible by all-weather roads from either Fredericton, 80 km by road north of Mount
Pleasant, by road from the small town of St. George, 38 km by road to the south, or 97 km by
road from Saint John.


The property can be accessed by proceeding 60 km west of Saint John on Route 1 to
provincial highway Route 785 (Beaver Harbour turn off). Then travel north 33 km on Route
785 (mainly an asphalt road with intermittent gravel) passing a paper mill. Stay left at the
fork in the road at 33 km on Route 785. The mine gatehouse is an additional 4 km after the
fork.


Route 785 is maintained on a year-round basis by the province and is the main access route to
the mine property and was used for the transportation of concentrates from the mine to the
port of Saint John and the eastern United States seaboard. The New Brunswick/Maine border
is located approximately 80 km to the southwest by road.


5.2           CLIMATE


The majority of information regarding climate reported herein has been gathered form the
Environment Canada internet website. The regional climate is best described as modified
continental with short, warm summers and long, cold winters.          Topography has little
influence on New Brunswick’s climate.       The month of January is the coldest in New
Brunswick and July is the warmest. On average, thunderstorms occur between 10 to 20 days
a year with only one thunderstorm a year severe enough to produce hail. Tornadoes are rare.
Winds blow predominantly from the west and northwest in the cold months and from the
south and southwest in the warm months.


In the summer, the daytime highs range between 20 to 22°C but inland temperatures can
reach 25°C and higher. Temperatures have exceeded 37.8°C on occasion. The interior



                                           - 17 -
                                                                       Watts, Griffis and McOuat

highlands record about 120 cm of rainfall a year. Fog occurs on more than one quarter of the
days of the year, 35% of the time during the month of July. Summer wind speeds average 12
to 15 km per hour. In the summer and fall, storms pass through the Bay of Fundy northeast
through the Strait of Belle Isle. At least one heavy rainstorm accompanies weakened tropical
storms and hurricanes affect southern New Brunswick every one or two years.


The January mean temperature is around -7.5°C with inland temperatures experiencing very
cold winters especially in areas of high altitude. Frigid temperatures are not infrequent with
extreme lows of -30 to -35°C every winter Southern sections of the province receive 200 to
300 cm of snow, less than 20% of their annual total precipitation. Winter storms frequently
bring rain to the Fundy coast and snow to the interior. Freezing rain is a hazard on about a
dozen or more days a year. Wind speeds average 15 to 20 km per hour in winter although
some winter storms can pack strong winds with snow often changing to rain. Many of these
storms originate from either the North Pacific or the Gulf of Mexico. Along the Fundy
shoreline, 140 to 160 frost-free days occur on average whereas in the central highlands there
are less than 90 days.


Geological mapping, soil geochemical surveys, trenching and rock stripping programs are
best carried out during the months of May to October. However, ground geophysical surveys
and drilling programs can be conducted year round. Winter drilling can be advantageous for
ease of crossing active streams or water sheds as many of these water bodies are frozen solid
during the winter season.


5.3            LOCAL RESOURCES AND INFRASTRUCTURE


Saint John, the largest city in New Brunswick with a population of around 70,000, is the
second largest port in Atlantic Canada. This major seaport is ice-free all year and is located
around 80 km by road from the minesite. Today, this industrial city is dominated by pulp and
paper, oil refining and light manufacturing.        When the Mount Pleasant Tungsten Mine
operated from 1983 to 1985, tungsten ore concentrate was regularly shipped via Route 785 to
Saint John for shipments to Europe. Concentrates could also be transported via Route 1 west
to potential U.S. customers.




                                           - 18 -
                                                                       Watts, Griffis and McOuat

The City of Fredericton with a population of around 49,000 is located north of Mount
Pleasant (Government of New Brunswick, 2005). This city is the provincial capital and home
to the University of New Brunswick.


The Mount Pleasant area is not heavily populated. Labour forces could be recruited locally
from the Saint John, St. George, St. Stephen and Fredericton region as well as the Bathurst
Mining Camp located in northeastern New Brunswick. As there is no town at the minesite,
mine personnel would most likely live in the nearby town of St. George.


There are commercial airports located at Fredericton (Oromocto) and Saint John. The closest
railway line runs from Saint John through Fredericton Junction northeast of Mount Pleasant to
the city of Montreal, Quebec (see Figure 1).


Fresh water is abundant in the region. Water for the mine is supplied from a pump house
located on nearby Piskahegan River to a storage reservoir on the hillside above the mill
(Billiton, 1985a).


Electric power is supplied to the minesite by the New Brunswick transmission grid. The
supply is delivered at 128 kV and is transformed to 4,160 V and 600 V to feed equipment.


5.4            PHYSIOGRAPHY


Southern New Brunswick is characterized by low-lying hills and gently rolling topography
with hills sloping down to tidal marshes at the edge of the Bay of Fundy (McLeod, 1990;
Environment Canada, 2005). Mount Pleasant is approximately 370 m above sea level, some
230 m above the valley floor, and is one of the highest points in southern New Brunswick.


The Mount Pleasant area has been heavily glaciated and has low relief characterized by
narrow ridges and wide valleys. Outcrop exposure is poor. During Pleistocene glacial
erosion and deposition, the drainage pattern became disrupted and consequently there are
numerous small lakes and ponds that formed during the Late Wisconsinian deglaciation time.
A prominent southeast-trending drainage pattern by fairly small streams and rivers parallels
the direction of glacial movement.




                                           - 19 -
                                                                          Watts, Griffis and McOuat

Very little of the land in the area is suitable for agriculture although there is some marketable
timber in the region. Many of the highland areas are dominated by hardwoods (dominantly
sugar maple). Mount Pleasant itself was previously timbered so little marketable timber
remains on the ground with surface rights held by ADEX in the immediate vicinity of the
mine.   The lowlands are dominated by softwoods (predominantly balsam fir) in poorly
drained ground such as the Hatch Brook and Piskahegan River areas.




                                            - 20 -
                                                                        Watts, Griffis and McOuat

                                       6. HISTORY



6.1           GENERAL


A review paper summarizing all historical work conducted previously on the Mount Pleasant
property has been provided by Mr. G. Kooiman, consulting geologist to ADEX. Text from
Kooiman’s report entitled “20 year Summary Report” has been reproduced below with his
permission (Kooiman, 2004). Additional information has been provided from other reports
and documents provided by ADEX to complete this review.


WGM did not conduct an independent assessment file search of the Department of Natural
Resources and Energy Mineral Branch databases since a considerable amount of information
was available from reports and documents supplied by ADEX.


The Mount Pleasant property has a long history of exploration and development. The focus
of exploration over the years has shifted from tin-base metals (“tin lodes”) from 1954-1969,
to porphyry tungsten-molybdenum-bismuth deposits (1969-1985), to porphyry tin deposits
(1985-1991) and back to tin-base metals (1991-2004), and now to include indium which is an
important component of the mineralization. All of the historical work completed on the
property has been summarized in Table 2.


6.2           EXPLORATION AND DEVELOPMENT


6.2.1          TIN-BASE METAL DEPOSITS (1954-1969)


Tin-base metal mineralization was first discovered in the area in 1937 on Kedron Brook
located approximately 9 km west of Mount Pleasant. However, this occurrence of small tin-
and zinc-bearing quartz veins was non-economic and created little interest.


The Mount Pleasant area was first staked in 1954 by Geochemical Associates and optioned to
Selco Exploration Limited (“Selco”) following a stream sediment and subsequent soil
survey for base metals, which indicated the possible presence of copper and lead
mineralization located on the east side of Hatch Brook Valley and on the west flank of Mount
Pleasant



                                           - 21 -
                                                                                         Watts, Griffis and McOuat


                                           TABLE 2
                       HISTORY OF WORK ON THE MOUNT PLEASANT PROPERTY
   Year                   Operator                                 Work Performed
   1954      Geochemical Associates        Stream and Soil Sample Surveys

   1955      Selco Exploration Ltd.                Packsack drilling, ground EM/radiation surveys

1956-1960    Kennco Explorations (Canada) Ltd.     IP surveying, diamond drilling – Fire Tower Zone

1960-1965    Mount Pleasant Mines Limited          Stripping and trenching, soil/bedrock sampling, IP, seismic, SP,
                                                   magnetic, gravity surveys, surface/UG drilling, met. testing,
                                                   geological, UG development and sampling, bulk sampling,
                                                   feasibility/”reserve” study (North Zone)

1967-1968    Sullivan Mining Group                 North Zone: Diamond drilling, development - 750 and 900 adits,
                                                   ground geophysics and geochemical work

1969 -1974   Brunswick Tin Mines                   Surface & U/G drilling, dev. 400/900/750 adits, exploration drifts,
                                                   bulk sample(s), I.P/EM surveying, XRF lab, re-mapping, met. work
1977 – 1979 Mount Pleasant Tungsten Mine           Dewatering, 10,000 tonne bulk sample, Strathcona Feasibility Study
            (Billiton – BTM Joint Venture)
1980 – 1984 Mount Pleasant Tungsten Mine           Mine/mill construction, tungsten concentrate production (1983) at
                                                   650,000 tpy, U/G drilling , reduced output (325,000 tpy, 1984)

July, 1985   Mount Pleasant Tungsten Mine          Mine Closure

   1985      Billiton Exploration Canada Limited   Surface diamond drilling (North Zone, Contact Crest, Contact
                                                   Flank, Endogranitic), visits by Dr. Taylor, Dr. Pollard and Dr.
                                                   Hosking

1985 - 1988 Lac Minerals & Billiton Exploration    North Zone drilling, 1,187 m access ramp (Fire Tower Zone to
            Canada Limited                         North Zone), surface and U/G drilling, , water pumps stopped,
            “Lac-Billiton Tin Project”             280 tonne bulk sample (Endogranitic & Crest) to Lakefield
            (Lac Minerals – Operator)              (metallurgical work)

   1987                                            Ore handling alternatives report by Redpath

1988 -1989                                         Tin exploration, IP survey, surface diamond drilling northeast of the
                                                   North Zone, Saddle Zone

1989 -1990   Novagold Resources Inc.               Diamond drilling - Saddle Zone

   1990      Novagold Resources Inc.               Cominco: 30 tonne metallurgical testwork at Lakefield, CANMET –
                                                   focus on tin recoveries, feasibility study by WGM

1991-1992    Novagold Resources Inc.               600 samples analyzed for indium, property returned to Lac

   1993      Lac Minerals                          WGM due diligence, samples shipped to Lakefield Research and
                                                   Cominco, promotional video by DNRE, concentrate shipped to
                                                   SIDECH bismuth smelter (Belgium)

   1993      Piskehegan Resources Limited          Purchased mine/mill complex and mineral rights from Lac/Billiton,
                                                   clear cut forest, 2000 samples analyzed for indium (core, pulps)

   1995      Piskehegan Resources Limited          Diamond drilling, 100 kg sample to Research And Productivity
                                                   Council to start bacterial inoculum for bioleach test work, 30 tonne
                                                   sample for bioleach heap test from 600 and 900 adits




                                                   - 22 -
                                                                         Watts, Griffis and McOuat

(Parrish and Tully, 1976). This occurred at the time of the large base metal discoveries in the
Bathurst Camp located in northeastern New Brunswick. Selco conducted geological studies
and ran a vertical loop electromagnetic (“EM”) survey and a reconnaissance radiation survey.
A massive boulder of löllingite (FeAs2) was found near the fire tower.


Selco drilled four packsack drillholes to test a geochemical anomaly and preliminary “Geiger
Counter” radiometric surveys were completed in the vicinity of the Fire Tower Zone.
However, none of the drillholes intersected any significant metallic mineralization and it was
concluded that the mineralized zones themselves showed only background radioactivity. As a
result, the property was returned to Geochemical Associates in July of 1955. In 1956,
Kennco Exploration (Canada) Limited (“Kennco”), the Canadian subsidiary of Kennecott
Copper, optioned the property and drilled ten holes but results were again disappointing and
the option was dropped. The Geological Survey of Canada ran an aeromagnetic survey of the
area in May, 1956 (Map #593G, Parrish and Tully, 1976). This survey determined that
Mount Pleasant is located on the side of a large aeromagnetic high.           Furthermore, it
determined that magnetic surveys would be of little help in outlining mineralized zones on the
property. Geochemical Associates allowed the claims to lapse in 1958. The provincial
government ran the first geological mapping program through the area that same year.


Renewed interest came with the discovery of in-situ gossanous outcrop material higher up on
Mount Pleasant. Samples of this material contained base metals and high amounts of tin. In
1959, MPML was formed and it re-staked the property and Kennco re-optioned the property
and re-assayed all the old geochemical samples and included the elements tin, molybdenum,
copper and lead (Parrish and Tully, 1976). Additional claims were staked followed by the
first ground induced polarization (“IP”) survey to be conducted on the property. The IP
Survey identified two broad north-south trending anomalies, one which coincided with the
Fire Tower Zone and the other with the Saddle area. Both geophysical anomalies correlated
fairly well with previously identified anomalous soil values. IP surveying was followed by
the drilling of 24 shallow holes in 1960. Drilling intersected tungsten, molybdenum and tin
mineralization.   However, because the mineralization could not be followed, and with
Kennco’s exploration policy shifted to mostly Western Canada, the option was dropped.


From 1960 to 1965, MPML completed surface stripping (120 m2) and trenching, soil and
bedrock sampling, ground geophysics (IP, seismic, self potential (“SP”)), magnetic and
gravity surveys), surface diamond drilling (Fire Tower Zone), metallurgical testing of drill



                                           - 23 -
                                                                         Watts, Griffis and McOuat

cores, detailed geological investigations, extensive underground development and
underground sampling and drilling programs (Parrish and Tully, 1976; Kooiman, 2004). IP
surveying was conducted by McPhar Geophysics Ltd. over all of the Fire Tower area, Saddle
area and North Zone as well as reconnaissance surveys in the area west of Hornet Hill. A
total of eighteen IP anomalies was identified. Follow-up diamond drilling indicated that the
IP anomalies could not be directly related to the main molybdenum, tungsten, bismuth zones
but were most likely related to the cap rock-type disseminated mineralization.


Ground magnetic surveys over the North Zone and Fire Tower areas did not locate any
significant magnetic anomalies. On the North Zone, results indicated that silicified zones
showed up as weaker magnetic background readings and that chloritized zones stood up
above background. The provincial government conducted a mapping program of the area in
1963.


The exploration work by MPML outlined widespread but erratic tin-base metal mineralization
in the northern part of the property (the North Zone) while surface diamond drilling near a
fire tower encountered many mineralised intersections with varying amounts of tin, tungsten
and molybdenum.       MPML drove a 1,465 m adit (the 600 adit), where some of the
underground drilling took place, and from 1963-64 outlined a number of tin-bearing lodes
(the Open Pit Zone). At that time, it was difficult to establish a geological model for the tin-
base metal mineralization at Mount Pleasant as similar deposits were not known in New
Brunswick or anywhere else in Canada.


From 1961 to 1962, several SP and resistivity measurements, both on surface and in diamond
drillholes, were completed in the North Zone and Saddle Zone areas (Parrish and Tully,
1976). Several weak anomalies were located within the Saddle area but data collected from
the North Zone were inconclusive possibly due to the wide spread of sphalerite. In May
1963, a 100-ton bulk sample was collected from the North Zone (?) for testing. A feasibility,
development and “reserve” study based mostly on the North Zone results was completed in
1964. A gravity survey was conducted over the 600 adit in August of 1965 to try to prove the
vertical continuity of the #1 and #3 tin lodes. The results were inconclusive indicating that
tin-base metal lodes might be reflected by low gravity values. Some exploration work was
completed on the #7 tin lode as well. However, work abruptly stopped when MPML ran into
financial problems.




                                            - 24 -
                                                                         Watts, Griffis and McOuat

The property lay dormant until mid-1967 when the Sullivan Mining Group (“Sullivan”)
began exploration for tin and copper in the Fire Tower Zone. Sullivan followed up on some
excellent diamond drill intersections by driving two exploration adits. The 750 adit (1,330 m
long) and the 900 adit (194 m long) were driven 2.4 by 2.4 m into the Fire Tower North Zone.
Only small replacement-style mineralized bodies were found. Additional geophysical and
geochemical work was carried out in 1968 (Parrish and Tully, 1976).


6.2.2        PORPHYRY TUNGSTEN-MOLYBDENUM-BISMUTH DEPOSITS (1969-1985)


Sullico Mines Limited, which became part of the Sullivan Mining Group in 1969, optioned
the property in 1967. In 1968, exploration activities focused to the Fire Tower Zone area with
the intersecting of tungsten, molybdenum and bismuth mineralization by drillhole MPS 39.


In 1969, Brunswick Tin Mines (“BTM”) was formed as a joint venture between Sullivan
(78%) and MPML (22%). That same year, deeper surface diamond drilling discovered large
porphyry-type tungsten-molybdenum-bismuth zones in the Fire Tower Zone. By 1971, a
“resource” had been outlined for the Fire Tower Zone with additional “resources” outlined in
the North Zone and Deep Tin Zone in 1972 (see Section 17.0, Mineral Resource and Mineral
Reserve Estimates).    All exploration attention was now focused on the large porphyry
deposits.


IP surveying was completed on adjoining areas in Hatch Brook, Niles Brook, Beach Hill,
Little Mount Pleasant, McDougall Lake and the East Group area in 1970 (Parrish and Tully,
1976). Weak anomalies attributed to contact pyritic and graphitic mineralization were located
in the Niles Brook and Hatch Brook areas. The strongest anomaly was identified on the East
Group where drilling intersected significant tin mineralization. Drill testing of a second IP
anomaly at Little Mount Pleasant intersected some zinc mineralization.


In 1971, an X-Ray Fluorescent Spectrometer (“XRF”) was set up in St. Stephen by BTM and
all core and other materials were assayed using this equipment. The surface of Mount
Pleasant was re-mapped and a second IP survey completed. Exploration shifted to the Deep
Tin Zone in 1972 and the #4 tin lode near surface. An 815-ton bulk sample was collected
from the 750 adit (North Zone). During 1972, a preliminary ground EM survey with an
EM-16 unit was conducted within the Saddle area and Hornet Hill.




                                           - 25 -
                                                                       Watts, Griffis and McOuat

BTM drove the 400 adit into the higher grade portion of the Fire Tower West Zone in 1973 to
delineate it and to obtain a bulk sample. Exploration drifts were established on the 30.5 m
(100 ft above sea level) level (the 900 adit) and extensive underground diamond drilling was
undertaken. Surface diamond drilling was also completed as well as 1,500 m of underground
development.


In 1974, MPML dropped its ownership in BTM to 11% due to its inability to provide its share
of exploration funding. BTM completed metallurgical studies and in 1976 completed a
feasibility study for a tungsten mine at Mount Pleasant based on the “reserves” in the Fire
Tower Zone and then started to actively search for another partner to help develop the
property.


In November, 1977, Billiton Exploration Canada Limited (“Billiton”) formed a 50/50 joint
venture (“JV”) with BTM (Sullivan 89%, BTM 11%) establishing the Mount Pleasant
Tungsten Mine. The JV gave Billiton the right to undertake a full Feasibility Study and earn
a 50% interest in the property by putting it into production (Billiton Canada Ltd., 1985a).
Arrangements were made to dewater the 400 decline and the 30.5 and 314.0 m (100 foot and
1,030 foot) level workings to mine a 10,000-tonne bulk sample in the core of the Fire Tower
West body. The sample was shipped to Sullivan’s Nigadoo River Mine where a continuous
mill test was carried out to evaluate the recovery of wolframite and molybdenite by flotation
(Billiton Canada Ltd., 1985a).    Strathcona Mineral Services Limited was contracted to
compile the Feasibility Study, which was completed in 1979. With the outlook for tungsten
prices being favourable, a decision to proceed to production was made at a design capacity of
650,000 tonnes mined/milled per year (see Section 17.0, Mineral Resource and Mineral
Reserve Estimates).


Mine/mill construction commenced in April 1980 with a total construction cost of
$150 million (Billiton Canada Ltd., 1985a).           Underground operations started in
December 1982, with the start up of the primary crusher. Sales of the tungsten (wolframite)
concentrate began in December 1983. A total of 14,478 m of underground drilling was
completed to delineate the tungsten-molybdenum zones between 1981 and 1985. In 1984,
mine production was reduced to 325,000 tonnes per year.


The mine experienced numerous setbacks including cost overruns, metallurgical difficulties
and falling tungsten prices and resulting poor profitability, which eventually led to the mine



                                           - 26 -
                                                                          Watts, Griffis and McOuat

being permanently closed in July 1985. During the mining operation from 1983 to 1985, a
total of 990,200 tonnes of tungsten ore was milled.


After the mine closed, Sullivan dropped its interest. MPML reverted their shares in the
company to a royalty based on $0.10 per short ton of ore mined.


6.2.3          PORPHYRY TIN DEPOSITS (1985-1991)


Mount Pleasant Tungsten Mine geologists re-logged most of the surface and underground
diamond drill cores drilled by BTM. In the summer of 1981, they recognized that significant
tin mineralization in the North Zone occurred in a less altered, fine-grained granite underlying
and intruding more intensely altered older rocks. As most of the budget went to further
outlining and sampling of the tungsten-molybdenum zones, it was not until the spring of 1984
that Billiton made funds available for a tin exploration program in the North Zone. A total of
4,767 m of diamond drilling was carried out in 1985. All twelve holes in this program
intersected significant tin mineralization in the contact Crest, adjacent contact Flank and
within the Endogranitic Zone, the latter hosted by a younger intrusive of fine-grained granite.


Site visits by several leading experts on tin geology confirmed the significance of the
discovery. Dr. R.G. Taylor and Dr. P.J. Pollard of the Tin-Tungsten Research Unit of James
Cook University of North Queensland, Townsville, Australia, concluded their visit report by
saying that “it should be realized that to establish 2-3 million tonnes of good grade “reserves”
(0.8-1.0% Sn) is an extremely difficult task and this potential seems obtainable at Mount
Pleasant,” (Taylor and Pollard, 1985). Dr. K.F.G. Hosking of Camborne, Cornwall, U.K, also
inspected the key drill cores and sections from the North Zone and was similarly impressed
by the drilling results stating that “the zone was a very promising tin prospect”.


After the closure of the tungsten mine, Billiton started to actively search for a joint venture
partner to further explore the tin deposits of the North Zone. Of the eight major mining
companies that presented bids, Lac Minerals Limited (“LAC”) became the preferred partner.
Approximately $6.5 million was spent between 1985 and 1988 to drive a 1,187 m long access
drift from the Fire Tower Zone to the North Zone, conduct underground drilling to delineate
the zone(s) of tin mineralization and to produce a feasibility study.




                                             - 27 -
                                                                        Watts, Griffis and McOuat

The “Lac-Billiton Tin Project” started in October 1985, with LAC as the operator,
notwithstanding the collapse of the International Tin Council cartel, which saw tin prices drop
from US$17.50/kg to US$5.50/kg. The project completed 2,101 m of development, which
included a 3.5 m by 5.0 m, 1,187 m long access ramp, which started from the 1020 level of
the service ramp of the Fire Tower Zone to the North Zone.


The joint venture completed 25,377 m of surface and underground diamond drilling. Two
bulk samples totalling 2,582 tonnes were excavated from the Contact Crest and Endogranitic
Zone and processed in the bulk sample tower on surface. Some 280 tonnes were shipped to
Lakefield Research (“Lakefield”) for metallurgical test work. The remaining material was
stored in the “A-frame” building on site where it remains today.


In 1987, J.S. Redpath Mining Consultants Limited of North Bay, Ontario, prepared a three-
volume report on ore handling alternatives for tin ore from the North Zone. Pilot plant testing
was completed on bulk samples collected from the Endogranitic Zone and the Contact Crest
deposit.


However, by the end of 1987, the tin price was still hovering in the US$5.50-$6.50/kg range,
well below the US$11.00/kg required for a positive production decision. As a result, LAC
put the tin project on hold and the underground workings were allowed to flood. The plant
and equipment were placed on a care and maintenance program. Some equipment was
reallocated to operating properties or sold.


During 1988, LAC continued its exploration for other tin deposits on the property with a
modest budget of $250,000 plus government funding (MISP programs).


An IP survey was carried out over the northeast quadrant of the mine property covering an
area of 4.0 km2. A six-hole surface drilling program started in June 1988, and was completed
in October of that same year. LAC terminated its exploration activities by the end of 1988.


In October, 1989, Novagold Resources Inc. (“Novagold”) optioned the property from
LAC/Billiton. Novagold completed a three-hole diamond drilling program in the Saddle
Zone and conducted metallurgical work on the tin mineralization based on a new flowsheet to
investigate the North Zone as a potential polymetallic mineral deposit. Novagold completed




                                               - 28 -
                                                                         Watts, Griffis and McOuat

initial metallurgical studies on the removal and processing of the sulphide mineralization to
recover tin, indium, zinc and copper (ADEX Mining Inc., 1995).


Novagold also commissioned a study by Cominco Engineering Services Limited
(“Cominco”) who developed a flowsheet to produce a 50% tin concentrate at an
80% recovery rate. As part of this study, a total of 30 tonnes of samples for metallurgical test
work were shipped to Lakefield, Cominco of Vancouver, British Columbia and the Federal
Government’s CANMET research facility in Ottawa. In 1990, Novagold initiated a tin
feasibility study by WGM with involvement of Davy Canada Inc. as well as a mineralogical
study of 40 core samples.


In 1992, Novagold allowed their option to lapse due to financial constraints.


6.2.4          TIN-INDIUM-BASE METAL DEPOSITS


Due to low tin prices and a bleak outlook for significant price recovery, exploration efforts
focused on the other metals associated with tin mineralization. Novagold became seriously
interested in the presence of indium in 1991 after visits by indium/bismuth experts of the
Geological Survey of Japan and the U.S. Bureau of Mines who provided very useful insight
into the geology of indium-bearing deposits, metallurgy and production figures/applications
for the indium industry as a whole. A sampling program was initiated in November 1991, and
was eventually completed with assistance of the New Brunswick Department of Natural
Resources and Energy (“DNRE”). Around 500 samples were analyzed for indium. The
Geological Survey of Canada (“GSC”) also participated in the 1991/1992 program by
analyzing over 100 samples of mineralized and unmineralized rocks from the Fire Tower
West Zone. Prior to the 1991/1992 program, only about 50 indium assays were available. In
addition, only a few hundred semi-quantitative assays were carried out during the 1970s.


In the spring of 1992, the property reverted back to LAC due to Novagold’s failure to secure
senior financing or find a partner to advance the project. Ongoing interest in indium and
bismuth by the Japanese and Europeans prompted DNRE to take on a proactive role in
promoting the property, assisting in technical matters and facilitating meetings with potential
investors.




                                            - 29 -
                                                                       Watts, Griffis and McOuat

In early 1993, Drew and McKeown began negotiations for the property. Due diligence work
was carried out by WGM and samples shipped to Lakefield and Cominco. DNRE produced a
promotional video on Mount Pleasant.        A bismuth-bearing concentrate was shipped to
SIDECH. During a trade mission to Germany and Belgium, led by then-Premier McKenna, a
meeting was held with the principals of SIDECH in Brussels in April 1993.


In December 1993, Piskahegan with Drew and McKeown as principals, purchased the
mine/mill complex and the mineral rights for Mount Pleasant from Billiton and LAC.
Piskahegan continued to develop the metallurgical processes for the treatment of tin-sulphides
from the North and Deep Tin Zones and prepared a new pre-feasibility study. A deal was
struck with a local contractor to clear-cut most of the forest that covered Mount Pleasant in
order for the company to meet its financial obligations.


Piskahegan quickly recognized the importance of indium as a co-product in any future mining
operation and over 2,000 samples of previously drilled core were analyzed for indium. The
investigation confirmed the widespread occurrence of indium, in particular in the tin-zinc-
copper-rich deposits.


A five-hole diamond drilling program was completed in 1995 to test indium, zinc and copper
mineralization within the Fire Tower Zone. Drilling intersected a new small zone called the
Scotia Zone and determined that the Fire Tower Zone contained a tin-bearing zone as well as
good indium, zinc copper values.


In September 1994, D.M. Fraser Services Ltd. prepared a report for Piskahegan reviewing the
feasibility of producing tin, indium, base metals and rare earth metal from the property
utilizing all work conducted on the property since 1987.


Finally, in January 1995, a 100 kg sample was shipped to Research and Productivity
Council (“RPC”) of Fredericton, New Brunswick to start bacterial inoculums for bioleach test
work.




                                            - 30 -
                                                                         Watts, Griffis and McOuat

6.3            MINING/MILLING OPERATIONS


6.3.1          FIRE TOWER ZONE


The Mount Pleasant Tungsten Mine was put into production in 1983 at a total construction
cost of $150 million.


Mining started in the Fire Tower West orebody after two declines were completed between
1981 and 1982 (Billiton Canada Ltd., 1985a). These declines provided access to the orebody
at the north end of the Fire Tower West and Fire Tower South Zone. The Service Ramp runs
from the surface to the 955 level (the 1,000 m mine level equals sea level) averaging a
15% slope and was used for transportation of mine personnel, materials and waste haulage.
The Conveyor Ramp is 940 m long, 625 m at an 18% slope and 315 m at a 25% slope and
runs from the underground crusher on the 935 level to the surface portal.


According to Billiton Canada Ltd. (1985) mining records, the underground operations started
in December 1982. The primary method employed at Mount Pleasant was transverse long
hole open stoping with primary and secondary extraction. The ore extraction was done
without backfill. Some of the stopes were large and in excess of several thousand tonnes.
The mine levels were laid out at 30 and 70 m intervals. However, during the initial stages of
production it was determined that shrinkage mining was essential to provide additional stope
support due to ground movement in one of the pillars. Additionally, vertical slicing was
replaced by horizontal slicing using vertical crater retreat (“VCR”) techniques.


The mine was designed to produce 650,000 tonnes of tungsten-molybdenum ore per year with
a manpower level of 77 underground employees.            During the short production period
(1983-85) the underground productivity averaged 50 tonnes per manshift. In 1984, the total
minesite manpower level was 235 employees.           Prior to the operation shut down, the
manpower level dropped to 155 employees and production was reduced to 325,000 tonnes per
year.


Selling and shipment of the tungsten concentrate began in December 1983. The tungsten
concentrate was sold exclusively to Billiton Metals and Ores International BV, the
Netherlands (Billiton, 1985a). Long-term supply contracts were in place with European and




                                            - 31 -
                                                                          Watts, Griffis and McOuat

U.S. customers. The concentrate was delivered in 250 kg drums or one-tonne bags. Lots of
18-22 tonnes were transported in containers by truck/ship to Europe or by truck to the U.S.


However, the mine was plagued by set backs. During construction of the mine, the tungsten
price dropped to US$12.50/kg and dropped even further in subsequent years. Severe capital
cost overruns, from an original $89 million to over $150 million, in addition to metallurgical
difficulties made for a bleak outlook for the property. By 1984, the price of tungsten had
dropped further to US$8.40/kg. In November of that year, the company decided to reduce
output to 325,000 tonnes per year and manpower was reduced from 256 to 155 employees.


In July 1985, the mine was closed permanently due to poor metal prices and the resulting poor
profitability and metallurgical problems after less than 2 years of production. A total of
990,200 tonnes of “tungsten ore” was milled from 1983 to 1985 (see Section 17, Mineral
Resources and Mineral Reserve Estimates). Tungsten was the only metal recovered in the
plant. No attempts were made to run the molybdenum recovery circuits.


The main mine is currently flooded to the portal level of the access ramps. Kvaerner Metals
Davy Ltd. (1997) estimated that de-watering will take 24 weeks.


6.3.2          NORTH ZONE


The North Zone was never been mined by any of the previous operators. The proposed
mining methods have been summarized below. As with all mineral deposits, mining methods
are dictated by the deposit geology, size, shape and orientation.


Billiton proposed access to the North Zone would be via the over-900 m long drift from the
Fire Tower West of a 1,200 m decline from surface starting a distance of about 600 m north of
the mill (Billiton Canada Ltd., 1985). They proposed that the Deep Tin Zone could be mined
using the same methods used at the Fire Tower Zone. The Contact Crest mineralization
would require a modified slice and bench or sub-level retreat method. The more steeply
dipping Contact Flank mineralization might be amenable to blast-hole stoping or blast-hole
shrinkage if it had a regular shape, or cut-and-fill if strike and dips were found to be erratic.
The Endogranitic mineralization could be mined by a room and pillar layout using top-slice
and bench methods or blast-hole retreat with remote mucking.




                                            - 32 -
                                                                       Watts, Griffis and McOuat

Piskahegan proposed using sub-level caving (“SLC”) as its main mining method for the
Endogranitic Zone and contact deposits (ADEX Mining Corp., 1995). Some blasthole stoping
would be employed on the Endogranitic Zone but blasthole could be the main mining method
for the Deep Tin Zone because the mineralization was interpreted to be one mass. SLC was
proposed because it was considered a low cost mining method. However, this technique has a
high dilution factor (21%) especially in narrower veins. Blasthole stoping was considered a
low-cost mining method and in the Deep Tin Zone less dilution (15%) was expected because the
mineralization was in one mass. VCR mining was also proposed where applicable.


Kvaerner Metals Davy Ltd. (1997) recommended a mixture of SLC and long hole stoping at a
rate of 2,500 tonnes/day for the extraction of ore from the North Zone and Deep Tin Zone.
SLC would be used for 90% of the deposits and long hole for the remainder.


6.3.3         MINE/MILL BUILDINGS AND EQUIPMENT


The principal buildings on the site are the Administration Building, Warehouse, “A” Frame”,
Ore Storage Shed, Concentrator, Core Storage and Cold Storage buildings (ADEX Mining
Inc., 1995). On the first floor, the administration building accommodates the mine and
geological offices, change rooms and lamp room. On the second floor, offices were reserved
for management and for the human resources and accounting departments. ADEX sold most
of the milling equipment to raise money for property and title maintenance.


The ore bins contain an unknown amount of uncrushed ore and there are twenty-five 205 litre
drums containing historic bulk-sample material from the Fire Tower Zone securely stored in
the warehouse.




                                           - 33 -
                                                                       Watts, Griffis and McOuat

                                 7. GEOLOGICAL SETTING



7.1            REGIONAL GEOLOGY


The Mount Pleasant area has been mapped on a regional scale by Bailey et. al (1877), Tupper
(1959), Laughlin (1960), Clark (1972), Ruitenberg (1963), Van de Poll (1963), Harris (1964)
and Tremblay (1965). A regional geological map is presented in Figure 3. Outcrop exposure
on the property is around 10%.


The Mount Pleasant deposits are located in southern New Brunswick within the Appalachian
Orogen in eastern Canada.        These deposits occur within gently dipping Late Devonian
Piskahegan Group volcanic and sedimentary rocks that are the remnants of a large
epicontinental caldera complex (Sinclair et al, 2005).


The regional geology in the mine area is dominated by the Mount Pleasant Caldera, the
exposed part measuring approximately 13 by 17 km (ADEX Mining Corp., 1995). Multiple
layered granitic intrusive rocks and associated mineralization at Mount Pleasant were emplaced
along the southwestern margin of the caldera complex. This structure occurs within the
northern extension of the Appalachian geosynclinal belt and is situated on the southeast flank
of New Brunswick’s Central Basin (ADEX Mining Inc., 1995).


The Piskahegan Group rocks of the caldera are undeformed and were emplaced in an orogenic
or post-collisional, pre- to syn-extensional setting following the Acadian Orogeny mountain
building event, which occurred from Silurian to Middle Devonian time period (Sinclair et al.,
2005; Sinclair, 1994). This caldera is bounded to the east and west by isoclinally folded
Ordovician and Silurian turbiditic greywacke and slate of the Silurian Waweig (Charlotte
Group) and Flume Formations and calcareous sandstone and to the south by the late-Silurian
to Devonian diorites and granite rocks of the Saint George Batholith. The northern portion of
the caldera is overlain unconformably by Upper Mississippian to Pennsylvanian Hopewell
Group red sandstone and conglomerate and in turn by Pictou Group sandstone and
conglomerate (Gowdy, 1995).


Late Devonian volcanism and granitic emplacement were associated with deformation of the
Acadian Orogeny. Pre-Acadian Orogeny tectonic forces formed northwest and northeast



                                            - 34 -
                                                                          Watts, Griffis and McOuat

trending wrench faults controlling the emplacement of stocks northwest of the Saint George
Batholith and subvolcanic intrusions within the Mount Pleasant caldera.


The Saint George Batholith is a northeast-trending post-orogenic, composite batholith that
developed and was emplaced along major structures at the junction of the Avalon and
St. Croix terranes during Late Silurian to Late Devonian time (McLeod, 1990). This batholith
intrudes rocks ranging in age from Late Precambrian to Early Devonian. Emplacement
postdated the deformation event associated with the Acadian Orogeny and preceded major
northeast-trending and north- to northwest-trending faults that were active at the end of the
Acadian Orogeny.


7.2            LOCAL GEOLOGY


The best geological map of the property was produced by Billiton Exploration Canada
Limited in 1985. Since then, the property has never been mapped in detail. The interpretation
of the geology at Mount Pleasant in and around the deposits has been obtained from diamond
drilling information.


Brunswick Tin Mines completed some reconnaissance geological mapping during the 1969,
1970 and 1971 field seasons around the area known as Little Mount Pleasant and the Sunday
Lake area (Parrish and Tully, 1996). In 1972, additional mapping at a scale of 1 inch to
40 feet was completed of surface outcrops, trenches and benches. There was also some
geology mapping of the 900, 750, 400 adits development.


Mount Pleasant represents the volcanic remnants with both vent and conduit fillings of a
mineral-rich volcanic eruptive centre located along the southwest margin of the Mount
Pleasant Caldera (Figure 4, ADEX Mining Inc., 1995). This eruptive centre has a marked
topographic expression reaching 370 m above sea level, or 230 m above the valley floor.


At Mount Pleasant, the caldera is comprised of Piskahegan Group rocks of Late Devonian age
consisting of three ash flow layers of rhyolitic pyroclastic rocks referred to as the Quartz-
Feldspar Porphyry that are separated by two discontinuous units of sedimentary breccia (up to
100 m thick) that forms the western boundary of the caldera, a feldspar porphyry and
metasedimentary rocks of interbedded red conglomerate, sandstone and shale (Sinclair et al,
2005; Billiton Canada Ltd., 1985b). These ash flow tuffs of the Piskahegan Group probably



                                           - 36 -
                                                                          Watts, Griffis and McOuat

originated from the numerous vents in the caldera. All rocks within the caldera generally dip
about 10 to 15° to the northwest except along the margin of the Mount Pleasant Caldera
where they dip at 15 to 50° toward the centre of the caldera (Sinclair et at, 1988).


The caldera rocks have been intruded by a line of cupolas of granitic rocks with associated
breccias (collectively named the “Mount Pleasant Porphyry”) that outcrop at the North Zone
and Fire Tower Zone and an intermediate Saddle Zone that does not reach surface. It should
be noted that little information has been provided on the “Little Mount Pleasant” cupola that
occurs at depth to the south of the Fire Tower Zone. At the Fire Tower and North Zones,
crosscutting breccias and associated intrusive rocks form irregular, roughly vertical pipe-like
complexes that were centres of subvolcanic intrusive and related hydrothermal activity
(Sinclair, 1994). The intrusive rocks were probably emplaced at depths of 1.0 km or less.
These cupolas, comprised of dominantly brecciated and altered volcanic vent material host
the tungsten-molybdenum and tin-base metal mineralization on the property. These clast-
supported breccias are complex with extensive hydrothermal alteration and were most likely
formed from multiple episodes of explosive brecciation related to magmatic fluid
overpressures developed in the crystallizing, fluid-saturated granitic magma.


Three distinct intrusions have been identified underlying the volcanic rocks at Mount
Pleasant, designated Granite I, Granite II and Granite III, which underlie the North Zone and
Saddle Zone. Granite I and II appear to most closely correlate with the fine-grained granite
and granite porphyry of the Fire Tower Zone, but they are separate intrusions. Granite III and
porphyritic granite appears to represent different parts of the same intrusive body
(Sinclair, 1994).


Structurally, the Mount Pleasant volcanism is marginal to and controlled by radial and
peripheral faulting associated with the Mount Pleasant Caldera (ADEX Mining Inc., 1995).
Faulting is present in the Mount Pleasant area as northwest-southeast-trending breaks that
appear to post-date deposit formation and redistributed the mineralized zones and displaced
some of the mineralization (Atkinson et al, 1981). A major fault structure known as the Fire
Tower Fault has displaced the Fire Tower North Zone some 150 m to the east of the Fire
Tower West Zone (Strathcona Mineral Services Limited, 1979). The trace of this fault was
intersected in the 400 decline where it dips 81° to the northeast (Parrish and Tully, 1976).




                                             - 38 -
                                                                         Watts, Griffis and McOuat

7.2.1          GEOLOGY OF THE FIRE TOWER ZONE


The host rocks in the Fire Tower Zone consist of a complex suite of magmatic-hydrothermal
breccias that crosscut volcanic and sedimentary rocks (Figure 5, Sinclair et al, 2005). These
breccias form an oval-shaped pipe consisting of angular-shaped clast-supported breccias to
matrix-supported breccias containing rounded fragments.         The fragments are mainly of
volcanic rocks.


This pipe is underlain by the oldest fine-grained granite intrusive in the Fire Tower Zone.
Both the pipe and granite are crosscut by an irregularly distributed younger-stage granite
porphyry. A coarser-grained porphyritic granite underlies the Fire Tower Zone at depth and
represent the youngest granite intrusion.


7.2.2          GEOLOGY OF THE NORTH ZONE AND SADDLE ZONE


The North Zone marks the site of an eruptive centre characterized by complex breccias and
subvolcanic intrusive rocks that occupy an oval-shaped vertical pipe about 250 by 300 m
across (Figures 4 and 5, Sinclair et al, 2005).        The hydrothermally-altered breccia is
composed of fragments of quartz-feldspar porphyry, feldspar porphyry and granitic rocks that
are intruded and underlain at depth by the Granite I, Granite II and Granite II intrusive rocks.
These granites are similar mineralogically, chemically and texturally to the three phases in the
Fire Tower Zone: fine-grained granite, granite porphyry and porphyritic granite, respectively.
Therefore, the contact relationships between these granites are difficult to determine. The
unaltered granite consists of quartz, K-feldspar, plagioclase and chloritized biotite
(Sinclair, 1994). Fluorite is a common accessory mineral and topaz occurs locally. A third
mineralized zone, the Saddle Zone, has no associated breccias and the related granitic rocks
are not exposed at surface.


Granite I is the oldest intrusive phase in the North Zone and is extensively altered (for the
most part) and brecciated (Sinclair et al, 2005). It also occurs under the Fire Tower Zone in
association with porphyry, low-grade tungsten-molybdenum mineralization. This granite
appears to have been emplaced at approximately the same time as the initial development of
the breccia pipe and formation of the tungsten-molybdenum zones.




                                            - 39 -
                                                                        Watts, Griffis and McOuat

Granite II is similar mineralogically to Granite I and is altered through pervasive
sericitization and chloritization. This granite occurs in the North Zone, the Saddle Zone and
with the porphyry in the Fire Tower Zone (Billiton Canada Ltd., 1985a). Tin mineralization is
generally associated with Granite II.


Granite II contains comb quartz layers consisting of parallel to sub-parallel layers in which
quartz crystals are oriented roughly perpendicular to the plane of layering. These layers are
an example of Unidirectional Solidification Textures (“USTs”) associated with fluid-saturated
and/or undercooled magmas (Sinclair, 1994). USTs, sometimes referred to as “brainrock”,
are a distinctive feature restricted mainly to Granite IIB near the IIA contact area and have
proved invaluable to deciphering the local mine geology (Gowdy, 1995; Billiton Canada Ltd.,
1985a). In the Saddle Zone, Granite II forms a cupola of granite composed of two plutonic
phases, the upper Granite IIA and lower Granite IIB (see Figure 4 and the following
paragraph). Comb quartz layers typically occur near the upper contacts of both Granite IIA
and Granite IIB.


Two separate phases of Granite II have been identified, the Granite IIA phase (granular
porphyritic zone) cut by a younger fine-grained granular phase called Granite IIB. Granite
IIA is located in the upper part of the breccia pipe. Granite IIB occupies the well-defined
protrusions or cupolas in the lower part of the pipe, its contact defined by the formation of
comb quartz layers (see Figure 5). Indium-bearing tin-base metal zones in the North Zone are
associated primarily with the Granite IIB. Granite IIB is underlain and cut by Granite III, the
third and youngest granite, which was emplaced under relatively quiescent conditions and
does not contain any significant mineralization. The contact between these two intrusive
units is marked by chill zones, aplitic layers or, in some cases, by zones of USTs, either
comb-quartz layers or dendritic unidirectional feldspar crystal layers, another type of UST
(Lac Minerals Limited, 1988).


Granite III is generally relatively fresh, massive and slightly coarser grained than Granites I
and II. It extends to the south and is most likely continuous with the porphyritic granite that
underlies the Fire Tower Zone (see Figure 5). To date, no significant “mineral resource” has
been identified within this unit but it has not yet been fully explored (Akerley, 1996;
Piskahegan Resources Limited, 1995; ADEX Mining Corp., 1995).




                                           - 41 -
                                                                       Watts, Griffis and McOuat

Hornet Hill


Hornet Hill is located around 1.5 km west of the North Zone and is a pronounced topographic
feature peaking at 180 m above sea level (see Figure 4). The hill is outlined as a distinct
radiometric anomaly and is composed of argillaceous metasediments underlain by
Mississippian chloritized, silicified and topaz-bearing porphyry which are intruded by a fine-
grained porphyritic granite at depth (Parrish and Tully, 1976; Billiton Canada Ltd., 1985b).
Drilling has not intersected any significant fault structures.




                                              - 42 -
                                                                       Watts, Griffis and McOuat

                                   8. DEPOSIT TYPES



8.1            GENERAL


The mineral deposits of Mount Pleasant are unique as they are the largest known tin-tungsten-
bismuth occurrences in the Canadian Appalachian (Parrish and Tully, 1978). Furthermore,
they are prime examples of a combined porphyry-tungsten and porphyry-tin deposits hosted
within Devonian age volcanic rocks that are not noted for such mineral deposits.           A
description of the deposit types is provided below focussing on tungsten, molybdenum, tin-
base metal porphyry deposits at Mount Pleasant, which have been the principal exploration
target since the 1930s.


The North Zone tin deposits have marked similarities to many of the world tin porphyry
deposits. However, at the time of the discovery of the tin-base metal mineralization by
Brunswick Tin Mines in 1967, it was difficult to establish a geological model for the
mineralization as similar deposits were not known in New Brunswick or elsewhere in Canada.
Comparisons were made with hypothermal-type orebodies, those of Cornwall, England, or
xenothermal-type Bolivian deposits (Kooiman, 2004). It was determined that the tin-bearing
lodes within the North Zone had characteristics similar to some of the Cornish tin lodes
(Kooiman et al., 1986: Kvaerner Metals Davy Ltd., 1997).


Hosking (1985) concluded that the North Zone tin deposits were similar in a broad geological
setting to Bolivian porphyry deposits, excluding the very rich tin lodes, which are
characteristic of the Bolivian deposits. He explained that the exo- and endo-tin deposits
associated with the apices of granitoid cusps were common and well-documented with
examples occurring at Sadisdorf (Germany) and Zinnwald or Cinovec (Czechoslovakia),
Queensland and New South Wales, Eastern Mongolia and elsewhere.             Furthermore, he
suggested that the apex of a granitoid cusp, which has been emplaced in quartz-porphyry at
Zinnwald may broadly reflect what was presently indicated in the North Zone granite.
Hosking (1985) cautioned that it would be misleading to forecast likely tonnages and grades
for the North Zone by considering tonnages and grades of other deposits based on their
similarities to the North Zone.




                                           - 43 -
                                                                         Watts, Griffis and McOuat

The Contact mineralization within the North Zone has been compared to granite-related
greisen tin deposits such as such as Cinovec, Krupka and Krasno in Czechoslovakia and the
German Democratic Republic (Billiton Canada Ltd., 1985b). Average tin contents in the
strongly greisenized zones are of the order of 0.1-0.3% Sn. The Sn:W ratio varies from
1:1 (Krupka) to 5:1 (Krasno) and 10:1 (Cinovec).


8.2                PORPHYRY MOLYBDENUM-(±TUNGSTEN) DEPOSITS


Porphyry molybdenum (Mo) granite-related deposits demonstrating similar characteristics to
the Mount Pleasant porphyry-type deposits have been described in detail below (Sinclair,
1995). Sinclair modelled his discussion based mainly on descriptions of the Climax and
Climax-type deposits in Colorado. Porphyry Mo deposits have been a major source of world
molybdenum production. They form in rift zones in areas of thick cratonic crust, in collision
zones (especially in association with tungsten vein-type deposits) and occur as high-level to
subvolcanic felsic intrusive centres where multiple stages of intrusion are common. Both
tungsten and tin have been recovered from these deposits.


There are no Climax-type porphyry Mo deposits located in British Columbia or elsewhere in
Canada. In the United States, porphyry Mo deposits include Climax, Henderson, Mount
Emmons and Silver Creek (Colorado) and Pine Grove (Utah).             Internationally, deposits
include Questa (New Mexico), Malmbjerg (Greenland) and Nordli (Norway).


Deposits are typically shaped like an inverted cup or hemispherical shell and are typically
large, generally measuring hundreds of metres across and tens to hundreds of metres in
vertical extent.


Mineralization occurs as stockworks of molybdenite-(±tungsten, tin)-bearing quartz veinlets
and fractures in highly evolved felsic intrusive rocks and associated country rocks. Deposits
are low grade but large and often amenable to bulk mining methods.             The age of the
mineralization is Paleozoic to Tertiary, but mainly Tertiary. Mineralized country rocks may
include sedimentary, metamorphic, volcanic and older intrusive rocks.           Tuffs or other
extrusive volcanic rocks may be associated with deposits related to subvolcanic intrusions.
The economic-type mineralogy, mostly molybdenite with smaller amounts of wolframite,
cassiterite, sphalerite and galena, is structurally controlled by the stockworks of crosscutting
fractures and quartz veins. Disseminations and replacements are less common. Gangue



                                            - 44 -
                                                                          Watts, Griffis and McOuat

minerals consist of quartz, pyrite, topaz, fluorite and rhodochrosite.      Multiple stages of
mineralization are commonly present and abundant quartz layers and other USTs characterize
productive intrusions.


Potassic alteration (K-feldspar ±biotite) is directly associated with high-grade Mo
(>0.2% Mo). Silicification (quartz and magnetite) can occur locally in the lower parts of
high-grade molybdenum zones. Quartz-sericite-pyrite alteration may extend hundreds of
metres vertically above the orebodies. Argillic alteration may extend hundreds of metres
beyond the quartz-sericite-pyrite alteration (both vertically and laterally).        Propylitic
alteration is widespread and may extend for several kilometres.


The genetic model for such deposits is magmatic-hydrothermal. Large volumes of magmatic,
highly saline aqueous fluids under pressure strip molybdenum and other ore metals from the
magma. Multiple stages of brecciation related to explosive fluid pressure release from upper
parts of the magma chambers resulting in deposition of ore and gangue minerals in
crosscutting fractures, veinlets and breccias in the outer carapace of the intrusions and
associated country rocks. Interaction of the magmatic-hydrothermal fluids with meteoritic
waters can result in late-stage alteration (a non ore-forming process).


Associated deposit types consist of silver-base metal veins, fluorspar deposits, some porphyry
tungsten-molybdenum deposits such as Mount Pleasant and Logtung (Yukon). Geochemical
signature elements may be anomalous concentrations of Mo, Sn, W, Rb, Mn, F and U in the
wallrocks. Stream sediment samples nearby may contain anomalous concentrations of Mo,
Sn, W, F, Cu, Pb and Zn. Geophysically, the related intrusions may be represented as
magnetic lows and radiometric surveys may be utilized to define anomalous U, Th or K in
association with altered and mineralized zones.


8.3            PORPHYRY TIN-(±INDIUM) DEPOSITS


Porphyry tin deposits have been described in detail below by Sinclair (1995b).           These
deposits form along extension zones in cratons, particularly post-orogenic zones, underlain by
thick crust, possibly cut by shallow-dipping subduction zones. In addition to tin, these
deposits can also contain tungsten, silver and indium (as at Mount Pleasant).




                                            - 45 -
                                                                          Watts, Griffis and McOuat

In Canada, deposits have been found at Mount Pleasant and East Kemptville (Nova Scotia).
When East Kemptville was in production it was the major producer of tin in North America.
Deposits discovered outside Canada include Catavi, Chorolque and Cerro Rico stock
(Bolivia), Ardlethan and Taronga (Australia), Kingan (Russia), Yinyan (China) and Altenberg
(Germany).


Porphyry deposits are commonly related to intrusive rocks and associated breccias but may
also include sedimentary, volcanic, igneous and metamorphic rocks. Tuffs or other extrusive
volcanic rocks may be associated with the deposits related to subvolcanic intrusions. These
deposits occur in high-level to subvolcanic felsic intrusive centres in cratons where multiple
stages of intrusive rock may be present.


Deposits vary in shape from an inverted cone to roughly cylindrical to highly irregular. They
are typically large, generally hundreds of metres across and tens to hundreds of metres in
vertical extent.


The age of mineralization is the same as the porphyry Mo deposits, Paleozoic to Tertiary. Tin
occurs principally in cassiterite with other ore minerals such as stannite, chalcopyrite,
sphalerite and galena. Indium can also occur within the sphalerite as observed at Mount
Pleasant. Common gangue minerals consist of pyrite, arsenopyrite, löllingite, topaz, fluorite,
tourmaline, muscovite, zinnwaldite and lepidolite. Mineralization is structurally controlled in
stockworks within crosscutting fractures and quartz veinlets or disseminated in hydrothermal
breccia zones. Mineralization is genetically related to felsic intrusions (i.e., granites), with
ore minerals concentrated in fracture stockworks, hydrothermal breccias and replacement
zones.


Sericite-pyrite-tourmaline alteration is pervasive in Bolivian porphyry tin deposits where
sericitic alteration is bordered by weak propylitic alteration. Greisen alteration, consisting of
quartz-topaz-sericite, commonly occupies the central zones of deposits (i.e., Ardlethan,
Yinyan). These zones grade outward to quartz-sericite-chlorite alteration.


As with the porphyry Mo, tin deposits have a magmatic-hydrothermal origin with the same
genetic model (discussed above). However, in the case of tin deposition, the mixing of
magmatic fluids with meteoric water may result in the deposition of some tin and other metals
in late-stage veins.



                                            - 46 -
                                                                          Watts, Griffis and McOuat


In exploring for tin porphyry deposits the host rocks may be anomalously high in Sn, Ag, W,
Cu, Zn, As, Pb, Rb, Li, F, and B close to the mineralized zones and in secondary dispersion
halos in overburden. Anomalous high concentrations of Sn, W, F, Cu, Pb and Zn have been
found in stream sediments.       Deposits generally occur in related intrusions, which are
geophysically represented as magnetic lows although the contact aureole may be a magnetic
high if pyrrhotite or magnetite are present. Anomalous U, Th or K can produce a radiometric
high in response to the related intrusive rocks, alteration and mineralized zones.




                                            - 47 -
                                                                          Watts, Griffis and McOuat

                                    9. MINERALIZATION



9.1             GENERAL


A number of well-documented mineralized zones have been identified at Mount Pleasant.
These zones, from south to north, have been designated as the Fire Tower Zone, Scotia Zone,
Saddle Zone and the North Zone. A schematic cross-section of Mount Pleasant showing the
locations of the zones is illustrated in Figure 5. At this time, the main deposits of interest are
located within the Fire Tower Zone and North Zone located approximately 1.0 km apart.
Each of the deposits occurs within 400 m from surface.


The Fire Tower Zone contains predominantly large (low grade) tungsten-molybdenum
deposits and was previously mined for tungsten. Some small indium-bearing tin-base metal
zones are also present.


Very little information is available regarding the characteristics of the tungsten and
molybdenum mineralization contained within the Scotia Zone, which is located in the
northern portion of the Fire Tower Zone.


The North Zone contains the most important indium-bearing, tin-base metal “resources”
outlined to date along with some poorly defined low-grade tungsten-molybdenum bodies
(ADEX Mining Corp., 1995). The Saddle Zone, located between the Fire Tower Zone and
the North Zone, contains mineralized zones with predominantly tin and some base metals. No
detailed assessment has been made of the “mineral resources” in this area, including their
potential for indium. (Sinclair et al, 2005).


9.2             FIRE TOWER ZONE


The Fire Tower Zone is a tungsten-molybdenum deposit that contains three distinct zones,
which have been named:


•     Fire Tower North;
•     Fire Tower West; and,
•     Fire Tower South.



                                                - 48 -
                                                                           Watts, Griffis and McOuat

Younger indium-bearing, tin-base metal mineralization has been superimposed over portions
of the tungsten-molybdenum deposits.        The mineralogical characteristics of each of the
different deposit types occurring within the Fire Tower Zone are described below.


WGM has prepared a Mineral Resource estimate for the Fire Tower West and Fire Tower
North portions of the overall Fire Tower Zone, as described in Section 17 of the report. For
the purposes of the estimates these two portions are referred to collectively as the Fire Tower
Zone.


9.2.1          FIRE TOWER ZONE TUNGSTEN-MOLYBDENUM DEPOSITS


Tungsten-molybdenum deposits in the Fire Tower Zone mainly occur in the lower part of the
breccia pipe and the upper part of the underlying fine-grained granite, and to a lesser extent in
associated volcanic rocks (Kooiman et al, 2005). These low-grade porphyry-type deposits are
characterized by extensive stockworks of mineralized fractures and quartz veinlets. Higher
grade zones occurring in areas of intense fracturing measure 200 to 300 m across and as much
as 100 m in vertical extent. The high-grade zones are surrounded by lower-grade zones are
characterized by more widely spaced fractures that extend for hundreds of metres into the
surrounding rocks. Remobilization of mineralization or reactivation of mineralizing fluids are
seen as the causes of the higher-grade mineralization in more intensely altered and brecciated
locations.


The Fire Tower Fault transects the Fire Tower Zone and has been intersected in the 400
exploration decline (see Figure 5). This steeply-dipping fault displaces Fire Tower North
150 m from Fire Tower West. The Fire Tower North deposit is terminated to the east by a
northerly trending fault.


Mineralization occurs as veinlets and disseminated grains in breccias mainly located within
the Mount Pleasant porphyry.       The principal “economic-type” minerals are fine-grained
wolframite and molybdenite, along with minor amounts of native bismuth and bismuthinite.
The gangue minerals consist of cassiterite, arsenopyrite, löllingite, quartz, topaz and fluorite.


Intense greisen-type alteration (quartz-topaz-fluorite) is associated with higher-grade
tungsten-molybdenum zones. Lower-grade zones are surrounded by an alteration assemblage




                                             - 49 -
                                                                         Watts, Griffis and McOuat

of quartz+biotite+chlorite+fluorite.    Chlorite-sericite propylitic alteration extends for
hundreds of metres beyond the mineralized zones until grading into unaltered rock.


According to Kooiman et al. (2005), the tungsten-molybdenum deposits appear to be related
to the emplacement of fine-grained granite.         Multi-stage mineralization is indicated by
crosscutting relationships between mineralized fractures and veinlets. Sparse molybdenum-
bearing fractures in fine-grained granite appear to represent the final stage of mineralization
associated with crystallization of this granite. Finally, the tungsten-molybdenum deposits
appear to predate crosscutting dykes of unmineralized granite porphyry that truncate
mineralized stockwork zones.


Fire Tower West Deposit


The Fire Tower West deposit lies within the Mount Pleasant porphyry near the contact with
the quartz-feldspar porphyry (“QPF”) and measures approximately 150 m long by 60 m wide
by 150 m thick (ADEX Mining Inc., 1995). Mineralization has invaded the QFP to a limited
extent. High-grade mineralization consists of irregular blobs, patches and disseminations,
fracture fillings and coatings. This deposit is generally oval shaped in cross-section and
extends upwards from elevation 950 m to 1,100 m with narrower mineralized shoots
extending further above in some sections. To the north, the zone narrows to around 20 m at
the Fire Tower Fault. The upper mining limit of this deposit was 200 to 250 m below the
surface of Mount Pleasant. A total of 270 m of underground decline and crosscut
development has been completed in this deposit. Diamond drilling to date indicates that the
deposit does not appear to continue to depth.


Fire Tower North Deposit


The Fire Tower North deposit is a near-vertically dipping deposit situated along the contact
between the Mount Pleasant porphyry and the feldspar porphyry (ADEX Mining Inc., 1995).
It exhibits an arcuate shape measuring around 15 m wide by 370 m long by 150 m thick. A
series of faults striking north-northwest and south-southwest cuts the central portion of the
deposit. This deposit is the continuation of Fire Tower West (displaced across the easterly
trending Fire Tower Fault).     In total, some 92 m of underground decline and crosscut
development has been completed in this deposit. The upper mining limit of this deposit was
200 to 250 m below the surface of Mount Pleasant. There is a pronounced tungsten zoning



                                           - 50 -
                                                                        Watts, Griffis and McOuat

with the highest grade values located in the core of the zone, in association with the highest
grade molybdenum. Bismuth grades are higher than those observed in Fire Tower West over
the entire vertical range of the deposit. Zinc concentrations are uniformly higher in the upper
levels of the deposit. Arsenic concentrations are also significantly higher in the Fire Tower
North deposit than the Fire Tower West deposit.


Fire Tower South Deposit


The Fire Tower South deposit is poorly defined and has been inferred from surface mapping
and sampling (ADEX Mining Inc., 1995). The mineralization of this deposit has not been
specifically described in detail in previous geological reports.


9.2.2             FIRE TOWER ZONE INDIUM-BEARING TIN-BASE METAL DEPOSITS


The characteristics of the indium-bearing tin-base metal deposits hosted within the Fire
Tower Zone have been best described by Kooiman et al. (2005). These deposits occur as
irregular veins and mineralized breccias that are irregularly distributed throughout the Fire
Tower Zone and are associated with altered and mineralized granite porphyry dykes.
Throughout the Fire Tower Zone, the tin-base metal deposits either crosscut or truncate
tungsten-molybdenum stockworks. In general, veins range from 1 to 2 cm in width and up to
several metres in strike length. Occasionally, larger veins up to 10 m in width and 100 m
long can occur. Veins pinch and swell along strike and contain abundant chlorite and fluorite
and disseminated massive sulphides. The Fire Tower Zone contains one tin lode, called the
No. 7 tin lode.


Mineralized breccias are irregular bodies and occur as small vertical circular pipes up to 10 m
wide and 100 m in vertical extent. These breccias can contain fine-grained sulphides and
cassiterite as well as chlorite and fluorite.


The indium-bearing tin-base metal veins and breccias contain the principal oxide minerals
cassiterite and wolframite.         Sulphide mineralization consists mainly of sphalerite,
chalcopyrite, galena and arsenopyrite and minor amounts of pyrite, löllingite, molybdenite,
tennantite, native bismuth and bismuthinite.




                                                - 51 -
                                                                          Watts, Griffis and McOuat

9.3            SCOTIA ZONE


The Scotia Zone, discovered during the 1995 drilling, is characterized as a multiple zone of
sulphide veins and replacement bodies hosted by Granite IIA, draped over the contact of
Granite III, between 300 m and 400 m below surface below and adjacent to the tungsten-
molybdenum Fire Tower North deposit (Akerley, 1996).               According to Akerley, the
geological continuity of this zone is uncertain but it appears to be open to the north and west
while its greatest potential appears to be east. The southern continuation of the tin sulphide
mineralization is expected to occur 150 m west and within 150 m from surface.


9.4            SADDLE ZONE


Tin-base metal mineralization of the Saddle Zone was discovered during the 1988 surface
drill program following tin zones that were encountered during underground development
between the Fire Tower Zone and the North Zone, see Figure 5 (ADEX Mining Corp., 1995;
Sinclair, 1994). The geology of the Saddle Zone is structurally similar to the Contact Zone
and Endogranitic Zone and the sulphide content is generally low. Tin occurs mainly as
cassiterite and as individual grains and this metal’s distribution is irregular with preliminary
exploration grades of 1.0% Sn to as high as 1.3% Sn (over a drill intersection of around
3.0 m) and about 30 ppm indium (ADEX Mining Corp., 1995). Only small amounts of W,
Mo and Bi are present.


The Saddle Zone contains evidence of at least four stages of alteration/mineralization related
to the formation of the tin-base metal zones, which have been described in detail below by
Sinclair (1994):


Stage 1 – pervasive sericitic and crosscutting weak fracture-controlled chloritic alteration of
Granite II. There was no significant mineralization during this stage.


Stage 2 – superimposed later stage silicic and greisen-type alteration (quartz, topaz, minor tin).


Stage 3 – massive chlorite-biotite within Granite IIA. Most of the tin in the Saddle Zone
occurs in the chlorite-biotite zone. This zone is subhorizontal (5-15 m thick) and is semi-
conformable with the upper contact of the host Granite IIA. It is massive, fine-grained
chlorite with variable amount of fluorite, iron-rich biotite and topaz (locally, minor almandine



                                             - 52 -
                                                                          Watts, Griffis and McOuat

garnet and magnetite). This chlorite-biotite zone is intensely altered, sulphide content is low
and, apart from tin, other metals are low. Tin occurs mostly as cassiterite (and in sulphides
such as stannite and kesterite) as individual disseminated grains and in larger fine-grained
clusters. The tin-base metal veins surrounding the massive chlorite-mica zone vary from one
centimetre to several metres wide, are typically sulphide-rich with abundant sphalerite,
chalcopyrite and galena. Fluorite and chlorite are also major constituents.


Stage 4 – late clay and related alteration with minor tin sulphides deposition.


According to Sinclair, there are also some tin-base metal veins in Granite IIB, peripheral to
the chlorite-biotite zone in Granite IIA. Only a few small, erratic tin-base metal zones are
present in Granite III.


9.5             NORTH ZONE


The North Zone is often polymetallic with tungsten, molybdenum, zinc, copper and other
metals accompanying the tin. However, the zone is predominantly tin-bearing, containing six
distinct tin-lodes described as leakages from deeper-seated mineralization located within
100 m from surface (Gowdy, 1995). Tin-lodes occur adjacent to dykes.


A number of more massive tin deposits occur at depth and have been designated as follows
(Figure 6):


•     The Deep Tin Zone;
•     Contact and contact Crest Deposits;
•     Contact Flank Deposit; and,
•     The Endogranitic Zone (Upper and Lower).


It is important to note that although the Deep Tin Zone actually occurs in the North Zone,
some authors describe the deposits within the North Zone as “the North Zone and Deep Tin
Zone”. In this instance, the North Zone includes the Contact, Crest and Flank deposits, the
Endogranitic Zone and the tin-lodes. The Deep Tin Zone is the shallowest of all the other tin-
bearing deposits in the North Zone with the exception of the tin-lodes.




                                            - 53 -
                                                                          Watts, Griffis and McOuat

The larger tin-base metal deposits occur at depths of 200 to 400 m, along the contact of
Granite I or within Granite II.         Contact bodies locally flank the granitoid cusp and its
protuberances and also the crest of the cusp (Sinclair, 1994). The Deep Tin Zone is an
irregularly-shaped body hosted by brecciated Granite I.


Host rocks are often brecciated and altered to a fine-grained, greisen-type assemblage of
quartz, sericite, topaz and fluorite.


The principal mineralogy of the deposits consists of fine- to very fine-grained cassiterite,
arsenopyrite, löllingite, sphalerite and chalcopyrite with lesser amounts of stannite, pyrite,
marcasite, galena, wolframite, molybdenite, tennantite, chalcocite, bornite, native bismuth,
bismuthinite and wittichenite.      Other associated minerals include abundant fluorite and
chlorite (Kooiman et al, 2005).


Many of the North Zone deposits contain significant amounts of indium in association with
elevated sphalerite (Sinclair et al, 2005). Indium-bearing tin-base metal zones in the North
Zone appear to be principally associated with sphalerite and are more concentrated in the
Deep Tin Zone.


The tin and porphyry tungsten-molybdenite deposits of the North Zone represent two
different periods of mineralization even though they overlap spatially. Tin mineralization in
the North Zone is younger than the Fire Tower Zone and crosscuts the older molybdenum-
tungsten zones. The tungsten and molybdenum zones at the North Zone roughly occupy the
same vertical position as the same mineralization in the Fire Tower Zone.


9.5.1           NORTH ZONE TIN-BASE METAL-INDIUM DEPOSITS


Contact, Crest, Flank and Endogranitic Deposits


The Contact, contact Crest and contact Flank deposits occur in breccias and other associated
host rocks at the upper contact or along the flanks and in the adjacent troughs of the Granite
IIB cupola whereas the Endogranitic Zone occurs within Granite II (see Figure 6).


In each of these deposits, cassiterite occurs as finely disseminated grains and as fine- to
medium-sized grains in veins or veinlets and along fractures. Associated minerals include



                                               - 55 -
                                                                        Watts, Griffis and McOuat

arsenopyrite, löllingite, sphalerite, chalcopyrite, pyrite and pyrrhotite.   Chlorite, fluorite,
quartz, topaz and sericite are the main alteration minerals (Sinclair, 1994). The contact crest
deposit is superimposed on older porphyry tungsten-molybdenum mineralization (see
Figure 6).


The contact Crest deposit is situated below the Deep Tin Zone along the upper contact and
sides of Granite IIB (see Figure 6).    The host rock is mainly Granite IIA and breccia.
Mineralization is similar to the Deep Tin Zone with respect to the principal economic-type
minerals and their modes of occurrence. Indium averages 45 g/t (Kooiman et al, 2005).


This deposit contains abundant quartz, chlorite, fluorite, topaz and occurs with disseminated
to massive sulphide and oxide minerals (Lac Minerals Ltd., 1988). Cassiterite occurs as fine-
grained crystals in chloritic zones mostly, in fluorite rich replacement veins, veinlets and in
the breccia matrix.


The contact Flank deposit is located below the Deep Tin Zone along the upper contact and
sides of Granite IIB (see Figure 6). The host rock is mainly Granite IIA and Breccia.


Mineralization is similar to the Deep Tin Zone with respect to the principal economic-type
minerals and their modes of occurrence. Indium averages 45 g/t (Kooiman et al, 2005).


In 1988, drilling determined that the contact Flank deposit has a strike length of over 200 m,
is 3 to 40 m wide and has a vertical extent of up to 70 m. According to Lac Minerals Ltd.
(1988), the best mineralization is accumulated in the area were the steeply-dipping Granite
I/Granite II contact flattens considerably forming an embayment, which may have acted as a
trap for the mineralization. Most of the cassiterite is concentrated in pods, veins and breccia
matrix. There is a higher percentage of coarser cassiterite, arsenopyrite and sphalerite in the
contact Flank deposit than in the Endogranitic Zone.


In 1988, the Endogranitic (“Endo”) was thought to be one large deposit measuring 225 m
from northwest to southeast with a vertical extent, in the central part of the zone, of over
200 m (Lac Minerals Ltd., 1988). The zone was between 3 and 45 m thick, flat lying to
gently dipping in the southeast to steeply dipping in the central and northern part. However,
extensive drilling in the North Zone has since divided the Endogranitic Zone into the Upper
Endogranitic Zone and Lower Endogranitic Zone, which may be controlled by depth of



                                           - 56 -
                                                                             Watts, Griffis and McOuat

crystallization within the granitic porphyry body (see Figure 6). Furthermore, it is now
apparent that the zone has inconsistent dips locally, dipping steeper at around 61ο in the
southwest to northeast direction (Redpath Mining Consultants Limited, 1995). This zone is
the most continuous tin-base metal mineralized body in the North Zone.                   A detailed
description of the Endogranitic Zone has been summarized below from Kooiman et al (2005).


The Endogranitic deposit is the largest and deepest of the tin-base metal-indium deposits in
the North Zone. It is an irregularly shaped, subhorizontal to steeply dipping, roughly tabular
deposit hosted almost entirely in Granite IIB. It also extends locally into adjacent volcanic
and sedimentary rocks. Five stages of greisen-style alteration consist of pervasive sericitic
alteration of the host rocks, crosscutting fracture-controlled chloritic alteration, quartz-topaz
alteration, chlorite-biotite alteration and finally (last stage) clay alteration of mainly kaolinite.
Significant tin and base metal mineralization is associated with the third and fourth stage of
alteration where alteration envelopes are up to several centimetres in width.


Third-stage mineralization consists of cassiterite, arsenopyrite, and fluorite, and minor
amounts of sphalerite, stannite, chalcopyrite, bismuthinite, chalcocite, pyrite, covellite and
roquesite occurring in veinlets, along hairline fractures and as disseminated grains in the
altered wallrocks. Mineralization accompanying the fourth stage of alteration consists of
topaz, coarse fluorite and irregular zones of disseminated fine-grained cassiterite. Other
minerals present in minor amounts as disseminated grains and small clusters include
arsenopyrite, löllingite, sphalerite, chalcopyrite, galena, native bismuth, bismuthinite,
wolframite, molybdenite, pyrite, and magnetite. This zone is primarily a tin deposit. Indium
content averages 45 g/t.


Tin Lode Deposits


Six distinct tin lodes have been identified in the North Zone in association with granite
porphyry dykes, with hydrothermal breccia or altered feldspar porphyry (Kvaerner Metals
Davy Ltd., 1997). ADEX Mining Corp. (1995) describes these lodes as leakages from a
deeper-seated mineralization that extend from surface to a depth of around 100 m (see
Figure 6).


The shallow tin lodes contain very fine-grained cassiterite and lesser amounts of stannite and
are associated with arsenopyrite, löllingite, sphalerite and chalcopyrite (Sinclair, 1994). Less


                                              - 57 -
                                                                        Watts, Griffis and McOuat

abundant sulphides include molybdenite, pyrite, marcasite, galena, bornite, tennantite,
bismuthinite, wittichenite and roquesite.


Quartz, fluorite, topaz and chlorite are the principal alteration minerals in association with
greisenized feldspar porphyry.


North Zone Tungsten-Molybdenum Deposits


The characteristics of the North Zone tungsten-molybdenum deposits have been described
below by Kooiman et al (2005), Kvaerner Metals Davy Ltd. (1997) and Parrish and Tully
(1978). They occur as discontinuous bodies that form a ring-shaped zone hosted mainly in
the North Zone Granite I and breccias and to a lesser extent in underlying brecciated Granite I
(granite porphyry dykes and feldspar porphyry, see Figure 6).


These deposits are similar to but smaller than those in the Fire Tower Zone, are less well-
developed and are lower grade. Tin content of these deposits reflect the superposition of the
younger tin-base metal mineralization on the tungsten-molybdenum deposits. Indium content
is low (typically 1 ppm In or less) in tungsten-molybdenum deposits not overprinted by the
tin-base metal mineralization.


Wolframite, molybdenite, bismuth and bismuthinite are the principal economic-type minerals
associated with host rocks, which are altered to a fine-grained assemblage of quartz, topaz,
fluorite and sericite.


9.6             HORNET HILL


Hornet Hill is located around 1 km west of the North Zone and has been drill tested. This hill
is underlain by fine-grained porphyritic granite that is pervasively chloritized and silicified
and is similar in appearance to the granite porphyry of the North Zone. The granite contains
veins with minor amounts of cassiterite in association with sphalerite-pyrite-chlorite veining.
It is the similarity in geological setting and its close proximity to the North Zone that has
made Hornet Hill an interesting exploration target (Billiton Canada Ltd., 1985b).




                                            - 58 -
                                                                       Watts, Griffis and McOuat

9.7            URANIUM AND GOLD MINERALIZATION – MOUNT PLEASANT
               REGION


Since 1937, exploration work in the Mount Pleasant region has focused on tungsten,
molybdenum, tin-indium and base metal mineralization. However, the region does host
several uranium and gold occurrences, some of which are described below (McLeod, 1990).


Exploration for fracture-controlled uranium occurrences was prevalent in the region from
1960 to the 1981. Uranium exploration focused in the Utopia Granite near Lily Lake, near
Trout Lake in the Mount Douglas Granite and around Sand Brook Mountain in the Mount
Douglas and Magaguadavic granites.


Since 1985, gold exploration in the general Mount Pleasant area (not on the ADEX property),
has been focused in and near the contact aureole of the Saint George Batholith, along the
northwest contact of the batholith in the South Oromocto Lake-Three Bridge Brook area and
near the eastern contact of the batholith in the Nerepis area.


Gold occurs in quartz veins associated with arsenopyrite, pyrite, pyrrhotite, chalcopyrite and
sphalerite along the northwestern contact. At the Three Bridge Brook area, 100 m northwest
of the Mount Douglas Granite contact, anomalous gold (values not defined) associated with
silver, zinc and highly anomalous bismuth were discovered. South of Three Bridge Brook, a
massive sulphide vein within the granite contained lead, zinc, silver and gold. This vein
extended 1,500 m along strike in the granite parallel to the granite contact. In the Nerepis
area, gold and base metals are associated with interbedded sericitic and locally silicified
metavolcanic and metasedimentary rocks of possible Cambrian age.


Numerous, significant exogranitic gold and/or polymetallic vein deposits are found in
association with the South Oromocto Lake Intrusive Suite. Heat generated by this suite also
served to remobilize and concentrate gold and polymetallic deposits near granite-country rock
contacts.




                                             - 59 -
                                                                         Watts, Griffis and McOuat

                                    10. EXPLORATION



In early December 1994, discussions begun between Piskahegan and ADEX leading to an
agreement whereby ADEX purchased all the shares of Piskahegan on June 21, 1995. In
January 1996, the name “Piskahegan Resources Limited” was changed to ADEX Minerals
Corp., a 100% owned subsidiary of ADEX.                ADEX continued Piskahegan’s work with
emphasis on locating small but high-grade sulphide-indium rich bodies for direct bioleaching
to be processed at a rate of 500 tons per day (Kooiman, 2004).


According to Kooiman (2004), a well-mineralized breccia pipe was discovered on Fire Tower
hill while bulldozing a road towards the collar of drillhole MPS 127. It measured around
10 m in diameter and composite samples averaged 5.4% Zn, 1.8% Cu, 1.5% Sn and 0.03% In.
This breccia pipe was intersected by drillhole MPS 127 from 8 to 15 m below surface. The
intersection assayed 4.48% Zn, 2.98% Cu and 2.5% Sn. No indium assays are available for
the intersection.


Gowdy (1995) visited the Mount Pleasant property in late March 1995, and held discussions
with geologists at the mine, including the economics of the project, environmental permitting,
mining and milling and the bioleach process and personnel and prepared a report for ADEX.
He reviewed the status of the computer database with a representative of the Department of
Natural Resources and Energy of New Brunswick. An examination of the indium analytical
data resulted in the following conclusions:


•   There was no correlation of indium with tin values;
•   Indium appeared to be higher when associated with zinc;
•   Indium appeared predominately as a sulphide and will report to a sulphide flotation
    circuit;
•   Indium, when tied up as an oxide, will more likely pass through the mill system entirely
    and go to the tailings;
•   1-2% of the indium of the entire Mount Pleasant mine is estimated to be in an oxide form; and
•   More indium will be associated with oxides in the deeper tin zones (Endogranitic Zone
    and Contact deposits).




                                              - 60 -
                                                                        Watts, Griffis and McOuat

He also suggested that the sulphide concentrate pond could be used as a potential source of
cash flow for future exploration and development work (see Section 17, Mineral Resource and
Mineral Reserve Estimates). The state of the computerized database of all drillhole data and
assays were also examined. He concluded that most of the data were not in ideal condition
and that further clean-up work was required.         Gowdy also reviewed ADEX’s proposed
exploration program of the Saddle Zone.


In June 1995, a 30-tonne bulk sample was collected from the 600 and 900 adit dumps for
bioleach metallurgical testing at RPC.       In August, a 1.0-tonne high-grade sample was
collected from the 600 adit dump for additional bioleach testing.


During 1995, two site visits were made by senior management of the Indium Corporation of
America to discuss progress on indium exploration and recovery programs (Kooiman, 2004).
In the following years they made other visits to the property.


According to Kooiman (2004), officials of the Malaysian Smelting Corp. visited Mount
Pleasant in March 1996. On April 25, 1996, a deal was announced that the Malaysians would
fund up to $2.0 million for a feasibility study but wanted to maximize tin output, which
required a throughput of 2,500 tonnes per day.


In June 1996, ADEX retained Kvaerner to prepare a feasibility study focusing on the
prospects of mining tin and indium from the North and Deep Tin Zones (see Section 16,
Mineral Processing and Metallurgical Testing). A 3,231 m drill program was undertaken to
assist in the calculation of a “resource” estimate for the North Zone and especially the Deep
Tin Zone (Kvaerner Metals Davy Ltd., 1997). A “probable resource” estimate was calculated
giving a life-of-mine of only 4 years (see Section 17, Mineral Resource and Mineral Reserve
Estimates). The Kvaerner study found that the net present value and the internal rate of return
were negative (ADEX Mining Inc., 1995).


The majority of all the drill information covering surface and underground holes was
computerized between 1995 and 1997 using GEMCOM software. A few hundred additional
diamond drill core sample pulps were selected in 1997 for indium analyses in the Deep Tin
Zone. “Reserve” calculations were carried out by ADEX on the Upper Deep Tin Zone and
smaller bodies such as the near-surface # 4 tin lode.




                                            - 61 -
                                                                      Watts, Griffis and McOuat

By March 1997, it became evident that no positive feasibility study could be achieved.
Kvaerner’s feasibility study was not formally completed and was not paid for but a copy was
turned over to ADEX. In retrospect, the 2,500 tonne per day scenario may have been over-
ambitious (Kooiman, 2004).


All geological work ceased by February 1998, and the property has essentially been dormant
since. According to Kooiman (2004), there was an attempt in 1999 by a small group of
metallurgical consultants called Mineral Chemicals Inc. to revive the 500 tonne per day
option of mining higher-grade bodies, however, nothing developed.


Mount Pleasant was in the news again after its tailing dam was breached by severe flooding in
early March 1998. Repairs to the dam were carried out immediately.


In 2001, ADEX supplied CANMET in Ottawa with an 800 kg sample made up of material
from the Fire Tower Zone, 600 adit dump and material in storage in the “A-Frame” building
to develop a new indium reference standard for the laboratory (see Section 16, Mineral
Processing and Metallurgical Testing).


Indium prices rose in 2004, resulting in renewed interest from other companies to enter into
an agreement with ADEX to acquire the property. However, no financial partners were
secured.


In the fall of 2005, ADEX provided WGM with a four page document summarizing their
thoughts on the exploration potential at Mount Pleasant (Kooiman, 2005). A copy of this
document is located in Appendix 3.


Late in 2005, ADEX gathered grab samples from five of the barrels of Fire Tower Zone bulk-
sample material mentioned in Section 6.3.3. The five samples were subjected to multi-
element ICP analysis. They averaged 0.35% WO3, 0.26% MoS2, similar values to those
reported for “mineral resources” at mine closure.


In March 2006, 182 samples of unsplit drill core from four holes named B104, B114, B169
and PRL95-02, found to have intersected the FTZ, were obtained and subjected to multi-
element ICP analysis. These results were then entered into the database used to prepare the
FTZ Mineral Resource estimate.       In addition, 19 samples of pulps saved from a 1995



                                           - 62 -
                                                                     Watts, Griffis and McOuat

sampling program of the bulk sulphide concentrate test material left over from the MPT
mining production were subjected to multi-element ICP analysis plus gold. The re-analysis
showed the material contained significantly anomalous Mo, Zn, Pb, Bi and As. In addition
the samples returned Au values from 30 – 723 ppb and Ag values from 12 – 46 ppm. Two
samples from these pulps plus two from the five samples of the Fire Tower Zone bulk sample
material were also tested for PGEs plus Rhenium. The results were not anomalous.




                                         - 63 -
                                                                          Watts, Griffis and McOuat

                                         11. DRILLING



11.1            GENERAL


Since 1955, at least a dozen drilling campaigns have been completed to explore and develop
the Mount Pleasant property. Over the last 50 years, 1,330 drillholes totalling 158,561 m
have been drilled. The breakdown of these numbers consists of 484 surface holes totalling
97,727 m and 846 underground holes totalling 60,833 m (Table 3). These drill programs have
led to the discovery of the Fire Tower Zone tungsten and North Zone tin deposits as well as
exploring tin mineralization at Hornet Hill. The last drill program was completed by ADEX
in 1996.


Each of the drill programs has been described below. The collar locations for the minesite
drillholes have been tied into a mine survey grid. Surface drill collar locations have been
plotted on Figure 7 showing their location relative to the mineralized deposits and previous
mining infrastructure. All sample lengths reported represent lengths measured down core and
do not necessarily represent the true thickness of the mineralized zones as many of the zones
appear to be irregularly shaped, both vertically and horizontally. Underground fan-style
drillholes intersect the mineralised zones from different angles and directions giving rise to
apparent widths instead of true width intersections.


During each of the previous drill programs, the operators have experienced difficulty in
identifying the various rock types due to many of the rocks being strongly altered (chloritic
and silicified) and brecciated (Gowdy, 1995). However, re-examinations of the previous drill
core by Piskahegan and ADEX have allowed for standardization of the drillhole geology
classifications and identification of the different lithological units.


Most holes were inclined holes up to 1973 when vertical drilling became more common
place. The size of the drill core prior to the Sullivan Mining Group's takeover was AX
(Parrish and Tully, 1976). From 1969 to 1972 Sullivan and BTM continued to use A core and
AQ core. As of June 1972, BTM started to use BQ as they found that the BQ holes did not
deviate as much as AQ holes. Underground drilling conducted in the 600, 750 and 900 adits
was




                                              - 64 -
                                                                                                         Watts, Griffis and McOuat


                                                       TABLE 3
                         SUMMARY OF MOUNT PLEASANT DRILL PROGRAMS – SURFACE AND UNDERGROUND
  Year                     Company                   Zone            Drilling      Hole Numbers                        No. of   Metres
                                                                                                                       Holes    Drilled
  1955      Selco Exploration Ltd.              Fire Tower Zone                Surface                                   4       305

  1956      Kennco Explorations (Canada) Ltd.   Fire Tower Zone ?              Surface                                  10       191

  1960      Kennco Explorations (Canada) Ltd.   Fire Tower Zone                Surface                                  24       1,463
                                                Saddle Area
Gemcom Drillhole Database:
 1959-65   Mount Pleasant Mines Limited         Fire Tower Zone                Surface     DDH-1 to DDH-32              172     18,376
                                                North Zone                                 DDH34 - DDH128
                                                Deep Tin Zone                              DDH131A
                                                                                           DDH131 to DDH132
                                                                                           DDH133 to DDH161
                                                                                           DDH164 - DDH166
                                                                                           DDH500 - DDH501
                                                                                           DDH505 to DDH511

                                                                             Underground   U1 to U8, U10 to U17         180      7,712
                                                                                           U18A, U19 to U58, U50A
                                                                                           U60, U62, U64, U66
                                                                                           U68, U70, U75 to U76
                                                                                           U70, U75 to U76, U78
                                                                                           U80 to U88, U90 to U99
                                                                                           U90 to U99, U94S
                                                                                           U100 to U119
                                                                                           U120 to UU127
                                                                                           U129 to U195, U164A

1969-75     Brunswick Tin Mines                 Fire Tower Zone                Surface     MPS-1 to MPS-85              225     57,667
                                                                                           MPS90 to MPS106
                                                                                           MPS108 to MPS133
                                                                                           MPS135 to MPS207
                                                                                           MPS209
                                                                                           MPS214 to MPS223
                                                                                           MPS225 to MPS235

                                                North Zone                   Underground   D7-1 to D7-2, D7-3A          123      4,732
                                                (750 Adit)                                 D7-3B, D7-4 to D7-123

                                                Deep Tin Zone                Underground   D9-1 to D9-9                 34       1,035
                                                (900 Adit)                                 D9-10 to D9-33, D9-35

                                                Deep Tin Zone                Underground   A1 to A173                   173     14,752

1981-85     Mount Pleasant Tungsten Mine        Fire Tower Zone              Underground   B3 to B77, B79 to B132       172     14,478
                                                                                           B134 to B153
                                                                                           B155 to B157
                                                                                           B159 to B161, B165
                                                                                           B167 to B172
                                                                                           B174 to B184

  1985      Billiton Exploration Canada Ltd.    Deep Tin Zone                  Surface     E1 to E4, E6 to E7, E7A      12       4,767
                                                Contact, Flank                             E8 to E9, E11 to E12, E16
                                                Endogranitic Zone,
                                                Saddle area

  1986      Lac- Billiton Tin Project           North Zone                   Underground   C-1 to C164                  164     18,124
                                                Deep Tin Zone
                                                Crest      and       Flank
                                                Endogranitic Zone

1987-88     Lac- Billiton Tin Project           North Zone                     Surface     LNZ-1 to LNZ-3               18       7,253
                                                Saddle Zone                                LNZ5 to LNZ10, LNZ10A
                                                Hornet Hill                                LNZ11 to LNZ18

  1989      Novagold Resources Inc.             Saddle Zone                    Surface     NMR89-1                       3       1,702
                                                                                           NMR90-1 to NMR90-2

  1995      Piskehegan Resource Limited         Fire Tower Zone                Surface     PRL95-1 to PRL95-5            5       2,772
                                                Scotia Zone

  1996      ADEX Mining Corp                    Deep Tin Zone                  Surface     AM96-1 to AM96-11            11       3,231
 TOTAL                                                                                                                 1,330    158,561




                                                                - 65 -
                                                                        Watts, Griffis and McOuat

completed with an air-powered BBU drills, producing A, E or XRT size core (Parrish and
Tully, 1976).     In 1975, two Longyear EHS 38 (electric) drills used in the 400 decline
produced BQ core.


Since 1985, all surface holes have been drilled vertically starting with NQ-size core switching
to BQ approximately half to two-thirds of the distance downhole (Gowdy, 1995).             All
underground holes continued to be drilled BQ-size and they were rarely surveyed. During the
Lac-Billiton Tin Project, down-hole surveys were carried out occasionally using a Pajari
instrument mainly to check the deviation in the deeper holes. All surface holes were drilled
vertically and drillholes seldom deviated over 3° over the entire length of the drillhole. Most
underground holes were relatively short and Pajari tests were carried out sporadically.


Historically, ten surface holes were intersected by underground workings.         Surface and
underground drillhole cores are reported 99% sampled and assayed (Kvaerner Metals Davy
Ltd, 1997). Average sample length was 3.0 m. Much of the core splitting was done with a
Longyear new improved core splitter. Drill reports seldom reveal the name of the company
that did the drilling.


Since the mid-1980s, there has been good ongoing continuity to the project through the
utilization of standardized log sheets and having the same personnel running the drill
programs and conducting the logging and sampling.


11.2            TIN BASE METAL DEPOSITS


Selco drilled four packsack holes for a total of 305 m to test a geochemical anomaly in 1955.
None of the holes intersected any significant metallic mineralization. In 1956, Kennco
optioned the property and drilled ten holes totalling 191 m but results were disappointing.
In 1960, Kennco drilled another 24 holes for a combined total of 1,463 m. These holes
intersected tungsten, molybdenum and tin mineralization.


MPML completed 18,376 m of surface and 7,712 m of underground diamond drilling from
1959 to 1965 focusing predominantly on the Fire Tower Zone (see Table 3). A number of the
holes were drilled to test IP anomalies thought to represent tungsten-molybdenum-bismuth
zones. Drilling determined that these anomalies were related to the cap rock disseminated
mineralization surrounding the main sulphide-bearing zones. Deep drilling near the Fire



                                            - 67 -
                                                                       Watts, Griffis and McOuat

Tower Zone encountered many mineralized intersections with varying amounts of tin,
tungsten and molybdenum.


11.3          PORPHYRY TUNGSTEN-MOLYBDENUM-BISMUTH DEPOSITS


From 1969 to 1975, BTM drilled 225 surface holes in the Fire Tower Zone totalling 57,667 m
and 330 (20,519 m) underground holes to delineate and sample the North Zone (750 Adit) and
Deep Tin Zone including the 900 Adit (see Table 3). Deeper surface and underground
diamond drilling helped to outline a “resource” for the large porphyry-type tungsten-
molybdenum-bismuth zones located in the Fire Tower Zone and delineate tin mineralization
in the North Zone.


Hole MPS 17 intersected several sections containing massive chalcopyrite. Hole MPS 39 was
very well mineralized and brought attention to the tungsten, molybdenum and bismuth values
(Parrish and Tully, 1976). Significant molybdenum, tungsten and bismuth intersections were
intersected by drillholes MPS 66, 67, and 68, all inclined holes in the Fire Tower Zone
(Parrish and Tully, 1976). Hole MPS-80 drill tested a strong IP anomaly intersecting 8.8 m of
0.29% Sn.


Drillhole MPS 124 intersected two tin zones assaying 0.48% Sn over 3.0 m and 0.19% Sn
over 3.4 m at depths of 813 m and 731 m respectively (Gowdy, 1995). Hole MPS 127
intersected the Fire Tower breccia pipe from around 8 to 15 m below surface.             The
intersection assayed 4.48% Zn, 2.98% Cu and 2.5% Sn. No indium assays were available for
the intersection. Drilling to test a moderately strong IP anomaly at Little Mount Pleasant
intersected some zinc mineralization (3.0 m of 2.5% Zn, MPS-134).


Two inclined holes were drilled at Hornet Hill targeting a bismuth geochemical anomaly
(Billiton Canada Ltd., 1985b). Holes MPS 173 and MPS 224 were drill to depths of 308 m
and 304 m, respectively.     Both holes intersected fine-grained chloritized and silicified
porphyritic granite at depth and veins containing minor amounts of cassiterite sphalerite-
pyrite-chlorite. The holes returned low tungsten, molybdenum and bismuth values. Hole
MPS 173 intersected a cassiterite-bearing chlorite vein assaying 0.89% Sn over 3.0 m
(Lac Minerals Ltd., 1988).




                                           - 68 -
                                                                          Watts, Griffis and McOuat

Three closely-spaced were drilled in the Deep Tin Zone to test the reliability of previous
drillhole results. Holes MPS 172, MPS 190 and MPS 197 demonstrated large variances, or
nugget effect, observed within the tin-bearing mineralization (Parrish and Tully, 1976).


Hole A148, drilled in the Deep Tin Zone, ended in tin mineralization with an intersection of
2.61% Sn over a core length of 3.0 m (Gowdy, 1995).


From the period 1981 to 1985, a total of 14,478 m of underground diamond drilling to further
delineate the tungsten-molybdenum zones was completed by Billiton and BTM.                   The
172 drillholes were numbered from B3 to B184 (see Table 3).


11.4           PORPHYRY TIN DEPOSITS


In 1985, Billiton completed 12 surface drillholes totalling 4,767 m to further delineate the tin
mineralization in the Deep Tin Zone, contact Crest and Flank deposits, Endogranitic Zone and
Saddle area.


The holes were numbered from E1 to E16 (see Table 3). Drilling confirmed the presence of a
large tin “resource” although there was still uncertainty regarding the shape and attitude of the
Endogranitic Zone mineralization (Billiton Canada Inc., 1985a). Examples of representative
drillhole intersections are given below in Table 4. Hole E12 intersected 6.7% Sn over a core
length of 5.2 m.


Up to the completion of the 1985 drill program, drilling of the North Zone had demonstrated
that there is a high percentage of very wide and high-grade tin intersections and that
mineralization was still open-ended (Hosking, 1985).          However, drilling had still not
delineated the shape of the intersected bodies or determined the variability in mineralogy, or
established the distribution pattern of the cassiterite within the bodies (Hosking, 1985).


In 1986, the Lac-Billiton Tin Project joint venture completed 25,377 m of surface and
underground diamond drilling to delineate the zones of tin mineralization and to produce a
feasibility study of the North Zone. A total of 164 underground and 18 surface holes was
completed to sample the various zones (see Table 3).




                                             - 69 -
                                                                                Watts, Griffis and McOuat

                                            TABLE 4
  EXAMPLES OF REPRESENTATIVE DRILL INTERSECTIONS - 1985 BILLITON DRILL PROGRAM (NORTH ZONE)
 Hole No. From        To     Width      Sn       WO3      MoS2       Bi      Zn      Cu                         Pb
                              (m)      (%)       (%)       (%)      (%)     (%)      (%)                       (%)
   E1     338.3     353.6     15.3    1.030      0.04     0.043    0.02     0.03    0.140                      0.04
          362.7     378.0     15.3    0.040      0.64     0.054    0.08     0.01    0.004                      0.02

   E2       207.03   213.4      6.1    1.800            0.17     0.200   0.22      1.90         0.060          0.06
            359.7    365.8      6.1    0.120            0.81     0.121   0.37      0.13         0.010          0.01

   E3       368.8    396.2     27.4    1.440            0.32     0.062   0.11      0.05         0.008          0.06

   E4       222.5    234.7     12.2    0.700            0.11     0.065   0.14      0.32         0.106          0.03

   E6       222.5    225.5      3.0    0.691            0.23     0.449   0.10      0.10         0.028          0.01
            405.4    408.4      3.0    1.451            0.01     0.030   0.01      0.70         0.012          0.68

   E7A      344.4    353.5      9.1    0.730            0.02     0.050   0.01      0.10          0.01          0.02

   E8        76.2    216.4    140.2    0.120            0.34     0.189   0.11      0.72         0.113          0.01
            371.9    396.3     24.4    1.550            0.09     0.062   0.08      0.01         0.161          0.04

   E9       332.2    340.4      8.2    0.470            0.52     0.112   0.22      0.03         0.199          0.01
                                       1.760            0.21     0.174   0.12      0.01         0.221          0.04

   E11      277.4    289.6     12.2    0.520            0.31     0.237   0.30      0.66         0.109          1.33
            320.0    326.1      6.1    1.810            0.12     0.101   0.07      0.01         0.017          0.04

   E12      222.5    227.7      5.2    6.700              0.03   0.042   0.04      0.01          0.19          0.10

   E16      307.8    313.9      6.1    0.010              0.70   0.217   0.12      0.01         0.010          0.01
            335.3    338.3      3.0    1.320              0.05   0.175   0.20      0.08         0.013          0.04
                                                                                   Source: Billiton Canada Ltd. (1985a)



A total of 18,124 m of underground drilling was completed, which included 6 holes (holes
C8-12, C19, 688.5 m) at the Deep Tin Zone, 7 holes (holes C1-4, 686.7 m) in the Saddle area
and 151 holes (holes C13-18, C20-C164, 16,749.0 m) at the Crest, Flank deposits and
Endogranitic Zone (Lac Minerals Ltd., 1988).


The surface holes, numbered LNZ-1 to LNZ-18, were completed between 1987 and 1988 in
the Saddle Zone and North Zone. Hole LNZ-4 was drilled to further explore the Hornet Hill
cupola located around 1 km west of the North Zone.


Three holes (LNZ-1 to LNZ-3) tested the Saddle area of the Fire Tower Zone for a total of
1,227.1 m (Lac Minerals Ltd., 1988). Hole LNZ 4 was drilled to a depth of 251.5 m at Hornet
Hill (Lac Minerals Ltd., 1988). Hole LNZ-13 was drilled 700 m east of the North Zone and
LNZ-14 was drilled 900 m north of LNZ-13 to test radiometric anomalies. Both holes
intersected two or more sections (3.0 to 6.1 m core lengths) containing tin, zinc and silver
mineralization as veins and disseminations associated with either feldspar porphyry,
porphyritic granite or siliceous QFP. The best intersection was in hole LNZ-13 that returned
0.29% Sn, 6.49% Zn and 9.55 g Ag/t over a core length of 6.1 m (274.3-280.4 m).


                                               - 70 -
                                                                                          Watts, Griffis and McOuat


Three deep vertical holes (LNZ 15, 16 and 17) were drilled for a total of 1,713.2 m in the
Saddle Zone area between the tin-base metal bearing North Zone and the Fire Tower Zone.
These holes were drilled to investigate the tin mineralization associated with Granite III, the
youngest and deepest seated of the three granites occurring in the North Zone (Lac Minerals
Ltd., 1988b). All holes intersected Granite III. Only one hole, LNZ 16, intersected tin values
in Granite II with 0.85% Sn and 0.23% WO3 over a core length of 0.6 m (Table 5). Hole LNZ
15 interested the widest tin intersection in Granite II (0.33% Sn over 39.6 m) and the highest
grade intersection (0.73% Sn over 6.1 m). Most of the tin deposits in the North Zone are
associated with Granite II (Lac Minerals Ltd., 1988b).

                                                TABLE 5
                        SUMMARY OF REPRESENTATIVE DRILL INTERSECTIONS
                        1987-88 LAC BILLITON DRILL PROGRAM (SADDLE ZONE)
 Hole No.   From       To        Width      Sn       WO3   MoS2      Bi                         Zn           Cu           Pb
                                  (m)      (%)       (%)    (%)     (%)                        (%)          (%)          (%)
 LNZ-15      54.90    57.90        3.00    0.12      0.00   0.01    0.01                       2.57         0.18         0.07
             73.10    76.20        3.10    0.08      0.00   0.04    0.02                       1.61         0.10         1.59
            182.90   185.90        3.00    0.00      0.48   0.33    0.09                       0.02         0.02         0.19
            225.50   246.90       21.40    0.00      0.01   0.22    0.22                       0.06         0.02         0.29
            256.00   259.10        3.10    0.06      0.01   0.00    0.10                       1.77         0.06         0.06
            268.20   271.30        3.10    0.00      0.00   0.05    0.15                       2.51         0.12         0.04
            304.80   344.40       39.60    0.33      0.09   0.09    0.13                       0.00         0.09         0.02
            356.60   362.70        6.10    0.41      0.19   0.04    0.19                       0.00         0.05         0.02
            368.60   371.80        3.00    0.26      0.00   0.07    0.05                       0.00         0.01         0.01
            376.40   381.00        4.60    0.47      0.12   0.06    0.04                       0.16         0.10         0.02
            399.30   405.40        6.10    0.73      0.27   0.03    0.05                       0.00         0.03         0.30

 LNZ-16     185.90   189.00      3.10   0.25            0.06        0.02         0.03          2.05         0.14         0.04
            432.80   435.80      3.00   0.21            0.04        0.00         0.00          0.00         0.00         0.02
            533.40   534.00      0.60   0.85            0.23        0.00         0.00          0.05         0.01         0.04
            545.60   548.90      3.30   0.66            0.21        0.00         0.00          0.01         0.00         0.03
            566.90   571.10      4.20   0.83            0.30        0.00         0.00          0.00         0.01         0.04

 LNZ-17      61.00    64.00      3.00   0.41            0.12        0.00         0.00          3.71         0.52         1.27
            350.50   356.60      6.10   0.33            0.12        0.01         0.00          0.08         0.03         0.04
            374.90   377.90      3.00   0.80            0.40        0.04         0.04          2.09         0.58         0.04
            420.60   423.70      3.10   0.14            0.13        0.02         0.16          0.00         0.01         0.01
            426.70   429.70      3.00   0.12            1.40        0.21         0.15          0.00         0.02         0.02
                                                          Source: Gowdy (1995) (Incomplete assays for holes PRL 95-1 and NMR90-1)



Novagold conducted a three-hole drilling program for a total of 1,702 m to test the Saddle
Zone between November 1989 and February 1990. Drillholes NMR89-1 to NMR89-3 were
all vertical. The first hole, NMR 89-1, intersected the highest tin value of 1.31% Sn over an
intersection length of 16.06 m (Table 6). According to Kooiman (2004), this hole intersected
one of the highest tin values ever recorded on the property: 3.97% Sn over a core length of
5.09 m.




                                               - 71 -
                                                                                                    Watts, Griffis and McOuat

                                                TABLE 6
                             SUMMARY OF REPRESENTATIVE DRILL INTERSECTIONS
                               1989 NOVAGOLD DRILL PROGRAM (SADDLE ZONE)
  Hole No.          From           To     Width    Sn         WO3           MoS2           Bi           Zn           Cu           Pb
                                           (m)    (%)         (%)           (%)           (%)          (%)          (%)          (%)
NMR 89-1           164.59        167.64    3.05   0.47        0.02          0.02          0.01         3.05         0.54         0.03
                   289.56        295.66    6.10   0.03        0.62          0.15          0.08         1.00         0.04         0.01
                   332.23        347.47   15.24   0.01        0.41          0.13          0.14         0.33         0.03         0.00
                   425.90        441.96   16.06   1.31        0.03          0.03          0.04         0.07         0.08         0.02
                   486.67        488.05    1.38   0.62        0.22          0.01          0.00         0.16         0.00         0.02
                   496.82        499.87    3.05   0.41        0.03          0.01          0.00         0.07         0.01         0.03
                   548.24        554.74    6.50   0.14        0.01          0.00          0.00         0.03         0.00         0.00

NMR 90-1           390.14        393.19    3.05   0.65
                   411.48        417.58    6.10   0.55
                   512.06        515.11    3.05   0.54

NMR 90-2            27.43         30.48    3.05   0.31        0.03           0.01         0.06         9.45         0.37         4.59
(Note 1)           353.57        359.66    6.09   0.37        0.06           0.06         0.07         2.47         0.31         0.03
                   365.76        390.14   24.38   0.06        0.22           0.12         0.10         0.60         0.05         0.01
                   452.02        455.80    3.78   0.77        0.03           0.12         0.07         0.11         0.01         0.03
Note 1 – 27.43 to 30.48 m, In+ 0.012%                             Source: Gowdy (1995) (Incomplete assays for holes PRL 95-1 and NMR90-1)



 11.5                    TIN-INDIUM-BASE METAL DEPOSITS


 Piskahegan completed a five-hole 2,772 m surface drill program in the Fire Tower Zone in
 1995 (see Table 3). The holes were numbered PRL95-1 to PRL95-5 and were all drilled
 vertically on claims 228004 and 338016. The first hole was drilled in January 1995 with the
 remaining four holes drilled from April to May 1995. The purpose of the drill program was to
 test for the presence of tin-indium-bearing Granite II in the footwall portion of the Fire Tower
 Fault (Akerley, 1996). The holes were drilled to depths between 424 and 613 m and the
 deepest hole ended 300 m below sea level. The drill geologist was G. Kooiman, Chief
 Geologist, who was responsible for the drill program. Drilling was completed by Lantech
 Drilling Services operating out of Dieppe, New Brunswick.


 A broad new zone of polymetallic mineralization, called the Scotia Zone, was intersected by
 each of the five holes. The program was successful in demonstrating that the Saddle Zone
 and Fire Tower North Zone were both underlain by the same tin-bearing granites, which most
 likely formed one continuous granite body (Kooiman, 2004). Drilling intersected good tin-
 indium-zinc-copper values although indium grades were generally lower than in the North
 Zone.


 In 1996, ADEX Mining Corp. drilled eleven diamond drillholes (AM96-1 to AM96-11)
 ranging from 182.88 m to 379.48 m, totalling 3,231 m to confirm and upgrade “resources” in
 the Deep Tin Zone, to furnish new data on indium and to provide material for metallurgical



                                                         - 72 -
                                                                         Watts, Griffis and McOuat

testing in support of the Kvaerner Feasibility Study (Kooiman, 1997; Kvaerner Metals
Davy Ltd., 1997).


Drilling was completed between July 25th and October 1st in the southern portion of the North
Zone (all NQ size drill core). With the exception of hole AM96-10, drilled at -86ο (azimuth
N77οE), all the remaining holes were drilled vertically. A total of 323 samples was collected
for assay.


All eleven holes intersected at least one mineralized interval and a total of 22 significant
intervals were encountered (Table 7), (Kvaerner Metals Davy Ltd., 1997). The weighted
average of the tin values for the 11 holes was 0.64% Sn, close to the previous average
“resource’ grade of 0.60% Sn (see Section 17, Mineral Resources and Mineral Reserve
Estimates). This program was successful as it identified a new zone, the Upper Deep Tin
Zone with high grade tin-indium-copper-zinc mineralization. The drillhole data was plotted
on site using GEMCOM software (Kooiman, 1997).

                                     TABLE 7
         ADEX 1996 DRILLING RESULTS FOR TIN AND INDIUM, DEEP TIN ZONE
    Hole          From           To          Length       % Sn        ppm In
                   (m)           (m)          (m)
AM96-01          140.21         170.68       30.48         0.51         201
                 228.60         271.27       42.67         0.29           9
AM96-02          124.97         140.21       15.24         1.03         353
AM96-03          159.41         179.83       20.42         1.52         213
                 357.38         367.89       10.52         0.75           9
AM96-04          128.02         156.97       28.96         1.00         224
AM96-05          155.45         173.74       18.29         1.52         365
                 201.17         210.31        9.14         0.52         339
                 237.74         268.22       30.48         0.29           7
AM96-06          124.97         128.02        3.05         0.04         351
AM96-07          143.26         185.93       42.67         0.24          75
                 204.22         233.01       28.96         0.80         282
                 295.86         298.70        3.05         1.33          47
AM96-08          173.74         215.34       41.81         0.52         372
AM96-09            86.87        100.58       13.72         1.04         701
                 128.02         143.26       15.24         0.30         294
                 249.94         282.55       32.61         0.37           8
AM96-10          158.50         201.17       42.67         0.25         273
                 237.74         246.89        9.14         2.30         536
AM96-11          115.82         118.87        3.05         1.39         861
                 155.45         161.4         6.10         0.23         359
                 204.22         208.79        4.57         2.11          44
WEIGHTED AVERAGE                                           0.64        16.4
                                                               Source: Kvaerner Metals Davy Ltd. (1997)




                                           - 73 -
                                                                          Watts, Griffis and McOuat

11.6           COMPUTERIZED DATABASE


The common practice at Mount Pleasant for core logging has been to record all the
information onto paper logging sheets. However, all of the drillhole information covering the
surface and underground drillholes were added to a computerized database between 1995 and
1997 using GEMCOM software. According to Kvaerner Metals Davy Ltd. (1997), around
60% of the drillhole database was entered by employees of the New Brunswick Department
of Natural Resources and ADEX entered the remainder of the data using their personnel,
including students. An examination of the database by Gowdy (1985) determined that it was
not in ideal condition with missing data and improper data entries. He recommended that the
data entries be rechecked.


In late 2005, ADEX supplied WGM with a copy of the computerized GEMCOM database for
review. This database contains all Mount Pleasant diamond drillhole data, including assay
results, for review. Each database for the North Zone, Saddle Zone and Fire Tower Zone
contains four tables, the “Header” table, the “Survey” table, the “Lithology” table and the
“Assay” table (Kvaerner Metals Davy Ltd., 1997). The Header file contains columns for the
drillhole number, “East (X)”, “North (Y)”, “Elevation (Z)”, “Azimuth” (not magnetic grid
azimuth), “Dip” and total “Length” of hole and Remarks. The survey table contains in hole
or downhole survey data (azimuth- Mine Grid, Dip) with uphole dips indicated by a “+” and
downhole by a “-”. The data in the Lithology table lists “From”, “To” and “Rock Unit” as a
numerical value (a lithological code, Table 8).

                                            TABLE 8
                    GEMCOM DATABASE, LITHOLOGICAL UNIT CODES
       Rock Unit                                        Lithological Unit Code
       Granite I, Granite (GR1,GR)                                 4
       Granite Porphyry (GP), Granite II (GR2)                     5
       Quartz Feldspar Porphyry (QFP)                              2
       Sedimentary Breccia (SEDBX)                                 1
       Fire Tower Breccia, Feldspar Porphyry (FTBx, FP)            3
       Fire Tower Breccia (FTBx)                                  3A
       Granite III (GR3)                                           6
                                                       Source: Kvaerner Metals Davy Ltd. (1997)




                                            - 74 -
                                                                         Watts, Griffis and McOuat

The assay table lists “From”, “To” for molybdenite, tungsten oxide, tin, copper, lead, zinc,
bismuth, arsenic, calcium, iron and indium. There is a total of 49,913 assay records in the
database as follows:


•   North Zone: 23,997 records;
•   Saddle Zone: 1,640 records; and
•   Fire Tower Zone: 24,276 records.


Gold and silver columns have been added to the Assay table for samples collected from the
Fire Tower and Saddle Zones. Values below detection limit (<0.01) or with no values are
denoted as 0.00 (Kvaerner Metals Davy Ltd., 1997). The North Zone also contains an
additional two tables called “Composite 1” and “Composite 2”. The Composite 1 contains:
“From”, “To”, “Interval”, “Thickness”. The Composite 2 has not been calculated. No codes
representing mineralization were entered into the database.


During the course of the WGM study, additional historic assay data have been found in
records on the site and added to the database.         The database has been reviewed and
crosschecked with drill logs and assay sheets and corrected where necessary. WGM has
concluded that the historic Fire Tower Zone drillhole and assay database is reliable and that it
is suitable for use in the preparation of an NI 43-101-compliant Mineral Resource estimate.




                                            - 75 -
                                                                       Watts, Griffis and McOuat

                      12. SAMPLING METHOD AND APPROACH



Information regarding the sampling methodology and approach was obtained through
discussions with G. Kooiman during the Mount Pleasant field visit and from previous
geological reports and papers provided by ADEX.


All assay results reported in this document have been obtained from previous ADEX reports
and from reports from previous operators that have worked on the property. The practice of
reporting exploration results to the public has changed dramatically over the last decade. In
the past, it was largely up to the company as to what results they wished to report to the
public. For example, an acceptable practice was to only report the best assay results. Many
did not choose to disclose their sampling techniques, the name of the laboratory to which
samples were dispatched or include copies of the original assay report certificates in their
final report. The best records have been kept since BTM’s arrival on the property in 1969 to
present. The authors have no reason or evidence to question the validity of the data presented
in the historical reports.   It is the authors' opinion that all sampling methods disclosed
conform to generally accepted Canadian mining industry practice.


Since the early 1980s, there has been good ongoing continuity to the project through the
utilization of standardized log sheets, having the same personnel running the drill programs
and conducting the logging and sampling. For example, Mr. Kooiman has been associated
with the project for some 25 years, working as a geologist for Billiton, LAC, Novagold and
Piskahegan and now as a geological consultant for ADEX.


The various methods and approaches have been summarized below with reference to drill
core logging and sampling, a critical component of the data-gathering exercise required for
Mineral Resource estimates for this property.


Brunswick Tin Mines


According to Parrish and Tully (1976), samples were taken at 15 cm to 4.6 m (15 foot)
lengths. Later all samples were taken at 3.1 m (10 foot) lengths. All cores were split in half
usually using a Longyear core splitter with the splitter being brushed clean between sample
splits. One half of core was retained in the core box and then the box was placed in racks



                                           - 76 -
                                                                         Watts, Griffis and McOuat

outside for storage. Each split core sample was put in a canvas sample bag with the sample
number labelled outside the bag and sample tag placed inside it.


For BTM drill programs (and all programs by LAC, etc.), if additional core sampling was
required then the core was quartered where possible or alternately, 15 cm representative
samples were retained for each 1.5 m of core (Kvaerner Metals Davy Ltd, 1997).


Lac Minerals Ltd.


During the Lac-Billiton Tin Project, LAC (the operator) logged all drill core (Lac Mineral
Ltd., 1988). After logging, the core was sampled using standard 3.1 m (10 foot) intervals.
Sampling was not a function of the geology with only a limited number of non-standard
length samples taken. Cores were split into equal halves using a Longyear core splitter. One
half of each sample was retained as reference material. None of the core logging was done
using computerized software programs (i.e., Log II) as recommended by Gowdy (1985).


Novagold Resources Inc., Piskahegan, ADEX


The drill core was logged by the same persons in the core shack building located on the
Mount Pleasant minesite. Samples were taken at regular intervals (usually 3.1 m) to cover
sections of core with visible mineralization.        A binocular microscope was used by the
geologist to assist in making visual estimates of tin, tungsten oxide and molybdenite and to
examine the fine-grained nature of the mineralization


Core with abundant sphalerite was always sampled (Kvaerner Metals Davy Ltd, 1997). The
core was initially viewed under ultraviolet light in search of scheelite (none found).
Therefore, fluorescence was restricted to aid in the identification of minerals such as fluorite
and certain sphalerites (Gowdy, 1995). Samples for splitting were marked using a lumber
crayon (the sample beginning and end points). Samples were split using a manual Longyear
splitter under the supervision of the project geologist, although some splits were done with a
rock saw. Half the core was retained for future reference. Split core samples were placed in a
numbered plastic bag, the sample tag placed in the bag and the bag sealed. No assay tags
were left in the core boxes to indicate the location of the sample interval (other than old
lumber crayon markings, when visible). The samples were then dispatched to the laboratory
for analyses (see Sample Preparation, Analyses and Security, Section 13).



                                            - 77 -
                                                                           Watts, Griffis and McOuat


Once logging and sampling were finished, the open core boxes were then placed, outside, in
steel core racks or cross stacked on the ground for long-term storage.


Assay results were not entered onto the hard copy drill log sheets. Copies of the drill logs and
assay certificates and sheets were kept in separate hard cover binders. None of the drill logs
appear to have reported core recovery percentages. The sample interval is clearly recorded on
the drill logs, however, assay results are seldom entered onto the drill logs.




                                             - 78 -
                                                                         Watts, Griffis and McOuat

                13. SAMPLE PREPARATION, ANALYSES AND SECURITY



13.1            GENERAL


Information regarding sample preparation, analyses and security was obtained through
discussions held with Trevor Boyd and G. Kooiman and information provided from
geological reports provided by ADEX. It is the authors' opinion that the sample preparation,
security and analytical procedures used conformed to generally accepted Canadian mining
industry practice.


The drill core was split in the core shack building on the minesite under the supervision of the
project geologist. This building was and is locked and a security fence surrounds the minesite
buildings. Security was and is maintained on the site 24 hours, 7 days per week. All drill
core from the previous drill programs is stored within the confines of the minesite.


All coarse rejects and pulps remain in storage in the large core shack warehouse located on-
site. The rejects have been labelled and are stacked on wooden pallets. The Mount Pleasant
Tungsten Mine (1985) “Mothball” report provided an inventory list of the stored rejects at the
time of closure, however, this list has not since been updated.


The various methods and approaches of preparing and analyzing the samples are summarized
below (by company). Information regarding the metallurgical work related to feasibility
studies can be found in Section 16, Mineral Processing and Metallurgical Testing.


13.2            MOUNT PLEASANT MINES LIMITED


In 1960, MPML analyzed its drill core for tin, copper, zinc, lead, molybdenum and tungsten.
The following year, MPML set up a geochemical laboratory (location unknown) and carried
out soil and bedrock surveys for tin, copper, lead, molybdenum and zinc (Parish and
Tully, 1976).




                                            - 79 -
                                                                          Watts, Griffis and McOuat

13.3           SULLIVAN MINING GROUP AND BRUNSWICK TIN MINES


In 1971, a Philips PW 1212 XRF was set up in St. Stephen, New Brunswick, by BTM and all
drill core and other materials were assayed for molybdenum, tungsten, bismuth, tin, copper,
zinc, lead and arsenic (Parrish and Tully, 1976). They also analyzed for calcium (for fluorite)
and some silver (Kvaerner Metals Davy Ltd., 1997). It should be noted that BTM had
problems with tin assays in the 1960s to late 1970s. The assaying procedure conducted by
Sullivan and BTM have been described below (Kvaerner Metals Davy Ltd., 1997).


All assaying was performed by XRF. Approximately one third of the sample was placed in a
cup holder for analysis. Assaying of a reference standard, plus three unknowns, for eight
elements, took approximately 24 minutes. The pulps were retained after analysis and stored
in the assay office by drillhole number.


High values (range unspecified) were re-assayed. The re-assay was performed on a briquette
or pellet made from 2.0 g of pulp. Boric acid was added as a binder along with 2.0 g of
barium dioxide to make a uniformly dense matrix. Weight measurements were made using a
Mettler H10W Balance. The uncompressed sample was then placed in a Spex 8000-11 Mixer
Mill for homogenization. The pellet was made by compressing at 30,000 psi in a Dietart
Briquetting Press for 25 seconds. The finished pellet was then X-Rayed. The analysis was
done under vacuum, taking around 1 minute per assay to complete. After analysis, pellets
were stored for four months and then discarded (Kvaerner Metals Davy Ltd., 1997).


13.4           BRUNSWICK TIN MINES


According to Parrish and Tully (1979), all split core samples were crushed on-site using a
Woodstock “O” Jaw Crusher and Riffle splitter to provide a representative sample. The
remaining half of the sample was then placed back in the canvas sample bag and labelled
“coarse reject” and placed in storage. The remainder of the sample was pulverized and
ground to -50 mesh size and placed on a 45 cm (18 inch) square piece of Kraft Paper and
rolled and mixed to achieve complete homogeneity. Using only a ½ inch spatula, the crusher
man removed rows and columns of the mounded sample until only one half of the sample
remained, which was then placed into a Canneco (kraft) envelope. The remaining half was
poured into a second envelope and labelled with the sample number. The pulps were then
sent to the assay office (at St. Stephen?) for additional shatter box grinding and assaying.



                                             - 80 -
                                                                       Watts, Griffis and McOuat


All assaying at BTM was performed by XRF using a Philips PW 1212 unit. Powders were
used to determine the concentrations for molybdenum, tungsten, bismuth, tin, copper, lead,
zinc and arsenic. Re-assays were performed, not on the powder, but on a briquette or pellet
made from 2.0 g of powder with 2.0 g of boric acid to act as a binder and 2 g of barium
dioxide. All weight measurements were made using a Mettler H10W Balance. Pellets were
made using a Dietart Briquetting Press. Remaining pulps were stored in the assay office by
drillhole and footage.


The method of collecting bulk samples, sludge sampling, composite sampling is detailed in
Parrish and Tully (1976), pages 61-63.


13.5           MOUNT PLEASANT TUNGSTEN MINE


The sample preparation and assay procedures have been described below (Kvaerner Metals
Davy Ltd., 1997).


Samples for assay were placed into sample bags and sent to the crushing room. The core was
crushed to ¼ inch mesh in a Woodstock ‘O’ Jaw Crusher and passed repeatedly through a
Fischer-Jones Sample Riffle box (4-942C) until the sub-sample filled two-thirds of a 250 ml
cup. This sample was first roll crushed to -2 mm size material. The coarse rejects were then
placed in sample bags in the sample storage building.


The ¼ inch sample was then pulverized in a BICO UA1 Pulverizer to -50 mesh size material
and the pulverized sample was rolled on paper to achieve complete homogeneity. One half of
the sample was sent to the mine assay office. The remaining pulp was placed in storage.


Care was taken to avoid contamination during each stage of sample preparation in the crusher
room at the mine. The equipment was brushed clean and blown out with compressed air
between samples.


In the assay office, the samples were listed by hole and length and the identifying assay-run
number was added to the list.      Two tablespoons of sample were removed for further
pulverizing in a Spex 8510 Shatter box (a Bleuler Rotary Mill was used for several years). A
half teaspoon of common detergent was added to the sample to prevent sticking and



                                           - 81 -
                                                                       Watts, Griffis and McOuat

pulverized for 2.5 minutes to -300 mesh size material. The new pulp was sent to the assay
laboratory with the remaining coarse pulp returned to permanent storage at the minesite. The
stored pulps provided material for monthly check samples, which were sent to three external
laboratories.


13.6            LAC-BILLITON TIN PROJECT


At the start of the project assaying was routinely carried out on site using well established
XRF methods. Assistance for calibration was obtained from Lakefield Research of Lakefield
Ontario. Later LAC sold all the on-site crushing equipment and samples were shipped to
XRAL Laboratories (“XRAL”) in Saint John for crushing and pulverizing. Pulps were then
shipped to XRAL in Toronto for analysis.


During the course of the Lac-Billiton Tin Project, each of the drill core samples was analyzed
on site for tin, tungsten, molybdenum, arsenic, bismuth, copper, lead, zinc and iron by XRF
using “SB” as the internal standard (Lac Minerals Ltd., 1988). Samples were also analysed
for calcium. Molybdenum and tungsten were assayed as molybdenite and tungsten oxide.
Molybdenum and tungsten form the older holes were recalculated as molybdenite and
tungsten oxide (Kvaerner Metals Davy Ltd., 1997). Major, minor and trace element analyses
were performed on fresh granite samples by the Geological Survey of Canada and Carleton
University. Coarse rejects and sample pulps were stored on site along with the diamond
drill core.


Indium analyses were completed by XRAL or Lakefield using Inductively-Coupled
Plasma/Mass Spectrometry (“ICP/MS”) as it appeared to be the most reliable method
available (Gowdy, 1995).


13.7            NOVAGOLD RESOURCES INC.


From 1991 to 1992, 200 samples from the North Zone were analyzed for indium by Atomic
Absorption (“AA”) and XRF by Novagold initially and completed by the New Brunswick
Department of Natural Resources and Energy (Kvaerner Metals Davy Ltd., 1997). The
Geological Survey of Canada also analyzed 100 samples for indium from the Fire Tower
Zone; these were analyzed at XRAL by ICP/MS.




                                           - 82 -
                                                                       Watts, Griffis and McOuat

13.8           PISKEHEGAN RESOURCES LIMITED


Analytical values for indium and bismuth were developed from studies completed by the New
Brunswick Department of Natural Resources and Energy in 1991 and from a core re-
evaluation study completed by Piskahegan in 1994 (ADEX Mining Corp, 1995).


In December 1993, Piskahegan analyzed 2,000 samples for indium by XRF, ICP/MS and
Induced-Coupled-Plasma Spectroscopy (“ICPES”). These analyses were done at Lakefield,
using XRF and ICPES, and at XRAL using ICPES and ICP/MS (Kvaerner Metals Davy
Ltd., 1997).


In 1994, the New Brunswick Department of Natural Resources and Energy compiled the
indium data in table format and analyzed another 250 samples from the Deep Tin Zone at
XRAL using ICP/MS (Kvaerner Metals Davy Ltd., 1997).


All analytical work for the 1995 drill program was completed by XRAL using the ICP
analytical method for tungsten (WO3), molybdenum (MoS2), copper, lead, zinc and arsenic
(Akerley, 1996). ICP/MS was used to determine indium, tin and bismuth. The analytical
results were appended at the back of the ADEX drill report.


13.9           ADEX


The methods of preparing and analyzing the drill core for the 1996 drill program are outlined
in the drill report prepared by Kooiman (1997).


A total of 323 samples covering some 949 m of core was transported to the SGS Minerals
Services (“SGS”) sample preparation facilities in Saint John, New Brunswick. Each sample
represented a 3.0 m (10 foot) split of NQ core weighing around 8 kg. The samples was
crushed to 95% passing 1 mm for holes AM96-01 to -03 and 50% passing 1 mm for holes
AM96-04 to -11. A 300 g sub-sample was then pulverized to -200 mesh (Kvaerner Metals
Davy Ltd., 1997). The pulps were transported to XRAL (Toronto) and were analyzed for
copper, zinc, lead, arsenic, tungsten (WO3) and molybdenum by ICP; a 0.5 to 1.0 g sub-
sample of the pass 200 mesh pulverized material was required for the ICP method (Kvaerner
Metals Davy Ltd., 1997). Tin, bismuth and indium were analyzed by ICP/MS. Three batches




                                           - 83 -
                                                                         Watts, Griffis and McOuat

of check samples were submitted to one or two other laboratories. All coarse rejects were
collected in Saint John and pulps were returned to the minesite.


Thirty-six pulps that were analyzed by XRAL were returned to the minesite and were split
into three parts. One part was kept on site, the other two parts were sent to Lakefield and to
the GSC laboratory in Ottawa respectively, for check assays. Lakefield was requested to
analyze for tungsten (WO3), molybdenum (MoS2), copper, tin, zinc, lead, arsenic, bismuth
and indium by XRF. The GSC laboratory offered bismuth, copper, indium, molybdenum,
lead, tin and zinc by ICP/MS. Acceptable to good agreement was obtained for most elements.
Additional repeat check assaying followed (a second batch of 46 samples and a third batch of
32 samples) with samples being sent to Lakefield for tin analysis by XRF.


It was decided to accept XRAL’s indium assays and low grade tin values.             The XRF
technique by Lakefield was considered to be the more accurate for samples with higher tin
contents (>0.2% Sn). According to G. Kooiman, the best analytical technique for indium
determination is ICP/MS at XRAL.


Some 2.4 tonnes of material from this drill program was used to prepare a 30-tonne bulk
sample that was shipped to Lakefield Research in 1997 for a pilot plant test.


The bulk of all the indium analyses have been done at XRAL by ICP and ICP/MS (Kvaerner
Metals Davy Ltd., 1997). However, Lakefield did complete some indium analyses by mostly
ICPES (some by XRF). ADEX used a CANMET Canadian Certified Reference standard,
which was submitted with the sample pulps with similar numbering series as a check
procedure for indium analyses.


Indium can be a difficult element to detect.          Kvaerner determined that for indium
>350 ppm, XRAL values are higher than those of Lakefield. For Lakefield, indium values
<50 ppm were always higher then the values obtained by XRAL. According to Kvaerner, this
problem is persistent and is not restricted to Mount Pleasant.


At the completion of the Kvaerner feasibility study, 84.6% of the Deep Tin Zone samples and
65.3% of the North Zone samples had been analyzed for indium. More specifically, 15.4% of
the Deep Tin Zone and 34.7% of the North Zone samples within the 0.2% Sn cutoff grade still
did not have indium analyses (Kvaerner Metals Davy Ltd., 1997).



                                            - 84 -
                                                                       Watts, Griffis and McOuat


According to Kvaerner, in their “resource” calculation they estimated the missing indium
values by using multiple regressions based on existing indium versus tin, copper and zinc
values. For example, in the North Zone, every second cross section is well analysed for
indium. The regression for the missing indium values on the intermediate cross section was
based upon the existing values on the adjacent cross sections plus whatever values were
available on the section to be estimated. If the value was negative, then the value was set to
“zero” in the “resource” estimate.


13.10          2005 WGM GRAB SAMPLING (ROCKS AND CORE)


All fourteen samples collected by WGM were sent to SGS, Toronto, formerly XRAL. This
laboratory is ISO/IEC 17025 accredited. With each batch of 48 samples or less, SGS inserts a
method blank and a standard (reference material or in-house standard) analyzed for control of
accuracy. With each batch of 12 samples or less, there is a duplicate analyzed for control of
precision.


At SGS, the entire sample is jaw-crushed and then 250 grams are pulverized to 85% passing
75 microns in a Cr-steel shatter box (Preparation Code PRP89).


Base metal and trace element geochemistry was determined by ICP, Aqua Regia (code
ICP12B) and included Sn, W, Mo, Bi, Ag, Cu, Ni, Zn, Pb and As. Analytical certificates are
appended (see Appendix 4). Samples whose concentrations exceeded 10,000 ppm (1.0%)
were re-analyzed using sodium peroxide fusion with an ICP finish. Results are reported as
% Cu, % Zn, % Pb, % Sn and % As.


A 30 g sample of the pulverized material was fire assayed for Au only (code FAI303) with an
ICP finish. Silver was determined using multi-acid digestion with an Atomic Absorption
(“AAS”) finish (method AAS40E).


Sn, W, Mo, In and Bi were also analyzed by sodium peroxide fusion and then run by ICP
(method ICP90A, total digestion). The upper limit of this method was 5%. The final results
for W and Sn increased significantly when using the total digestion method (ICP90A) as
compared with the lower values obtained using the partial digestion ICP12B method.
However, the results remained relatively the same for Mo and Bi between the two analytical



                                           - 85 -
                                                                       Watts, Griffis and McOuat

techniques. At WGM’s request, SGS calculated the values for Mo and W as molybdenite
(MoS2) and tungsten oxide (WO3); values are presented in Appendix 4.


Indium concentrations were also determined by multi-acid digestion with ICP/MS finish
(method IC40M). These values did not increase significantly when comparing the results
with the ICP90A method.


For the March 2006 sampling program, samples were sent to SGS. The additional samples
obtained from the core intersecting the Fire Tower Zone and saved pulps from the bulk
sulphide material were analysed by ICP (method ICP90A) plus Au (method FAI303) where
requested. The four samples chosen for PGEs plus Rhenium analysis were tested by method
code FAM363 (FAS and NiS collection plus ICPMS scan).




                                         - 86 -
                                                                        Watts, Griffis and McOuat

                             14. DATA CORROBORATION



The authors conducted a field visit of the Mount Pleasant property from November 8 to
10, 2005 to review data, the condition of surface installations and visit some outcrop areas in
part to confirm the presence of mineralization. Paul Dunbar spent two days with Gustaaf
Kooiman reviewing all the historical exploration and development work completed on the
property, reviewing the ADEX files and touring the Fire Tower Zone and North Zone to
examine mineralized showings. One day was spent examining and sampling the drill core
from the past diamond drill programs. The authors visited the “A-Frame” building and
observed the leftover material still in storage from the previous bulk sampling programs on
the Endogranitic Zone and contact Crest deposit. Andrew Hara spent time touring the mine
building and site and reviewing the ADEX files.


Approximately 90% of the core collected from previous drill programs is stored at the
minesite. The majority of the drill core boxes are stored outside in steel racks or cross-
stacked on the ground. The boxes are well tagged with hole numbers, although some of the
tags have fallen off. A complete inventory list of the drill core and coarse rejects in storage
can be found the Mount Pleasant Tungsten Mine (1985) mine closure (“Mothball”) report.
This inventory list has not since been updated. The pulps and coarse rejects (and some drill
core) are currently stored under lock and key in the core shack warehouse.


A global positioning system instrument (GPS, Garmin 12XL) was used to record the locations
of the two field samples and several drill collar casings (NAD83, Zone 19T).            Digital
photographs were taken to document the field visit and sampling activities.


A total of 14 samples, 2 grab samples from the field and 12 samples of drill core, was taken to
determine their precious and base metal concentrations and confirm the presence of
mineralization. The field sample locations are plotted on Figure 7. Samples were dispatched
to SGS Minerals Laboratory in Toronto for analysis. WGM assay results are tabulated in
Table 9 and are accompanied by historic assays for the same drill core intervals. The assay
certificates can be found in Appendix 4. Spot checks comparing previous assay reports with
the drill logs and the GEMCOM database were undertaken to check for accuracy.




                                           - 87 -
                                                                                                            Watts, Griffis and McOuat


                                                              TABLE 9
                                             WGM ANALYTICAL RESULTS (MOUNT PLEASANT)
                   W       WO3       Mo      MoS2    Bi      Sn      In    Ag       Cu               Zn       Pb       As      Au
                 ICP90A   ICP90A   ICP90A   ICP90A ICP90A  ICA50  IC40M AAS40E    ICA50            ICA50    ICA50    ICA50   FAI303
                                                          ICP90A ICP90A  ICP12B  ICP12B           ICP12B   ICP12B   ICP12B     1
                   %        %        %        %       %      %     PPM     G/T      %                %        %        %      PPB
Field Samples:
MP-1              0.02     0.03     0.03     0.04   0.03   1.170        58      3.0       0.03     1.28     0.03     1.25      32
MP-2              0.02     0.02     0.01     0.01   0.02   1.580       339     111.0      2.60     41.3     8.65     0.71      55

Drill Core Samples:
MPC- 1           0.02      0.03      0       0.01   0.01   2.90         5        0.9       0.06    0.37     0.07     0.16      4
Lac-Billiton               0.03              0.03   0.07   1.74                            0.08    0.04              0.31
MPC- 2           1.32      1.67     0.06     0.10   0.39   0.10        138    75.9/64.6   12.40    0.32     0.03     2.84     239
Piskahegan                 0.74              0.06   0.09   0.07        62.5     28.65      3.55    0.32              0.89     380
MPC- 3           0.04      0.05     0.06     0.09   0.01   9.23        1050     10.0       2.69    0.26       0      0.09      6
Lac-Billiton               0.18              0.27   0.32   1.14        17.8                0.02    0.01     0.01     0.22
MPC- 4           0.24      0.31     0.03     0.05   0.02   4.64        168       <2        1.69    0.09       0      11.5      13
Lac-Billiton               0.79              0.05   0.04   5.39         43                0.55     0.02     0.01     9.02
MPC- 5           0.63      0.80     0.04     0.06   0.16   4.05        350      22.5      16.70    0.97     0.13     10.7      59
ADEX                       0.51              0.09   0.45   3.99        943                4.32     5.28     0.11     4.61
MPC- 6           0.82      1.03     0.35     0.58   0.69   0.04         2        3.0       0.16    0.04       0      0.11     158
MPTM                       0.46              0.34                                                                    0.12
MPC- 7           0.48      0.60     0.68     1.13   0.09   <0.01        1        <2       0.03     0.02      0       0.02      57
MPTM                       0.45              0.42                                                                    0.07
MPC- 8           0.13      0.17     0.01     0.02   0.04   0.497        25     116.0      0.29     4.88     13.5     2.37      21
Lac-Billiton               0.12                            0.41                           0.52     3.71     1.27     0.23
MPC- 9           0.01      0.02     0.09     0.15   0.02   0.488       1570      9.0      0.48     13.7     0.07     1.79      14
Lac-Billiton               0.04              0.11   0.01   0.10        207                0.11     2.03              0.83
MPC-10           2.93      3.69     0.52     0.87   0.17   0.022        15       8.0      0.03     0.12     0.07     2.53     108
MPTM                       2.20              0.45                                                                    4.59
MPC-11           3.22      4.07     0.88     1.46   0.48   0.019        49       4.0      0.06     0.46     0.03     1.74     154
BTM              0.88      1.11     0.30     0.50   0.34                                  0.07     0.03     0.02     0.64
MPC-12           1.41      1.78     0.75     1.25   0.22   <0.01        1        <2       0.03     0.02       0      0.87     187
BTM              1.15               0.36            0.18   0.01                           0.06     0.13     0.01     1.17


                                                              - 88 -
                                                                        Watts, Griffis and McOuat

Six drill sites were visited and the collars locations verified using a GPS instrument. The
collar locations and inclinations were verified for drillholes E1, E9, MPS 151, MPS 127,
PRL95-1 and PRL95-1. Most of the holes were clearly labelled with the hole number with
casings still in place and capped.


One composite grab sample (MP-1) was taken of a tin lode zone in outcrop. The gossan zone
measured 0.5 to 2.0 m in width.       The sample returned 1.28% Zn, 1.17% Sn, 1.25% As,
3.0 g Ag/t and 58 ppm In. The North Zone 600 adit and Fire Tower Zone 900 adit were
located and visited. The 900 adit, used to explore the No. 7 tin lode, was cemented shut with
cinder blocks and backfilled. Grab sample MP-2 was collected from the 900 adit tailings.
The sample contained sphalerite, fluorite and abundant galena hosted in Granite II (quartz-
feldspar porphyry).    Sample MP-2 returned 41.3% Zn, 8.65% Pb, 2.60% Cu, 1.58% Sn,
111.0 g Ag/t and 339 ppm In, confirming the presence of the observed mineralization. Mine
survey station P7 was also located in the field.


Drill Core Examination

On November 10, 2005, Paul Dunbar, assisted by G. Kooiman, examined and sampled
portions of the drill core from the BTM (1A-69), Mount Pleasant Tungsten Mine (B24, B29,
B99), Lac-Billiton Tin Project (C13, C35, C-95, LNZ-17, E1), Piskahegan (PRL 95-2) and
ADEX (AM96-10) drill programs (Table 10). Spot checks were made to cross-check sample
intervals in the core boxes, core logging and verification that mineralization was present. All
information compared reasonably well with the author’s observations.          WGM collected
12 grab samples of the mineralized core, numbered MPC-1 to MPC-12 (see Table 2).
Overall, the assay results compare well with the original assays obtained over the same
intervals by previous operators and confirm the presence of tungsten, molybdenum, tin,
indium, bismuth and silver mineralization (see Table 9). No significant gold assays were
obtained from any of the samples (highest was 239 ppb Au, MPC-2). Sample MPC-3 from
the Endogranitic Zone contained the highest value for tin (9.2% Sn) as well as 1,050 ppm In,
higher values than those obtained Lac-Billiton in 1986.        The highest indium value of
1,570 ppm (0.16% In) with 13.7% Zn, 0.49% Sn and 0.15% MoS2, was obtained from sample
MPC-9 collected from the No. 1 tin lode (North Zone).




                                             - 89 -
                                                                                 Watts, Griffis and McOuat



                                           TABLE 10
          WGM DRILL CORE SAMPLING MOUNT PLEASANT – SAMPLE DESCRIPTIONS
Drillhole      WGM        Old  Old Sample Length WGM Sample                       Comments
              Sample    Sample   From       To   From         To
                                  (ft)     (ft)   (ft)       (ft)
Crest Deposit:
C13           MPC-1     10350    110.8    127.8  123.1      123.5 Composite sample, locally 2-
                                                 126.0      126.6 3% cassiterite,             arsenopyrite,
                                                                   chlorite, Granite II host
Scotia Zone:
PRL 95-2      MPC-2     15063   1,160.0 1,170.0 1,161.0 1,161.4 Massive sulphides, chalcopyrite,
                                                                   pyrite, silicified Granite II
Endogranitic Zone:
C35           MPC-3      7276    140.0    150.0  142.0      142.6 Fractures infilled with cassiterite,
                                                                   malachite,       molybdenite,        trace
                                                                   wolframite, Granite II host
Flank Deposit:
C-95          MPC-4     10431    260.0    270.0  262.3      262.9 Abundant          cassiterite     infilling
                                                                   fractures,          2-3% chalcopyrite,
                                                                   arsenopyrite, silicified granite
Deep Tin Zone:
AM96-10       MPC-5     16005    790.0    800.0  791.4      791.9 Massive chalcopyrite, abundant
                                                                   arsenopyrite
Fire Tower South Zone:
B24           MPC-6      1421    110.0    120.0  110.7      111.0 Composite          sample,      abundant
                                                 117.4      117.7 arsenopyrite
Fire Tower South Zone:
B29           MPC-7      1544     70.0     80.0   75.8       76.2  3-5% Molybdenite, locally, fine
                                                                   grained wolframite
Saddle Zone:
LNZ-17        MPC-8     13710    200.0    210.0  208.8      209.3 Low sulphide, galena, arsenopyrite,
                                                                   molybdenite           in       fractures,
                                                                   chalcopyrite
Tin Lode No. 1 (North Zone):
E-1           MPC-9      8067    200.0    210.0  202.3      202.8 Composite sample, molybdenite,
                                                                   sphalerite, arsenopyrite, silicified
Fire Tower North Zone:
B99          MPC-10      3623    190.0    200.0  193.1      193.4 Composite sample, fractures filled
                                                 199.4      199.6 with                 lots                of
                                                                   wolframite+disseminations,
                                                                   silicified
Fire Tower West Zone:
1A-69        MPC-11     26526     20.0    30.0 0.1 and 0.4 ft core Fractures        and       disseminated
             MPC-12     26527     30.0    40.0      0.6 ft core    wolframite and molybdenite




                                                 - 90 -
                                                                       Watts, Griffis and McOuat

Kvaerner Metals Davy Ltd. Feasibility Study


Kvaerner conducted its own independent review comparing check assays with those reported
from the historical drill programs (North Zone and Deep Tin Zone samples only). They
reviewed all the available check assay data and data on standards and concluded that,
although correlations were generally good (a statistical correlation of better than 0.99), the
lack of precision between laboratories is partly due to comparing different analytical
techniques between laboratories.


The analyses of four composite samples for tin, tungsten oxide and arsenic by Lakefield from
the Billiton drilling program were 15.20% lower than the corresponding Billiton assays.
These differences were refereed with 15 check assays sent to Carnon Consolidated Ltd.,
Cornwall (U.K.), Billiton, Arnhem, The Netherlands and Berstrom & Bakka (South Africa).
Lakefield results were established as correct.


A total of 36 checks on XRAL pulps for ADEX holes AM96-01 to -05 for bismuth, copper,
indium, molybdenite, lead, tin and zinc was sent to Lakefield and the GSC for re-assaying.
XRAL and the GSC analyzed all elements by ICP/MS whereas Lakefield analyzed tin by
XRF, indium by ICPES and other elements by ICP. According to Kvaerner Metals Davy
Ltd., (1997), there was a problem with tin assays above 0.5%, which may have been related to
the analytical method used. It was determined that ICP/MS was good for samples containing
low tin concentrations. Furthermore, all three laboratories were in agreement at the lower
concentrations.   XRAL and the GSC both recommended ICPES for samples containing
Sn>0.5%. With the exception of Sn, assay results for bismuth, copper, zinc and indium
compared closely.


Forty-six pulps from drillholes AM96-06 to -09 were sent to Lakefield for tin and indium
with one MP1A standard inserted. It was determined that the Lakefield indium results were
13.4% lower than the standard. Therefore, it was determined that only indium results from
XRAL would be used by ADEX in their “resource” estimates.




                                            - 91 -
                                                                      Watts, Griffis and McOuat

                             15. ADJACENT PROPERTIES



WGM is not aware of any technical information regarding any adjacent properties that would
be relevant to Mount Pleasant nor has the client brought WGM's attention to such information
or data.




                                          - 92 -
                                                                       Watts, Griffis and McOuat

          16. MINERAL PROCESSING AND METALLURGICAL TESTING



16.1           TIN BASE METAL DEPOSITS


Mount Pleasant Mines Limited conducted metallurgical testing of drill cores between 1960
and 1965. In May 1963, a 100-ton bulk sample was collected from the North Zone for
testing. The sample was sent to Ottawa where the firm of Behre Dolbear conducted “reserve”
studies. Bulk samples were also sent to Europe in 1964 (Kooiman, 2004). In 1964, Bechtel
prepared a feasibility and development study based mostly on the North Zone results and, in
that same year, R. Hewlett of Colorado also prepared a computerized “reserve” study.


16.2           PORPHYRY TUNGSTEN-MOLYBDENUM-BISMUTH DEPOSITS


In 1972 to 1973, BTM collected an 815-ton bulk sample from the North Zone 750 adit that
was dispatched for metallurgical test work at an undisclosed laboratory (Parrish and Tully,
1976). The next year, BTM drove the 400 adit (a 2.75 m by 5.5 m decline) into the higher-
grade part of the Fire Tower West Zone to delineate and to obtain a bulk sample of the
higher-grade mineralization.    In 1976, BTM completed its metallurgical studies and a
feasibility study for a tungsten mine at Mount Pleasant based on the “reserves” in the Fire
Tower Zone.


16.2.1        STRATHCONA 1979 FEASIBILITY STUDY FOR BILLITON CANADA LTD.


Metallurgical Test Work


Strathcona Mineral Services Limited was contracted by Billiton Canada Ltd. to complete a
feasibility study that was completed in 1979 (Strathcona Mineral Services Limited, 1979). As
part of this study, metallurgical test work was conducted to identify the deposit mineralogy
and determine what applicable process would maximize mineral recoveries.               Gravity,
magnetic and flotation processes were evaluated as well as combinations of these three
processes.   One major problem that was identified in the recovery of tungsten was the
intergrowth of ferberite (FeWO4) with other minerals, which affected the ease of liberation of
tungsten. It was also determined that the magnetic concentration process resulted in the




                                           - 93 -
                                                                           Watts, Griffis and McOuat

production of a low-grade tungsten concentrate assaying 2-4% WO3 containing a very high
percentage of chlorite gangue and this was dismissed as a viable recovery process.


It should be noted that chlorite is the only associated mineral that could create problems
during the grinding process. According to Hosking (1985), chlorite is commonly associated
with cassiterite and it is not readily released by grinding because it is flexible but not elastic.
Therefore, chlorite/cassiterite composite grains may be lost during tabling in the mill and
during magnetic separation as such composite grains may report with the magnetic fractions.


Two pilot plant programs were carried out in 1975, one to evaluate the gravity process at an
Ottawa plant and one at the Nigadoo pilot plant to evaluate the flotation process. As for the
gravity testing, a 96-hour continuous test run was completed at the rate of approximately one
half tonne per hour during which consistent metallurgy was obtained.


The Nigadoo Bulk Sample Pilot Plant Test


As part of the feasibility study conducted by Strathcona Mineral Services Limited for Billiton
in 1979, a 10,000 tonne bulk sample from the Fire Tower West deposit was mined from
underground (7,000 tonnes from the Fire Tower West; 1,000 tonnes from the Fire Tower
North; 2000 tonnes of stockpiled material). The sample was shipped to Sullivan’s Nigadoo
mill in northern New Brunswick and was treated at a maximum rate of 150 tonnes per day in
a continuous mill test to evaluate the recovery of wolframite and molybdenite by flotation.
This work included hydrometallurgical test work, Acid Bake Testing and nitric and aqua regia
leach testing. It was determined that both tungsten and molybdenum concentrate produced in
the flotation phase required further treatment to remove impurities by hydrometallurgical
processes in order to produce a marketable concentrate and that further test work was required
before designing a full-scale commercial plant (Strathcona Mineral Services Limited, 1979).


This work further demonstrated that final tungsten concentrates grading 70% WO3 and
containing less than 0.05% arsenic, and final molybdenum concentrates grading 85% MoS2
and containing less than 0.02% lead, copper and zinc, less than 0.05% arsenic and less than
0.1% bismuth could be consistently obtained via the nitric and aqua regia leach routes
respectively.




                                             - 94 -
                                                                        Watts, Griffis and McOuat

At Nigadoo, considerable effort was spent determining the most suitable method for assaying
for the primary metals of interest, particularly for tungsten. The most successful method was
identified as the hydrochloric acid leach method. Copper, lead, zinc, bismuth, iron, and
molybdenum assays were completed with atomic absorption methods.


16.2.2         OPERATION OF THE MOUNT PLEASANT TUNGSTEN MINE


The Mount Pleasant Tungsten Mine operated for less than two years from 1983-85. The
mineral processing of the Fire Tower Zone deposits has been summarized below from Billiton
Canada Ltd. (1985a).       Metallurgical testing by Billiton of the North Zone deposits is
summarized below from Billiton Canada Ltd. (1985b).


Fire Tower Zone


The concentrator at Mount Pleasant was designed to process 650,000 tonnes per year and
produce 2,000-2,500 tonnes per year of 70% WO3 tungsten concentrate (through tungsten
magnetic separation) and 700-1,000 tonnes per year of 85% MoS2 molybdenum concentrate
(through molybdenum leaching steps), depending on the head grade.


The tungsten recoveries estimated in the Feasibility Study proved to be optimistic. The
average tungsten recovery in 1984 was 51% due to losses of very fine grained wolframite.
Subsequent metallurgical improvement work helped to increase the tungsten recovery to
around 60%.


The principal minerals comprising the Fire Tower Zone deposits are quartz (70%), fluorite,
topaz, chlorite, mica-clays, feldspars and opaques. The opaque minerals included about
0.5% Wolframite, 0.2% molybdenite, 0.03-1.0% arsenic minerals and smaller quantities of
copper, zinc, lead, bismuth, tin, silver and indium minerals. The wolframite occurs as iron-
rich ferberite with a liberation size ranging from 50 to 200 microns.


Arsenic found in both arsenopyrite (FeAsS) and löllingite (FeAs2) was identified as the most
deleterious contaminant.


The comminution circuit consisted of underground primary crushing followed by screening
out of pebbles for the grinding circuit. Screened undersize was crushed in a tertiary crusher



                                            - 95 -
                                                                         Watts, Griffis and McOuat

to provide mill feed. A secondary crusher was used to crush oversize pebbles. Autogenous
grinding was chosen because the testwork demonstrated iron interference with wolframite
flotation by steel grinding media. The milled product size was 80%-75 microns. The milled
product then passed to a bulk sulphide flotation section where most of the sulphide minerals,
including molybdenite and arsenopyrite were floated off.       The circuit tailings contained
around 97% Wolframite, which passed to the tungsten recovery section.            The tungsten
recovery started with the rejection of slimes using three stages of hydrocyclones in series.
Approximately 90% of the wolframite was recovered to the underflows, which passed on to
the next stage, which was the wolframite flotation circuit.


The flotation concentrate, containing about 30% WO3 and 20% arsenic, was leached in
sulphuric acid to deactivate or eliminate magnetic iron minerals, and then after filtration,
passed to a high-gradient magnetic separation using a Sala machine. The principal separation
of wolframite from arsenic minerals was achieved through roughing and two cleaning stages
to yield a 68-70% WO3 concentrate with arsenic levels of less than 1%.


Tungsten magnetic concentrate was then leached in ferric sulphate to further reduce arsenic
impurity levels and then dewatered and packed in 250 kilogram drums or 1 tonne bags for
shipment.


Molybdenite was to be recovered from the bulk sulphide concentrate (mentioned earlier)
using flotation with multiple cleaning stages. The flotation circuit was designed to be capable
of producing concentrate grades of up to 85% MoS2 at 60% recoveries. This concentrate
required leaching to reduce impurity levels. The leaching circuit consisted of preliminary
heat treatment to modify particle surfaces to reduce foaming in the subsequent aqua regia
leach. It was only partially commissioned due to low molybdenum prices. The leach circuit
incorporated a unit for the removal of nitrous fumes from the waste products. Leached
concentrate was then to be filtered, dried and bagged.


The molybdenum flotation tailings contained enrichments of several metal sulphides
including copper, lead, zinc, bismuth, silver and indium. Bench-scale flotation testwork
indicated that there is a potential to remove zinc and bismuth as a by-product of the tailings.
Cassiterite was found to also occur in the Fire Tower Zone material but not in large enough
quantities to evoke interest at that time.




                                             - 96 -
                                                                          Watts, Griffis and McOuat

The plant was equipped with an effluent treatment section, which received the various tailings
streams. Fluoride and heavy metal ions were removed in a series of agitator tanks before
being discharged by gravity to the nearby tailings pond.           At that time, all regulatory
requirements with respect to effluent were achieved by this system. The tailings water was
decanted into the natural drainage system. The tailings dam height was designed to support
20 years of mill production capacity.


Much of the tungsten loss from the various parts of the circuit was associated with the
generation of ultra-fines in the grinding circuit. It was concluded that if iron could be proved
to not interfere with the wolframite flotation process, all or parts of the grinding circuit could
be replaced by steel media milling elements to reduce the generation of ultra-fines. A test in
this regard was never undertaken to prove or disprove this conclusion.


It was also concluded that a combination of gravity concentration for coarse wolframite and
flotation for fine wolframite, after preliminary sulphide flotation in each case, might provide
enhanced recovery, particularly if preceded by a rod/ball milling circuit (Billiton, 1985a).


Metallurgical and analytical laboratories established at the site handled metallurgical
testwork, environmental checking, concentrate quality and geological sampling.


North Zone


Initial studies by Lakefield Research for Billiton indicated that approximately 70% of the tin
was recoverable from the North Zone deposits. At that time, no work had been undertaken to
establish the recovery level of the other metals such as tungsten, molybdenum, zinc and
copper.


In 1985, a Phase I metallurgical test program was conducted by Lakefield on composite
samples collected from the Contact and Upper/Lower Endogranitic Zones. Cassiterite was
found to be the main tin mineral, accounting for more than 95% of the tin. A sulphide
mineral (mawsonite) accounted for the remainder. Cassiterite usually occurs as granular
aggregate with gangue minerals averaging greater than 100 micron in diameter.


As far as liberation was concerned, heavy liquid studies on Contact Zone material indicated
good liberation as measured by tin in the 2.95 (specific gravity) floats from 1 mm size



                                             - 97 -
                                                                       Watts, Griffis and McOuat

particles.   Upper Endogranitic mineralization showed similar results.     Samples down to
100 microns from the Lower Endogranitic mineralization had poor liberation.           Arsenic
minerals were well liberated from all three zones at relatively coarse sizes.      The other
sulphides did not perform as well.


Sulphide flotation tests using amyl xanthate collector and MIBC frother showed that 90% of
the arsenic and over 80% of the total sulphides could be recovered to a rougher concentrate at
a grind of 80% passing 220 microns, with a loss of only 5% of the tin. Finer grains gave
slightly improved sulphide recoveries and lower tin losses.


Tin flotation after desliming had a recovery of 77% of the tin to a rougher concentrate and
45% to a third cleaner concentrate at a grade of 34% tin using styrene phosphoric acid
collector at a grind of 80%-72 microns. Most of the tin remaining in the tailing was in the
+53 micron fractions.


Gravity concentration gave a recovery to rougher concentrate of 95%, a recovery to cleaner
concentrate of 69% and a grade of 29% tin. Topaz was identified as a diluent to the gravity
concentrates that needed to be removed. Scouting magnetic separation testwork using a
Frantz Magnetic Separator on the 100-150 micron size fraction showed that over 60% of the
tin reported to the magnetic fraction.


Both, flotation and gravity concentration appeared to reach a limiting concentrate grade of
around 30% tin but gravity gave a better recovery on the -53 micron material. According to
Billiton Canada Ltd. (1985a), an appropriate flowsheet appeared to be a fairly coarse grind
(80%-220 microns) followed by sulphide flotation, size separation at around 50 microns,
gravity concentration of the +50 micron fraction, to give a concentrate of around 30% tin at
an overall recovery of about 70%.


16.3            PORPHYRY TIN DEPOSITS


16.3.1          BULK SAMPLING PROGRAMS: LAC-BILLITON TIN PROJECT


Bulk samples were collected from the North Zone’s Endogranitic Zone and the contact Crest
deposit during October-November 1986 through underground development work to produce a
feasibility study (Lac Minerals Ltd., 1988).     Sampling was conducted for evaluation of



                                           - 98 -
                                                                      Watts, Griffis and McOuat

horizontal holes through the zones and metallurgical testing. Representative samples were
collected using an on-site sampling plant for shipment to Lakefield for assaying.        All
remaining material was stored in the “A-Frame” on-site where it remains today. The source
of information provided below is from Lac Minerals Ltd. (1988).


Endogranitic Zone Bulk Sample


A bulk sample drift (Section 2A), also called the “2A Bulk Sample Drift”, was pre-drilled to
define the limits of the deposit prior to underground development. Two holes were drilled
horizontally from the 950 exploration drift through the Endogranite Zone from the hanging
wall to footwall. Hole C82 was collared 1.14 m northwest of hole C81. The core was logged,
spit and assayed. The 2A bulk sample drift, measuring 3.5 x 4.0 m (cross section) advanced
at 3.0 to 3.4 m rounds (11 rounds in total). Each round of muck was processed as an
individual bulk sample. Each face in the ore was mapped, chip sampled and photographed.
Bulk comparisons were very good. Hole C81 averaged 0.71% Sn and hole C82 averaged
0.73% Sn. The bulk sample averaged 0.72% Sn (Kvaerner Metals Davy Ltd., 1997).


Contact Crest Zone Bulk Sample


The sample site was located at the east side of the North Zone Access Decline between
13,630 N and 13,650 N. It was pre-drilled by hole C13, which was logged and sampled. The
procedure for collecting the Crest deposit bulk sample was the same as that of the
Endogranite Zone (described below). A total of 2,582 tonnes of material was collected.


Bulk Sample Processing and Results


Each bulk sample from the two zones was trucked to surface, crushed to minus 5/8” and run
through a three-stage sample tower. A total of 1,728 tonnes of Endogranite Zone material
grading 0.79% Sn was processed and 195.8 tonnes grading 0.83% Sn was shipped to
Lakefield. The crest bulk sample totalled 854 tonnes grading 1.0% Sn. A total of 84.6 tonnes
grading 1.08% Sn was shipped to Lakefield.


A comparison of the tin and arsenic values for the total bulk sample, the shipped sample and
the average of the calculated heads at Lakefield is given in Table 11. Results for the
Endogranite Zone bulk sample compared very well. The discrepancies with the Crest deposit



                                          - 99 -
                                                                                  Watts, Griffis and McOuat

may have resulted from incomplete blending of the two high-grade and two low-grade rounds
taken underground.      A total of 20 tonnes of the shipped Crest sample, not used for
metallurgical tested, remained in storage at Lakefield at the end of the project.

                                          TABLE 11
                       LAC-BILLITON BULK SAMPLE TEST RESULTS
   Bulk Sample           Average Grade        Average Grade  Lakefield Research
                        Total Bulk Sample    Shipped Sample Average Head Grades
                         %Sn         %As     %Sn       %As   %Sn          %As
Endogranite Zone         0.79        0.39    0.83      0.39  0.84          0.43
Crest Deposit            1.05        0.35       1.08       0.35              0.91                0.32
                                                                  Source: Lac Minerals (1988), Section 2.6.3


There was a poor correlation of assay results between individual core lengths from drillholes
and the corresponding blasted rounds. This correlation illustrates the erratic distribution of tin
mineralization within the Endogranite Zone and Crest deposit. However, there was a better
correlation between assays of complete intersections by drillholes and bulk sample results
leading to the conclusion that the drillhole grades were acceptable for use in estimating North
Zone “ore reserves”.


16.3.2          J.S. REDPATH MINING CONSULTANTS METALLURGICAL
                TESTING/FLOWSHEET


In 1987, J.S. Redpath Mining Consultants Limited of North Bay, Ontario, prepared a three-
volume report on ore handling alternatives for tin ore from the North Zone. Metallurgical test
work results from Lakefield indicated promising recoveries. After completing a substantial
amount of bench-scale test work, a two-month period of pilot plant testing on bulk samples of
the two main types of mineralization (Endogranitic and Contact) was carried out at Lakefield
from January to March 1987. This led to the development of a flowsheet, which used many
of the process features found in the successful Wheal Jane operation in Cornwall, U.K. A
metallurgical balance indicated an overall recovery of 64% of the tin into a concentrate
grading 36.9% Sn, combining gravity and flotation concentrates (Kooiman, 2004).




                                             - 100 -
                                                                          Watts, Griffis and McOuat

16.3.3          COMINCO ENGINEERING SERVICES LTD. METALLURGICAL TEST-
                WORK/FLOWSHEET


In 1989, Novagold Resources Inc. contracted Cominco Engineering Services Ltd. to conduct
metallurgical work on the tin ore from the North Zone to investigate its potential as a
polymetallic mineral deposit and develop a new flowsheet utilizing a flotation plant bioleach
process described below by ADEX Mining Corp. (1995). As part of this study, 30 tonnes of
material were shipped to Lakefield for metallurgical testwork (Kooiman, 2004).


Flotation Plant


Cominco developed a new flowsheet in 1991. The circuit consists of a rod mill followed by a
ball mill in closed circuit with cyclones. A Falcon Concentrator (a high intensity gravity
separator using centrifugal force) was included to treat the cyclone overflow.         Magnetic
separators are necessary to remove grinding steel and other magnetic constituents, which will
destroy the effectiveness of the Styrene Phosphoric Acid (“SPA”) used as the tin collector. The
non-magnetic flow is conditioned in preparation for sulphide flotation. The sulphide rougher
concentrate is retreated in a cleaner column. The column concentrate becomes the feed for the
bioleach process. The rougher tails are conditioned with sulphuric acid and SPA before feeding
the tin rougher cells. The rougher concentrate is cleaned in two stages of column cells. The
rougher tails feed a bank of scavenger cells. The scavenger concentrate is combined with the
first cleaner tails for desliming prior to returning to the roughers.


Cominco concluded that flotation plants were simpler to operate than gravity plants and that a
flotation plant was easier to monitor and control than a gravity plant.


The initial bench tests on the Mount Pleasant material yielded a concentrate grading 43% tin at
80% recovery.


Cominco also noted that column cells had been successfully used to upgrade tin concentrate at
both the Wheal Jane Mine and at the East Kemptville Tin Mine. At both mines, concentrate
grades had been improved by 6-11%.


For cash flow purposes, Cominco used a tin grade of 50% at a recovery of 80%. The flotation
circuit was also successful in reducing the arsenic in the tin concentrate to less than 0.4%. The



                                               - 101 -
                                                                          Watts, Griffis and McOuat

information from the bench tests was sent to smelters for concentrate acceptability and for
calculation of penalties. The smelter charges were used in the cash flows.


Cominco designed a flotation plant in 1991. Detailed capital and operating costs were also
developed for a 1,500 tonne per day (“tpd”) mill. These costs were increased by inflation and
scaled up to give a capital and operating cost estimate for a 2,000 tonne per day mill. The plant
was designed using as much of the infrastructure and equipment remaining from the tungsten
plant as was possible. The costs for additional required purchases were based on all new
equipment. There was an opportunity for significant cost savings by purchasing used equipment
from the East Kemptville Tin Mine.        Much of the equipment from Mount Pleasant was
purchased for the East Kemptville Tin Mine when the Mount Pleasant Tungsten Mine closed.


Bioleach Process


Initially, work concentrated on utilizing pressure leach technology to treat the sulphide
concentrate from the tin circuit. After a preliminary economic analysis, it was found that the
pressure leach technology was too expensive to recover the sulphide metals. In August 1994, a
sample of the sulphide concentrate was provided to the Research and Productivity
Council (“RPC”) in New Brunswick to determine if the concentrate was amenable to a bioleach
process. The bacterial strain used was taken from water at one of the waste dumps at Mount
Pleasant and cultured. The natural bacteria at Mount Pleasant had already mutated to live on the
Mount Pleasant mineralization. The main target for the bioleach process was the indium. In the
120 days of the agitated leach test, 80% of the indium was solubilized. Zinc, copper and
bismuth were also solubilized at about the same level. Bismuth was to be studied in further tests
to determine if more metal could be extracted. It was concluded that potential operating costs
for bioleach were about 20% of the costs of pressure leach. Mount Pleasant Mine would be
expected to produce between 10 to 30 tonnes of sulphide concentrate per day depending on the
type of mineralization processed.


Piskahegan planned to use a combination of metal cementation and Solvent Extraction (“SX”)
to recover the metals from solution. Their plan was to produce an 80% indium cement (zinc
powder as a cementing agent), a bismuth cement (lead powder as a cementing agent), a copper
cement (scrap iron as a cementing agent) and zinc metal with a small electrowinning cell.




                                            - 102 -
                                                                        Watts, Griffis and McOuat

16.3.4         WGM-SUPERVISED FEASIBILITY STUDY


In 1990, a feasibility study was initiated and supervised by WGM with involvement of Davy
Canada Inc (Davy Canada Inc., 1990). A Study Report proposed construction of a 1,500 tpd
tin concentrator at the Mount Pleasant property. The design basis and flowsheet for the plant
were developed based on testwork, which was completed by Lakefield.


The tin concentration facility was designed to provide a low-grade tin concentrate to feed an
on-site chlorination plant, provided by others.         The concentration facility included
underground crushing and conveying and consisted of surface storage and crushing, dense
medium separation, coarse and fine gravity concentration, fine-tin flotation, concentrate
regrinding, sulphide flotation and concentrate thickening and filtration. The total estimated
capital cost of the concentrator was $20.67 million.


At approximately the same time as the WGM study was underway, Novagold commissioned a
mineralogical study of 40 core samples from the various deposit areas in the North Zone. The
study was carried out by H.W. Fander of Central Mineralogical Services of Australia. Fander
was recommended by East Kemptville Tin Mine management and was credited with
pinpointing the cause of large amounts of fines produced during concentration (large
cassiterite crystals are micro-fractured and stressed and fall readily apart into fines during
processing). According to Kooiman (2004), the Fander report, completed in May 1990, was
probably the best mineralogical report carried out on tin mineralization at Mount Pleasant.


16.4           TIN-INDIUM BASE METAL DEPOSITS


In 1991 and 1992, 600 samples of mineralized and unmineralized rocks from the Fire Tower
West Zone were analyzed for indium. Until then, only around 50 indium assays were
available.


In early 1993, due diligence work was carried out by WGM and samples were shipped to
Lakefield and Cominco (Kooiman, 2004). A bismuth-bearing concentrate was shipped to
SIDECH, a bismuth smelter and refiner near Brussels, Belgium.




                                            - 103 -
                                                                       Watts, Griffis and McOuat

That same year, Piskehegan continued to develop the metallurgical processes including a
bioleach process for the treatment of tin-sulphides from the North and Deep Tin Zones and
prepared a new pre-feasibility study (ADEX Mining Inc., 1995).


Piskahegan collected over 2,000 samples of previously drilled core and analyzed them for
indium (Kooiman, 2004). The samples were mostly diamond drill core rejects and pulps from
the North Zone. In addition, pulps from underground chip samples collected in the sixties and
seventies from the 600, 750 and 900 adit workings were also analyzed. Over 80 samples from
the deeper underground development in the North Zone were added to complete the
investigation.


The investigation confirmed the widespread occurrence of indium, in particular, in the tin-
zinc-copper rich deposits. The average indium content from 2,376 samples was 112.6 ppm
(Table 12). The highest recorded indium value was 8,690 ppm. One in every eleven samples
yielded over 300 ppm In. Most of the high values, those exceeding 1,000 ppm In, were
collected from the southern part of the Deep Tin Zone and the Fire Tower North Zone.

                                           TABLE 12
                           SUMMARY OF INDIUM ASSAYS, MOUNT PLEASANT
   Range of Indium             Number of       Range of Indium            Number of
       (ppm)                    Samples            (ppm)                   Samples
          >1                     2,346            500-525                    12
         1-25                    1,129            525-550                     5
        25-50                     333             550-575                     3
        50-75                     218             575-600                     5
       75-100                     140             600-625                     4
      100-125                      98             625-650                     3
      125-150                      66             650-675                     6
      150-175                      65             675-700                     2
      175-200                      46             700-725                     5
      200-225                      32             725-750                     1
      225-250                      34             750-775                     3
      250-275                      25             775-800                     1
      275-300                      17             800-825                     1
      300-325                      17             825-850                     3
      325-350                      22             850-875                     5
      350-375                      13             875-900                     5
      375-400                       9             900-925                     2
      400-425                      12             925-950                     0
      425-450                       8             950-975                     3
      450-475                      10            975-1,000                    1
      475-500                       7              >1,000                    41
Total Number of Samples Analyzed for Indium = 2,376;                         Source Kooiman (2004)
Average Indium = 112.58 ppm; Median Indium = 229.62 ppm




                                                          - 104 -
                                                                       Watts, Griffis and McOuat

In September 1994, D.M. Fraser Services Ltd. prepared a report for Piskahegan reviewing the
feasibility of producing tin, indium, base metals and rare earth metals from the Mount
Pleasant deposits utilizing all work conducted on the property since 1987.        A financial
analysis was prepared based on the North Zone (including the Deep Tin Zone) and utilizing
tin flotation and pressure leach circuits for sulphide minerals followed by solvent extraction
(D.M. Fraser Services Ltd., 1994).


In January 1995, a 100-kg sample was shipped to RPC to start bacterial inoculums leaching
for bioleach test work.


16.5           METALLURGICAL PROCESSING AND TESTING BY ADEX


In June 1995, work started to prepare a 30-tonne sample for a bioleach test heap at RPC
(Kooiman, 2004).      High-grade material with zinc and zinc-copper mineralization was
collected from the dumps of the 600 adit and, to a lesser extent, from the 900 adit. The
sample was shipped to RPC at the end of July 1995. It assayed 4.93% Zn, 0.75% Cu,
0.91% Sn and 0.019% In.


During mid-August, a 1.0-tonne high-grade ore sample was collected from the 600 adit
dumps and shipped to RPC for direct bioleaching tests (Kooiman, 2004). The sample assayed
6.54% Zn, 6.26% Cu, 2.64% Sn, 7.98% As, 0.40% Bi and 0.097% In.


In the fall of 1995, the technical program was redesigned, shifting from heap leach technology
to the operation of a continuous stirred tank reactor (“CSTR”) system. Initially, at RPC and
later on at the minesite (Kooiman, 2004). The feed for this work was again collected from the
600 adit dump, as a 5-tonne sample, grading 11.06% Zn, 1.38% Cu, 3.64% As and 0.131% In.
The sample was shipped to the Technical University of Nova Scotia (“TUNS”) in Halifax for
processing by flotation. The flotation concentrates were shipped back to RPC and Mount
Pleasant by the end of 1995.




                                           - 105 -
                                                                        Watts, Griffis and McOuat

16.5.1         KVAERNER 1996/97 FEASIBILITY STUDY – NORTH ZONE


On June 25, 1996, ADEX awarded the preparation of a feasibility study to Kvaerner, formerly
Davy International Canada Ltd. The study was to be used as the basis for arranging project
financing to re-establish a mining and processing operation at Mount Pleasant. The study was
nearing completion when the mining markets suffered a significant setback in 1997 in the
aftermath of the Bre-X scandal.


The scope of the study included the audit and verification of ADEX’s “reserve” estimates of
the North Zone and Deep Tin Zone to support a production rate of 2,000 tpd, an operating
schedule of 7 d/wk and the recovery of tin, indium, copper, zinc and bismuth. During the
course of the study the production rate was increased to 2,500 tpd, by using economies of
scale, in an attempt to improve the project economics.


Several samples were shipped to Lakefield in 1996 and in January 1997 (Kooiman, 2004). A
60-kg sample was shipped to Lakefield in August 1996 and processed in September for the
evaluation of new collectors in the tin flotation circuit. The sample assayed 0.78% Sn,
0.081% Cu, 0.38% Zn, 0.62% As and 0.002% In. A second, 1-tonne sample, was shipped in
October and was used for bench scale flotation work at Lakefield in November. This sample
assayed 0.79% Sn, 0.18% Cu, 0.67% Zn, 0.73% As and 0.007% In.


In the fall of 1996, a 30-tonne bulk sample was collected by ADEX for metallurgical testing
and pilot plant testing at Lakefield in support of the feasibility study. The sample was to
represent the average composition of the total North Zone and much attention was paid to
how it was collected (Kooiman, 2004). Approximately two thirds of the sample consisted of
material originally collected by LAC from the Endogranitic and Contact Zones (Table 13).
The remaining one third of the sample came from underground development samples,
underground core drilling rejects, surface diamond drill core rejects and 2.4 tonnes of rejects
and split core from the 1996 surface drilling programs.




                                           - 106 -
                                                                          Watts, Griffis and McOuat

                                        TABLE 13
            COMPOSITION OF 1996 BULK METALLURGICAL SAMPLE
Material Used                                                                          Tonnes
Endogranitic Zone (950L)                                                               18.0
Contact Crest (950L)                                                                    3.0
Deep Tin Zone coarse rejects                                                            2.5
High Grade Vein Material (North Zone Access Decline)                                    1.5
Development Rock (North Zone underground development)                                   1.5
Crest/Flank/Deep Tin Zone coarse rejects (from earlier drill programs)                  3.5
Average Grade: 1.1% Sn, 0.32% Zn, 50 ppm In                                            30.0
                                                             Source: Kvaerner Metals Davy Ltd., (1997)


The bulk sample left Mount Pleasant on January 8, 1997 and portions of this material were
used for a continuous pilot plant test at Lakefield to meet the following objectives (Kooiman,
2004):


•   To achieve a tin recovery of greater than 80% and a concentrate grade greater than
    40% tin and less than 0.5% arsenic; and
•   To maximize the recovery of indium into a sulphide concentrate suitable for treatment by
    bacterial leach technology.


The Lakefield sample assayed 0.79% Sn, 0.67% Zn and 70 ppm In.


Good results were obtained in sulphide flotation and in the recovery of coarse tin (Kooiman,
2004).    Poor results were obtained in the flotation of fine tin and further laboratory
development work was recommended on fine-tin flotation, however, the program was
curtailed at that point.


A few hundred additional diamond drill pulps were selected in 1997 for indium analysis for
the Deep Tin Zone area. “Reserve” calculations were then carried out on the Upper Deep Tin
Zone and smaller bodies such as the near-surface No. 4 tin lode.


Kvaerner Study Recommendations and Conclusions


A mixture of sublevel caving and long hole stoping was recommended for an efficient
extraction of ore. The proposed mine design included access by inclined ramps, ore transport
by truck to an underground crusher and then by belt conveyor to surface.



                                              - 107 -
                                                                           Watts, Griffis and McOuat

The ore would be processed at three processing plants for which the study prepared general
arrangements and flowsheets.


The existing mill building was to be modified to process run-of-mine ore to produce a zinc-
indium flotation concentrate as bioleach feed and a tin concentrate for smelting.


The study concluded the following:


•   A new bioleach plant would utilize a bacteria oxidation process to separate the base
    metals into an oxidized sulphate solution;


•   A new hydromet plant would produce indium, zinc and copper in a series of reduction,
    precipitation and solvent extraction stages;


•   The existing surface facilities at the Mount Pleasant property would be re-used to the
    greatest extent possible;


•   The estimated capital costs of bringing the property into operation were $102 million
    based on mid-1997 costs;


•   The operating costs were estimated at $44.34/t of ore, which was broken down into a mine
    operating cost of $19.40/t and a process operating cost of $24.94/t;


•   Financial analyses were conducted on two cases: a “mineable resource” of
    3.6 million tonnes and an 8 million tonnes “resource”. For both cases the net present value
    (“NPV”) and the internal rate of return (“IIR”) were negative and the break-even tin price
    was above US$3/0.45 kg; and


•   The study proposed an alternative and in WGM's opinion more attractive scenario,
    whereby the facility would produce a tin concentrate and an indium-copper-zinc
    concentrate. Kvaerner’s preliminary financial analysis, based on 1997 costs, showed a
    NPV of $62 million (at a discount rate of zero) and an IRR of 13.3%.




                                             - 108 -
                                                                         Watts, Griffis and McOuat

16.5.2         CANMET – NEW INDIUM STANDARD


In the fall of 2001, a request was made by CANMET in Ottawa for ADEX to supply its
mineral science laboratories with mineralized material for the manufacture of a new Mount
Pleasant standard (Kooiman, 2004). CANMET had almost depleted its supply of MP 1-A
standard, which was made in the early eighties using No. 7 tin lode mineralization taken from
the 900 adit dumps. The MP 1-A standard, with a recommended indium value of 0.033% In
±10 ppm, has been widely used during indium assaying campaigns at Mount Pleasant.
Standard MP1-A replaced the first standard made from Mount Pleasant ores, MP-1 (1978)
with recommended values of 15.90% Zn, 2.43% Sn, 2.09% Cu, 1.88% Pb, 0.014% Mo,
0.069% In, 0.024% Bi, 0.77% As and 57.9 g Ag/t.


According to Kooiman (2004), an 800-kg sample was shipped to CANMET in
December 2001. It contained material from the 900 adit dump (125 kg), the breccia pipe of
the Fire Tower Zone (300 kg), the 600 adit dump (325 kg) and tungsten-molybdenum-
bismuth mineralization from the “A-frame” (50 kg). Some of the material collected from the
600 adit dump is rich in chalcopyrite, fluorite and characterized by cm-sized radial aggregates
of black tourmaline. This material originated from the 310 East drift of the 600 adit where
muck samples were taken in 1965 averaged 5.58% Cu, 1.47% Zn and 0.84% Sn.                    A
few tonnes of this material are present in the core shack, stored in 45-gallon drums.




                                            - 109 -
                                                                              Watts, Griffis and McOuat

        17. MINERAL RESOURCE AND MINERAL RESERVE ESTIMATES



17.1           WGM MINERAL RESOURCE ESTIMATE STATEMENT


WGM has prepared Mineral Resource estimates for the Mount Pleasant Fire Tower West
Zone and Fire Tower North Zone, collectively known as the Fire Tower Zone. A summary of
the Mineral Resource estimates is provided in Table 14.

                               TABLE 14
             MINERAL RESOURCE ESTIMATE – PREPARED BY WGM
                   Area                Inferred Mineral Resource
                                  (using a 0.3% WO3 Eq* cutoff grade)
                                  Tonnes          %WO3         %MoS2
       Fire Tower West            9,209,081        0.34          0.21
       Fire Tower North           3,865,356        0.37          0.20
       Total Fire Tower Zone     13,074,438        0.35          0.21
       * WO3 Eq (equivalent) = %WO3 + 1.5 x %MoS2. The basis for the use of this form of cutoff
       and how it was derived are discussed later in the text.


The Mineral Resource estimates were prepared and carried out in accordance with the
provisions of NI 43-101 guidelines and the CIM standards.


For the purposes of this report, the relevant definitions for the CIM Standards are as follows:

   A Mineral Resource is a concentration or occurrence of diamonds, natural solid
   inorganic material, or natural solid fossilized organic material including base and
   precious metals, coal, and industrial minerals in or on the Earth’s crust in such form
   and quantity and of such a grade or quality that it has reasonable prospects for
   economic extraction. The location, quantity, grade, geological characteristics and
   continuity of a Mineral Resource are known, estimated or interpreted from specific
   geological evidence and knowledge.

   An ‘Inferred Mineral Resource’ is that part of a Mineral Resource for which
   quantity and grade or quality can be estimated on the basis of geological evidence and
   limited sampling and reasonably assumed, but not verified, geological and grade
   continuity. The estimate is based on limited information and sampling gathered
   through appropriate techniques from locations such as outcrops, trenches, pits,
   workings and drillholes.




                                               - 110 -
                                                                           Watts, Griffis and McOuat

    An ‘Indicated Mineral Resource’ is that part of a Mineral Resource for which
    quantity, grade or quality, densities, shape and physical characteristics, can be
    estimated with a level of confidence sufficient to allow the appropriate application of
    technical and economic parameters, to support mine planning and evaluation of the
    economic viability of the deposit. The estimate is based on detailed and reliable
    exploration and testing information gathered through appropriate techniques from
    locations such as outcrops, trenches, pits, workings and drillholes that are spaced
    closely enough for geological and grade continuity to be reasonably assumed.

    A ‘Measured Mineral Resource’ is that part of a Mineral Resource for which
    quantity, grade or quality, densities, shape, and physical characteristics are so well
    established that they can be estimated with confidence sufficient to allow the
    appropriate application of technical and economic parameters, to support production
    planning and evaluation of the economic viability of the deposit. The estimate is
    based on detailed and reliable exploration, sampling and testing information gathered
    through appropriate techniques from locations such as outcrops, trenches, pits,
    workings and drillholes that are spaced closely enough to confirm both geological
    and grade continuity.

17.2           GENERAL MINERAL RESOURCE ESTIMATION PROCEDURES


The Mineral Resource estimate procedures consisted of:


•   Database compilation and verification;
•   Development of 3-D wireframe models within major lithological units, using the suite of
    geochemical assays available for each drillhole sample interval; and
•   Generation of block models for Mineral Resource estimates for the Fire Tower Zone,
    using a geostatistical approach applying ordinary Kriging and carrying out comparative
    estimations using Inverse Distance Squared (“ID2”) and Nearest Neighbour (“NN”)
    methods.


17.3           DATABASE


17.3.1         GENERAL


Data used to generate the Mineral Resource estimates originated from a Gemcom Software
International Inc. (“Gemcom or GEMS”) Project converted from an older version of
Gemcom software. This GEMS project was created by ADEX in 1997. The GEMS Project
contained three separate drillhole databases pertaining to three Mount Pleasant zones, namely



                                             - 111 -
                                                                       Watts, Griffis and McOuat

the Fire Tower Zone, the Saddle Zone and the North Zone (not to be confused with the North
Zone portion of the Fire Tower Zone). WGM has not validated the data for the North Zone
and Saddle Zone workspaces as they were not part of this study.


The Fire Tower Zone drillhole database consisted of 676 collar locations (in Mine
Coordinates), geological codes, and 24,544 assay intervals with multi-element values (% of
MoS2, WO3, Sn, Cu, Zn, Pb, Bi, As, Ca, Fe and In (ppm)). The data were provided in digital
form on a CD.


Additional information, including copies of the geological logs, mine workings, historical
“mineral resource” estimates and geological interpretations were supplied as paper copies.
Occasionally, Excel spreadsheets or faxes containing additional data (e.g., geological
information or assays) from the site were either e-mailed or hand delivered to WGM by
ADEX.


Twenty-five east-west cross sections (with spacing varying between 12 and 31 m), 18
north-south cross sections (with 25 m spacing) and 15 radial cross sections (approximately
10 m spacing) were generated by WGM to coincide with the historical sections interpreted by
ADEX.


17.3.2          DATA VALIDATION


Upon receipt of the data, WGM performed the following validation steps:


     Checking for location and elevation discrepancies by comparing collar coordinates with
     the copies of the original drill logs received from the site;
     Checking minimum and maximum values for each quality value field and
     confirming/modifying those outside of expected ranges;
     Checking for inconsistency in lithological unit terminology and/or gaps in the
     lithological code; and
     Checking for gaps, overlaps and out of sequence intervals for both assays and lithology tables.


The Assay table contained several errors, i.e., “composite length greater than hole length”,
“out of sequence interval” or “negative value interval”, which were easily corrected. The
“zero length interval” errors indicated drillholes with no assay values. For four drillholes



                                             - 112 -
                                                                          Watts, Griffis and McOuat

with no assays and located in the main mineralized zone, WGM requested additional
sampling and the resulting new assay data was added to the database. Within the Lithology
table, a few of the drillholes have missing intervals. These were corrected using drill logs
provided by ADEX. After the corrections were completed, the database was in relatively
good order and no errors were identified that would have a significant impact on the Mineral
Resource estimate.


17.3.3         DATABASE MANAGEMENT


The drillhole data were stored in a GEMS multi-tabled workspace specifically designed to
manage collar and interval data.       Other data, like surface contours or cross sectional
geological interpretations were stored in multi-tabled polyline workspaces.         The project
database also stored section and level plan definitions, 3-D surfaces and solids, and the block
models, such that all data pertaining to the project are stored within the same project database.


17.4           GEOLOGICAL MODELLING PROCEDURES


17.4.1         GENERAL


In general, the modelling procedures were as follows:


•   Geological interpretation and digitizing of lithological outlines;
•   3-D surface (TIN) and solid/wireframe creation;
•   Database manipulation and compositing;
•   Statistical analysis and variography;
•   Block grade estimation; and
•   Classification and reporting of Mineral Resources.

17.4.2         GEOLOGICAL INTERPRETATION AND DIGITIZING


Section Definitions
Vertical sections were defined for the Fire Tower West and North zones, and were oriented to
coincide with original ADEX vertical sections. It should be noted that the original east-west
(“E-W”) sections had a spacing that varied from section to section, from less than 10 m to
31 m. This irregularity in spacing of original sections was maintained to ensure consistency


                                             - 113 -
                                                                          Watts, Griffis and McOuat

and alignment with historical drilling. The north-south (long) sections were defined with a
standard 25 m separation. In the Fire Tower North Zone, additional radial sections were
created to best fit the orientation of underground holes.


In total, 25 north-looking vertical (cross) sections, 18 west-looking vertical (long) sections
and 15 radial sections were defined for the Fire Tower West and Fire Tower North Zones.
Figure 8 shows the drillhole plan (collars only) and the section locations.


Geological Interpretation of the Fire Tower Zone
The boundaries of the mineralized body were interpreted manually by Mr. Boyd on 58 drill
section plots ranging spatially from less than 10 m to 31 m apart orientated E-W, north-south
(“N-S”) and radial with reference to the mine grid coordinates. Geological interpretation
identified at least three main W-Mo mineralized units named Fire Tower Breccia (“FT-BX”),
Granite I (“GR1”) and Quartz Feldspar Porphyry (“QFP”), however, these units were found to
be not consistently mineralized and the mineralization commonly cut across geological units
and structural boundaries. The wide variety and inconsistency of the geological units hosting
potentially economic mineralization meant that boundaries were defined based solely on
%WO3 and %MoS2 values that were plotted on the cross sections. Boundaries were drawn
halfway between drill holes, and if no holes existed to limit the mineralization outlines, the
boundaries were extended to a maximum of 20 m away from the nearest hole. In general,
extensions of the boundaries were made consistent with the trends defined by joining known
cutoff boundaries. A minimum width of three metres was used for defining the zones.


For some holes, the database contained assay values for Sn, Zn, Cu, As, Bi, Pb, Ca, Fe, Au,
Ag and In. A fourth mineralized unit named Granite II (“GR2”) was found to host important
Sn-In-base metal mineralization. However, these elements and this mineralized unit were not
incorporated into the Mineral Resource estimate because they possess vastly different
processing and recovery challenges, and thus must be assessed economically as separate
mineralized bodies. Such an assessment is beyond the scope of this report. In places, this
mineralization was found to be adjacent to, and even to overlap, the W-Mo mineralized body.


Cutoff Grade
Mineralized zones were originally defined as an upper tungsten zone based on a cutoff of
0.15% WO3, and a separate smaller lower molybdenum zone based on a cutoff of




                                             - 114 -
                                                                        Watts, Griffis and McOuat

0.20% MoS2. As the building of the model progressed, this concept was changed to a single
cutoff for zone definition, i.e., a 0.3% WO3 equivalent (“Eq”), in which WO3 Eq = %WO3 +
1.5 x %MoS2. The WO3 Eq cutoff was chosen because of the close geological and spatial
relationship between the elements, and its formula was based on the average previous 10-year
ratio of the price of Mo to W, consistent with the premise of a mine life for the Fire Tower
Zone of +10 years. The use of the WO3 Eq cutoff resulted in the modeling of a significantly
more coherent, integrated and potentially mineable mineralized body.


The value of the Fire Tower Zone W-Mo mineralization at the WO3 Eq cutoff is US$27/tonne
(C$30) at a chosen tungsten price of US$90/MTU (US$9.0/kg WO3) based upon the mine life
of +10 years and the previous ten year price relationship between W and Mo. This assumed
metal price/Eq grade cutoff is a reasonable one for the purposes of preparing a Mineral
Resource estimate, particularly considering that the assumed prices are far below early June
2006 prices, which are approximately US$18/kg WO3 and US$25/lb for MoS2.


Digitizing Geological Interpretations and Solid/3-D Wireframe Creation
The original manually drawn cross sectional interpretations of the mineralization were
digitized into a GEMS polyline workspace. Each polyline was assigned an appropriate rock
type and stored with its section definition (Figure 9). Three types of polylines were created,
each representing separate zones: WO3 Zone, MoS2 Zone and WO3 Eq Zone. Special care
was taken to ensure that the digitized lines were ‘snapped’ to drillhole intervals. This step
allows for the creation of a true 3-D wireframe that honours the 3-D position of the drillhole
interval. This is important because some drillholes were substantially offset from the cross
section midpoint.


In total, 13 sections in the Fire Tower West Zone and 15 sections in the Fire Tower North
Zone have digitized sectional polylines. Digitized sectional interpretations of geological
polylines and drillhole information were plotted for verification and potential changes. A
number of the longitudinal sections with the polygons projected from the cross sections was
also plotted to ensure correlation between sections. All changes were digitally updated and
stored in the GEMS polyline workspace.


The geological polylines digitized on the vertical sections were joined using special polylines
(tie lines) in order to produce separate 3-D solids/wireframes for each zone, so individual




                                           - 116 -
                                                                          Watts, Griffis and McOuat

volumes and tonnages could be reported. In total, five geological wireframes were created;
WO3 Zone, MoS2 Zone and WO3 Eq Zone in the Fire Tower West area, and WO3 Zone and
WO3 Eq Zone in the Fire Tower North area. Only the WO3 Eq zones were utilized in the
block model generation.


Digitizing Mine Workings and Stopes and 3-D Wireframe Creation
WGM also digitized outlines of the mine workings and mined-out stopes based on the most
up-to-date level plans and vertical sections provided by ADEX. The lines were initially
digitized using AutoCAD software and then exported as a DXF file for each level plan. The
DXF files were imported into a GEMS polyline workspace created specifically for the mine
workings and stopes for 3-D wireframe/solid generation (Figure 10). In total, polylines for
seven level plans and five stopes were produced.


All the workings polylines were ‘extruded’ into solids in GEMS using a 4 m corridor width
(height of the cross-cuts and drifts) as control for defining the third dimension of each solid.
This methodology represents a simple approach for generating solids, and it is sufficient at
this level of study to define this type of geometric shape. WGM did not produce 3-D
wireframes of the ramps joining the mine levels.


Solids representing mine stopes were created in a similar manner to the geological solids
using polylines and tie lines.      Polylines digitized from the level plan outlines were
incorporated for solid generation and the cross sections served as vertical limits for the stopes.
Because of limited information regarding the actual shape of the stopes, the created solids
provide only an approximate volume of the mined material.


Topographic Surface Creation
A topographic surface or triangulated irregular network (“TIN”) was created using collar
elevations of the holes drilled from surface for the entire Mount Pleasant Project. Altogether,
the generation of the topographic surface incorporated 448 drillhole collars.




                                             - 118 -
                                                                           Watts, Griffis and McOuat

17.5           DATABASE PREPARATION, STATISTICAL ANALYSIS AND
               COMPOSITING


17.5.1         BACK-CODING OF ROCK CODE FIELD


The 3-D solids that represented the interpreted mineralized zones were used to back-code a
rock code field into the drillhole workspace. Each interval in the assay table was assigned a
new rock code value based on the rock type solid that the interval midpoint fell within. Only
the two WO3 Eq geological solids, Fire Tower West and Fire Tower North, were back-coded
and considered for the Mineral Resource estimate.


17.5.2         DRILLHOLE DATA CONVERSION


The GEMS software drillhole data were converted into a format compatible with software
developed by Geostat Systems International Inc. (“Geostat”) for statistical/geostatistical
analysis and block modelling. Although the database contained multiple elements assayed
(MoS2, WO3, Sn, Cu, Zn, Pb, Bi, As, Ca, Fe), for the purpose of this study, only MoS2 and
WO3 have been investigated.


Table 15 presents basic statistics of the drillhole data, regardless of their position with respect
to the mineralized envelope and Figure 11 shows the 3-D drillhole distribution in the Fire
Tower Zone.


                                   TABLE 15
                   BASIC STATISTICS OF DRILLHOLE SAMPLES
                          Minimum    Maximum    Average                           C.O.V.
         Sample length      0.05 m     7.62 m     2.88 m                          26.5%
            MoS2            0.0%       4.85%      0.088%                           123%
            WO3             0.0%       5.10%      0.105%                           210%




                                             - 120 -
                                                                         Watts, Griffis and McOuat




            Figure 11.      3-D representation of the drillholes with respect to the
                              Fire Tower mineralized envelope

17.5.3         PREPARATION OF ASSAY COMPOSITES


In order to carry out the variography and Mineral Resource block modelling, a set of equal
length composites of 2.5 m was generated from the raw drillhole intervals.               Table 16
summarizes the statistics of the composites inside the mineralized envelope above
0.01% WO3 and 0.01% MoS2 for the West and North zones.

                                     TABLE 16
                       BASIC STATISTICS OF 2.5 m COMPOSITES
   Sector      Element   Number   Minimum      Maximum   Average                       C.O.V.
                                     (%)          (%)     (%)
    West        MoS2      3,680     0.01         2.48     0.21                         61.5%
                WO3       3,683     0.01         4.30     0.34                         82.2%

   North        MoS2        1,698         0.01           1.18         0.20             69.5%
                WO3         1,690         0.01           4.04         0.38             87.1%


The statistical distributions of both MoS2 and WO3 show lognormal distributions (Figures 12
to 15) and both zones also exhibit similar behaviour. Considering the nature of the elements
and their statistical distributions, WGM is of the opinion that it is not necessary to cap high-
grade values for MoS2 or WO3.



                                            - 121 -
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             Watts, Griffis and McOuat


             10
                                                                                                                                                                                                          Cumulative frequency plot
                      MoS2




              1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    !       !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    !

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                ! ! !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       !   !!
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            !!   !!! !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       !!!!
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    !!!
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     !       !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         !           !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     ! !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                               ! ! !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                           !!!
                                                                                                                                                                                                                                                                                                                                                                                                                                                                 !!    !!!
                                                                                                                                                                                                                                                                                                                                                                                                                                                  !! ! ! ! !
                                                                                                                                                                                                                                                                                                                                                                                                                                      !! !! !
                                                                                                                                                                                                                                                                                                                                                                                                                         !!!!!!!
                                                                                                                                                                                                                                                                                                                                                                                                                 !!!!!!!!
                                                                                                                                                                                                                                                                                                                                                                                                        !!!!!!!!!
                                                                                                                                                                                                                                                                                                                                                                                                 !!!!!!!
                                                                                                                                                                                                                                                                                                                                                                                          !!!!!!!
                                                                                                                                                                                                                                                                                                                                                                                  !!!!!!!!
                                                                                                                                                                                                                                                                                                                                                                           !!!!!!!
                                                                                                                                                                                                                                                                                                                                                                    !!!!!!!
                                                                                                                                                                                                                                                                                                                                                             !!!!!!!
                                                                                                                                                                                                                                                                                                                                                     !!!!!!!!
                                                                                                                                                                                                                                                                                                                                             !!!!!!!!
                                                                                                                                                                                                                                                                                                                                    !!!!!!!!!
                                                                                                                                                                                                                                                                                                                              !!!!!!
                                                                                                                                                                                                                                                                                                                       !!!!!!!
                                                                                                                                                                                                                                                                                                             !!!!!!!!!!
                                                                                                                                                                                                                                                                                                     !!!!!!!!
                                                                                                                                                                                                                                                                                             !!!!!!!!
                                                                                                                                                                                                                                                                                         !!!!
                                                                                                                                                                                                                                                                                  !!!!!!!
                                                                                                                                                                                                                                                                           !!!!!!!
                                                                                                                                                                                                                                                                      !!!!!
                                                                                                                                                                                                                                                                !!!!!!
                                                                                                                                                                                                                                                            !!!!
                                                                                                                                                                                                                                                       !!!!!
             0.1                                                                                                                                                                                                                             !!
                                                                                                                                                                                                                                               !!!
                                                                                                                                                                                                                                                  !!!!!
                                                                                                                                                                                                                                         !!!!
                                                                                                                                                                                                                                  !!!!!!!
                                                                                                                                                                                                                            !!
                                                                                                                                                                                                                       !!
                                                                                                                                                                                                          ! ! !!!!
                                                                                                                                                                                                     !!
                                                                                                                                                                                              ! !!
                                                                                                                                                                                          !
                                                                                                                                                                                      !
                                                                                                                                                                             !!!
                                                                                                                                                                         !
                                                                                                                                                                     !
                                                                                                                                                                !
                                                                                                                                                            ! !
                                                                                                                                                    !
                                                                                                                                            !
                                                                                                                    !       !       !



                                                                                                            !
                                                                            ! ! ! ! !!!!!!!!!!!
                                                                       !!
                                                                   !


                                                               !
                                                           !
                                                       !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   Cumulative Freq [%]
         0.01              !       !       !       !


                    0.01                                   0.2                                                  1                   2                                      5                              10                                         20                         30                                          50                                          70                         80                                       90                               95                  98 99                                                     99.8                                          99.99




Figure 12.             Cumulative frequency plot of MoS2 2.5 m composites above 0.01% in the West Zone


              10
                                                                                                                                                                                                           Cumulative frequency plot
                       WO3




                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        !       !

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        !       !

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                ! ! !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        !!! !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               !!
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      !! !!!
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 !!!!!
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 !
               1                                                                                                                                                                                                                                                                                                                                                                                                                                                                   !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       ! !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           ! !

                                                                                                                                                                                                                                                                                                                                                                                                                                                                               ! !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                            !!
                                                                                                                                                                                                                                                                                                                                                                                                                                                                   !   !!
                                                                                                                                                                                                                                                                                                                                                                                                                                                            !   !!
                                                                                                                                                                                                                                                                                                                                                                                                                                                       !!
                                                                                                                                                                                                                                                                                                                                                                                                                                                 !!!
                                                                                                                                                                                                                                                                                                                                                                                                                                          !! !
                                                                                                                                                                                                                                                                                                                                                                                                                             !!   !! !!
                                                                                                                                                                                                                                                                                                                                                                                                                       !!!!!!
                                                                                                                                                                                                                                                                                                                                                                                                                   !!!!
                                                                                                                                                                                                                                                                                                                                                                                                            !!!!!!!
                                                                                                                                                                                                                                                                                                                                                                                                       !!!!!
                                                                                                                                                                                                                                                                                                                                                                                                  !!!!!
                                                                                                                                                                                                                                                                                                                                                                                           !!!!!!!
                                                                                                                                                                                                                                                                                                                                                                                 !!!!!!!!!!
                                                                                                                                                                                                                                                                                                                                                                           !!!!!!
                                                                                                                                                                                                                                                                                                                                                                      !!!!!
                                                                                                                                                                                                                                                                                                                                                           !!!!!!!!!!!
                                                                                                                                                                                                                                                                                                                                                    !!!!!!!
                                                                                                                                                                                                                                                                                                                                             !!!!!!!
                                                                                                                                                                                                                                                                                                                                        !!!!!
                                                                                                                                                                                                                                                                                                                                  !!!!!!
                                                                                                                                                                                                                                                                                                                             !!!!!
                                                                                                                                                                                                                                                                                                                      !!!!!!!
                                                                                                                                                                                                                                                                                                            !!!!!!!!!!
                                                                                                                                                                                                                                                                                                     !!!!!!!
                                                                                                                                                                                                                                                                                                 !!!!
                                                                                                                                                                                                                                                                                             !!!!
                                                                                                                                                                                                                                                                                       !!!!!!
                                                                                                                                                                                                                                                                                !!!!!!!
                                                                                                                                                                                                                                                                         !!!!!!!
                                                                                                                                                                                                                                                                   !!!!!!
                                                                                                                                                                                                                                                              !!!!!
                                                                                                                                                                                                                                                         !!!!!
                                                                                                                                                                                                                                                     !!!!
                                                                                                                                                                                                                                                !!!!!
                                                                                                                                                                                                                                           !!!!!
                                                                                                                                                                                                                                        !!!
                                                                                                                                                                                                                                     !!!
                                                                                                                                                                                                                              !   !!!
                                                                                                                                                                                                                       ! !!
              0.1                                                                                                                                                                                    !!!
                                                                                                                                                                                                           ! !!
                                                                                                                                                                                                                  !!

                                                                                                                                                                                                !
                                                                                                                                                                                          !!!
                                                                                                                                                                                      !
                                                                                                                                                                                 !!
                                                                                                                                                                             !
                                                                                                                                                                     ! !
                                                                                                                                                                 !
                                                                                                                                                             !
                                                                                                                                                        !
                                                                                                                                                !
                                                                                                                                        !

                                                                                                                                !
                                                                                                                        !


                                                                                                                !
                                                                                                      !!!
                                                                                                     !
                                                                                                   !!

                                                                                              !!

                                                                                          !
                                                                                   ! !!
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 Cumulative Freq [%]
             0.01              !       !       !       ! ! ! ! ! ! ! ! !!


                    0.01                                       0.2                                                  1               2                                        5                             10                                         20                        30                                          50                                         70                         80                                      90                                95                   98 99                                                  99.8                                            99.99




Figure 13.                 Cumulative frequency plot of WO3 2.5 m composites above 0.01% in the West Zone




                                                                                                                                                                                                                                                                           - 122 -
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              Watts, Griffis and McOuat


             10
                                                                                                                                                                   Cumulative frequency plot
                     MoS2




                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               !

              1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       !   !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             ! !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       ! !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              !!
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   !! ! ! !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         !!!!!
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   !!!
                                                                                                                                                                                                                                                                                                                                                                                                                                                                           !   !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                       !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                   !
                                                                                                                                                                                                                                                                                                                                                                                                                                                         ! ! !
                                                                                                                                                                                                                                                                                                                                                                                                                                                     ! !
                                                                                                                                                                                                                                                                                                                                                                                                                                           !!!!
                                                                                                                                                                                                                                                                                                                                                                                                                                    !!!!
                                                                                                                                                                                                                                                                                                                                                                                                                              !!
                                                                                                                                                                                                                                                                                                                                                                                                                !!! ! ! !
                                                                                                                                                                                                                                                                                                                                                                                                         !!!!
                                                                                                                                                                                                                                                                                                                                                                                                  !!!
                                                                                                                                                                                                                                                                                                                                                                                           !!!!!!!
                                                                                                                                                                                                                                                                                                                                                                                      !!!!!
                                                                                                                                                                                                                                                                                                                                                                                !!!!!!
                                                                                                                                                                                                                                                                                                                                                                           !!!!!
                                                                                                                                                                                                                                                                                                                                                                     !!!!!!
                                                                                                                                                                                                                                                                                                                                                                 !!!!
                                                                                                                                                                                                                                                                                                                                                            !!!!!
                                                                                                                                                                                                                                                                                                                                                       !!!!!
                                                                                                                                                                                                                                                                                                                                                  !!!!!
                                                                                                                                                                                                                                                                                                                                            !!!!!!
                                                                                                                                                                                                                                                                                                                                      !!!!!!
                                                                                                                                                                                                                                                                                                                             !!!!!!!!!
                                                                                                                                                                                                                                                                                                                     !!!!!!!!
                                                                                                                                                                                                                                                                                                               !!!!!!
                                                                                                                                                                                                                                                                                                       !!!!!!!!
                                                                                                                                                                                                                                                                                              !!!!!!!!!
                                                                                                                                                                                                                                                                                       !!!!!!!
                                                                                                                                                                                                                                                                                 !!!!!!
                                                                                                                                                                                                                                                                         !!!!!!!!
                                                                                                                                                                                                                                                           !!!!!!!!!!!!!!
                                                                                                                                                                                                                                                   !!!!!!!!
                                                                                                                                                                                                                                               !!!!
                                                                                                                                                                                                                                           !!!!
                                                                                                                                                                                                                                        !!!
             0.1                                                                                                                                                                                                             !!!
                                                                                                                                                                                                                                !!!!!!!!
                                                                                                                                                                                                                        !!!!!
                                                                                                                                                                                                                    !!!!
                                                                                                                                                                                                           !!!!!!!!!
                                                                                                                                                                                                    !!   !!
                                                                                                                                                                                     !!!!!!
                                                                                                                                                                            !! !
                                                                                                                                                                        !
                                                                                                                                                                  !!!
                                                                                                                                                             !!
                                                                                                                                                        !!
                                                                                                                                       ! !!!!
                                                                                                                                   !
                                                                                                                               !
                                                                                                                           !
                                                                                                                       ! !
                                                                                                                   !

                                                                                                           !   !
                                                                                                       !
                                                                                                   !
                                                                                                 !!
                                                                                             !
                                                                                        !!
                                                                              !! !!
                                                ! ! ! ! ! ! ! ! !!
                                            !


                                        !
                                    !

                                !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          Cumulative Freq [%]
         0.01               !


                   0.01             0.2                                       1                            2                       5                               10                                                  20                         30                                           50                                           70                          80                                      90                              95                         98 99                                                   99.8            99.99




Figure 14.            Cumulative frequency plot of MoS2 2.5 m composites above 0.01% in the North Zone



             10
                                                                                                                                                                   Cumulative frequency plot
                     WO3




                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           !   !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   !   !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         ! !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   ! ! !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              !!
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         !!
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   !!!
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       !!   !! !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   !!!
                                                                                                                                                                                                                                                                                                                                                                                                                                                                           !   !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                   ! !
                                                                                                                                                                                                                                                                                                                                                                                                                                                               !
                                                                                                                                                                                                                                                                                                                                                                                                                                                           ! !
              1                                                                                                                                                                                                                                                                                                                                                                                                                                 !!
                                                                                                                                                                                                                                                                                                                                                                                                                                                     ! !
                                                                                                                                                                                                                                                                                                                                                                                                                                          !!!
                                                                                                                                                                                                                                                                                                                                                                                                                                    !!!
                                                                                                                                                                                                                                                                                                                                                                                                                             !! !
                                                                                                                                                                                                                                                                                                                                                                                                                      !! !
                                                                                                                                                                                                                                                                                                                                                                                                              !! !!
                                                                                                                                                                                                                                                                                                                                                                                                        !!!
                                                                                                                                                                                                                                                                                                                                                                                                  !!!
                                                                                                                                                                                                                                                                                                                                                                                             !!!!
                                                                                                                                                                                                                                                                                                                                                                                        !!!!!
                                                                                                                                                                                                                                                                                                                                                                                !!!!!!!!
                                                                                                                                                                                                                                                                                                                                                                            !!!!
                                                                                                                                                                                                                                                                                                                                                                       !!!!!
                                                                                                                                                                                                                                                                                                                                                                   !!!!
                                                                                                                                                                                                                                                                                                                                                               !!!!
                                                                                                                                                                                                                                                                                                                                                        !!!!!!!
                                                                                                                                                                                                                                                                                                                                                    !!!!
                                                                                                                                                                                                                                                                                                                                              !!!!!!
                                                                                                                                                                                                                                                                                                                                        !!!!!!
                                                                                                                                                                                                                                                                                                                                   !!!!!
                                                                                                                                                                                                                                                                                                                            !!!!!!!
                                                                                                                                                                                                                                                                                                                        !!!!
                                                                                                                                                                                                                                                                                                                  !!!!!!
                                                                                                                                                                                                                                                                                                          !!!!!!!!
                                                                                                                                                                                                                                                                                                 !!!!!!!!!
                                                                                                                                                                                                                                                                                          !!!!!!!
                                                                                                                                                                                                                                                                                 !!!!!!!!!
                                                                                                                                                                                                                                                                           !!!!!!
                                                                                                                                                                                                                                                                     !!!!!!
                                                                                                                                                                                                                                                                  !!!
                                                                                                                                                                                                                                                            !!!!!!
                                                                                                                                                                                                                                                       !!!!!
                                                                                                                                                                                                                                                  !!!!!
                                                                                                                                                                                                                                          !!!!!!!!
                                                                                                                                                                                                                                    !!!!!!
                                                                                                                                                                                                                                !!!!
                                                                                                                                                                                                                        !!!!!!!!
                                                                                                                                                                                                                   !!!!!
                                                                                                                                                                                                               !!!!
                                                                                                                                                                                                            !!!
                                                                                                                                                                                                          !!
                                                                                                                                                                                                   !!   !!
                                                                                                                                                                                               !
                                                                                                                                                                                          !!
                                                                                                                                                                                     !!
             0.1                                                                                                                                                       !!
                                                                                                                                                                            !
                                                                                                                                                                                !!

                                                                                                                                                                  !!
                                                                                                                                                        ! !!!
                                                                                                                                                    !
                                                                                                                                                !
                                                                                                                                            !
                                                                                                                                        !
                                                                                                                                   !!
                                                                                                                               !
                                                                                                                           !
                                                                                                                       ! !

                                                                                                                   !
                                                                                                               !
                                                                                                           !
                                                                                                       !
                                                                                             !
                                                                                       !!!!!!
                                                                                   !
                                                                              !!
                                                                         !!
                                                                     !
                                                                !!

                                                            !


                                                    ! ! !
                                                !
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          Cumulative Freq [%]
         0.01               !   !   !   !   !


                   0.01             0.2                                       1                            2                       5                               10                                                  20                         30                                           50                                           70                          80                                      90                              95                         98 99                                                   99.8            99.99




Figure 15.                Cumulative frequency plot of WO3 2.5 m composites above 0.01% in the North Zone




                                                                                                                                                                                                                                              - 123 -
                                                                                                        Watts, Griffis and McOuat

17.6                 VARIOGRAPHY


Variograms were computed to characterize the spatial continuity of the mineralization in both
the North and West zones. Table 17 presents the variogram models.


It was noted that the MoS2 is more continuous than the WO3. Also, the West Zone presents
longer ranges than the North Zone (for MoS2 only). This could be due to the horseshoe shape
of the Fire Tower North Zone. Figures 16 to 19 presents the variogram graphs for each zone.

                                                        TABLE 17
                                               VARIOGRAM MODELS
 Sector        Element                                             Model
                            0.005      + Spherical(0.003,40m,30m,15m) with maximum direction East-West,
                                       minimum vertical
                MoS2                   + Spherical(0.0061,180m,50m,45m) with maximum direction East-West,
                                       minimum vertical
  West
                            0.120      + Exponential(0.320,7m,5m,5m) with maximum direction vertical
                                       + Exponential(0.126,15m,7m,7m) with maximum direction vertical
                 WO3
                                       Note relative model derived from the computed lognormal model

                            0.155    + Exponential(0.206,15m,15m,10m) with minimum direction vertical
                                     + Exponential(0.270,35m,35m,10m) with minimum direction vertical
                MoS2        Note relative model derived from the computed lognormal model

  North
                            0.131    + Exponential(0.348,7m,5m,5m) with maximum direction vertical
                                     + Exponential(0.226,15m,7m,7m) with maximum direction vertical
                 WO3
                            Note relative model derived from the computed lognormal model

Note: Some variograms above are modelled with the Exponential equation. In this case, the ranges presented are approximately one third of
the zone of influence. In contrast, for the Spherical model, the ranges are equal to the zone of influence.


17.7                 MINERAL RESOURCE BLOCK MODELLING


The Mineral Resources have been estimated with the Kriging geostatistical estimation
technique. For comparison and cross checking purposes, Inverse Distance Squared (“ID2”)
and Nearest Neighbour (“NNB”) methods have also been used.




                                                               - 124 -
                                                                                                                                                                   Watts, Griffis and McOuat


0.026
                                 Variogram Mt-Pleasant 2.5m composites
            γABS,MoS2
0.023




                                                                                                                                             9
                                                                                                                                           95
0.021




                                                                                                                                         12




                                                                                                                                                      5
                                                                                                                                                    73




                                                                                                                                                                       4
                                                                                                                                                                     15
                                                                                              4




                                                                                                                                                                               03
                                                                                                                                                  27
                                                                                            21



                                                                                                        1




                                                                                                                                                                   20
                                                                                                                                    4
0.018




                                                                                                                                                                             75
                                                                                                      99




                                                                                                                                  79
                                                                                          15




                                                                                                                                                                                      7
                                                                                                    39




                                                                                                                                31




                                                                                                                                                                                    67
                                                                                                                         3
                                                                                                                       71
                                                                                                                     19
0.016




                                                                                                                                     2
                                              6
                                                                                                             "




                                                                                                                                   90
                                            58
                                                                                                         "




                                                                           5
                                                                                                    "            "         "
            SILL                                                                                "




                                                                         58
                                                                                                                       "




                                                                                                                                 24
                                          10




                                                              08 122
                                                        "     "   "                   "     "




                                                                                                                                              7
                                                                                 "




                                                                                                                         6
                                                                        "




                                                                       28
                                                    "




                                                                                                                                            81
                                                                                                                       27
                                                                             "
0.013                                           "




                                                                                                            7
                                                                  7




                                                                                                                                          24
                                           "




                                                                                                                     26
                                                                                                          05
                                                                                1
                                      "




                                                                9


                                                                              50




                                                                                                        25
                                                                                              7




                                                                                                                                                       8
                                                                            17



                                                                                            33




                                                                                                                                                     38
                                                   9

                                                            16
                                                 97
                                  "




                                                                                                                                                               7
                                                                                          21




                                                                                                                                                   20
0.010                        "




                                                                                                                                                             58
                                               13
                                     3
                        "


                                   58




                                                                                                                                                                               81
                                                                                                                                                                     19
                                                                                                                                                           13
                                   0
                    "
                                 24
                                 10




                                                                                                                                                                             21
                                                                                                                                                                   67




                                                                                                                                                                                       3
                       24


0.008




                                                                                                                                                                                     36
                      151


                "
                    49




0.005
            "


0.003

                                                                                                                                                                              Distance
0.000
        0.0                 22.5                45.0                   67.5                90.0              112.5               135.0           157.5     180.0           202.5          225.0

Variable : MoS2                                                   Date               : 11-05-2006
Variogram : Absolute                                              File               : MtPleasantcmp25AllZones.gsd
                    "
Direction   : Average                        EW                  NS                  NW                  112.5                  22.5        Vert
Azimuth     :    0.00                     90.00                0.00              315.00                 112.50                 22.50        0.00
Dip         :    0.00                      0.00                0.00                0.00                   0.00                  0.00      -90.00
Tolerance   : 180.00                      25.00               25.00               25.00                  25.00                 25.00       25.00
Lag Dist    :    5.00                     15.00               15.00               15.00                  15.00                 15.00        5.00

Gamma = N(0.0050) + S(0.0030, 40.0/30.0/15.0, 90.0/0.0/0.0) + S(0.0061, 180.0/50.0/45.0, 90.0/0.0/0.0)




                            Figure 16.                                  Variogram of MoS2 in the West Zone


0.596
                                 Variogram Mt-Pleasant 2.5m composites
            γLOG,WO3
0.537

0.477
            SILL
0.417

0.358

0.298

0.239

0.179

0.119

0.060

                                                                                                                                                                              Distance
0.000
        0.0                 22.5                45.0                   67.5                90.0              112.5               135.0           157.5     180.0           202.5          225.0

Variable : WO3                                                    Date               : 11-05-2006
Variogram : Logarithmic                                           File               : MtPleasantcmp25AllZones.gsd

Direction   : Average                        EW                  NS                  NW                  112.5                  22.5        Vert
Azimuth     :    0.00                     90.00                0.00              315.00                 112.50                 22.50        0.00
Dip         :    0.00                      0.00                0.00                0.00                   0.00                  0.00      -90.00
Tolerance   : 180.00                      25.00               25.00               25.00                  25.00                 25.00       25.00
Lag Dist    :    5.00                     15.00               15.00               15.00                  15.00                 15.00        5.00

Gamma = E(0.2500, 7.0/5.0/5.0, 0.0/90.0/0.0) + N(0.0800) + E(0.1190, 15.0/7.0/7.0, 0.0/-90.0/0.0)




                            Figure 17.                                      Variogram of WO3 in the West Zone




                                                                                                  - 125 -
                                                                                                                                                                                              Watts, Griffis and McOuat


   1.008
                                           Variogram Mt-Pleasant 2.5m composites
              γLOG,MoS2
   0.907

   0.806

   0.705

   0.605




                                                                                                                  6
                                                                                                                20
                                                                                                                                        "




                                                                                                                                                   "




                                                                                                                                             "




   0.504
                                                                                                                                    "




              SILL
                                                                                                                                                         "




                                                                                                                               "




                                                                                                                          "




                                                                                                                     "




                                                                                                                                                         1
                                                                                                                "




                                                                                                   09 9
                                                                                                   "




                                                                                                          "




                                                                                             "




                                                                                                 10 46
                                            21 41
                                                                                        "
                                                                         "




   0.403                                            "




                                                                     "
                                                                                 "




                                                                                    2
                                          11 14
                                            "


                                                         "




                                                               5 7
                                                                "




                                                                                                                                                                                         30
                                                                                                                                                                         61
                                                                                  84
                                      "




                                                             86 97




                                                                                                                                                                 23




                                                                                                                                                                                  98
                          1
                                 "




                                                                                                                                                                                                 15
                            "




                                                                                                                                                                                       94
                        26




                                                                                                                                                                       48
                                                                                                                      4




                                                                                                                                                               27




                                                                                                                                                                                71




                                                                                                                                                                                                          64
                                                                                                                    91




                                                                                                                                                                                               95
                                                                                                                                                 85 17
                                                                                                                               83 6
                                                                               74




                                                                                                                                                                                                                   78
                                                                                                                                                                                                        73
   0.302




                                                                                                                                   4




                                                                                                                                                   7




                                                                                                                                                                                                                 43
                                                                             10




                                                                                                                                 9
                         64




                   "
                       12




   0.202
              "




   0.101

                                                                                                                                                                                                         Distance
   0.000
            0.0                      22.5                      45.0                         67.5                     90.0               112.5                  135.0      157.5        180.0          202.5      225.0

  Variable : MoS2                                                                       Date                  : 11-05-2006
  Variogram : Logarithmic                                                               File                  : MtPleasantcmp25AllZones.gsd
                        "
  Direction   : Average                                    EW                      NS                         NW                    112.5                     22.5       Vert
  Azimuth     :    0.00                                 90.00                    0.00                     315.00                   112.50                    22.50       0.00
  Dip         :    0.00                                  0.00                    0.00                       0.00                     0.00                     0.00     -90.00
  Tolerance   : 180.00                                  25.00                   25.00                      25.00                    25.00                    25.00      25.00
  Lag Dist    :    5.00                                 15.00                   15.00                      15.00                    15.00                    15.00       5.00

  Gamma = N(0.1000) + E(0.1500, 15.0/15.0/10.0, 0.0/0.0/0.0) + E(0.2394, 35.0/35.0/10.0, 0.0/0.0/0.0)




                                     Figure 18.                                              Variogram of MoS2 in the North Zone



1.000
                                      Variogram Mt-Pleasant 2.5m composites
            γLOG,WO3
0.900

0.800

0.700

0.600
            SILL
0.500

0.400

0.300

0.200

0.100

                                                                                                                                                                                                              Distance
0.000
        0.0                     10.0                         20.0                       30.0                        40.0                    50.0                60.0          70.0       80.0           90.0        100.0

Variable : WO3                                                                       Date                     : 11-05-2006
Variogram : Logarithmic                                                              File                     : MtPleasantcmp25AllZones.gsd

Direction   : Average                              EW                            NS                        NW                       112.5                     22.5        Vert
Azimuth     :    0.00                           90.00                          0.00                    315.00                      112.50                    22.50        0.00
Dip         :    0.00                            0.00                          0.00                      0.00                        0.00                     0.00      -90.00
Tolerance   : 180.00                            25.00                         25.00                     25.00                       25.00                    25.00       25.00
Lag Dist    :    5.00                           15.00                         15.00                     15.00                       15.00                    15.00        5.00

Gamma = E(0.2500, 7.0/5.0/5.0, 0.0/90.0/0.0) + N(0.0800) + E(0.2037, 15.0/7.0/7.0, 0.0/90.0/0.0)




                                     Figure 19.                                                  Variogram of WO3 in the North Zone



                                                                                                                              - 126 -
                                                                       Watts, Griffis and McOuat

17.7.1          BLOCK MODEL GRID PARAMETERS


The Mineral Resources have been estimated in a grid of regular blocks. The block model grid
covers both the West Zone and North Zone and is shown in Table 18.

                                        TABLE 18
                             BLOCK MODEL GRID PARAMETERS
   Direction              Origin    Size     Minimum (index)          Maximum (index)
   East-West             15,400E    5m         15,400E (1)              15,875E (96)
   North-South           12,200N    5m         12,200N (1)             12,700N (101)
   Vertical               900Z      5m           900Z (1)                1,250Z (71)


17.7.2          GRADE INTERPOLATION


Kriging
The principal Mineral Resource estimate model is derived from Kriging. The variograms
modelled and summarized in the previous section of this report were used to estimate each
zone separately.

         Search ellipsoid:     75 m in the East-West direction
                               50 m in the North-South direction
                               50 m in the Vertical direction
         Maximum number of composites used to estimate a block: 15
         Minimum number of composites used to estimate a block: 1
         Maximum number of composites coming from a single hole: 4
         Octant search strategy was used with a maximum of 4 composites per octant.

Inverse Distance Squared
This estimation technique was used to provide ADEX with a comparison to the primary
method of Kriging. In this case, both the West and North zones were interpolated with the
following search parameters:

         Search ellipse: 50 m sphere
         Maximum number of composites used to estimate a block: 15
         Minimum number of composites used to estimate a block: 1
         Maximum number of composites coming from a single hole: 4
         Octant search strategy was used with a maximum of 4 composites per octant.




                                            - 127 -
                                                                       Watts, Griffis and McOuat

Nearest Neighbour
This technique was used to provide ADEX with an additional comparison to Kriging. In this
case, both the West and North zones were interpolated with the following search parameters:


         Search ellipse: 50 m sphere
         Maximum number of composites used to estimate a block: 1
         Minimum number of composites used to estimate a block: 1

17.8            MINERAL RESOURCE CLASSIFICATION AND TABULATION


17.8.1          KRIGED MODEL


The Mineral Resources are compiled by simple addition of the Kriged model blocks and by
averaging the corresponding grade values. In order to study the behaviour of the Mineral
Resources with respect to a given cutoff, WGM has generated the Mineral Resources at
various cutoff levels (Table 19). The cutoffs were chosen to produce a grade-tonnage curve.
For this exercise, 11 cutoffs, from 0% to 1.0% WO3 Eq (in increments of 0.1%) were used.
However, to define the Mineral Resources for this report, WGM has used a cutoff of
0.3% WO3 Eq.


The specific gravity used to derive tonnes from the block volumes is constant at 2.65. This
value was provided by ADEX and is based on historic measurements. WGM has accepted
this specific gravity as reasonable for this type of mineralization.


WGM has classified the Fire Tower Mineral Resource estimate as Inferred. Until more
verification work has been completed by ADEX, i.e., twinning of old drillholes and further
validation of the database with a more rigorous check sampling program, the Mineral
Resources can only be considered as Inferred.


17.8.2          COMPARISON METHODS TO KRIGED MODEL


For comparison purposes, ID2 and NNB grade estimation methods were used. The ID2
method is a distance-weighted interpolation class of methods, similar to Kriging, where the




                                             - 128 -
                                              Watts, Griffis and McOuat


                      TABLE 19
                 FIRE TOWER ZONE
 INFERRED MINERAL RESOURCES KRIGED BLOCK MODEL
 Cutoff (WO3 Eq)    Tonnage      WO3      MoS2
West Zone
        0.0        9,257,775     0.34     0.21
        0.1        9,257,775     0.34     0.21
        0.2        9,257,775     0.34     0.21
        0.3        9,209,081     0.34     0.21
        0.4        8,820,856     0.34     0.22
        0.5        7,507,781     0.36     0.23
        0.6        5,292,381     0.40     0.25
        0.7        3,182,981     0.45     0.27
        0.8        1,738,731     0.50     0.29
        0.9        1,033,169     0.55     0.30
        1.0          490,913     0.62     0.32

North Zone
       0.0               3,959,763     0.37      0.19
       0.1               3,959,763     0.37      0.19
       0.2               3,959,763     0.37      0.19
       0.3               3,865,356     0.37      0.20
       0.4               3,595,719     0.39      0.20
       0.5               2,934,213     0.42      0.22
       0.6               2,124,969     0.47      0.23
       0.7               1,440,606     0.52      0.25
       0.8                 923,856     0.57      0.27
       0.9                 549,213     0.63      0.29
       1.0                 302,763     0.70      0.32

Total West and North Zones
       0.0              13,217,538     0.34      0.21
       0.1              13,217,538     0.34      0.21
       0.2              13,217,538     0.34      0.21
       0.3              13,074,438     0.35      0.21
       0.4              12,416,575     0.35      0.21
       0.5              10,441,994     0.38      0.23
       0.6               7,417,350     0.42      0.24
       0.7               4,623,588     0.47      0.26
       0.8               2,662,588     0.53      0.28
       0.9               1,582,381     0.58      0.30
       1.0                 793,675     0.65      0.32




                             - 129 -
                                                                         Watts, Griffis and McOuat

grade of a block is interpolated from several composites within a defined distance range of
that block. ID2 uses the inverse of the distance squared between a composite and the block as
the weighting factor.


The second comparative method used was NNB. In this technique, the grade of a block is
estimated by assigning only the grade of the nearest composite to the block. In a 2-D
situation, this would be equivalent to a polygonal estimation. In a 3-D spatial environment, it
is similar to a polyhedral estimation. Note that with this method, there is no interpolation of
grades.

Figure 20 presents the grade-tonnage curves of the Kriged model together with the ID2 and
NNB models for comparison. The superimposition of the three methods allows for easy
comparisons at different cutoffs and an evaluation of their differences. It must be noted that
the Kriged model forms the basis for the estimated Inferred Mineral Resources of this report.


WGM has elected to use the Kriged model since the continuity of the grades can be modelled
from the variograms. Kriging and ID2 both estimate the grades using a distance weighted
interpolation method. Kriging uses the variograms, whereas ID2 uses the inverse of the
distance squared, to assign weights in the interpolation function. The ID2 is purely empirical
and it is not supported by the in-situ grade continuity patterns. Kriging takes advantage of the
in-situ continuity through the use of the variograms, hence, the Kriged model should reflect
reality more closely than ID methods.


The Nearest Neighbour method is the three-dimensional version of the 2D polygonal
estimation method.      It represents an extreme case of minimum dilution and maximum
selectivity. It is likely to underestimate tonnage and overestimate grade above a given cut-
off, but is a good check on other methods.




                                             - 130 -
                                                                                        Watts, Griffis and McOuat




                                   Fire Tower Zone Total Inferred Mineral Resources

 14,000,000                                                                                   0.9



                                                                                              0.8
 12,000,000

                                                                                              0.7

 10,000,000
Tonnage                  .                                                                    0.6   Grade (%)   .
  8,000,000
                                                                                              0.5



                                                                                              0.4
  6,000,000


                                                                                              0.3
  4,000,000

                                                                                              0.2

  2,000,000
                                                                                              0.1



           0                                                                                  0.0
               0.   0.        0.      0.      0.   0.     0.     0.        0.    0.      1.

                                    Cut-off             WO3
                                                         (WO3+1.5MoS )2


    Kriged Tonnage            ID2 Tonnage          NNB Tonnage            Kriged MoS2           Kriged WO3
     ID2                      NNB                  ID2 WO3                NNB WO3



     Figure 20.              Fire Tower Zone grade-tonnage curve based on Kriged model




                                                   - 131 -
                                                                      Watts, Griffis and McOuat

17.9           HISTORIC MINERAL RESOURCE ESTIMATES


Note: This Section of the report contains descriptions of several historic “mineral
resource” and “mineral reserve” estimates. All of these historic estimates were
prepared prior to the implementation of NI 43-101. WGM has neither audited these
estimates nor made any attempt to classify them according to NI 43-101 standards or
the Council of Canadian Institute of Mining, Metallurgy and Petroleum definitions
(“CIM Standards”). They are presented because ADEX and WGM consider them to be
relevant and of historic significance.     These estimates should not be relied on. In
addition, WGM has used the words “orebody” and “orebodies,” commonly used to
describe mineralized bodies at the time. The use of these words does not imply that the
mineralized bodies described can be economically exploited.


17.9.1         NORTH ZONE TIN-INDIUM “RESOURCES”


A significant tin and indium historical “resource” was also outlined at Mount Pleasant. The
“resource” is hosted within what is referred to as the North Zone and the Deep Tin Zone. In
this case, the North Zone refers to the Contact Crest/Flank and the Upper and Lower
Endogranitic deposits.


The first undiluted “ore reserves” for the North Zone were estimated in December 1963 by
MPML with “proven ore” of 115,000 (short) tons with a grade of 0.61% Sn and 2.24% Zn
(Behre Dolbear & Company, 1963). The definition for “proven” is provided in Appendix 1A.


In 1973, Brunswick Tin Mines delineated a “reserve” in the Deep Tin Zone of
2.14 million tonnes and grades of 0.028% Mo, 0.061% W, 0.064% Bi, 0.045% Sn, 0.12% Cu,
0.80% Zn, 0.04% Pb, 0.27% As and 4% fluorite (Billiton Canada Ltd., 1985a).          The tin
grades were cut to 2% to compensate for erratic highs. Uncut tin grades were just over
0.60% Sn (see Table 18). The density used for the calculation of ore in the contact Crest was
2.75 g/cm3 (Billiton, 1985a).


Billiton calculated a new “resource” for the North Zone in 1985, subdividing the North Zone
into five distinct forms of mineralization, the Contact Crest and Flank, Upper and Lower
Endogranitic and Deep Tin Zone.       In each case, BTM assumed that the Endogranitic
mineralization was flat-lying and that each of their 1985 vertical drillhole intersections


                                           - 132 -
                                                                        Watts, Griffis and McOuat

represented “true widths”. The “resource” estimates are given in Table 20 and the grades are
“uncut”. A total “resource” for the North Zone was estimated at 6,792,670 tonnes at a grade
of 0.80% Sn. The orebodies were blocked into “proven, probable and possible reserve”
classifications using “resource” category definitions given in Appendix 1B.


                                TABLE 20
            1985 BILLITON “RESOURCE” SUMMARY – NORTH ZONE
  Mineralization Type           Tonnes            Grade (% Sn)
  Contact
    Crest                      2,195,875              0.63
    Flank                        667,315              1.60
  Total                        2,863,190              0.86

  Endogranitic
    Upper                               1,320,880                           0.80
    Lower                                 468,600                           1.31
  Total                                 1,789,480                           0.93

  Deep Tin Zone                         2,140,000                           0.60

  GRAND TOTAL                           6,792,670                           0.80
                                                                Source: Billiton Canada Ltd. (1985a)


According to Lac Minerals (1988), each orebody was defined by a 0.2% Sn cutoff grade, a
minimum width of 3.0 m and geological continuity. The tonnage and grade estimations were
calculated using the sectional method assuming that each section represents width halfway to
the next section. Orebodies were sliced at 25 m spaced levels on the SW-NE drill sections.
The area of each orebody between levels was determined on each section by planimetering.
The area was then multiplied by 25 m, the area of influence of each section and by the SG of
2.75, resulting in the tonnage. The grade for each block was calculated by averaging the
number of assay results occurring within the block.


In 1996, ADEX defined a “resource” by diamond drilling and outlined a “probable undiluted
resource” of 4,849,000 tonnes grading 0.695% Sn and 87 ppm In (ADEX Mining
Corp., 1995). This “resource” estimate was calculated utilizing GEMCOM software using
PCXPLOR and GEOMODEL on a polygonal and sectional basis.                    Block areas were
planimetered and volumes and tonnages calculated using a 25 m influence and a density of
2.75 tonnes/m3 and 0.2% Sn cutoff (Kvaerner Metals Davy Ltd., 1997). ADEX’s “resource”
estimate was audited by Kvaerner Metals Davy Ltd., (1997) as part of the feasibility study.


                                           - 133 -
                                                                          Watts, Griffis and McOuat

Kvaerner suggested that the “probable resource” classification should be regarded as an
“inferred” or “possible resource” due to the widely-spaced surface drillholes used in the
estimation and the complex mineral occurrence.


Kvaerner estimated an audited “probable resource” of 3,645,429 tonnes with an average grade
of 0.801% Sn, 107.15 ppm In, 0.114% WO3, 0.055% MoS2, 0.187% Cu, 0.063% Pb and
0.869% Zn from the ADEX total “resource” (Table 21), (Kvaerner Metals Davy Ltd., 1997).
At a planned mining rate of 2,500 tonnes/day the projected mine life would be four years.

                                       TABLE 21
                    TIN-INDIUM “RESOURCES”, KVAERNER STUDY (1997)
     Deposit            Total    Sn    In    WO3   MoS2   Cu        Pb                    Zn
                      (tonnes)  (%)  (ppm)    (%)   (%)   (%)      (%)                   (%)
 North Zone          1,877,260 0.859  30.31  0.156 0.065 0.139    0.070                 0.357
 Deep Tin Zone       1,768,169 0.742 188.74  0.070 0.045 0.237    0.055                 1.412
 TOTAL               3,645,429 0.802 107.15  0.114 0.055 0.187    0.063                 0.869
 0.2% Sn cutoff; Mo% is 60% of MoS2; Specific Gravity = 2.75


Kvaerner further determined that the total “mineable resource” consisted of 3,718,338 tonnes
with a grade of 0.662% Sn, 85.72 ppm In, 0.091% WO3, 0.044% MoS2, 0.150% Cu,
0.050% Pb, 0.089% Bi and 0.695% Zn using a recovery factor of 85%, a dilution factor of
20% and a cutoff grade of 0.1% Sn. However, the Kvaerner Feasibility Study showed that the
tin and indium “resource” was uneconomic at that time. Kvaerner made the following
recommendations and conclusions regarding the geology and future “resource” estimates:


1. All geological testwork performed to date needs to be fully re-evaluated with 3D
    modelling of the existing testwork to improve the understanding of the patterns of
    mineralization to better predict the most profitable areas for exploration;

2. Exploration for additional “resources” has been limited and restricted to surface drilling
    since underground workings are flooded;

3. The deposits are complicated and only partially understood;

4. Missing indium assay information is required for samples not previously assayed for this element;

5. Additional drill testwork is required to upgrade and enlarge the “resources” in the Deep
    Tin Zone, North Zone and Saddle Zone (i.e., 10,000 m of underground drilling to firm up
    “resource” boundaries for the Deep Tin Zone); and




                                                     - 134 -
                                                                        Watts, Griffis and McOuat

6. De-watering of the underground workings would be required to enable underground
   testwork to be carried out and to enable mine production to begin.


17.9.2         TIN BASE METAL LODE DEPOSITS


The near surface tin-base metal deposits at Mount Pleasant are generally small, in the 15,000
to 25,000 tonne range. “Reserves” in the No. 7 tin lode in the Fire Tower Zone were
estimated to be 15,000 tonnes grading 0.5% Sn, 5.6% Zn, 1.2% Pb and 0.7% Cu
(Sinclair, 1994).


In the North Zone, Tin Lodes No. 1 to 3 were estimated to contain around 50,000 tonnes of
zinc-tin mineralization with unknown indium content (Kvaerner Metals Davy Ltd., 1997). As
for the tin lode No. 4, also located in the North Zone, in 1973 BTM calculated a “reserve” of
640,000 tons grading 0.239% Sn and 0.964% Zn (Parrish, 1973). This “reserve” estimate was
determined using diamond drillholes information within 15 m (50 feet) of each other.


In 1992, ADEX Minerals Corp. calculated an updated “indicated and inferred resource”
(classifications not defined) for the Lode No. 4 based on a 60 ppm In cut off (Martin, 1997).
“Indicated” was estimated at 43,010 tonnes grading 0.486 % Sn, 0.191 % Cu, 2.043% Zn and
197.503 ppm In. “Inferred” was estimated at 58,202 tonnes grading 0.337% Sn, 0.180% Cu,
2.824% Zn and 182.097 ppm In. ADEX used a higher cutoff than BTM and thus ended up
with a lower estimated “resource”.


17.9.3         SULPHIDE CONCENTRATE POND


Gowdy (1995) proposed that potential early cash flow could be obtained from processing the
tailings materials remaining in the sulphide concentrate pond. During the operation of the
mine, the Billiton’s flotation circuit scalped off the sulphides in the ore prior to further
processing of the tungsten. The sulphide concentrate was disposed of in a separate pond.
According to Gowdy (1995), the pond contains approximately 17,500 tonnes of sulphide
material grading at 0.5% WO3, 8.0% MoS2, 18.0% As, 4.0% Bi, 2.0% Cu, 7.0% Zn, 0.5% Sn
and 274.29 g In/t (8.0 opt).




                                           - 135 -
                                                                        Watts, Griffis and McOuat

This estimate was prepared by the Billiton Mount Pleasant Mill personnel based on what was
discharged to the pond and was regarded by Gowdy to fairly reflect the actual grade and
tonnage.


Tin in the pond is not considered to be recoverable. The sulphide material is buried under
waste rock, sand and a liner and has been hydroseeded. The layer of concentrate occupies
5,000 m3 and is approximately 1.0 m thick.


This material may have some value for metallurgical testwork as it could be similar in
character to the MoS2-rich tails from a future WO3-recovery circuit that would next go to an
MoS2 recovery circuit. Further study should be made to determine if this is the case.




                                             - 136 -
                                                                          Watts, Griffis and McOuat

                 18. OTHER RELEVANT DATA AND INFORMATION



18.1           ENVIRONMENT



The Province of New Brunswick currently holds a $2.0 million mortgage on the buildings as
security to cover the costs of building removal and contouring (ADEX Mining Corp., 1995).
In addition, ADEX has a $0.5 million security bond posted with the New Brunswick
government for mine reclamation. According to ADEX Mining Corp. (1995), this bond was
also supposed to cover the cost of water treatment of the mine in perpetuity.


All known previous environmental studies that have been completed at Mount Pleasant have
been outlined below as well as environmental requirements to resume mining operations.
Also included are the details surrounding the Ministerial Order issued by the New Brunswick
Department of the Environment revoking the minesite's “Approval to Operate” permit
(allowing water treatment, discharge and monitoring) and the steps ADEX is taking to have
this order revoked.


18.2           PREVIOUS ENVIRONMENTAL STUDIES


In 1979, Strathcona conducted a Feasibility Study on behalf of Billiton and provided a
summary of the environmental description of the project area including:


•   Flora and Fauna – vegetation, wildlife, fish survey, benthic survey; and
•   A detailed outline of environmental requirements.


In 1995, ADEX summarized the environmental and permitting requirements that would be
necessary in consideration of any future plans to bring Mount Pleasant back into production.
These procedures, which were documented in an ADEX report in 1995 are summarized
below. They include requirements once operations restart.


An Approval to Construct Permit must be obtained from the Department of the
Environment (“DOE”) before any construction program can commence. To obtain such
Approval, the property must be registered for an Environmental Impact Assessment (“EIA”).



                                            - 137 -
                                                                         Watts, Griffis and McOuat

When it is registered, an EIA Registration Document must be prepared and submitted. The EIA
Registration Document must contain a Reclamation Plan, an Effluent Control Plan and a
Feasibility Study. In addition, security will be required in an amount to cover the costs of the
reclamation as spelled out in the EIA Registration Document. When the new security is posted,
the mortgage on the buildings will be cancelled.


Given that the property has already been in production and assuming a good EIA Registration
Document is prepared, there is a good chance that the property could be screened out of the full
EIA process, in which case the Approval to Construct could be obtained in as few as two
months after submission of the EIA Registration Document. To go through the full EIA process
could take as long as 24 months.


Following start-up of operations, all effluent must be monitored and sampled to ensure that all
controls are operating at or better than limits stated in the EIA Registration Document. If
effluent levels are within limits, the Department of the Environment will issue an Operating
Permit. A Mining Lease must be obtained from the DNRE. DNRE and DOE work on the
Approval to Construct and the Mining Lease simultaneously and the Mining Lease will be
approved at about the same time as the Approval to Construct.


In 1996, Washburn & Gillis Associates was contacted by ADEX to review the environmental
permitting requirements that would be required for redevelopment of the Mount Pleasant
Mine. The requirements were outlined as follows (Washburn & Gillis Associates, 1996):


•   Registration of the project under the Environmental Impact Assessment Regulation of the
    New Brunswick “Clean Environment Act” addressing all potential environmental
    concerns;

•   Preparation of a Feasibility Study and Reclamation Plan to obtain a Mining Lease under
    the Mining Act, Chapter M-14.1, Section 68. A Mining Lease is usually issued within
    three months of the submission of the study and plan;

•   Obtaining a Construction Permit under Regulation 82-126 of the “Clean Environment
    Act”. This permit is required prior to beginning any construction activities at the site and
    can typically be obtained within approximately six week of submitting an application;

•   Obtaining an “Operating Permit” under the requirements of the Mining Act, Chapter
    M-14.1, Section 77. This permit, issued by the New Brunswick Department of Natural


                                            - 138 -
                                                                           Watts, Griffis and McOuat

    Resources & Energy is required prior to the start-up of commercial production operations
    and usually take around three months to obtain.         ADEX requires an “Approval to
    Operate” to permit the operation of a mine water treatment plant and to approve a
    discharge of treated mine water (as mentioned in Section 18.1) to Hatch Brook;

•   A “Certificate of Approval” issued in accordance with the Water Quality Regulations
    under the “Clean Environment Act” granting approval to operate a source of potential
    water contaminants; and

•   An Application for Approval to the New Brunswick Department of Environment for any
    program involving the dewatering of the Mount Pleasant Mine.


Other permits and approvals required for operation of the on-site facilities would include:


•   Approval to Construct and Operate a storage facility for explosives;
•   Approval to Construct and Operate a Sewage Disposal Facility; and
•   Approval under the Federal Metal and Mining Effluent Regulation.


18.3           MINISTERIAL ORDER


On April 27, 1999, a “Ministerial Order (99-004)” was issued by the New Brunswick
Minister of the Environment stating that they had reason to believe that contaminants from
the mining operation and the mine had been released into the environment contrary to
Subsection 5.3(1) of the Clean Environment Act. A copy of this order is appended as
Appendix 2.


In late 2004, ADEX entered into discussions with New Brunswick Department of
Environment to have the Ministerial Order lifted. A procedure was outlined by the Standing
Committee on Mining and the Environment (“SCME”) to lift the order and replace it with
an “Approval to Operate” permitting the discharge of water from the flooded mine workings
subject to the following main conditions:

1. Upon receipt of a letter from the new Chairman of the Board of ADEX Mining,
    committing in writing to provide to the SCME, a “Tailings Dam & Spillway Safety
    Study” done in accordance with the Canadian Dam Association's Dam Safety Guidelines;
    and



                                            - 139 -
                                                                          Watts, Griffis and McOuat

2. The Study is to be done by a consultant with expertise in the area of dam safety studies
   and be acceptable to the SCME. The Study would be completed by May 31, 2005 and
   would also include cost estimates for any deficiencies identified in the Study.


According to the correspondence, any approval would likely include a reduced monitoring
frequency schedule, which would be determined at the time of issuance.


Early in 2006, ADEX engaged Jacques Whitford Limited, well known environmental
consultants, to carry out the above-noted tailings dam study and paid for it in advance.
SCME acknowledged this progress in complying with SCME requirements.


The dam study, although somewhat behind schedule, is almost complete and SCME has
indicated to ADEX that it is now willing to lift the Ministerial Order and issue an Approval to
Operate with the payment of a $30,000 permit fee. ADEX is presently re-establishing a
sampling and testing procedure for the mine discharge and tailings pond waters, which it
plans to use for demonstrating a record of good compliance in water monitoring before
making the “official” request to lift the order and pay the permit fee.




                                             - 140 -
                                                                        Watts, Griffis and McOuat

                     19. INTERPRETATION AND CONCLUSIONS



19.1             GENERAL


The Mount Pleasant Mine contains several polymetallic deposits with historic “resource
estimates” of tungsten, molybdenum, tin and indium, which occur with other minor metals
such as bismuth, zinc and copper. The property has undergone considerable exploration and
development since its discovery in 1937. Work has included stream and soil sampling
surveys, surface and underground drilling, IP, seismic, SP, magnetic, gravity, EM and
radiation surveys, stripping, trenching and sampling, some surface geological mapping, two
major feasibility studies (Strathcona, Kvaerner), bulk sampling, metallurgical testing,
underground development work and mining.


The property has never been systematically mapped to produce a comprehensive geology
map. Companies have cited reasons for not mapping the property such as the difficulty of
mapping individual rock units due to their similarly close mineralogy, geochemisty and wide-
spread alteration and poor outcrop exposure. Therefore, previous mapping has relied entirely
on drill data and underground mapping and sampling programs to provide a detailed
geological interpretation of the deposits at Mount Pleasant.


Exploration and development work has been concentrated on two areas, which have been
designated the Fire Tower Zone and the North Zone. Deposits occur mainly in hydrothermal
breccias and fine grained granite and to a lesser extent in associated volcanic and sedimentary
country rocks.


The “historic resources,” mining methods, metallurgical testing and metal recoveries are well
documented. To date, a total of 1,330 surface and underground drillholes have produced
some 159,000 m of drill core for sampling leading to the underground development and
opening of the Mount Pleasant Tungsten Mine. The drill information also provided an
excellent understanding of the geology of the deposits at Mount Pleasant.           Tungsten-
molybdenum deposits at Mount Pleasant were determined to be large and of low grade.


The mine produced tungsten ore concentrate from the Fire Tower Zone from 1983 to 1985
when operations ceased after only 23 months of production due to metallurgical problems and



                                            - 141 -
                                                                        Watts, Griffis and McOuat

a significant decline in the price of tungsten. No other metals such as molybdenum, tin or
indium were produced.      Initial production was at a rate of 650,000 tpy with reduced
production to 324,000 tpy before the mine closed. Upon the closure of the mine, the site was
placed on care and maintenance. In 1996, Kvaerner was engaged by ADEX to produce a
feasibility study of the North Zone tin-indium deposits, including the Deep Tin Zone.
However, declining tin prices and increasing costs rendered the project uneconomic. The
tungsten-molybdenum deposits have not been re-evaluated since closure.


The following porphyry-type deposits have been identified at Mount Pleasant:

   Fire Tower Zone:
   • Fire Tower North (tungsten-molybdenum-bismuth deposit);
   • Fire Tower West (tungsten-molybdenum-bismuth deposit);
   • Fire Tower South (tungsten-molybdenum-bismuth deposit);
          – one continuous body with the Fire Tower West;
   • Tin-base metal deposits; and
   • No. 7 tin lode.

   Scotia Zone:
   • Tin-base metal deposit associated with Fire Tower North (silver, copper, zinc).

   Saddle Zone:
   • Tin-base metal deposit (silver, copper, zinc, lead).

   North Zone:
   • Upper and Lower Endogranitic Zone (tin, indium, silver, copper zinc, tungsten,
      molybdenum, bismuth);
   • Contact deposit (tin, indium);
   • Flank deposit (tin, indium, copper, tungsten, molybdenum); and
   • Contact Crest deposit (tin, zinc, silver).

   Deep Tin Zone:
   • Upper (tin, indium, zinc, copper, silver);
   • Lower (tin+arsenopyrite);
   • Tin lodes (No’s 1 to 6) – leakage to surface; and
   • Tungsten-molybdenum-bismuth deposit in Granite I.

The distribution of tin mineralization within the Saddle Zone has been reported to be irregular
requiring additional surface and underground drilling before a proper Mineral Resource
estimate can be prepared for this zone (Gowdy, 1995).



                                           - 142 -
                                                                          Watts, Griffis and McOuat

Kvaerner has pointed out that the North Zone deposits are complicated and are still not fully
understood. Their “resource” was estimated from a series of scattered deposits, which require
further definition by drilling. It is still uncertain at this stage as to whether the Endogranitic
Zone deposits consist of two individual layers (Upper and Lower) or whether they consist of a
number of rather steeply-dipping shoots. In addition, the Deep Tin Zone is less well defined
and appears to consist of less continuous pockets of mineralization and will require at least
5,000 m of additional underground drilling to enable a Mineral Resource estimate (Kvaerner
Metals Davy Ltd., 1997). Kvaerner also points out that the North Zone is open to the east,
requiring more drilling to further define the North Zone deposits. The Endogranitic Zone and
Crest deposits have potential to be extended to the north.


The similar geological setting and close proximity to the North Zone makes Hornet Hill an
interesting exploration target. Hornet Hill is a buried granite intrusion and was only explored
by three diamond drillholes. BTM hole MPS 173 intersected a cassiterite-bearing chlorite vein,
which assayed 0.89% Sn over a core length of 3.0 m. In 1972, an EM survey completed by
BTM defined a strong conductor that was traced for some 250 m on the north side of Hornet
Hill. WGM is uncertain if the source of this EM conductor was ever determined. IP
surveying may prove invaluable in exploring for mineralization deep within the Hornet Hill
structure (below 250 m from surface).


WGM, as part of its due diligence, collected two field samples of mineralized rock (grabs)
and twelve split core samples from 11 drillholes covering five of the previous drill programs
by BTM, Mount Pleasant Tungsten Mine, the Lac-Billiton Tin Project, Piskahegan and
ADEX. The assay results between WGM and those obtained by the previous operators were
in good agreement. The results all verify that significant tungsten, molybdenum, bismuth, tin,
indium, silver, zinc and copper are present at Mount Pleasant. This sampling also confirmed
that none of the zones or deposits contains any significant gold. WGM is of the opinion that
historic assay results are reliable and suitable for use in the preparation of Mineral Resource
estimates and has prepared such an estimate for the Fire Tower Zone as documented in
Section 17 above.


The WGM analytical work at SGS also determined the following:

•   Analytical method ICP12B is best for the initial determination of concentrations of the
    base metal and trace element geochemistry;



                                             - 143 -
                                                                         Watts, Griffis and McOuat

•   The best method for determining the total concentration of W and Sn is through total acid
    digestion (SGS method ICP90A). This method had no affect in increasing recoveries of
    Mo or Bi (as compared with SGS method ICP12B;

•   Indium determination using SGS method ICP90A is the least expensive with values only
    slightly smaller than those obtained by method IC40M at an additional cost. Indium
    occurs in association with sphalerite (ZnS), with is higher in the North Zone deposits; and

•   Although ICP/MS has been the recommended analytical method for indium analyses, SGS
    does not want to run samples with high expected concentrations due to the possibility of
    contaminating their equipment.


At this time, ADEX does not have an “Approval to Operate,” covering the treatment,
discharge and monitoring of water nor does it have an “Operating Permit” allowing it to
undertake mining activities in the event that the company wishes to resume mining
operations.   The Approval to Operate was revoked by a Ministerial Order in 1999.
Reclamation work, testing and reporting are still required under the order.         ADEX has
outlined and agreed to a procedure with the Province of New Brunswick to have this order
lifted and a tailings dam study is nearing completion. WGM did not conduct a review to
determine what other permits are still in place. The Standing Committee on Mining and the
Environment has verified that Mount Pleasant needs to register under EIA. The EIA will be
required if ADEX ever applies for a mining lease under plans to go back into production.


19.2           MINE FACILITIES AND INFRASTRUCTURE


The Mount Pleasant surface facilities are in remarkably good shape.          The ore storage,
conveyor galleries, mill, flotation, warehousing and office buildings in most cases would
require only a modest amount of effort and capital to bring them back to useable condition.
The existing mill-flotation building appears to be in a very good shape. Retrofitting of this
building or conversion to new processing requirements might provide substantial savings to
the project as opposed to erecting a new facility. There is, however, no useful processing
equipment left in the building.


The underground mine was stripped of all the infrastructure installations and is flooded up to
the top of conveyor incline and adit-access portals. The Fire Tower Zone, which was the core
of the previous underground operation, contains an inventory of 800,000 tonnes of broken


                                            - 144 -
                                                                        Watts, Griffis and McOuat

tungsten-molybdenum material in stopes. The broken material grade is approximately
0.39% WO3 and 0.19% MoS2.


Almost all of the major mill and mine equipment was sold in the past in order to cover costs
associated with care and maintenance of the site.


19.3           KVAERNER FEASIBILITY STUDY, NORTH ZONE DEPOSITS


19.3.1         GENERAL


WGM reviewed the Kvaerner study and a number of documents and information related to
the project. Other feasibility studies, conducted prior to the Kvaerner study, were also
reviewed for comparison and relevance with the project. The list of studies and documents is
shown in References.


The Kvaerner study addresses the scope of the project reasonably well, in particular when
taking into account the limited metallurgical test work done by the owners prior to the
commencement of the study. During the course of the study, Kvaerner, through others,
conducted a number of additional metallurgical tests in order to increase the confidence level
with regard to the bioleaching and hydrometallurgical processes. The results of the additional
tests in combination with the previous test results obtained by the owners, helped in designing
of the above processes and their flowsheets.


With regard to the bioleach and indium recovery process, the study concluded that there are
still unresolved and outstanding issues associated with handling potential hazards, such as
arsine gas and waste streams and they must be quantified. Means of handling such hazards
must be devised and engineered. The study also suggested that it would take up to six months
of pilot plant work to complete the design and environmental permitting.


19.3.2         MINING


The mining aspects were well addressed and supported with detailed estimates with regard to
the productivities and costs in 1996. WGM agrees with the selection of mining methods for
exploiting the deposits. The same applies to the mine layout, design and equipment selection.




                                           - 145 -
                                                                          Watts, Griffis and McOuat

The 2,500 tonnes/day of tin-indium ore production target selected by the Kvaerner team,
although aggressive, appears to be achievable.


The ventilation considerations and design adequately addressed the production and safety
requirements for the proposed mining operation.


The ore transport from mining areas by use of LHDs and trucks to the underground crusher and
then to surface via a belt conveyor appears to be the right choice and economically justified.


The mine dewatering and services reestablishment plan adequately addressed ground
conditioning needs as well as time and resources needed for the accomplishment of the
dewatering tasks.


The targeted productivities for the mining operation are in line with current productivities
achieved in other Canadian mines. On the other hand, the manpower levels appear to be
somehow conservative. Similar mining operations would use slightly lower manpower levels.


In summary, the Kvaerner Feasibility Study incorporated in a practical way the relevant
information and existing underground mine development with regard to its proposed mining
scenario.


19.3.3         PROCESSING


WGM is of the opinion that the processing aspects were addressed approximately with respect
to the metallurgical test work results achieved before and during the study, and previous
operational experience gathered at the Mount Pleasant operation. The milling and flotation
layout and the flowsheets were designed to utilize conventional and proven technologies and
equipment and as such do not pose any significant operational or performance risks. In fact,
the authors indicated that there potential exists for some incremental process improvements
and WGM agrees with this statement. This could result in potential savings and improve the
economics of the project provided further detailed engineering follows.


The general design and layouts of the bioleach and hydromet plants are based on small-scale
test results utilizing certain types of Mount Pleasant mineralization. The Mount Pleasant




                                            - 146 -
                                                                        Watts, Griffis and McOuat

mineralization is complex and as such would require larger-scale testing before making any
final commitment with regard to the proposed layouts and designs.


The Kvaerner study concluded that the bioleach and hydromet processes were too expensive
to operate and proposed to assess a potential to install a tin-indium operation utilizing a
conventional milling process to produce two types of concentrates. WGM agrees with this
conclusion based on the results of the overview evaluations of the three scenarios regarded for
mining of the Mount Pleasant deposits.


19.3.4         FEASIBILITY STUDY CAPITAL COSTS ESTIMATES


WGM reviewed the capital cost estimates for the project in light of the proposed processes
and mining methods and size of production. The Kvaerner study capital cost estimates are
supported with basic calculations of labour, materials, energy and other components of
construction elements needed for re-establishing operations at Mount Pleasant. In most cases
the Kvaerner estimates were supported with quotes obtained from the potential suppliers of
new or used equipment to be used at the operation. In WGM’s opinion, the other cost
components of the study were estimated within a reasonable cost range with respect to the
scope of the project.


WGM adjusted the Kvaerner estimated costs to reflect the current levels using an order of
magnitude approach. For consistency, WGM used a compounded 3%/year inflation rate
multiplication factor against the study capital and operating cost estimates, except for the
mining costs, in order to arrive with costs reflecting the current market conditions. After
adjustments were made the factored cost estimates were compared with the current equipment
prices and labour costs and they appear to be in balance.


The underground mine capital costs were adjusted by comparison with similar projects
currently in the development stage elsewhere in Canada and to a certain degree by using a
factoring method.


WGM cautions readers that its study of the Kvaerner costs was merely to determine their
relative accuracy not to provide an opinion as to whether the Kvaerner study can be used in a
future economic study of the operation. Since there is no Mineral Resource defined at Mount
Pleasant, no discussion of economics is possible at this time.



                                            - 147 -
                                                                           Watts, Griffis and McOuat

19.3.5         FEASIBILITY STUDY OPERATING COST ESTIMATES


WGM reviewed Kvaerner’s operating cost estimates and concludes that they were performed
according to accepted industry standards.


WGM believes that there is potential to lower some of the adjusted and estimated costs
through further project optimization, which requires a higher level of study effort.


19.3.6         WGM CONCLUSIONS REGARDING THE KVAERNER STUDY


The Kvaerner study appears to address the scope of the project reasonably well.


The Kvaerner study capital cost estimates were supported with quotes obtained from the
potential suppliers of new or used equipment to be used at the operation. These costs need an
item-by-item detailed update to adjust them to current levels. WGM used broad general costs
adjustments for the purpose of evaluation of different mining scenarios.


WGM agrees with the selection of mining methods for exploiting the deposits. The same
applies to the mine layout, design and equipment selection.


The milling and flotation layout and the flowsheets were designed to utilize conventional and
proven technologies and equipment and as such do not pose any significant operational or
performance risks.


The bioleach process has been piloted at the minesite and the process technology for metals
recovery has been tested at a bench scale.


The Kvaerner’s study concluded that the bioleach and hydromet processes were too expensive
to operate and proposed to assess a potential to install a tin-indium operation utilizing a
conventional milling process to produce two types of concentrates. WGM agrees with this
conclusion based on the results of high-level evaluations of the three scenarios for mining of
the Mount Pleasant deposits. These evaluations are of preliminary nature and require more
detailed work to firm up the results of the assessment.




                                             - 148 -
                                                                        Watts, Griffis and McOuat

WGM conducted order-of-magnitude evaluations based on three mining scenarios using
historic “resource” estimates. These scenarios included the following alternatives:

•   The base case scenario, utilizing bioleach and hydromet technology to process tin-indium
    mineralization;
•   Conventional processing of tin-indium mineralization to produce two types of
    concentrates; and
•   Conventional processing of tungsten-molybdenum mineralization.


The best short-term scenario appears to be developing the tungsten-molybdenum
mineralization of the Fire Tower Zone.


In the case of the tin-indium scenario, utilizing conventional processing to produce two types
of concentrates, two key aspects need to be investigated. The first one is finding a suitable
customer for the indium-zinc-copper concentrate and the second one is negotiation of an
adequate and acceptable indium price realization agreement between ADEX and a potential
customer.


19.4           ANALYSIS


Re-establishing Mount Pleasant as a tungsten-molybdenum operation would be far easier than
developing a new operation based on mining and processing tin-indium ore. The tungsten
mine is already developed, with a substantial amount of inventory of broken mineralization,
and only needs to be dewatered and reequipped. The processing of tungsten, although not
economic during the short period of operation in the 1980s, provided a valuable experience,
which can be utilized in the design and construction of a new and improved processing plant.


The tin-indium scenario utilizing bioleach and hydromet processes would be far more
expensive and requires running of a pilot plant. Additionally, it would take a much longer
time to develop and construct the facility, and operating costs would be higher than the
conventional milling and flotation scenario.


WGM concludes that further advanced studies should be carried out to determine if the
newly-established Mineral Resources of the Fire Tower Zone can be converted into Mineral
Reserves.



                                           - 149 -
                                                                        Watts, Griffis and McOuat

                               20. RECOMMENDATIONS



Based on its review of the Kvaerner Feasibility Study, in light of currently improved metal
prices environment, and the presence of an NI 43-101-compliant WO3-MoS2 Mineral
Resource at the Fire Tower Zone, WGM concludes that the Mount Pleasant property is one of
merit. It is recommended that ADEX carry out a small diamond drilling program to gather
mineralized material from the zone and subject it to metallurgical testwork designed to
develop a preliminary tungsten-molybdenum flowsheet. A Scoping Study of re-establishing
production from the zone should be carried out in conjunction with this testwork.


There should also be a review of the historic North Zone drillhole and assay database to
determine what additional drilling would be required to enable the preparation of a Mineral
Resource estimate for the deposit. In addition, there should be compilation and mapping
carried out to determine the near-surface potential, as several North Zone drillholes
intersected as yet poorly defined near-surface tin-indium mineralization. As progress is made
regarding tin-indium potential, the Kvaerner study could to be used, to some degree, as a
basis to produce a new Feasibility Study.


As Kvaerner points out, the North Zone (Sn, In) deposits are complicated and are still not
fully understood. The historic “resource” outlined in the Kvaerner study was estimated from
a series of scattered deposits, which require further definition drilling. The Deep Tin Zone is
the least defined of the deposits and appears to consist of less contiguous pockets of
mineralization (Kvaerner Metal Davy Ltd., 1997). According to Kvaerner, future surface
drilling of the North Zone will require closely spaced holes, no more than 50 m apart. A
better evaluation of the mineralized zones can be done by underground drilling (i.e., the Deep
Tin Zone). However, this would involve dewatering the underground workings, which would
be costly and take approximately 6-7 months to complete. Therefore, in the short term, any
future drilling with the intention of exploring or upgrading the North Zone to prepare a
NI 43-101-compliant Mineral Resource estimate will need to be done from surface.




                                            - 150 -
                                                                           Watts, Griffis and McOuat

The proposed work plan and budget at Mount Pleasant as prepared by WGM in collaboration
with ADEX amounts to $1,100,000. It is designed as follows and further documented in
Table 22.


•   Additional Sampling and analysis of unsplit core from 1995 drilling by Piskahagen
    Resources in which descriptions in drill logs suggest potential for expanding the size of
    Fire Tower North Zone;

•   Complete the tailings dam study and carry out other required permitting and
    environmental monitoring activities required to remove Ministerial Order;

•   Drill four HQ (6.35 cm diameter) drillholes of approximately 400 m each. These holes
    will serve a dual purpose, 1) to obtain approximately 600 kg of representative Fire Tower
    Zone mineralized material for bench scale metallurgical testwork, and 2) to provide more
    geological and grade information to incorporate into the existing drillhole database;

•   Carry out bench-scale metallurgical testwork to develop a preliminary flowsheet for the
    recovery of both WO3 and MoS2 in the form of concentrates;

•   Carry out a Scoping Study to evaluate the feasibility of resuming tungsten-molybdenum
    mining operations from the Fire Tower Zone at Mount Pleasant;

•   Compilation, mapping and trenching (if warranted) to evaluate near-surface tin-indium
    potential above the North Zone (#4 lode, #7 lode, 600 Adit, FTZ Breccia Pipe) including
    bench scale metallurgical testwork;

•   Compilation of previous exploration and development data with respect to the origin and
    status of surface stockpiles on the property and near-surface tin-indium mineralized
    material with the possibility of conducting follow-up bulk sampling and testing;

•   Since many historic samples were not assayed for indium, it is proposed that additional
    sampling of historic rejects and pulps and quarter splitting and sampling of historic core
    be carried out to facilitate the evaluation of the overall indium potential of the property;.

•   Quantitative section (deep penetration) IP surveying to determine if the tungsten-
    molybdenum mineralization is continuous between the Fire Tower Zone and Saddle Zone,
    and to explore for deeper mineralization beneath Granite II (explore for stacked porphyry
    deposits at depth under Mount Pleasant). Also, to explore for additional mineralization at
    Hornet Hill. IP surveying may also be useful in conjunction with the evaluation of near-
    surface tin-indium potential; and


                                              - 151 -
                                                                        Watts, Griffis and McOuat

•   An internal quality assurance/quality control program for analytical work should be set up
    and analytical methods standardized with duplicate check assays done at a second ISO
    certified laboratory. With regard to the North Zone, Kvaerner determined that far less
    than 10% of the pre-1996 drill samples were rechecked.


                                         TABLE 22
           MOUNT PLEASANT - PROPOSED WORK PLAN AND BUDGET
                  Work Type                     Units   Unit Cost $  Cost (C$)
Additional core splitting and assaying           400        50          20,000
Environmental monitoring                                                25,000
Diamond Drilling – 4 HQ-sized holes
(incl. geologist & helper labour & assaying)   1,600 m     175         280,000
Petrographic/mineralogic study                                          10,000
Metallurgical testwork (FTZ min.)                                       50,000
Scoping Study - FTZ Zone                                               150,000
Additional sampling for indium evaluation                               25,000
Compilation, mapping & sampling                20 days    1,000         20,000
Trenching (mapping & sampling)                    1      20,000         20,000
Bulk sampling and testing (Sn-In min.)                                  80,000
IP surveying                                                            70,000
Consulting Fees                                100 days   1,000        100,000
GEMCOM (or similar software & training)                                 40,000
Environmental work (Operating Permit etc.)                             100,000
Holding costs (land)                                                    10,000
Transportation, meals, accommodation                                    50,000
Subtotal                                                            $1,050,000
General Contingency ~5%                                                $50,000
Total                                                               $1,100,000

WGM recommends that further in the future, ADEX consider carrying additional exploration
programs on the property. To date, there has been no significant effort put into the search for
gold mineralization on the property.      Much of the gold exploration in southern New
Brunswick has focused on the Clarence Stream area, some 10 km west of Mount Pleasant,
where Freewest Resources continues to expand a near-surface gold “resource” (Northern
Miner, 2005). In November 2005, a gold-bearing quartz boulder was discovered by a New
Brunswick Department of Natural Resources geologist that assayed 1,320 g Au/t in the Harry
Brook area 90 km east of Mount Pleasant. This discovery started a claim staking rush in the
area. In light of current high gold prices and recent discoveries of gold in the region, WGM
recommends that ADEX review the gold potential of the property.




                                           - 152 -
                                                                       Watts, Griffis and McOuat

The property should also be mapped in detail and sampled in search of other mineralized
targets.


Most of the exploration work has been concentrated on the Fire Tower Zone and North Zone
(including the Deep Tin Zone). ADEX believes that the Granite II is continuous between the
Fire Tower Zone and the North Zone where limited drilling has taken place and that a number
of tin mineralized cupolas may exist along that trend. Therefore, additional exploration work
to identify drill targets along this trend may be warranted.




                                             - 153 -
                                                                       Watts, Griffis and McOuat

                                       CERTIFICATE

                           To Accompany the Report entitled
                  “A Technical Review of the Mount Pleasant Property,
             Including a Mineral Resource Estimate for the Fire Tower Zone
                             Southwestern New Brunswick
                      for ADEX Mining Inc.” dated August 1, 2006


I, Paul A. Dunbar, do hereby certify that:

1.     I reside at 64 Massey Drive, Charlottetown, Prince Edward Island, C1E 1X8.

2.     I graduated from the University of Waterloo, Waterloo, Ontario in 1983 with a B.Sc.
       in Earth Sciences (Honours Applied Earth Sciences, Co-operative Program), and from
       Laurentian University of Sudbury, Ontario in 1989 with an M.Sc. in Geology and
       have been practicing my profession continuously since 1979.

3.     I am a member in good standing with the Association of Professional Geoscientists of
       Ontario (Membership Number 1227) and the Association of Professional
       Geoscientists of Nova Scotia (Membership Number 049).

4.     I am a Senior Associate Geologist with Watts, Griffis and McOuat Limited, a firm of
       consulting geologists and engineers, which has been authorized to practice
       professional engineering by Professional Engineers Ontario since 1969, and
       professional geoscience by the Association of Professional Geoscientists of Ontario.

5.     I am an independent qualified person for the purpose of National Instrument 43-101.

6.     I visited the ADEX property from November 8-10, 2005, and reviewed the technical
       information, old feasibility studies and reports for the mentioned property.

7.     I have no personal knowledge as of the date of this certificate of any material fact or
       change which is not reflected in this report.

8.     I have worked as a professional geoscientist for over 20 years since my graduation.
       My relevant experience for the purpose of this Technical Report is:

       •   Worked extensively on projects in the exploration for gold, other precious metal
           and base metal deposits, including VMS-type and porphyry-type deposits;
       •   Held positions as Exploration Geologist, Chief Geologist and Project Supervisor
           for major and junior Canadian mining companies, both in Canada and
           internationally; and
       •   Have previously prepared NI 43-101 reports to be filed with various regulatory
           authorities across Canada.



                                             - 154 -
                                                                        Watts, Griffis and McOuat

9.    I wrote and am responsible for the majority of this report including Sections 2 through
      16, excluding Section 16.5.1 (only small input), Section 17.9, Section 18, References
      and Appendices. I co-wrote and share responsibility for the Summary, Interpretation
      and Conclusions (Section 19) and Recommendations (Section 20).

10.   Neither I, nor any affiliated entity of mine, is at present, under an agreement,
      arrangement or understanding or expects to become, an insider, associate, affiliated
      entity or employee of ADEX Mining Inc., or any associated or affiliated entities.

11.   Neither I, nor any affiliated entity of mine own, directly or indirectly, nor expect to
      receive, any interest in the properties or securities of ADEX Mining Inc., or any
      associated or affiliated companies.

12.   Neither I, nor any affiliated entity of mine, have earned the majority of our income
      during the preceding three years from ADEX Mining Inc., or any associated or
      affiliated companies.

13.   I have read NI 43-101 and Form 43-101F1 and have prepared the technical report in
      compliance with NI 43-101 and Form 43-101F1; and have prepared the report in
      conformity with generally accepted Canadian mining industry practice, and as of the
      date of the certificate, to the best of my knowledge, information and belief, the
      technical report contains all scientific and technical information that is required to be
      disclosed to make the technical report not misleading.



                                             signed by
                                            " Paul A. Dunbar "


                                            Paul A. Dunbar, M.Sc., P.Geo.
                                            August 1, 2006




                                           - 155 -
                                                                      Watts, Griffis and McOuat

                                     CERTIFICATE

                          To Accompany the Report entitled
                 “A Technical Review of the Mount Pleasant Property,
            Including a Mineral Resource Estimate for the Fire Tower Zone
                            Southwestern New Brunswick
                     for ADEX Mining Inc.” dated August 1, 2006


I, Andrew Hara (Harasimowicz), P.Eng. do hereby certify that:

1.     I reside at 1577 Camelford Rd., Mississauga, Ontario, Canada, L5J 3C8.

2.     I am Principle of Hara-Mining Enterprises Inc. 1577 Camelford Rd., Mississauga,
       Ontario, Canada, L5J 3C8

3.     I graduated from the Academy of Mining and Metallurgy, Krakow, Poland in 1975
       with a B.Sc. in Mining.

4.     I am a registered as a Professional Engineer in the Province of Ontario (Registration
       Number 90247024). I am a Member of the Canadian Institute of Mining, Metallurgy
       and Petroleum.

5.     I am a Senior Associate Mining Engineer with Watts, Griffis and McOuat Limited, a
       firm of consulting engineers and geologists, which has been authorized to practice
       professional engineering by the Professional Engineers Ontario since 1969, and
       professional geoscience by the Association of Professional Geoscientists of Ontario.

6.     I have worked as a mining engineer for a total of 30 years since my graduation. My
       relevant experience for the purpose of the Technical Report is:

       •   Review and report as a consultant on a number of operations and projects around
           the world for due diligence, operations expansions and troubleshooting;
       •   Director of Mining with a Major Canadian Mining Corporation;
       •   Mine Superintendent; and
       •   Senior Project Engineer, Researcher and Production Supervisor.

7.     I have read the definition of “qualified person” set out in the National Instrument
       43-101 and certify that by reason of my education, affiliation with a professional
       association and past relevant work experience, I fulfill the requirements to be an
       independent qualified person for the purposes of NI 43-101.




                                          - 156 -
                                                                        Watts, Griffis and McOuat

8.    Mr. Paul Dunbar has prepared and written the majority of this report. I wrote and am
      responsible for sections 16.5.1 (small input from Paul Dunbar) and jointly prepared
      and share responsibility for the Summary, Interpretation and Conclusions (Section 19)
      and Recommendations (Section 20). I also reviewed the entire document providing
      comments as appropriate.

9.    I visited the ADEX property from November 8-10, 2006, and reviewed the technical
      information, old feasibility studies and reports for the mentioned property.

10.   I have no personal knowledge as of the date of this certificate of any material fact or
      change, which is not reflected in this report.

11.   Neither I, nor any affiliated entity of mine, is at present, under an agreement,
      arrangement or understanding or expects to become, an insider, associate, affiliated
      entity or employee of ADEX Mining Inc., or any associated or affiliated entities.

12.   Neither I, nor any affiliated entity of mine own, directly or indirectly, nor expect to
      receive, any interest in the properties or securities of ADEX Mining Inc., or any
      associated or affiliated companies.

13.   Neither I, nor any affiliated entity of mine, have earned the majority of our income
      during the preceding three years from ADEX Mining Inc., or any associated or
      affiliated companies.

14.   I have read NI 43-101 and Form 43-101F1 and have prepared the technical report in
      compliance with NI 43-101 and Form 43-101F1; and have prepared the report in
      conformity with generally accepted Canadian mining industry practice, and as of the
      date of the certificate, to the best of my knowledge, information and belief, the
      technical report contains all scientific and technical information that is required to be
      disclosed to make the technical report not misleading.



                                             signed by
                                            " Andrew Hara (Harasimowicz) "




                                            Andrew Hara (Harasimowicz), P.Eng.
                                            August 1, 2006




                                           - 157 -
                                                                        Watts, Griffis and McOuat

                                         CERTIFICATE

                           To Accompany the Report entitled
                  “A Technical Review of the Mount Pleasant Property,
             Including a Mineral Resource Estimate for the Fire Tower Zone
                             Southwestern New Brunswick
                      for ADEX Mining Inc.” dated August 1, 2006

I, Robert de l'Etoile, eng., do hereby certify that:

1.      I reside at 963 des Capucines, Laval, Quebec, Canada, H7X 3K7.

2.      I am a graduate from the Ecole Polytechnique de Montréal, Quebec in 1980 with a
        B.Sc.A in geological engineering and in 1982 with a M.Sc.A in geological
        engineering from the same institution, and I have practised my profession
        continuously since that time.

3.      I am a registered member of the Ordre des ingénieurs du Québec (Registration
        Number 35543). I am a Member of the Canadian Institute of Mining, Metallurgy and
        Petroleum.

4.      I am a Senior Associate Engineer with Watts, Griffis and McOuat Limited, a firm of
        consulting engineers and geologists, which has been authorized to practice
        professional engineering by Professional Engineers Ontario since 1969, and
        professional geoscience by the Association of Professional Geoscientists of Ontario.

5.      I have worked as an engineer for a total of 25 years since my graduation. My relevant
        experience for the purpose of the Technical Report is: Over 20 years of consulting in
        the field of geostatistical Mineral Resource estimation, orebody modelling and mineral
        resource auditing.

6.      I have read the definition of “qualified person” set out in the National Instrument
        43-101 and certify that by reason of my education, affiliation with a professional
        association and past relevant work experience, I fulfil the requirements to be an
        independent qualified person for the purposes of NI 43-101.

7.      Mr. Paul Dunbar and Mr. Andrew Hara prepared and wrote the majority of this report.
        I prepared, wrote and am responsible for sections 17.5 to 17.8.

8.      I have no personal knowledge as of the date of this certificate of any material fact or
        change, which is not reflected in this report.

9.      Neither I, nor any affiliated entity of mine, is at present, under an agreement,
        arrangement or understanding or expects to become, an insider, associate, affiliated
        entity or employee of ADEX Mining Inc., or any associated or affiliated entities.



                                              - 159 -
                                                                        Watts, Griffis and McOuat

10.   Neither I, nor any affiliated entity of mine own, directly or indirectly, nor expect to
      receive, any interest in the properties or securities of ADEX Mining Inc., or any
      associated or affiliated companies.

11.   Neither I, nor any affiliated entity of mine, have earned the majority of our income
      during the preceding three years from ADEX Mining Inc., or any associated or
      affiliated companies.

12.   I have read NI 43-101 and Form 43-101F1 and have prepared the technical report in
      compliance with NI 43-101 and Form 43-101F1; and have prepared the report in
      conformity with generally accepted Canadian mining industry practice, and as of the
      date of the certificate, to the best of my knowledge, information and belief, the
      technical report contains all scientific and technical information that is required to be
      disclosed to make the technical report not misleading.



                                             signed by
                                            " Robert de l'Etoile "




                                            Robert de l'Etoile, eng.
                                            August 1, 2006




                                           - 160 -
                                                                       Watts, Griffis and McOuat

                                       CERTIFICATE

                           To Accompany the Report entitled
                  “A Technical Review of the Mount Pleasant Property,
             Including a Mineral Resource Estimate for the Fire Tower Zone
                             Southwestern New Brunswick
                      for ADEX Mining Inc.” dated August 1, 2006


I, Dorota A. El-Rassi, do hereby certify that:

1.     I reside at 165 Shaughnessy Blvd, Unit 9, Toronto, Ontario, M2J 1J9.

2.     I graduated from the University of Toronto, Toronto, Ontario in 1997 with a B.A.Sc.
       in Mining Engineering (Honours), and in 2000 with an M.Sc. in Geology and
       Mechanical Engineering and have been practicing my profession since 1997.

3.     I am a Professional Engineer licensed by Professional Engineers Ontario (Registration
       Number 100012348).

4.     I am a Geological Engineer with Watts, Griffis and McOuat Limited, a firm of
       consulting geologists and engineers, which has been authorized to practice
       professional engineering by Professional Engineers Ontario since 1969, and
       professional geoscience by the Association of Professional Geoscientists of Ontario.

5.     I am a Qualified Person for the purposes of NI 43-101 with regard to a variety of
       mineral deposit types, with Mineral Reserve and Mineral Resource estimation
       parameters and procedures and with those involved in the preparation of technical
       studies.

6.     I have not visited the ADEX property. I have reviewed the technical information for
       the Fire Tower Zone, including the geological interpretation, the drillhole and assay
       database and historic cross sections, level plans and stope outlines as provided by
       ADEX. I am responsible for Sections 17.1 to 17.4 inclusive, with the exception of the
       portion of Section 17.4.2 dealing with the preparation of the geological model and
       selection of the cutoff grade, of the report

7.     I have no personal knowledge as of the date of this certificate of any material fact or
       change which is not reflected in this report.

8.     Neither I, nor any affiliated entity of mine, is at present, under an agreement,
       arrangement or understanding or expects to become, an insider, associate, affiliated
       entity or employee of ADEX Mining Inc., or any associated or affiliated entities.




                                             - 161 -
                                                                        Watts, Griffis and McOuat

9.    Neither I, nor any affiliated entity of mine own, directly or indirectly, nor expect to
      receive, any interest in the properties or securities of ADEX Mining Inc., or any
      associated or affiliated companies.

10.   Neither I, nor any affiliated entity of mine, have earned the majority of our income
      during the preceding three years from ADEX Mining Inc., or any associated or
      affiliated companies.

11.   I have read NI 43-101 and Form 43-101F1 and have prepared the technical report in
      compliance with NI 43-101 and Form 43-101F1; and have prepared the report in
      conformity with generally accepted Canadian mining industry practice, and as of the
      date of the certificate, to the best of my knowledge, information and belief, the
      technical report contains all scientific and technical information that is required to be
      disclosed to make the technical report not misleading.



                                              sign by
                                            " Dorota A. El-Rassi "



                                            Dorota A. El-Rassi, M.Sc., P.Eng.
                                            August 1, 2006




                                           - 162 -
                                                                       Watts, Griffis and McOuat

                                          CERTIFICATE

                           To Accompany the Report entitled
                  “A Technical Review of the Mount Pleasant Property,
             Including a Mineral Resource Estimate for the Fire Tower Zone
                             Southwestern New Brunswick
                      for ADEX Mining Inc.” dated August 1, 2006


I, Trevor Boyd, do hereby certify that:

1.     I reside at 148 Lascelles Blvd., Toronto, Ontario, M5P 2E6

2.     In 1988 I earned a M.Sc.(A) Minex degree in Earth Science from McGill University,
       Montreal, Quebec and a Ph.D. in Geology in 1996 from University of Toronto,
       Toronto, Ontario.

3.     I am a member in good standing with the Association of Professional Geoscientists of
       Ontario (Membership Number 1023).

4.     I am a Geological Consultant directly hired by Adex Mining Inc. to provide geological
       and logistical support to Watts, Griffis and McOuat Limited in the preparation of this
       report.

5.     I am an independent qualified person for the purpose of National Instrument 43-101.

6.     I visited the ADEX property from October 24-26 and November 8-10, 2005, and
       reviewed the technical information, old feasibility studies and reports for the
       mentioned property.

7.     I have no personal knowledge as of the date of this certificate of any material fact or
       change which is not reflected in this report.

8.     I have worked as a professional geoscientist for a total of 13 years since the
       completion of my M.Sc. degree. My relevant experience for the purpose of this
       Technical Report is:

       •   Worked extensively on projects in the exploration for gold, uranium, other
           precious metal and base metal deposits, including VMS-type, magmatic-type,
           vein-type and porphyry-type deposits; and
       •   Held positions as Exploration Geologist and Project Supervisor for major and
           junior Canadian mining companies in Canada.

9.     I prepared and am responsible for the geological model and selected the cutoff grade
       (as described in Section 17.4.2 of the report), which form the basis of the Mineral
       Resource estimation completed in this report.

                                             - 162 -
                                                                        Watts, Griffis and McOuat


10.   Neither I, nor any affiliated entity of mine, is at present, under an agreement,
      arrangement or understanding or expects to become, an insider, associate, affiliated
      entity or employee of ADEX Mining Inc.

11.   Neither I, nor any affiliated entity of mine own, directly or indirectly, nor expect to
      receive, any interest in the properties or securities of ADEX Mining Inc.

12.   Neither I, nor any affiliated entity of mine, have earned the majority of our income
      during the preceding three years from ADEX Mining Inc.

13.   I have read NI 43-101 and Form 43-101F1 and have prepared the technical report in
      compliance with NI 43-101 and Form 43-101F1; and have prepared the report in
      conformity with generally accepted Canadian mining industry practice, and as of the
      date of the certificate, to the best of my knowledge, information and belief, the
      technical report contains all scientific and technical information that is required to be
      disclosed to make the technical report not misleading.




                                             signed by
                                            " Trevor Boyd "



                                            Trevor Boyd, Ph.D., P.Geo.
                                            August 1, 2006




                                           - 163 -
                                                                      Watts, Griffis and McOuat

                                          REFERENCES

ADEX Mining Inc.
       1995            The Mount Pleasant Mine, Corporate Overview.            Promotional
                       brochure, 11 p.


ADEX Mining Corp.
       1995            Summary Prefeasibility Study, ADEX Mineral Limited, Mount
                       Pleasant Property, 15 p.


Akerley, P.
       1996            Mount Pleasant Project Assessment Report, prepared for ADEX
                       Mining Corp. 16 p.


Atkinson, J.R., Kooiman, G. and Coates, H.J.
       1981            Geology of Mount Pleasant Tungsten, New Brunswick: in Canadian
                       Mining Journal, pp. 73-75.


Bailey, L.W., Ells, R.W., & Matthew, G.F.
       1877            Report of Geological Observations in southern New Brunswick: in
                       Geological Survey of Canada, Report of Progress.


Behre Dolbear & Company
       1963            Appendices to Preliminary Report of August 5, 1963, on estimates of
                       Ore Reserves, North Zone-Mount Pleasant, Charlotte County, New
                       Brunswick, Canada, prepared for Mount Pleasant Mines Limited.
                       Appendix A-F.


Billiton Canada Ltd.
       1985a           Mount Pleasant Tungsten (MPT), Part 1, The Fire Tower Orebodies:
                       report under cover of Mount Pleasant Tungsten Mine, St. George, New
                       Brunswick, 23 p.


       1985b           Mount Pleasant Tungsten (MPT), Part II, The North Zone Tin: report
                       under cover of Mount Pleasant Tungsten Mine, St. George, New
                       Brunswick, 40 p.

                                            - 164 -
                                                                     Watts, Griffis and McOuat


Canadian Institute of Mining, Metallurgy and Petroleum
       2002          CIM Standards on Mineral Resources and Reserves, Definitions and
                     Guidelines. Adopted by CIM Council August 20, 2000, 26 p.


Davy Canada Inc.
       1990          Watts, Griffis and McOuat Limited for Nova Gold Resources Inc.,
                     Mount Pleasant Tin Feasibility Study.


Department of Land and Mines, Fredericton, New Brunswick
       1965          Geology of the Upper Shin Creek and Mount Pleasant Areas.
                     J.R. Tremblay, Mines Branch Report (unpublished).


       1962          Fredericton Junction Map Area, York, Sunbury and Charlotte Counties.
                     G.S. Clark, New Brunswick Mines Branch, pp. 61-63.


D.M. Fraser Services Inc.
       1995          Pre-Feasibility Study, Mount Pleasant Property, prepared for ADEX
                     Mining Corp., 83 p.


       1994          Financial Summary, Piskahegan Resources Limited, Mount Pleasant
                     Property, prepared for Piskahegan Resources Limited, 11 p.


Environment Canada
       2005          Atlantic Climate Centre (New Brunswick) Website
                     http//atlantic-web1.ns.ec.gc.ca/climatecentre/?lang=En&n=7A6129C7-
                     1#intro


Government of New Brunswick
       2005          About New Brunswick – Population, Website
                     http://www.gnb.ca/cnb/nb/Pop-e.asp




                                           - 165 -
                                                                      Watts, Griffis and McOuat

Gowdy, W.
       1995         Confidential Report: Property Visit, Mount Pleasant Mine, New
                    Brunswick, prepared for ADEX Mining Corp., 18 p.


Hosking, K.F.G.
       1985         Report on the North Tin Zone of Mt. Pleasant, New Brunswick,
                    Canada, Mount Pleasant Tungsten Mine, report to Billiton Canada Ltd.
                    Included in their 1985b report, 6pp.


Kooiman, G.J.A.
       2005         Correspondence to ADEX re: Exploration Potential at Mount Pleasant,
                    4 p.


       2004         Exploration and Development, 20-year Summary Report, Mount
                    Pleasant Property, prepared for ADEX Mining Inc., 16 p.


       1997         Report on Surface Diamond Drilling on the Mount Pleasant Claim
                    Group, prepared for ADEX Mining Corp., 12 p.


Kooiman, G.J.A., McLeod, M.J. and Sinclair, W.D.
       1986         Porphyry Tungsten-Molybdenum Orebodies, Polymetallic Veins and
                    Replacement Bodies, and Tin-Bearing Greisen Zones in the Fire Tower
                    Zone, Mount Pleasant, New Brunswick: in Economic Geology, v. 81,
                    pp. 1356-1373.


Kvaerner Metals Davy Ltd.
       1997         ADEX Mining Inc. Mount Pleasant Feasibility Study, New Brunswick:
                    Reference 144900, v. I, II and III (including appendices).


Lac Minerals Ltd.
       1988         Extension of Mount Pleasant Tin Deposit, Part I, PR-87-14-21G7, by
                    G. Kooiman.


       1988b        Extension of Mount Pleasant Tin Deposit, Part II, Project 87-14-21G7,
                    by G. Kooiman, 7 p.



                                          - 166 -
                                                                        Watts, Griffis and McOuat


Martin, D.
        1997           Memorandum to Mr. D.M. Fraser from ADEX Minerals Corp., re:
                       Lode #4 Resources Based on 60 ppm In Cutoff, 34 p.


Mount Pleasant Tungsten Mine
        1985           Mount Pleasant Tungsten Mine Geological Department Mothball
                       Report. Mothball Report, Vol. I.


Natural Resources and Energy, Mineral Resources, New Brunswick
        1990           Geology, Geochemistry, and Related Mineral Deposits of the Saint
                       George Batholith, Charlotte, Queens, and Kings Counties, New
                       Brunswick. M.J. McLeod, Mineral Resource Report 5, 169 p.


Northern Miner
        2005           NB Gold Discovery Generates Buzz, article in the Northern Miner,
                       v. 91, No. 37, p.1.


Parrish, I.S.
        1973           Correspondence from Brunswick Tin Mines Ltd., Sullivan Mining
                       Group re 1973 Ore Reserves, North Zone, Tin #4 Lode, 2 p


Parrish, I.S. and Tully, J.V.
        1978           Porphyry Tungsten at Mt. Pleasant, N.B. Economic Geology and
                       Mineralogy: in the CIM Bulletin, dated June 28th , pp. 93-100.


Parrish, I.S. and Tully, J.V.
        1976           Summary Report on the Geology of the Mount Pleasant Project,
                       Brunswick Tin Mines Ltd., 371 p.


Piskahegan Resources Limited
        1995           Piskahegan Resources Limited – Mount Pleasant, 22 p.




                                             - 167 -
                                                                     Watts, Griffis and McOuat

Redpath Mining Consultants Limited
       1995          Piskahegan Resources Limited Mount Pleasant Property, Redpath Mine
                     Design – North Zone, prepared for ADEX Mining Corp., v. II.


Ruitenberg, A.A.
       1967          Stratigraphy, Structure and Metallization, Piskahegan-Rolling Dam
                     Area (Northern Appalachians, New Brunswick, Canada), Leidse
                     Geologiche medeligon, v. 40, pp. 79-120.


Sinclair, W.D., Kooiman, G.J.A., Martin, D.A. and Kjarsgaard, I.M.
       2005          Geology, Geochemistry and Mineralogy of Indium Resources at Mount
                     Pleasant, New Brunswick, Canada: in Press, Ore Geology Reviews,
                     23 p.


Sinclair, W.D. (Lefebure, D.V. and Ray, G.E. (editors))
       1995          Porphyry Mo (Climax-type): in Selected British Columbia Mineral
                     Deposit Profiles, v. 1 – Metallics and Coal, British Columbia Ministry
                     of Energy of Employment and Investment, Open File 1995-20, pp. 105-
                     108.


       1995b         Porphyry Sn: in Selected British Columbia Mineral Deposit Profiles,
                     v. 1 – Metallics and Coal, British Columbia Ministry of Energy of
                     Employment and Investment, Open File 1995-20, pp. 97-100.


Sinclair, W.D. (Seltmann, Kampf & Moller (editors))
       1994          Tungsten-Molybdenum and Tin Deposits at Mount Pleasant, New
                     Brunswick, Canada Products of Ore-Fluid Evolution in a highly
                     Fractionated Granitic System: in Geological Survey of Canada
                     Contribution No. 39893, pp. 410-417, ISBN 80-7075-152-5.


Sinclair, W.D., Kooiman, G.J.A. and Martin, D.A.
       1988          Geological Setting of Granites and Related Tin Deposits in the North
                     Zone, Mount Pleasant, New Brunswick: in Current Research, Part B,
                     Geological Survey of Canada, Paper 88-1B, pp. 201-208.




                                          - 168 -
                                                                    Watts, Griffis and McOuat

Strathcona Mineral Services Limited
       1979           Feasibility Study of the Brunswick Tin Project, Mt. Pleasant, New
                      Brunswick, Canada, prepared for Billiton Exploration Canada Limited,
                      Vol. II, Final Report, Vol. III Drawings.


Taylor, R.G. and Pollard, P.J.
       1985           The North Zone Tin Mineralization at Mount Pleasant, New
                      Brunswick, Canada, prepared for Billiton Canada Ltd. Property visit,
                      12 p.


Washburn & Gillis Associates Ltd.
       1996           Faxed document to D.M. Fraser Services Inc. re: Environmental
                      Permitting Requirements for the Mt. Pleasant Mine Redevelopment.


University of New Brunswick
       1964           Volcanic Rocks of the Sunday Lake Area, New Brunswick: M.Sc.
                      Thesis by F.R. Harris (unpublished).


       1963           Carboniferous Volcanic and Sedimentary Rocks of the Lower Shin
                      Creek Area, New Brunswick: M.Sc. Thesis by H.W. Van de Poll
                      (unpublished).


       1960           The Carboniferous Volcanic Rocks of New Brunswick: M.Sc. Thesis
                      by W.H. Laughlin (unpublished).




                                           - 169 -
             Watts, Griffis and McOuat




APPENDICES




  - 170 -
                                                                Watts, Griffis and McOuat




                               APPENDIX 1:
                         ORE CLASSIFICATIONS
IN SUPPORT OF HISTORIC RESOURCE ESTIMATES (SECTION 17.0)




Note: All of the information in this Appendix predates NI 43-101, therefore is not
       NI 43-101 compliant. It is provided for information purposes only, and
       does not imply that “resource” and “reserve” estimates using these
       classifications are NI 43-101 compliant.
                                                                       Watts, Griffis and McOuat

                                         Appendix 1A


Ore Classification category definition (Behre Dolbear & Company, 1963):


Proven Ore - Ore for which tonnage is computed from dimensions revealed in outcrops,
trenches, workings, and drillholes and for which the grade is computed from the results of
detailed sampling. The sites for inspection, sampling, and measurements are so closely
spaced and the geologic character is defined so well that the size, shape and mineral content
are well established. The computed tonnage and grade are judged to be accurate within limits
which are stated and no such limit is judged to differ from the computed tonnage or grade by
more than 20 per cent.


                                         Appendix 1B


Ore Classification category definitions (Lac Minerals, 1988):
Lac-Billiton Tin Project – “North Zone”


Proved Ore: Ore drilled off on 25 m spaced sections showing geological continuity or within
12.5 m of positively identified surface holes.


Probable Ore: Ore drilled off on 50 m spaced sections showing geological continuity or
within 25 m of surface holes.


Possible Ore: Ore in widely spaced surface or underground holes and a degree of geological
interpretation.




                                      - Appendix 1, Page 1 -
                    Watts, Griffis and McOuat




   APPENDIX 2:
MINISTERIAL ORDER
                                                                       Watts, Griffis and McOuat

This “Ministerial Order” was retyped by WGM due to the poor quality of the faxed copy.

                                MINISTERIAL ORDER

To: ADEX Mining Inc.
    121 King Street West
    Suite 850
    Toronto, Ontario
    Canada M5A 1J3

-AND-

    William B. Burton, President
    1 Colson Avenue
    Toronto, Ontario
    Canada, M4V 1Y3

      WHEREAS ADEX Mining Incorporated (herein after called the “Owner”) is the
owner of a minesite at Mount Pleasant in the County of Charlotte and the Province of New
Brunswick.

       AND WHEREAS the Minister of the Environment (hereinafter called the “Minister”)
has reason to believe that contaminants from the mining operation and the mine have been
and are being released into or upon the environment, contrary to Subsection 5.3(1) of the
Clean Environment Act, being Chapter C.6 of the Statutes of New Brunswick.

        THEREFORE, the Minister issues this order pursuant to Subsection 5(1) and 5(2) of
the said Clean Environment Act and orders that the owner shall do the following:

   1.     Provide on an immediate and continuous basis, adequate power supply, equipment
          and personnel in order to continuously adjust the mine water discharged from the
          mine to a pH level of 10.5 (± 1.0 point) before release of the mine water to the
          tailings pond.

   2.     Maintain the water in the tailings pond at the pH of 8.5 (±1.0 point) as measured at
          the discharge from the tailings pond. This condition shall be complied with by
          June 14, 1999.

   3.     Commission a report on the environmental effects of the exposure of tailings in the
          tailings pond. The report shall be prepared by individuals having expert
          knowledge in sampling the tailings material, testing it and predicting the potential
          environmental effects.

   4.     Commission a report on the adequacy of the existing tailings dam to withstand
          major storm events and whether or not the tailings dam is consistent with criteria


                                    - Appendix 2, Page 1 -
                                                                     Watts, Griffis and McOuat

          identified in the Canadian Dam Safety Association Dam Safety Guidelines. The
          report shall be prepared by individuals having expert knowledge in performing this
          work.

   5.     Sample twice a week, the mine water, the treated mine water, the water in the
          tailings pond and the water discharged from the tailings pond for pH, Arsenic and
          Zinc. This work is to begin no later than June 14, 1999.

   6.     Report to the Department on a monthly basis the results of sampling and analysis,
          required by item 5 above. The report shall be submitted within 15 days of the end
          of the month during which the sampling is done. The first report shall be
          submitted by June 14, 1999.

   7.     Report to the Department immediately any failure to comply with the requirements
          of item 1 and 2.

   8.     Submit to the Department for approval a proposed schedule for completion of the
          work required by items 3 and 4. The proposed schedule shall be submitted to the
          Department by June 14, 1999.

FAILURE to Comply with this Order constitutes an offence under the Clean Environment
Act.

DATED at Fredericton, New Brunswick this 27 day of April,          A.D., 1999




____________________________
GENE DEVEREUX
Minister of the Environment




                                    - Appendix 2, Page 2 -
                                 Watts, Griffis and McOuat




             APPENDIX 3:
ADEX SUMMARY OF EXPLORATION POTENTIAL
                                                                       Watts, Griffis and McOuat

                EXPLORATION POTENTIAL AT MOUNT PLEASANT

Reference: Kooiman (2005) – ADEX Consultant

W-Mo-Bi Mineralization

Fire Tower Zone

Large zones of W-Mo-Bi mineralization occur in the Fire Tower Zone. The mineralized
bodies in the Fire Tower Zone are known as the Fire Tower West, Fire Tower South and Fire
Tower North. All three zones formed a single body at one stage before the Fire Tower West
and South were separated from the Fire Tower North by a large fault, the Fire Tower Fault.
The Fire Tower West is, in places, separated from the Fire Tower South (the name is
misleading because the zone actually occurs mostly east of the Fire Tower West) by the
intrusion of a large body of younger granite porphyry. There is no potential for large
additional “resources” although underground diamond drilling remains incomplete in the
south of the Fire Tower West and the east of the Fire Tower North. Small tonnages could be
added in these zones.

North Zone

The W-Mo-Bi mineralization in the North Zone occurs in four ill-defined zones, known as the
X,Y,W and Z zones. These zones have been explored only by surface drilling. Underground
definition drilling could lead to additional “resources”. Metal grades in the “North Zone” are
generally lower than in the Fire Tower Zone.

Sn-In Base Metal Mineralization

Sn-In base metal deposits are associated with the intrusion of small, steep-sided Granite II
bodies. A large underground exploration program conducted in 1985-1987 and several
surface drilling programs in subsequent years led to the recognition of four separate, younger
Granite II bodies: Granite IIa and Granite IIb. The four bodies or cupolas are: The North
Zone, the “South Cupola” of the North Zone, the Saddle Zone and the Fire Tower North
Zone. Sn-In base metal mineralization may occur within the Granite IIb phase (endogranitic
mineralization) or at the contact of Granite IIa/IIb as contact flank or contact crest
mineralization. In the “South Cupola” of the North Zone, mineralization may occur away
from the contact, hosted by Granite IIa such as parts of the Upper Deep Tin Zone.

Targets for Additional “Resources” of Sn-In Base Metal Mineralization

Additional “resources” of Sn-In- base metal mineralization may be found in and around
known cupolas or could exist associated with presently unknown granite bodies.




                                     - Appendix 3, Page 1 -
                                                                       Watts, Griffis and McOuat

The following targets have been identified:

Target 1 - West, East, and South of the South Cupola of the North Zone

Sn-In- base metal mineralization on the north side of the “South Cupola” was discovered in
1972 and given the name Deep Tin Zone. This body was re-drilled in 1996 (11 holes, AM96-
1 to AM96-11).

Reinterpretation of earlier surface drilling results and underground mapping and sampling
during 1986 in the North Zone access decline show that mineralization occurs on all sides of
the South Cupola, over a vertical distance of about 200m.

Surface hole MPS 195, a vertical hole, straddles the southern Granite IIa/IIb contact. It
assayed 0.16% Sn, 1.56% Zn and 121 ppm In over 192m. Mineralization occurs also to the
west of the South Cupola.

Surface hole MPS 162 intersected a well-mineralized chlorite-fluorite replacement vein
assaying 6.31% Sn, 0.80% Cu, 9.69% Zn and 0.06% In over 3m at the 1,100m elevation.

Mineralization east of the “South Cupola” is found in the North Zone access decline and in
several surface holes. Selected underground samples indicate that over a length of 70m
(13410 N to 13480N) the decline straddles the east side of the cupola. The mineralization is
mostly as Sn-Cu-As in chlorite-fluorite veins and replacements. Samples yielded up to
13.49% Sn, 4.92% Cu and 7.81% As. Indium values are generally low, at 0.01% In, which is
to be expected as the mineralization at this elevation (around 975m) is low in sphalerite, the
main indium carrier.

Several surface holes intersected Sn-In-Base metal mineralization above the decline.

MPS 170 intersected a high-grade Sn-Cu replacement vein at the 1005m level assaying
6.78% Sn and 2.06% Cu over 7m. This mineralization is similar to that of the North Zone
Access Decline.

At higher elevations, intersections are characterized by higher zinc values. MPS 165
intersected 9.15% Zn, 0.82% Cu, 0.28% Sn and 1660 ppm In over 3m, at the 1040 level.
MPS 147 intersected 9.54% Zn, 0.28% Cu, 0.28% Sn and 371 ppm In over 9.1m at the 1065
level.

Target 2 - Area East of the North Zone Access Decline (East of 15500 E)

The area east of the North Zone Access Decline has been less explored than the area west of
the decline. It also includes the No. 5 lode area where shallow surface holes (e.g., DDH 117,
DDH 141, etc.) intersected narrow (3-5m wide) mineralization zones high in Sn, Cu, Zn and
As. No indium assays are available for these holes.




                                     - Appendix 3, Page 2 -
                                                                         Watts, Griffis and McOuat

Vertical hole E 16 (drilled in 1985) was drilled in the No. 5 lode area. The hole intersected
dykes and larger bodies of Granite II. The area could be part of the South Cupola or could be
underlain by a separate cupola.

Target 3 - Area Between North Zone and Saddle Zone

No deep drilling was carried out over a distance of about 400m between the North Zone and
the northern most drilled hole in the Saddle Zone (hole NMR 90-1).
This is a large area, a prime target area for extensions of existing zones or an area of unknown
cupolas.

Target 4 - Area Between North Zone and Surface Hole LNZ 13

There is no deep drilling information available for the area between the North Zone and hole
LNZ 13, covering a distance of 500-700m. LNZ 13 intersected quartz-feldspar porphyry
(QFP) intruded by Granite III; no Granite II was intersected. However, QFP hosted
replacements, high in Zn with some Sn and In (max. 79 ppm over 6.1m) may indicate the
presence of Granite II in this area.

Target 5 - Area Between Saddle Zone and the Fire Tower North Zone

No deep drilling was carried out between the southern most hole in the Saddle Zone, NMR
90-2 and a cluster of five holes drilled in the Fire Tower North Zone, PRL 95-1 to 95-5. The
distance is approximately 300-350m. There is potential for additional “resources” of both the
Saddle Zone and/or the Fire Tower North Zone or mineralization between the two zones
could be continuous.




                                      - Appendix 3, Page 3 -
                     Watts, Griffis and McOuat




   APPENDIX 4:
ASSAY CERTIFICATES

								
To top