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Mel Property

Property Description and Location

The Mel property consists of 257 mineral claims covering 5,380 hectares situated in the Watson Lake Mining
District of the Yukon Territory. The property is located approximately 80 kilometers east-northeast of the town of
Watson Lake. A list of the claims and information regarding the claims is shown in Table 4.1.

Claim Status Mel Property

Claim Name Grant Number Expiring Date NTS Location
ANDY 1 YA72509 2012/04/03 095-D-06
ANDY 2 YA72510 2012/04/03 095-D-06
ANDY 3 YA72511 2012/04/03 095-D-06
ANDY 4 YA72512 2012/04/03 095-D-06
ANDY 5-8 YA72513-YA72516 2012/04/03 095-D-06
BOZ 1-2 YA66985-YA66986 2012/04/03 095-D-06
BOZ 3 YA66987 2012/04/03 095-D-06
BOZ 4 YA66988 2012/04/03 095-D-06
CHUNGO 1 YA66946 2011/04/03 095-D-06
CHUNGO 2-8 YA66947-YA66953 2012/04/03 095-D-06
DAVE 1-8 YA72501-YA72508 2012/04/03 095-D-06
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Claim Name Grant Number Expiring Date NTS Location
EDY 1-4 YA66962-YA66965 2011/04/03 095-D-06
EDY 5 YA66966 2012/04/03 095-D-06
EDY 6 YA66967 2011/04/03 095-D-06
EDY 7 YA66968 2012/04/03 095-D-06
HOSE 1-4 YA66919-YA66922 2011/04/03 095-D-06
HOSE 5 YA66923 2015/04/03 095-D-06
HOSE 6 YA66924 2011/04/03 095-D-06
HOSE 7 YA66925 2015/04/03 095-D-06
HOSE 8 YUA66926 2011/04/03 095-D-06
JEAN 1-4 Y72731-Y72734 2016/04/03 095-D-06
JEAN 5 Y72961 2013/04/05 095-D-06
JEAN 6 Y72962 2015/04/05 095-D-06
JEAN 7 Y72963 2013/04/05 095-D-06
JEAN 8-10 Y72964-Y72966 2011/04/05 095-D-06
JEAN 11 Y74418 2014/04/03 095-D-06
JEAN 12-15 Y74419-Y74422 2012/04/03 095-D-06
JEAN 16 Y74423 2013/04/03 095-D-06
JEAN 17 Y74424 2014/04/03 095-D-06
JEAN 18 Y74425 2013/04/03 095-D-06
JEAN 19 Y74426 2014/04/03 095-D-06
JEAN 20-21 Y74427-Y74428 2013/04/03 095-D-06
JER 1-8 YA66931-YA66938 2015/04/03 095-D-06
JOE 1-2 YA45269-YA45270 2013/04/03 095-D-06
JONI 1-2 YA66846-YA66847 2012/04/03 095-D-06
JONI 3 YA66848 2011/04/03 095-D-06
JONI 4 YA66849 2012/04/03 095-D-06
JONI 5 YA66850 2011/04/03 095-D-06
JONI 6 YA66851 2012/04/03 095-D-06
JONI 7 YA66852 2011/04/03 095-D-06
JONI 8 YA66853 2012/04/03 095-D-06
KELI 1-4 YA66842-YA66845 2012/04/03 095-D-06
KELI 5-8 YA66927-YA66930 2012/04/03 095-D-06
MEL 11-16 Y22230-Y22235 2013/04/03 095-D-06
MUMBO 1-2 YA66977-YA66978 2011/04/03 095-D-06
MUMBO 3-8 YA66979-YA66984 2012/04/03 095-D-06
OTT 1-8 YA66954-YA66961 2012/04/03 095-D-06
RALFO 1 YA66939 2012/04/03 095-D-06
RALFO 2 YA66940 2011/04/03 095-D-06
RALFO 3 YA66941 2012/04/03 095-D-06
RALFO 4-5 YA66942-YA66943 2011/04/03 095-D-06
RALFO 6 YA66944 2015/04/03 095-D-06
RALFO 7 YA66945 2011/04/03 095-D-06
SAM 1-32 YB46141-YB46172 2012/04/03 095-D-06
SAM 33-35 YB46173-YB46175 2012/04/03 095-D-06
SAM 36-67 YB46176-YB46207 2012/04/03 095-D-06
SAM 68-86 YB46208-YB46226 2012/04/03 095-D-06
SIN 1-6 YA66989-YA66994 2012/04/03 095-D-06
SIN 7-8 YA66995-YA66996 2011/04/03 095-D-06
SOV 1-6 YA28600-YA28605 2013/04/03 095-D-06
TOMI 1-8 YA66969-YA66976 2012/04/03 095-D-06
WET 1 Y83309 2012/04/03 095-D-06
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Claim Name Grant Number Expiring Date NTS Location
WET 2 Y83310 2013/04/03 095-D-06
WET 3 Y83311 2012/04/03 095-D-06
WET 4 Y83312 2013/04/03 095-D-06
WET 5-8 Y83313-Y83316 2012/04/03 095-D-06
WET 9-11 Y83317-Y83319 2011/04/03 095-D-06
WET 12-16 Y83320-Y83324 2013/04/03 095-D-06
WET 25-32 Y83325-Y83332 2012/04/03 095-D-06
YANG 1-6 YA66997-YA67002 2012/04/03 095-D-06

Assessment work required to keep the property in good standing is $105 per claim per year. Sufficient work has
been filed or payment made in lieu of work to keep all the claims in good standing at least to April 3, 2012.

The location of the four mineralized zones, including the mineral resource at the "Main Mel Zone", is shown on
Figure 4.1. There are no known environmental liabilities on the property. Permits to conduct exploration work on
the property are required and must be applied for prior to the start of a work program. Applications for work permits
have not been made since a work program has not been finalized.


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In August, 2000, pursuant to an agreement dated June 9, 2000 with Breakwater, Breakwater conveyed to Barytex a
100% undivided interest in the Mel property in consideration of 600,000 shares in the capital of Barytex and a
payment of a royalty of 1% net smelter returns from the property.

Previously, pursuant to an agreement dated August, 1992 with Breakwater, Barytex had the option to acquire an
85% undivided interest in the property. Under the terms of this agreement, Barytex paid $1 million to Breakwater in
a series of payments from 1992 to 1997 and was required to spend a total of $1.65 million on exploration of the
property by September, 2000 to vest its interest. As of June, 2000 a total of $1.33 million had been spent on
exploration. Barytex also had the right to acquire an additional 5% interest in the property under the terms of a
February, 1985 agreement with Sulpetro Minerals Limited (now Breakwater).

Under the terms of a September, 1996 agreement with Cominco Ltd. (“Cominco”), Barytex granted Cominco the
option to earn a 60% interest in the Mel property. Cominco agreed to pay $350,000 by September, 1998, (of which
$50,000 was paid) and incur cumulative expenditures of $1.2 million. To date, Barytex and Cominco have spent a
total of $1.33 million, of which $472,706 was spent by Cominco, on exploration of the property. In September,
1997, Cominco abandoned its interest in the property due to the lack of encouraging drill results from a two-hole
drill program conducted to test geophysical anomalies believed to represent a faulted extension of the Main Mel
mineralized horizon.

Accessibility, Climate, Local Resources, Infrastructure and Physiography

The Mel property is located approximately 400 kilometers east of the city of Whitehorse. Access to the property is
by means of the paved Alaska Highway that runs 50 kilometers to the south of the property, providing a link to the
port of Skagway 600 kilometers to the west. Rail access is available 500 kilometers to the southeast at the town of
Fort Nelson. A 46 kilometer winter road north from the Alaska Highway provides seasonal access to the property.
An airstrip on the property allows for year round access. Watson Lake, located on the Alaska Highway, is the
nearest population center.

The climate is characterized by cold winters and moderate summers. Precipitation is moderate and winter snow
accumulation is in the order of 80 centimeters. Drilling can be carried out in winter as well as in the summer months
but is not recommended during the spring break-up.

The surface rights are held by the Yukon government and any mining operation requires regulatory approval. There
is no electrical power available. However, a large thermal coal resource is located 10 kilometers from the property.
Water is available from small lakes and streams on the property. There are ample areas suitable for plant sites,
tailings storage, and waste disposal areas.

The property is situated on the southern fringe of the Logan Mountains of southeastern Yukon. The terrain is
characterized by subdued topography with local elevations ranging from 900 meters at valley bottoms to 1,200
meters at local hill tops.

Vegetation on the property consists of spruce, pine, and balsam with willow and alder comprising most of the
understory. Most of the area is in varying stages of regeneration following forest fires.

History

The property was first staked by prospectors in 1967 and subsequently optioned to Newmont Mining Corporation
(“Newmont”). Newmont conducted a program of trenching and geochemical surveys. Five trenches exposed low-
grade, Main Mel Zone zinc-lead-barite mineralization over a strike length of 488 meters. The zone averaged 5.3%
combined lead-zinc over widths from 2.3 to 9 meters. Newmont subsequently dropped their option and the Mel
property was acquired by Barytex. Barytex subsequently optioned the property to Granby Mining Corp. (“Granby”).
Between 1974 and 1975, Granby conducted an 18 hole diamond drill program (1,952 meters). The drilling
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intersected two parallel, north-striking, barite-sphalerite-galena zones. The Main Mel Zone averaged 6.1 meters true
width. Based on the drilling, a mineral resource of 2.6 million tonnes averaging 5.35% zinc, 1.93% lead, and 54.6%
barite to a depth of 152 meters below surface was estimated.

In 1976, St. Joseph Explorations Ltd. (“St. Joseph”) optioned the Mel property and conducted geological mapping,
geochemical and geophysical surveys on the property. During 1978 and 1979, St. Joseph completed a 19 hole drill
program totaling 4,054 meters. Based on the drill program, a mineral resource of 4,782,380 tonnes grading 5.61%
zinc, 2.05% lead, and 52.1% barite was calculated by St. Joseph for the Main Mel Zone. Preliminary metallurgical
testing conducted on the Main Mel Zone by Lakefield Research in 1978 yielded concentrates ranging from 60.9% to
84.7% zinc, 78.0% to 79.6% lead and 90.3% to 94.4% barite.

In 1981, St. Joseph sold its 51% interest in the Mel property to Sulpetro Ltd. Following the sale, Sulpetro Minerals
Ltd. (“Sulpetro”) was established to hold the property. Regional exploration conducted by Sulpetro in 1981 led to
the discovery of the "Mel East Zone", a zinc showing, located 7.3 kilometers northeast of the Mel deposit. Limited
geochemical surveys conducted by Sulpetro over the next two years defined a large zinc soil anomaly in the area of
the Mel East Zone.

Geological mapping and geochemical sampling conducted in 1984 between the Main Mel Zone and the Mel East
Zone led to the discovery of the Jeri zinc showing, located 4 kilometers north-northeast of the Main Mel Zone.
During 1985, Sulpetro drilled 10 holes totaling 1,009 meters to test the Jeri Zone. Nine (9) of the 10 holes
intersected zinc mineralization over a strike length of 550 meters. Zinc values ranged up to 13.11% zinc over 3.37
meters within a large zone of silicified and dolomitized limestone. Later that year, Sulpetro sold its interest to
Novamin Resources Ltd. (“Novamin”), who drilled-tested the Main Mel Zone at depth with a 7 hole drill program
totalling 2,012 meters. Drill results indicated that the zinc-lead-barite mineralization continued to a depth of at least
450 meters below surface. As a result of the Novamin drilling, the mineral resource was increased to 5,581,030
tonnes grading 6.63% zinc, 1.92% lead, and 49.64% barite. Breakwater purchased Novamin in 1988, giving them
joint ownership of the Mel property with Barytex.

In 1989, Barytex conducted a soil geochemical survey near the Jeri Zone and completed four diamond drill holes
(663 meters) on the Main Mel Zone. The drill program consisted of in-fill drilling at the north end of the Main Mel
Zone and confirmed the continuity of the Main Mel Zone. Based on a 29 hole drill program, Barytex subsequently
estimated an Indicated Mineral Resource for the Main Mel Zone of 5,687,492 tonnes grading 6.77% zinc, 1.92%
lead and 51.1% barite.

A 1989 pre-feasibility study by Sandwell Swan Wooster Inc. concluded that the property was potentially viable and
provided recommendations for further exploration and development.

Barytex conducted an in-fill drill program consisting of 11 diamond drill holes totaling 1,552 meters and surface
trenching in 1990. Drilling between previously drilled, widely spaced holes aided in the design of an open-pit.

A resource estimate, based on 48 intersections from 42 diamond drill holes, was calculated by consultants Nevin
Sadlier-Brown Goodbrand Ltd. in a report dated October 9, 1990. The report stated that the Main Mel Zone
contained a drill-indicated mineral inventory of 5,238,000 tonnes grading 7.86% zinc, 2.09% lead, and 48.98%
barite for the Main Mel Zone.

Since August 1993, Barytex and Cominco spent a total of $1.33 million on exploration of the Mel property that
included the drilling of 25 diamond drill holes totaling 6,173 meters. To date, a total of 90 diamond drill holes
(16,759 meters) have been drilled on the Mel property. Of the four sediment-hosted, zinc-rich zones discovered to
date, three have been drilled; the Main Mel Zone, Jeri Zone and "Jeri North Zone". The majority of the drilling has
been conducted on the Main Mel Zone. No drilling has been conducted on the "Mel East Zone".

During 1993, eighty-six (86) claims were staked to cover the northerly strike extension of the Jeri Zone and 66 line-
kilometers of grid was established. Geological mapping traced the favorable contact hosting the Jeri Zone zinc
mineralization for a strike length of over 9 kilometers. Eleven (11) trenches exposed mineralization along a 2.5
kilometers section of the Jeri Zone. The most encouraging assay results from trench sampling were obtained from
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trench 5, where a 5 meter-wide zone averaged 16.5% zinc and in trench 4, where a 5 meter-wide zone averaged
10.7% zinc.

In 1994, six (6) additional drill holes totaling 3,122 meters were drilled on the Main Mel Zone. This led to an
increase in the Indicated Mineral Resource, estimated by Barytex, to 6,778,000 tonnes grading 7.1% zinc, 2.03%
lead and 54.69% barite. Higher grade intersections have been defined within the Main Mel Zone in excess of 12%
combined lead-zinc. The highest grade intersection assayed 19.72% zinc over a true thickness of 5.16 meters. The
Main Mel Zone is open down dip with the potential to increase the resource tonnage.

Geochemical and geophysical surveys conducted in 1995 along strike and to the north of the Jeri Zone revealed
significant zinc anomalies and geophysical induced polarization ("IP") and resistivity anomalies. During 1995, this
new area, identified as Jeri North Zone, was tested with 8 widely-spaced drill holes totaling 847.6 meters over a
strike length of two kilometers. Two of these holes intersected significant zinc mineralization; 15.6% zinc over a
core length of 5.1 meters in hole J-95-5 and 9.9% zinc over a core length of 5 meters in hole J-95-4.

In the area 1.5 kilometers south of the Main Mel Zone, two drill holes tested a geophysical conductor on strike with
the Mel Main Zone. The targeted mineralized horizon was not reached.

In 1996, Cominco, under an option agreement with Barytex and Breakwater, began exploration work on the Mel
Property. Exploration work included the drilling of 6 diamond drill holes totaling 1,189 meters on the Jeri North
Zone. This program was aimed at further testing the zinc mineralization discovered in 1995. Drill hole J-96-10
drilled 200 meters to the south and along strike of holes J-95-4 and J-95-5, encountered 12.38% zinc over a 3 meter
core length. The other 5 holes drilled within this area intersected lower grade mineralization. A seventh drill hole
was drilled 1.5 kilometers south of the Main Mel Zone to test an IP anomaly believed to represent the southern
extension of the favorable mineralized horizon hosting the Main Mel Zone. This drill hole did not intersect the
favorable contact zone.

Cominco conducted a soil sampling program on the Mel East Zone to confirm the presence of the large zinc
anomaly originally outlined by Sulpetro during their 1983 exploration program. Results indicated a strongly
anomalous zinc zone over a 1,400 meter long by 150 meter wide area, open to the north, south, and east. This
anomaly is coincident with the favorable contact hosting a zinc showing. Cominco conducted additional soil
sampling in 1996 in the Jeri North Zone area. Several anomalous samples corresponded with the projected trace of
the mineralized horizon.

During 1997, Cominco conducted IP and resistivity surveys in three areas: south of the Main Mel Zone; the Mel
East Zone area; and an area on the southern part of the Jeri Zone. In addition, a magnetic survey and a limited
gravity survey were conducted south of the Main Mel Zone. The geophysical program resulted in the identification
of anomalies in all three areas surveyed. Two drill holes tested the geophysical conductors located 1.5 kilometers
south of the Main Mel Zone. The holes intersected carbonaceous mudstones, interpreted to be a source for the
geophysical anomalies. Neither of the two drill holes intersected the target contact zone that is host to the Main Mel
Zone.

Geological Setting

The claims are situated near the southern margin of the Selwyn Basin, a tectonic element present during Paleozoic
time. Sedimentary rocks are dominant and range in age from late Precambrian to Devono-Mississippian. Mafic to
intermediate volcanic rocks ranging in age from upper Proterozoic to lower Cambrian are present northeast of the
property.

Sedimentary strata are folded along north-south trending axes and are offset by strike slip, normal and thrust faults.
Major north-south trending thrusts have easterly directed displacements ranging up to 3,000 meters.

The Mel property is underlain by sedimentary strata which are lower Cambrian to Silurian in age. Lithologies
include carbonates and clastic sediments broadly folded into a north-south trending, overturned syncline (Figure
4.1). The synclinal structure has been modified by a number of north-south trending faults which may exhibit both
vertical and lateral displacements.
- 34 -

The stratigraphic unit which hosts the mineralization in the Mel deposit area is a well defined barite-quartz horizon
which disconformably overlies a 150 meter-thick grey cryptograined limestone unit. A distinctive 30 meter-thick
argillite unit overlying the mineralized horizon grades upward into wavy banded limestone, a rock unit which is well
represented in the region.

Deposit Type

The mineralization at the Mel deposit and at the Jeri and Mel-East sites is considered to be sedimentary-exhalative
in origin.

The sphalerite-galena mineralization at the Mel deposit is hosted in a barite-quartz horizon overlain by a
disconformable grey, cryptograined limestone unit. As presently defined, the central part of the mineralized body is
characterized by near massive barite with moderate zinc and lead content. A peripheral zone exhibits the highest
metal grades encountered with an attendant decrease in barite content and progressively higher silica content at the
margin of the deposit. At depth, the barite content and thickness increase.

Mineralization at the Jeri zone is hosted by a limestone unit considered to be the equivalent of the cryptograined
limestone which occurs at the Mel deposit. In the Jeri zone area these rocks are locally silicified, dolomitized and
brecciated at, and immediately beneath, the contact with the overlying argillite. Mineralization consists of zinc
minerals smithsonite and sphalerite and barite is present as a gangue mineral in quartz viens.

The geological model derived from interpretation of surface mapping and drill hole data suggests that the Mel
deposit and the Jeri zones of mineralization may be different but more-or-less contemporaneous manifestations of a
single depositional event. A low-angle disconformity exists at the base of the main mineralized barite-quartz unit at
the contact with the underlying cryptograined limestone. The contact is abrupt and depositional styles below and
above it are radically different. The limestone is also cut by silica and carbonate veins which do not appear to persist
into the overlying rocks.

The footwall limestone is interpreted to represent an episode of prolonged quiescent carbonate deposition. The
veining implies some degree of induration prior to the deposition of the overlying strata and the disconformity is
consistent with an erosional interval and/or some form of tectonic activity. This was followed by local deposition of
very fine clastic material which formed thin, discontinuous mudstone layers and lenses. Subsequent and, in places,
coeval exhalative activity resulted in deposition of chemically precipitated barite, silica, sphalerite and galena to
form the mineralized barite-quartz unit. This unit is now described as a sediment hosted exhalite.

Mineralization

The zinc-lead-barite mineralization at the Main Mel Zone and the zinc showings at the south end of the Jeri Zone
and Mel East Zone occur within a stratigraphic zone resting on a cryptograined limestone unit that is overlain by a
distinctive argillite unit grading upward into a wavy banded, argillaceous limestone. At the Jeri North zone, the
same stratigraphic interval contains zinc (coarse-grained sphalerite) mineralization in a massive chert overlain by a
volcanic flow and volcaniclastic sequence followed by wavy banded, argillaceous limestone. Of the four sediment-
hosted, zinc-rich zones discovered to-date, the Main Mel Zone, Jeri Zone, and Jeri North Zone have been tested by
drilling.

At the Main Mel Zone, mineralization consists of coarse-grained sphalerite and galena disseminated throughout a
mixture of mudstone, silica, carbonate, and coarse crystalline barite. Minor amounts of fine grained, sparsely
disseminated pyrite occur locally but overall accounts for less that 2% of the sulphides.

Drilling at the Main Mel Zone has outlined an Indicated Resource of 6.78 million tonnes grading 7.10% zinc, 2.03%
lead, and 54.69% barite based on 48 holes. The deposit is open down-dip with potential for a significant increase in
tonnage. There are higher grade sections within the deposit and some 1 million tonnes grading 6.4% zinc, 1.88%
lead, and 56.3% barite that could be available for open pit mining.

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At the Jeri Zone, unusually strong alteration of the footwall carbonate to zinc-bearing, hydrothermal dolo mite and
silicified dolomite has been exposed along the middle fold limb for several kilometers. Similar style zinc
mineralization is found on the eastern-most fold limb. Sampling of trenches on the Jeri Zone yielded grades of up to
16.5% zinc over 5 meters. Geological mapping has extended this favorable horizon for 8 kilometers northward
where diamond drilling in August, 1995 at the Jeri North Zone resulted in the discovery of zinc mineralization
within an extensive chert unit underlying volcanic flows and tuffs that form part of the stratigraphy. Hole No. 95-4
intersected 9.9% zinc over 5.0 meters (4.7 meters true width) within a massive chert unit. Hole No. 95-5, drilled on
the same section, intersected 15.6% zinc over 5.1 meters (3.1 meters true width) 70 meters down dip.

In 1996, Cominco drilled 6 holes totaling 1,139 meters on the Jeri North Zone to expand the zone of zinc
mineralization intersected in hole Nos. 4 and 5. One of the holes (J96-10) drilled on strike and 200 meters to the
south of J-95-4 and J-95-5, intersected two zones of significant sphalerite mineralization. One zone assayed 3.39%
Zn over 2.1 meters of core length, the second zone returned 12.38% Zn over 3.0 meters. Holes drilled to test the
down-dip and on strike extent of the above mentioned intersections failed to encounter significant zinc
mineralization thus limiting the size of the mineralization zone to probably less than 400 meters in length and a
down-dip length in the order of 100 meters.

At least five kilometers of the favorable horizon hosting the Jeri Zone and Jeri North Zone of zinc mineralization
remains to be tested. Mineralization at the Jeri Zone is hosted by a limestone unit considered to be the equivalent of
the cryptograined limestone which occurs at the Main Mel Zone. In the Jeri Zone area, these rocks are locally
silicified, dolomitized, and brecciated at, and immediately beneath, the contact with the overlying argillite. The
altered and brecciated limestone is mineralized by the zinc minerals smithsonite and sphalerite. Elevated lead values
are present but no economically significant lead mineralization has been identified. Barite is present as a gangue
mineral in quartz veins but does not appear to be sufficiently abundant to be economically important. The presence
of the zinc carbonate mineral smithsonite suggests that zinc mineralization may, in part, be secondary.

During 1985, Sulpetro drilled 10 holes totaling 1,009 meters to test the Jeri Zone. Nine (9) of the 10 holes drilled
over a strike length of 550 meters intersected zinc mineralization. Zinc values ranged up to 13.11% zinc over 3.37
meters of core length within a thick zone of silicified and dolomitized limestone. In 1994, eleven trenches were
excavated across the Jeri Zone along a 2.5 kilometer segment of the favorable horizon. Zinc values of up to 16.5%
zinc over a 5 meter-wide zone were obtained from trench No. 5. The mineralization consisted of disseminated
smithsonite and minor sphalerite hosted in silicified and dolomitized limestone. The work conducted to date on the
Jeri Zone is not sufficient to allow resource estimates to be made.

At the Mel East Zone, smithsonite mineralization occurs at the contact of cryptograined limestone and wavy banded
limestone. Three grab samples taken in 1981 from 3 separate small outcrops averaged 9.6% zinc. Subsequent soil
sampling in 1982 revealed a 1,400 meter-long soil geochemical zinc anomaly coincident with the mineralized
contact. Soil sampling in 1996 by Cominco confirmed the earlier geochemical results and outlined a north-south
trending zinc anomalous zone 1,300 meters long and 150 meters wide that is open to the north, east, and south. The
mineralization at the Main Mel Zone, the Jeri Zone and the Mel East Zone is considered to be sedimentary-
exhalative in origin. All the mineralization discovered to date occurs at the contact with underlying cryptograined
limestone.

In addition to the exhalative type mineralization, there is potential for the discovery of unconformity and karst
related zinc mineralization.

Exploration

1993 Exploration Work

Jeri Zone

During 1993, 86 claims were staked to cover the northerly strike extension of the Jeri Zone and a 66 line-kilometer
grid was established. Geological mapping traced the favorable contact hosting the Jeri Zone zinc mineralization for a
strike-length of over 9 kilometers. Eleven trenches were excavated and exposed zinc mineralization along a 2.5
kilometers section of the Jeri Zone. A link-belt 3400 excavator was used for the trenching. The trenches were
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mapped in detail and chip samples were taken along the bottom of the trenches. Sample intervals varied in length
from 1.5 meters to 5 meters.

Significant zinc values were obtained from sampling in 3 out of the 10 trenches. One of the trenches failed to reach
bedrock. The following is a tabulation of results from the best trenches.

Trench No. Sample Width (m) Percent Zinc
3 7 5.3
4 5 10.5
5 5 16.5

The trenching program allowed a detailed examination of the massive, locally silicif ied and dolomitized limestone
unit hosting the zinc mineralization and the overlying wavy banded limestone unit. The mineralized zone occurs in
strata equivalent to the cryptograined limestone hosting the Main Mel Zone. Lead and barite are locally anomalous
but are not present in economically significant amounts. Most of the zinc mineralization is in the form of smithsonite
with only minor sphalerite observed in the mineralized zones exposed by trenching. However, locally significant
amounts of sphalerite were intersected in several holes drilled in 1985, suggesting that there is potential for
discovery of larger unoxidized zinc deposits at depth.

The trenching and sampling program was supervised by H. L. King, P. Geo, a Qualified Person, as that term is
defined in NI 43-101, employed by Barytex. The assay results are considered reliable since the analyses were carried
out by Acme Analytical Laboratories in Vancouver ("AAL"), a well known laboratory with International Standards
Organization accreditation.

1994 Exploration Work

Main Mel Zone

In 1994, 6 drill holes totaling 3,122 meters were drilled on the Main Mel Zone. The results of the drilling led to an
increase in the mineral resource, calculated by Barytex, to an Indicated Resource of 6,778,000 tonnes grading 7.1%
zinc, 2.03% lead and 54.69% barite. Higher grade intersections have been defined within the Main Mel Zone in
excess of 12% combined lead-zinc. The highest grade intersection assayed 19.72% zinc over a true thickness of 5.2
meters. The drilling established that the Main Mel Zone is open down-dip with potential to significantly increase the
resource tonnage. The drilling was carried out by D.J. Drilling Ltd. based in Watson Lake.

Geophysical surveys including magnetic, very-low-frequency (“VLF”) and IP surveys were carried out in 1994 over
the south extension to the Main Mel Zone. VLF and magnetic coverage extended from lines 82N to 96N and IP
surveys were conducted on lines 82N to 84N, 88+50N, and 89N to 91N. The IP survey outlined a chargeability and
resistivity anomaly on line 84N that is on strike with the Main Mel Zone. The geophysical work was carried out by
S.J.V. Consultants Ltd., a geophysical contractor.

Jeri Zone

Soil sampling across the favorable contact between cryptograined limestone and wavy banded limestone along a 2-
kilometer segment of the northern extension to the Jeri Zone (Jeri North Zone) was carried out in 1994. Samples
were taken at 25 meter intervals along lines spaced at 200 meters. Anomalous soil geochemical zinc and lead values
were returned on most lines sampled. Two zinc and lead geochemical soil anomalies were outlined; one extending
from line 132N to 142N and the other from line 150N to 152N. IP geophysical surveys were carried out over lines
135N and 136N centered on one of the zinc-lead soil anomalies. A strong chargeability anomaly was outlined on
both lines 135N and 136N, coincident with the zinc-lead anomaly that marks the favorable contact between wavy
banded limestone and the underlying cryptograined limestone. The 1994 exploration program was supervised by H.
L. King, P. Geo, a Qualified Person, as that term is defined in NI 43-101, employed by Barytex.

- 37 -
1995 Exploration Work

Main Mel Zone

Approximately 1 kilometer south of the Main Mel Zone, IP surveys were conducted on lines 85N and 86N. The
survey resulted in defining a chargeability and resistivity anomaly extending to the north to the anomaly first
identified on line 84N in the 1994 survey.

Two diamond drill holes were completed on Section 85N in an attempt to explain the IP anomaly outlined on
sections 84N to 86N. Minor graphite was noted in the core along several shear zones which may explain the IP
anomaly. However, the targeted contact zone between the wavy banded limestone and the cryptograined limestone
was not intersected.

Jeri North Zone

The Jeri North Zone is located 8 kilometers northeast of the Main Mel Zone, on the east limb of a syncline and on
the same stratigraphic horizon as the Main Mel Zone. IP surveys were carried out in July 1995 on grid lines 131N to
142N, spaced 100 meters apart. A strong chargeability anomaly and corresponding resistivity low, partially
coincident with anomalous zinc geochemical soil values, was outlined over a strike length of 1,100 meters.

A program of diamond drilling was carried out in 1995 to test the coincident IP and geochemical anomaly on the
Jeri North Zone. A total of 8 widely-spaced diamond drill holes, totaling 847.6 meters, tested the anomalous zone
over a strike length of 2 kilometers.

The drilling intersected a sequence of intermediate volcanic flows and sediments overlain by a relatively thin unit of
calcareous shale that forms the base of the extensive wavy banded limestone found throughout the property. A
massive chert unit, up to 5 meters thick, was intersected at the base of the volcanic -volcaniclastic sequence. In
places the chert rests directly on the basal cryptograined limestone unit but in some sections is separated from the
cryptograined limestone by a dolomitic unit. Sphalerite mineralization was encountered mainly within the chert unit
with lesser amounts occurring in an overlying ash unit and in an underlying dolomitic unit.

Significant zinc mineralization was intersected in Hole No. J-95-4 and J-95-5 drilled on Section 142N. The coarse-
grained sphalerite found in Hole J-95-4 occurs within a massive chert unit directly overlying massive, light grey,
cryptograined limestone. Assays over a core length of 5.0 meters averaged 9.9% zinc. Hole J-95-5 was drilled to
intersect the mineralized zone 70 meters down-dip and encountered sphalerite in coarse-grained masses and in
disseminated form within the chert unit and also within volcanic ash and dolomite. Assays from a 5.1 meter interval
of mineralized chert assayed 15.6% zinc. If the mineralized ash unit and dolomite is included, a 7.6 meter section
averages 10.9% zinc. This new discovery of zinc mineralization indicates there is significant potential for other
zones of zinc mineralization along the 10-kilometer strike-length of the east limb of the syncline located on the
property. The drill program was supervised by H. L. King, P. Geo, a Qualified Person, as that term is defined in NI
43-101, employed by Barytex.

1996 Exploration Work

General

In 1996, Cominco, under an option agreement with Barytex and Breakwater, began exploration work on the Mel
property. Work was carried out on the Jeri North Zone, Mel East Zone and in the area immediately south of the
Main Mel Zone.

Jeri North Zone

Exploration work included the drilling of 6 diamond drill holes totaling 1,189 meters on the Jeri North Zone. This
program was aimed at further testing the zinc mineralization discovered in 1995. Drill hole J-96-10, drilled 200
meters to the south and along strike of holes J-95-4 and J-95-5 encountered 12.38% zinc over a 3-meter core length.
The other 5 holes drilled within this area intersected lower grade mineralization.
- 38 -

Main Mel Zone

One diamond drill hole was drilled 1.5 kilometers south of the Main Mel Zone to test an IP anomaly believed to
represent the southern extension of the favorable mineralized horizon hosting the Main Mel Zone. The drill hole did
not reach the favorable contact zone.

Mel East Zone

Cominco conducted a soil sampling program on the Mel East Zone to confirm the presence of the large zinc
anomaly originally outlined by Sulpetro during a 1983 exploration program. Results indicated a strongly anomalous
zinc zone over an area 1,400 meters long by 150 meters wide and open to the north, south, and east. This anomaly is
coincident with the favorable contact hosting the zinc showing referred to as the Mel East Zone and represents a
significant drill target.

The exploration data collected by Barytex and by Cominco was done under the supervision of Qualified Persons, as
defined in NI 43-101. The geochemical analyses and assaying of rock and core samples was carried out by reputable
analytical laboratories. There is no reason to believe that the data obtained in the 1993 to 1996 programs are
unreliable.

Drilling

Since 1993, Barytex and Cominco have completed 25 BQ diamond drill holes totaling 6,173 meters on the property.
The majority of the drilling was conducted on the Main Mel Zone.

In 1994, six holes totaling 3,122 meters were completed on the Main Mel Zone. The core was logged, photographed,
and mineralized sections split with one-half of the mineralized section submitted for assay to AAL. All six (6) drill
holes intersected the mineralized zone. The results of the deeper drill holes indicate that the zinc-lead-barite zone is
increasing in thickness and in strike length.

In August, 1995, eight diamond drill holes were completed on the Jeri North Zone totaling 847.6 meters. The 8
widely-spaced drill holes tested a 2.1 kilometer strike length of the Jeri North Zone. Five (5) of the 8 holes
intersected zinc mineralization with 2 of these holes encountering significant zinc values. The best intersection was
5.1 meters of core length that averaged 15.6% zinc.

The drilling on the Jeri North Zone intersected a sequence of intermediate volcanic flows and sediments overlain by
a relatively thin unit of calcareous shale that forms the base of the extensive wavy banded limestone unit found
throughout the property. A massive chert unit, up to 5 meters thick, is found at the base of the volcanic -
volcaniclastic sequence. The chert is locally mineralized with disseminated pyrite and coarse-grained sphale rite. In
places the chert rests directly on the basal cryptograined limestone unit but in some sections is separated from the
cryptograined limestone by a dolomitic unit.

At the Jeri North Zone, sphalerite mineralization is found mainly within the chert unit with lesser amounts occurring
in an overlying ash unit and in an underlying dolomitic unit. Significant zinc mineralization was intersected in Hole
No. J-95-4 and J-95-5 drilled on Section 142N. The coarsegrained sphalerite found in Hole J-95-4 occurs within a
massive chert unit directly overlying massive, light grey, cryptograined limestone. Assays over a core length of 5.0
meter averaged 9.9% zinc. Hole J-95-5 was drilled to intersect the mineralized zone 70 meters down-dip and
encountered sphalerite in coarse-grained masses and in disseminated form within the chert unit and also within
volcanic ash and dolomite. Assays from a 5.1 meter interval of mineralized chert assayed 15.6% zinc. If the
mineralized ash unit and dolomite is included, a 7.6 meter section has an average grade of 10.9% zinc.

In August, 1995, two diamond drill holes totaling 317 meters were completed to test for the southern extension of
the Main Mel Zone. The holes failed to reach the favorable contact between the wavy banded limestone and the
cryptograined limestone that marks the mineralized horizon at the Main Mel Zone.

- 39 -
In 1996, exploration work by Cominco included the drilling of six diamond drill holes totaling 1,189 meters on the
Jeri North Zone. This program was aimed at further testing the zinc mineralization discovered in 1995. Drill hole J-
96-10 drilled 200 meters to the south and along strike of holes J-95-4 and J-95-5, encountered 12.38% zinc over a 3
meter core length. The other 5 holes drilled within this area intersected lower grade zinc mineralization. The drilling
to date has defined a zone of significant zinc mineralization over a strike length of about 400 meters and extending
to approximately 100 meters down-dip.

During 1996, Cominco completed one diamond drill hole 1.5 kilometers south of the Main Mel Zone to test an
induced polarization anomaly interpreted to represent the southern extension of the favorable mineralized horizon
hosting the Main Mel Zone. The drill hole failed to intersect the favorable contact zone.

During 1997, Cominco drilled two diamond drill holes to test gephysical targets identified to the south of the Main
Mel Zone. Both holes intersected carbonaceous mudstones interpreted to be a source for the geophysical anomalies.

All drill programs carried out by Barytex and by Cominco were supervised by Qualified Persons, as defined in NI
43-101. All cores were logged and all mineralized zones intersected were split with one-half of the sample submitted
for analysis. The remaining one-half of the core is stored on the property. The samples taken during drilling
programs managed by Cominco personnel were shipped to the Cominco laboratory in Vancouver and analyzed for
zinc, lead, copper and silver. Samples taken during drilling programs managed by Barytex were shipped to AAL and
analyzed for lead, zinc, silver. Selected samples were also analyzed for barium.

Sampling and Analysis

Soil Sampling

On the Jeri North Zone reconnaissance soil sampling was carried out by Barytex during 1993 on lines spaced 1,000
meters apart from section 166N to 206N. Soil samples were taken at 25 meter intervals along sections of lines that
crossed the favorable contact zone. In 1994, grid lines were established at a 100 meter spacing from line 130N to
152N. Soil samples were collected at 25 meter intervals along lines that crossed the favorable contact zone. A total
of 59 soil samples were taken.

Reconnaissance soil sampling was also carried out by Barytex in 1994 on strike and to the north of the Main Mel
Zone from 114N to 134N. Samples were taken along grid lines spaced 200 meters apart. Sample density varied from
10 meter to 20 meter spacing along the lines. A total of 54 soil samples were collected.

All samples were taken from the “B” soil horizon, placed in kraft paper bags and marked with grid coordinates. A
description of the sample medium, sample depth and location was recorded. The samples were shipped by
commercial transport to AAL for analysis. A 0.5 gram sample was then analysed by Inductively Coupled Plasma
(“ICP”) methods for zinc, lead, copper, silver and barium.

In 1996, Cominco carried out a soil sampling program in the Jeri North Zone area along grid lines from 149N to
224N. The sampling was generally carried out on grid lines spaced 200 meters apart with samples taken at 25 meter
intervals where lines crossed the projected trace of the mineralized horizon. At distances greater than 100 meters on
either side of the mineralized horizon, samples were spaced at 100 meters. A total of 587 soil samples were
collected.

In 1997, Cominco completed soil sampling in three areas on the Mel property. Four grid-based lines of soil sampling
were completed south of the Main Mel Zone on lines 87N to 90N. Three (3) lines of soil sampling were completed
at the Jeri Zone at 50 meters intervals along lines spaced at 200 meters. A total of 39 samples were collected. In the
Mel East Zone area, a single contour line of soil sampling totaling 39 samples was completed to test the southern
strike extension of the mineralized horizon.

All samples taken by Cominco personnel were collected from the “B” soil horizon, placed in kraft paper bags and
labeled with a sample number. A description of the sample medium, sample depth and site was recorded. The
samples were shipped to the Cominco Exploration Research Laboratory in Vancouver for analysis. The soil samples
taken in 1996 were analyzed by atomic absorption methods for lead and zinc. Samples taken during 1997 were
- 40 -
analyzed for 27 elements by ICP emission spectrometry. Soil sampling by Barytex and Cominco was supervised by
Qualified Persons, as defined in NI 43-101, and considered to have been taken with due care. Soil profiles may
differ from site to site and the sample medium in places may differ in organic content allowing for some variation in
results. However, there is no reason to believe that the samples taken are not generally representative or that sample
quality is not acceptable.

Quality control for samples assayed by AAL was limited to analyzing a duplicate sample for approximately every 30
samples submitted. A standard sample was also inserted after each 35th sample analyzed. Quality control measures
taken at the Cominco laboratory are not described in the geological reports submitted to Barytex by Cominco.

Core Sampling

All core was carefully logged by Qualified Persons, as defined in NI 43-101, and mineralized sections photographed
before sampling. The mineralized sections were marked for sampling according to rock type, changes in character
and quantity of the mineralization. Sample lengths were generally limited to 1 meter and in no case greater than 1.5
meters. All mineralized core was then split by core-splitter with one-half of the core placed in plastic sample bags
along with a sample tag number and securely fastened with locking plastic ties. The other one-half was replaced in
the core trays and stored in core racks on the property.

Core samples from drilling programs carried out by Barytex were sent to AAL and analyzed for zinc, lead, silver,
and barium and subjected to specific gravity determinations. At least every 30 th sample was re-assayed and at least 1
standard was inserted and assayed in each data set. Quality control measures followed at the Cominco laboratory
were not described in exploration reports provided to Barytex.

Security of Samples

All core samples for analysis were placed in plastic bags along with a sample number tag and securely fastened with
a zip-lock tie. Sample bags were then placed in sealed cardboard boxes for shipment by commercial transport to
AAL for those samples taken by Barytex. Samples taken by Cominco personnel were shipped by commercial
transport to the Cominco Exploration Research laboratory in Vancouver.

Soil samples taken by both Barytex and Cominco were packed in boxes securely sealed and shipped via commercial
transport to either AAL for samples collected by Barytex or to the Cominco Exploration Research Laboratory in
Vancouver for samples collected by Cominco.

Mineral Resource and Mineral Reserve Estimates

In October, 1990, an independent mineral resource estimate was made by Nevin Sadlier-Brown Goodbrand Ltd. for
the Main Mel Zone. The resource estimate, based on 48 intersections in 42 diamond drill holes, was defined by the
consultants as a drill-indicated mineral inventory of 5,238,000 tonnes grading 7.86% zinc, 2.09% lead and 48.98%
barite for the Main Mel Zone. For the purposes of grade and tonnage calculations, a weighted average grade of
individual samples from within the intersection was calculated for each drill hole. The true width of the intersection
was obtained from measurements of contact angles and comparison with geological cross sections. Drill hole
locations were surveyed and down hole information was obtained by gyroscopic compass surveys. Resource
estimates were calculated by using an “Inverse Distance Squared” technique. In this method, the influence exerted
by any drill hole intersection on an arbitrary block is inversely proportional to the square of its distance from a node
at the center point of the block.

Subsequent to the independent estimate, six (6) diamond drill holes were drilled by Barytex in 1994 totaling 3,122
meters. A revised resource estimated that included the 6 additional drill holes was made by Barytex in 1994 for the
Main Mel Zone. An Indicated Resource was estimated at 6,778,000 tonnes grading 7.10% zinc, 2.03% lead, and
54.69% barite using the “Inverse Distance Squared” technique described above except that individual specific
gravities for sphalerite, galena, and barite were used to calculate the specific gravity of each sample interval. The
resource estimate by Barytex under the direction of H. Leo King, P. Geo, a Qualified Person, as defined in NI 43-
101, has not been independently verified.

- 41 -
Preliminary metallurgical testing on Main Mel Zone core by Lakefield Research indicates that after grinding to 100
mesh, the mineralization responded well to flotation and yielded concentrates ranging from 60.9 to 64.7% zinc, 78.0
to 79.6% lead, and 90.3 to 94.4% barite with recoveries of 90.3% to 96.2% for zinc, 97.7 to 98.0% for lead, and 88
to 90.9% for barite. A later, large scale test was done for barite concentrate market evaluation. Concentrate grading
95.1% barite with a recovery of 92.6% was produced from 12 kg of feed grading 53.5% barite.

There are no known environmental, permitting, or title issues regarding the Mel property that may affect the mineral
resource. The Yukon government is supportive of mining which historically has had an important economic impact
on the territory.

Exploration and Development

Although the Company has not proposed a current exploration program on the Mel property, further work is
warranted and the Company is currently re-evaluating its strategy on this property.

A future drilling program would test the southern portion of the Jeri Zone where zinc-bearing, silicified dolomite has
been exposed by surface trenching and tested by previous limited drilling. Similar style mineralization is present at
the Mel East Zone where anomalous lead-zinc soil geochemistry and IP anomalies have defined a drill target.

Drilling to test the deeper potential of the Main Mel Zone is also under consideration.


Mineral Projects - Barb Property

Property Description and Location

The property consists of twenty-one (21) mineral claims (440 hectares) situated in the Watson Lake Mining District
of the Yukon Territory. A list of the claims and claim information is shown in Table 4.2.

Claims Status – Barb Property

Claim Name Grant Number Expiring Date NTS Location
BETH 2 YB00654 2011/07/24 105-H-06
BETH 4-14 YB00655-YB00665 2011/07/24 105-H-06
BETH 16-20 YB00667-YB00671 2011/07/24 105-H-06
PAT 29-32 YB51854-YB51857 2011/08/29 105-H-06

The Barb property is located on the eastern arm of Frances Lake, 160 kilometers north of the town of Watson Lake
and 310 kilometers northeast of the city of Whitehorse. The Robert Campbell Highway runs 15 kilometers west of
the property and provides access to Frances Lake.

Assessment work required to keep the property in good standing is $105 per claim per year in work or cash.
Sufficient work has been filed or payments made to keep all claims in good standing to July 24, 2011.

Accessibility, Climate, Local Resources, Infrastructure and Physiography

The Barb property is located on the eastern arm of Frances Lake. The Robert Campbell Highway runs 15 kilometers
west of the property and provides access to Frances Lake. Alternative access is via float plane from Watson Lake.

The climate is characterized by cold winters and moderate summers. Precipitation is moderate and winter snow
accumulation is in the order of 80 centimeters. Drilling can be carried out in winter as well as in the summer months
but is not recommended during the spring break-up.

- 42 -
The surface rights are held by the government and any mining operation would require regulatory approval. There is
no electrical power available in the area. Water is available from Francis Lake and streams on the property. There
are ample areas suitable for plant sites, tailings storage, and waste disposal areas.

The property is situated within the Campbell Mountains in southeastern Yukon. The terrain is characterized by
subdued topography with local elevations ranging from 775 meters at lake level to 1,550 meters on the western slope
of Mount Hunt. Vegetation on the property consists of spruce, pine, and balsam with some willow alder, poplar, and
tamarak.

History

Lead-zinc-silver mineralization was first discovered in the area and subsequent claims staked in the late 1930s. In
1943, Cominco prospected the area. Datalaska Mines, between 1960 to 1963, conducted a program consisting of
hand trenching and sampling on a mineral occurrence known as the Matt Berry Zone, located one kilometer north of
the property.

Matt Berry Mines Ltd. ("Matt Berry") was formed in 1965 in order to develop the the Matt Berry Zone located
adjacent to the property. Between 1966 and 1970, considerable work was carried out on the Matt Berry Zone
including hand trenching, VLF electromagnetic (“EM”) surveying, geochemical surveying, Turam EM surveying
and diamond drilling. A total of 31 drill holes (2,728 meters) were drilled on the Matt Berry lead-zinc-silver zone
(the "Matt Berry Zone"). In 1970, an additional 2 drill holes totaling 391 meters were completed under an agreement
with Metallgesellschaft Canada Ltd. and Canadian Nickel Company Ltd.

In 1972 Nordev Resources optioned the claims and sold a 40% interest to New Joburke Exploration Ltd. In 1974,
Cyprus Anvil Mining Corporation held an option on the property and conducted a gravity survey over a portion of
the property.

All claims were allowed to lapse and in 1977, Sovereign Metal Corporation, the predecessor of Kobex Minerals Inc.
restaked the ground and carried out a data review and estimated a resource of 588,000 tons grading 6.1% lead, 4.6%
zinc and 3 ounces of silver per ton for the Matt Berry Zone. In 1978, the property was optioned to New Frontier
(NPL), who conducted a pulse EM survey. The property subsequently reverted to Sovereign Metals Corporation
who conducted a trenching program in 1979. Cominco optioned the property in 1980 and conducted a drill program
of 5 widely spaced, diamond drill holes totaling 1,229 meters. The drill program failed to intersect any encouraging
mineralization.

During 1981, Cominco conducted a program of geological mapping and soil geochemistry on the present property.
Several coincident lead and zinc anomalies underlain by a quartz-augen schist unit were identified. Several copper
anomalies, including one that is 400 by 600 meters in size, were also outlined. The copper anomalies were found to
be located up-slope from the quartz-augen schist unit and to be underlain by sparsely exposed, metamorphosed
mudstone and siltstone strata.

In 1987, Pulse Resources Ltd. carried out 43 line kilometers of ground magnetic surveys that covered newly
discovered mineralization named the Money Zone. Geochemical soil sampling was completed on the same grid and
in 1988 a program of induced polarization and detailed geochemistry was carried out over the Money Zone.

In 1991, Pulse Resources Ltd. (“Pulse”) conducted a 4-hole diamond drill program totaling 303 meters to test a 450
meter strike-length of the “Money Zone”. The Money Zone area is outlined by a 600 meter-long coincident lead-
zinc soil geochemical anomaly with favorable stratigraphy, similar to that found at the Matt Berry Zone located one
kilometer to the north. Moderate to strong IP chargeability features were also defined in the Money Zone area.
Results from the Pulse drill program included 1 to 3 meter-long intercepts of semimassive to massive sulphides in 3
of the 4 holes with minor base metal values. One of the drill holes, PUL91-1, returned a 0.5 meter intercept of base
metal mineralization that assayed 5.87% zinc and 1.82% lead. Pulse dropped their option in 1992.

Barytex carried out line cutting, geological mapping and prospecting between 1992 and 1995 on the property. In
1998, Barytex carried out an airborne geophysical survey which outlined conductive responses along strike from the
Matt Berry Zone and downslope from the Money Zone.
- 43 -

Geological Setting

The property area is underlain by Devonian-Mississippian metasedimentary rocks in contact with Cretaceous quartz
monzonite of the Mount Billings batholith. Extensive glacial till masks much of the underlying stratigraphy in the
Francis Lake area. Regional faulting in the area is characterized by major east-west striking faults and less
pronounced northeast trending faults.

The Barb property is underlain by Devonian/Mississippian phyllitic rocks that form the western limb of a north-
northwest trending syncline. The phyllitic rocks form two conformable units: a dark green to black phyllitic unit
overlying a lighter grey, fine-grained unit. Cherty tuffaceous beds occur within the dark phyllites and host thin-
bedded, massive sulphides on the adjacent Matt Berry Zone. Phyllitic rocks on the property host an extensive quartz-
sericite unit that is locally sulphide bearing and possibly volcanic in origin.

Deposit Type

Historically, the area including the adjacent Matt Berry Zone has been explored for shale-hosted Sedex massive
sulphide deposits. Although felsic volcanic rocks had been noted previously in the area, their significance has only
recently been recognized. During the 2000 field season, Fonseca, a geologist working for the YTG Mineral
Resource Branch carried out fieldwork in order to refine the mineral deposit models applicable to the western part of
the Selwyn Basin in the Frances Lake map area. This work led to a redefinition of the Matt Berry deposit model.
Fonseca writes that “the copper-rich nature of the ore, volcanic textures in the ore contacts, and the presence of
alkaline felsic metavolcanic rocks beneath the deposit suggests that the mineralization fits a mineral deposit model
intermediate between Sedex and VMS end members.”

Mineralization

The mineralization comprising the Money Zone consists of zinc and lead sulphides in pyritic layers hosted in an
extensive quartz-sericite unit of possible volcanic origin. Semi-massive to massive sulphides have been intersected
in 3 of 4 diamond drill holes and range in thickness from 1 to 3 meters. Sulphides include semi-massive pyrite,
disseminated to banded sphalerite, galena, pyrrhotite and minor chalcopyrite and arsenopyrite. A 0.5 meter interval
in one hole assayed 5.87% zinc and 1.82% lead.

Exploration

Geological Mapping

In June, 1995, Barytex carried out geological mapping and prospecting on the property. The mapping was carried
out along cut lines spaced 400 meters apart.

The areas covered by the mapping are underlain mainly by dark grey phyllitic rocks that are generally thin bedded
and in places are hornfelsed with a well-developed slaty cleavage. Quartz veins, both concordant and discordant, are
common. A quartz augen schist unit about 150 meters thick, probably of volcanic origin, was mapped within
phyllitic strata on the property.

In general, bedding strikes southeast and dips northeast from 20 degrees to 50 degrees.

Airborne Geophysical Survey

In September, 1998, a “Dighem” airborne geophysical survey was carried out over the Barb property. Dighem is a
proprietary airborne geophysical system owned by Geoterrex Dighem, a division of CGG Canada Ltd. The survey
was carried out by Geoterrex-Dighem of Mississauga, Ontario. The survey consisted of approximately 172 line-
kilometers with flight lines flown in a direction of 60° at a line separation of 200 meters.

The purpose of the survey was to detect zones of conductive mineralization and to provide information that could be
used to map the geology and structure of the survey area. This was accomplished by using a Dighem multi-coil,
- 44 -
multi-frequency EM system, supplemented by a high sensitivity cesium magnetometer. The information from these
sensors was processed to produce maps which display the magnetic and conductive properties of the survey area. A
global positioning electronic navigation system ensured accurate positioning of the geophysical data with respect to
the base maps. Visual flight path recovery techniques were used to confirm the location of the helicopter where
visible topographic features could be identified on the ground.

Several anomalies in the surveyed area which are typical of bedrock conductors were defined as a result of the
geophysical survey. A high priority EM anomaly located immediately to the west and parallel to the Money Zone, is
coincident with an IP anomaly that has not been tested by drilling. The conductor is at least 600 meters in length.

The airborne geophysical survey results are considered to be reliable and follow-up with detailed surface
geophysical surveys to define drill targets is warranted.

Geochemical Surveys

Three geochemical surveys have been conducted on the property and on surrounding areas. The survey results are
summarized below:

• In 1981, Cominco collected 1,179 soil samples, 16 silt samples and 34 rock samples which were analyzed
for copper, lead, zinc and silver. Results indicated several co-incident lead and zinc anomalies and
widespread higher copper values upslope from the lead and zinc values. Anomalous levels were considered
to be 70 ppm copper, 23 ppb lead and 100 ppm zinc. Geophysical surveys were recommended.

• In 1987, Strato Geological Engineering Ltd. (Strato) on behalf of Pulse Resources established a new grid
on the property and surrounding area (100 metre line spacing and 25 metre sample spacing) to cover known
mineralized areas. A total of 720 soil samples were analyzed for copper, lead, zinc, silver and arsenic.
Anomalous values were defined as mean value plus 1 standard deviation and highly anomalous values as
mean value plus 2 standard deviations.

• In 1988, Strato conducted a detailed survey in the area of the Money Zone by infill sampling between the
1987 lines. Two hundred and seventy seven (277) samples were collected and results supported the 1987
work. A number of anomalies for each element were defined. A general northwest trend to the anomalies is
evident conforming to the trend of the Matt Berry mineralization and the geophysical anomalies.

Deep overburden in the area as indicated by the 10-20 meters encountered in the Money Zone drilling along with
reported muskeg, swamps and heavy vegetation most probably hinders the exact definition of possible
mineralization by geochemical means. The anomalous levels used by Cominco and Strato are different and likely
reflect the larger sampled area covered by Cominco.

Drilling

No drilling has been carried out on the property by Barytex. Historical records include drill logs, assay results and
sections developed from the diamond drill holes completed by Pulse.

In July, 1991, a 303 meter (4 holes) BQ diamond drill program by Pulse tested 450 meters of strike-length on the
Money Zone. This area is underlain by a 600 meter-long, coincident lead-zinc soil geochemical anomaly, favorable
stratigraphy and moderate to strong IP chargeability features. Results of the drill program included 1.0 to 3.0 meter-
long intercepts of semi-massive to massive sulphides in 3 of the 4 holes drilled. A 0.5 meter intercept of base metal
mineralization intersected in hole PUL 91-1, assayed 5.87% zinc and 1.82% lead. The mineralization is hosted
within a quartz sericite schist unit that may have significant base metal potential.

Sampling and Analysis

The diamond drill program in 1991 was carried out by Pulse. The drill core was logged and mineralized sections
split and sampled. Sample intervals ranged from 0.5 meters to 1.5 meters. Overall core recoveries ranged from 65%
to 75%. However, recoveries from the mineralized section in hole no. PUL 91-3 ranged from 8% to 80% and
- 45 -
averaged 39%. The low recoveries may have affected the accuracy of the results. The assaying was carried out by
TSL Laboratories in Saskatoon, Saskatchewan. It is not known what quality control measures were carried out by
the laboratory.

Security of Samples

Reports available to Barytex regarding historical work and more recent work do not describe measures taken to
ensure the validity and integrity of samples.

Mineral Resource and Mineral Reserve Estimates

No mineral resource estimates have been carried out on the Money Zone.

Exploration and Development

Although the Company has not proposed a current exploration program on the Barb property, a future exploration
program should include a ground geophysical survey program to detail selected airborne geophysical targets.
These geophysical anomalies would then be tested by diamond drilling. One high priority target is located
immediately to the west and parallel to the Money Zone. The Company is currently re-evaluating its strategy on this
property.

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