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002E/06/1709

First Year Assessment Report on

Prospecting, Rock and Stream Sediment Sampling

on the

Charles Brook Property, Licences 018399M and 018400M, NTS 02E/06,

North-central Newfoundland and Labrador

Submitted by

David Walsh

for licence holders

David Walsh, Russell White and Robert Roche

May 2012

Work Year: 1 Total Claims: 12

Total Expenditure: $6501.73

TableofContents

Introduction ................................................................................................................................. 3

Location and Access ................................................................................................................... 3

Geology ....................................................................................................................................... 3

Previous Work and Mineralization ............................................................................................. 5

Work and Results 2011 ............................................................................................................... 5

Conclusions and Recommendations ........................................................................................... 6

ListofTables Table 1. Mineral Licence Details. .................................................................................................. 3 Table 2. Sample Locations .............................................................................................................. 6 

ListofFigures Figure 1. Property Location. .......................................................................................................... 4 Figure 2. Claims Location. ……………………………………………………………………….5 Figure 3. Property Geology. ……………………………………………………………………...6 Figure 4. Sample Locations. ……………………………………………………………………7

Confidential

2

Introduction The Charles Brook Property consists of 48 mapped staked claims contained in 6 mineral licences, located on the Botwood Peninsula in Central Newfoundland. The property is part of a joint ownership agreement with 3 prospectors, David Walsh, Russell White and Robert Roche. Details of the licences are outlined in Table 1. This report outlines work done in 2011 on licences 18399M and 18400M. This work was conducting during a weeklong trip in early May, 2011 and consisted of prospecting, rock and stream sediment geochemical sampling. The area was staked for its potential to host intrusive related gold occurrences. Table 1. Mineral Licence Details.

Licence  Owner  # Claims  Staked Date 

18399M  Russell White  6  20/12/2010 

18400M  David Walsh  6  20/12/2010 

19601M  David Walsh  6  19/11/2011 

19602M  Robert Roche  12  19/11/2011 

19644M  Robert Roche  6  03/12/2011 

19645M  Robert Roche  12  03/12/2011 

       

Total    48   

LocationandAccess The property is located approximately 20 km north of the town of Botwood, NL on the north coast of central Newfoundland. It is located in the centre of a narrow peninsula on the west side of the Bay of Exploits that is approximately 4 km wide. The area consists of boreal forest with several larger ponds and streams. It is characterized by a series of north-south trending ridges with moderate relief. These are interpreted as more competent sandstone beds of the Charles Brook Member of the New Bay Formation. The property location is shown in Figure 1 and the claims location is shown in Figure 2.

Geology The property lies within the Exploits Subzone of the Dunnage Techno-stratigraphic Zone of Newfoundland (Williams, Colman-Sadd, & Swinden, 1988) and is underlain by formations of the Exploits Group (O'Brien, 2006) which have been intruded by the Thwart Island Gabbro (O'Brien, 2006).

Confidential

3

Figure 1. Property Location.

The Ordovician Charles Brook Member of the New Bay Formation lies on the east side of claims 18399M and 18400M (Figure 3) and is described as dominantly light grey, graded, medium bedded sandstone turbidite interstratified with greyish-green laminated argillite; minor, light grey, massive pebbly wacke containing common rip-up clasts of slump-folded argillite and displaying rare polymictic conglomerate lags; light-green andesite-rich lapilli stone; tuffaceous wacke with abundant sandstone dykes (O'Brien, 2006). The early Ordovician Saunders Cove Formation underlies the Charles Brook Member to the west (Figure 3) and is described as thin-bedded red chert intercalated with rare basalt flows; red chert interbedded with red and green, well banded, siliceous argillite; minor interval of dark-grey shale and light-grey carbonaceous argillite; red and green siltstone turbidite and buff, thin-bedded, parallel laminated sandstone; light-grey, graded, pebbly and sandy wacke having rare polymictic conglomerate lags (O'Brien, 2006). These units have been intruded by the middle Ordovician Thwart Island Gabbro which is

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4

630,000 mE628,000 mE626,000 mE

5,466,000 mN

5,47

2,00

0 m

N5,472,000 m

N5,470,000 m

N5,

470,

000

mN

5,46

6,00

0 m

N5,

468,

000

mN

5,468,000 mN

626,000 mE622,000 mE 624,000 mE 628,000 mE 630,000 mE5,464,000 m

N5,

464,

000

mN

0,00

0 m

N5,

462,

000

mN

5,462,000 mN

622,000 mE 624,000 mE

Saunders Cove

Charles Arm

Saunders Cove

Charles Arm

Mouse Cove

Pleasantview

Pigeon Island

Cabbage Harbour Head

Govers Harbour

Cabbage Harbour

Diver Pond

Indian Cove

Brook Harbour

Granfer Island

Winter Tickle

Ritters Arm

Mouse Island

East Hare Island

South Arm

Charles Brook

Burnt Island

Sunday Island

Charles Brook

Indian Cove Island

Cutnows Cove

Sandy Cove

011550M

018117M

018399M

018400M

019445M

019600M

019601M

019602M

019671M

019695M

019771M

019781M

David Walsh

1

kilometres

20.5

Drawing:

Scale: 1:50000

0

Projection: UTM Zone 21 (NAD 27 for Canada)

Date: 09/05/2012

Author: DTW

NTS: 02E/06

Figure 2Charles Brook

PropertyClaims Location

Confidential

5

5,466,000 mN

628,000 mE626,000 mE

5,464,000 mN

630,000 mE

622,000 mE 624,000 mE

5,470,000 mN

5,46

8,00

0 m

N5,468,000 m

N5,

470,

000

mN

5,47

2,00

0 m

N5,472,000 m

N626,000 mE622,000 mE 624,000 mE 628,000 mE

5,46

4,00

0 m

N5,

462,

000

mN

630,000 mE

0,00

0 m

N5,462,000 m

N5,

466,

000

mN

Saunders Cove

Charles Arm

Saunders Cove

Charles Arm

Mouse Cove

Pleasantview

Pigeon Island

Cabbage Harbour Head

Govers Harbour

Cabbage Harbour

Diver Pond

Indian Cove

Brook Harbour

Granfer Island

Winter Tickle

Ritters Arm

Mouse Island

East Hare Island

South Arm

Charles Brook

Burnt Island

Sunday Island

Charles Brook

Indian Cove Island

Cutnows Cove

Sandy Cove

011550M

018117M

018399M

018400M

019445M

019600M

019601M

019602M

019671M

019695M

019771M

019781M

0 0.5 1

kilometres

2

Drawing:

David Walsh

Scale: 1:50000 Projection: UTM Zone 21 (NAD 27 for Canada)

Date: 09/05/2012

Author: DTW

NTS: 02E/06

Figure 3Charles Brook Property

Geology

Legend

Thwart Island Gabbro

Brook Harbour Member

Charles Brook Member

Saunders Cove Formation

New Bay Formation

Confidential

6

described as layered or massive, medium- to coarse-grained, hornblende-pyroxene gabbro laccoliths; quartz diorite sills and diabase dykes; hornblende-bearing pegmatite (O'Brien, 2006).

PreviousWorkandMineralization Previous geological work on the property is well summarized by O’Brien (2006) and complied in GSNL Map 2006-04 (O'Brien, 2006). References for this previous work can be found in that publication. Previous industry work in the area has been limited. “Exmar Resources Limited and Gary Lewis conducted some exploration in the immediate area of the Saunders Cove copper showing (002E/06/Cu 002). Their work consisted mainly of reconnaissance prospecting, soil sampling and sampling old muck piles in a limited area around the showing. Anomalous copper in-soil values were noted around the showing but were of limited extent and sporadic. Au in-soil values of up to 116 ppb Au were also noted in the immediate area” (Lohman, 1988). Lewis (1998) reported that there were quartz veins noted along the shoreline but none were sampled and that a sample of quartz float returned an assay of 191 ppb Au. Cornerstone Resources conducted prospecting and rock and stream sediment sampling over the area in 2004. Several float samples with anomalous gold values were discovered in the Charles Arm area. Two samples assayed 2093 and 5570 ppb Au and reported to be within qtz veining with arsenopyrite and pyrite. Several stream sediment anomalies were also discovered in the Charles Brook area with one sample assaying 427 ppb (Hussey, 2005). This showing is registered in the MODS database as 02E/06/Au 012.

WorkandResults2011 Work in 2011 occurred during May 4–9th, 2011 and consisted of prospecting, stream sediment and rock geochemical sampling. Weather conditions were poor during the work period with cold temperatures, wind, rain and snow. Abnormally high water conditions made sampling of larger streams impossible so reported anomalies could not be confirmed and work was restricted to smaller streams. In total 8 rock samples and 11 stream sediment samples were collected. All samples were sent to Eastern Analytical Laboratories in Springdale, NL for fire assay Au analysis as well as an ICP 30 element package. Results are included in appendix i. All rock samples were grab samples of potential mineralized vein + host rock material. Samples were manually split with half going to the lab and the other half kept for a reference. Stream sediment samples were classified in the field to -60 mesh with a small classifier. In some cases a large amount of material (+ 2 kg) had to be classified in order to obtain a sufficient sample size. Sample locations are outlined in Table 2 and plotted in Figure 4. Results were disappointing but one stream sediment sample, CA007ST, returned a value of 70 ppb Au confirming anomalous gold within the claim area.

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628,000 mE627,000 mE5,

466,

000

mN

5,466,000 mN

5,465,000 mN

5,464,000 mN

5,46

5,00

0 m

N5,

468,

000

mN

5,46

7,00

0 m

N5,467,000 m

N5,468,000 m

N5,

464,

000

mN

626,000 mE625,000 mE 627,000 mE 628,000 mE

625,000 mE 626,000 mE

Charles Arm

C010

CA002ST

CA001ST

C006

Charles Arm

Govers Harbour

Govers Point

Charles Brook

Burnt Island

Sunday Island

C010

CA002ST

CA001ST

C006

C001ST

CP001ST

CP002ST

CP003ST

CP004ST

CP005ST

CP006ST

CP007ST

CP008ST

C001

C003

C004

C005

C008

C009

018399M

018400M

Date: 09/05/2012

Scale: 1:20000 Projection: UTM Zone 21 (NAD 27 for Canada)

Drawing:

Author: DTW

David Walsh

800

Figure 4Charles Brook

Sample Locations

0 200 400

metres

NTS: 02E/06

Stream Sediment Sample

Rock Sample

Legend

Mineral Licence

Confidential

8

Table 2. Sample Locations

Sample  Type  UTM_Zone X_NAD27  Y_NAD27 

C001ST  stream  21  625628.2729 5466718.986 

CP001ST  stream  21  626416  5466478.846 

CP002ST  stream  21  626095  5466340.766 

CP003ST  stream  21  625766  5465634.825 

CP004ST  stream  21  625758  5465801.929 

CP005ST  stream  21  625755  5466071.682 

CP006ST  stream  21  625637  5466210.013 

CP007ST  stream  21  625548  5466944.148 

CP008ST  stream  21  625670  5467291.185 

CA001ST  stream  21  625185.04  5468062.48 

CA002ST  stream  21  625115.59  5467946.59 

C001  rock  21  627001.9406 5464539.166 

C003  rock  21  627229.3679 5464792.793 

C004  rock  21  625569.9977 5468320.927 

C005  rock  21  625295.0811 5468114.211 

C006  rock  21  625566.724  5468492.581 

C008  rock  21  626269.9923 5465506.932 

C009  rock  21  625530.367  5466503.751 

C010  rock  21  626085.4447 5467292.484 

ConclusionsandRecommendations Prospecting in 2011 failed to delineate the source of the anomalous float discovered by Cornerstone Resources in 2004. This was mainly due to the poor weather conditions, high surface water levels and insufficient coverage of the claim area. Stream sediment sampling did discover an anomalous sample, confirming the presence of gold within the geology. Further detailed prospecting is recommended within the claim area, especially to the west, which is up-ice from the anomalies. Focus should be paid to the gabbroic intrusions in the area. The source for the 5 g/t float sample discovered by Cornerstone Resources should also be a focus of any future exploration program. Respectfully submitted, David Walsh Geologist

Confidential

9

References Hussey, A. H. (2005). First Year Assessment Report of Prospecting, Rock and Stream Sediment

Sampling on Licences 9815M, 9816M, 9817M, 9818M and 9819M, Norte Dame Bay Gold Project, NTS 2E/06, Bay of Exploits Area, NL. Newfoundland and Labrador Geological Survey, Assessment File 02E/06/1438, 52 pages.

Lewis, G. (1998). First year assessment report on prospecting and geochemical exploration for

licence 5590m on claims in the Saunders Cove area, South Arm, New Bay, Newfoundland. Newfoundland and Labrador Geological Survey, Assessment File 02E/06/1028, 24 pages.

Lohman, G. (1988). Second year assessment report on geological and geochemical exploration

for licence 2922 on claim block 4562 in the Tea Arm south and Saunders Cove areas, north-central Newfoundland. Newfoundland and Labrador Geological Survey, Assessment File 02E/06/0619, 39 pages.

McBride, D., & Baker, C. (1988). First year assessment report on geological and geochemical

exploration for licence 2922 on claim block 4562 in the Tea Arm and South Arm areas, north-central Newfoundland. Newfoundland and Labrador Geological Survey, Assessment File 02E/06/0574, 18 pages.

O'Brien, B. H. (2006). Geology of the Bay of Exploits - New Bay area (parts of NTS 2E/5, 6, 7,

11), north-central Newfoundland. Scale 1:50 000. Newfoundland and Labrador Department of Natural Resources, Geological Survey, Map 2006-04. Open File 002E/1483.

Williams, H., Colman-Sadd, S., & Swinden, H. (1988). Tectonic - stratigraphic subdivisions of

the central Newfoundland. Current Research, Geological Survey of Canada, 91-98.

Confidential

10

ManPower  

Name  Position  Residence   Days 

David Walsh  Geologist  Logy Bay, NL  12 

Russell White  Prospector  Outer Cove, NL  7 

Robert Roche  Prospector  Outer Cove, NL  7 

Expenditure Item  #   Cost   Total 

       

Prospecting  21  $           100.00   $          2,100.00 

Mapping  2  $           100.00   $             200.00 

Report Writing  3  $           100.00   $             300.00 

       

       

Analytical  19  $             28.89   $             548.91 

Vehicle   7  $             60.00   $             420.00 

ATV  7  $             40.00   $             280.00 

Travel & Accommodations      $             856.32 

Meals and Camp Expenses      $             568.00 

Supplies      $             380.45 

       

       

       

Sub‐total      $          5,653.68 

Overhead @ 15%      $             848.05 

       

Total      $          6,501.73 

Confidential

11

Au Fire Assay/ICP Geochemistry CertificateClient: David WalshGeologist: Eastern Analytical LimitedProject: Charles Arm P.O. Box 187Sample: Stream / Till Little Bay Road Signed by:______________________

Springdale, NLDskFile: 1101430 A0J 1T0 (Concentrations in assay range

may cause interferences in DateIn: September 02, 2011 Phone: 709-673-3909 associated elements.)DateOut: September 16, 2011 Fax: 709-673-3408

Email:easternanalytical@nf.aibn.com---------------------------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------Sample Au Ce Sr Ba Fe P Hg Mg As V Na Mo Al Be Ca Zn Cu Sb Ag Pb Bi Ti Cd Co Ni W La K Mn Sn CrNumber ppb ppm ppm ppm % % ppm % ppm ppm % ppm % ppm % ppm ppm ppm ppm ppm ppm % ppm ppm ppm ppm ppm % ppm ppm ppm----------------------------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------- --------Blank - Au 5 --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---Std - Au 398 --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---Blank --- 10 1 10 0.01 0.01 1 0.01 5 1 0.01 1 0.01 0.5 0.01 1 1 5 0.2 2 2 0.01 0.5 1 1 10 10 0.01 5 20 1LKSD-2-STD --- 112 20 171 2.75 0.10 1 0.49 7 32 0.02 1 1.26 0.6 0.45 183 30 5 0.8 28 2 0.03 1.3 15 17 10 30 0.16 1391 20 23C001ST 5 28 10 23 2.15 0.03 1 0.61 13 33 0.01 1 1.43 0.5 0.33 47 9 5 0.2 5 2 0.06 0.6 12 22 10 10 0.04 698 20 28CP001ST 5 65 29 25 4.76 0.11 1 0.58 48 58 0.02 3 4.00 1.9 0.60 99 27 5 0.2 5 2 0.04 1.3 35 37 10 10 0.05 2016 20 46CP002ST 5 13 5 19 1.75 0.01 1 0.50 11 23 0.01 1 0.99 0.5 0.14 41 2 5 0.2 2 2 0.05 0.5 12 15 10 10 0.02 866 20 18CP003ST 5 67 8 34 4.62 0.05 1 0.69 33 31 0.01 2 2.64 0.7 0.17 109 24 5 0.2 8 2 0.01 1.2 30 46 10 10 0.04 2440 20 38CP004ST 5 34 6 12 2.88 0.04 1 0.66 7 28 0.01 1 1.63 0.5 0.20 51 6 5 0.2 4 2 0.03 0.7 13 20 10 10 0.03 1436 20 25CP005ST 5 53 12 60 4.14 0.06 1 0.67 183 35 0.01 1 2.35 0.6 0.33 107 9 5 0.2 6 2 0.01 1.2 22 28 10 10 0.04 8147 20 32CP006ST 5 53 17 74 3.45 0.06 1 0.56 138 42 0.01 1 1.87 0.6 0.49 74 11 5 0.2 10 2 0.03 1.1 25 22 10 10 0.04 10430 20 32CP007ST 74 27 10 26 2.87 0.03 1 0.52 14 58 0.01 1 1.72 0.6 0.22 36 8 5 0.2 8 2 0.05 0.7 17 16 10 10 0.04 1470 20 38CP008ST 5 29 10 14 2.07 0.04 1 0.61 9 35 0.02 1 1.03 0.5 0.32 36 9 5 0.2 4 2 0.05 0.5 11 16 10 10 0.05 802 20 25CA001ST 5 27 23 32 4.65 0.04 1 0.72 103 78 0.03 10 1.76 0.5 0.22 58 4 5 0.2 13 2 0.06 1.2 46 17 10 10 0.06 2914 20 36CA002ST 5 24 14 15 4.27 0.03 1 0.70 42 71 0.02 4 1.74 0.5 0.18 44 9 5 0.2 12 2 0.08 1.0 34 20 10 10 0.06 2284 20 38BH01-20+40 5 45 38 81 2.03 0.05 1 0.81 14 27 0.01 1 1.10 0.6 2.36 45 23 5 0.2 9 2 0.03 0.6 14 25 10 10 0.06 630 20 21BH01-40+60 12 39 33 68 1.84 0.05 1 0.78 10 25 0.01 1 1.04 0.5 1.95 40 19 5 0.2 7 2 0.03 0.5 13 23 10 10 0.05 545 20 19BH01-60 5 36 28 63 1.79 0.05 1 0.73 9 26 0.01 1 0.96 0.5 1.67 37 17 5 0.2 6 2 0.04 0.5 12 20 10 10 0.04 514 20 18BH02-20+40 5 40 32 72 1.88 0.05 1 0.76 11 26 0.01 1 1.02 0.5 1.95 38 19 5 0.2 7 2 0.03 0.5 13 22 10 10 0.05 546 20 19BH02-40+60 5 39 30 55 1.86 0.05 1 0.78 8 27 0.01 1 1.02 0.5 1.79 38 15 5 0.2 5 2 0.04 0.5 12 21 10 10 0.04 500 20 20BH02-60 5 38 29 61 1.80 0.05 1 0.70 9 28 0.01 1 0.95 0.5 1.69 36 16 5 0.2 6 2 0.04 0.5 13 19 10 10 0.05 520 20 19BH02-60 DUP --- 38 28 63 1.74 0.05 1 0.70 9 26 0.01 1 0.94 0.5 1.70 41 16 5 0.2 6 2 0.04 0.5 12 19 10 10 0.05 506 20 19C001 5 10 5 10 1.99 0.01 1 0.97 5 32 0.32 1 1.68 0.5 0.96 25 16 5 0.2 2 2 0.06 0.5 13 24 10 10 0.01 299 20 310C003 5 27 76 16 4.87 0.05 1 2.69 5 95 0.23 1 3.55 0.8 4.16 46 53 5 0.2 2 2 0.01 1.3 33 30 10 10 0.21 624 20 137C004 5 10 4 10 1.61 0.02 1 0.81 5 29 0.15 1 1.64 0.5 1.36 19 8 5 0.2 2 2 0.06 0.5 11 14 10 10 0.01 191 20 234C005 5 27 9 10 4.03 0.03 1 1.54 5 138 0.17 2 2.74 0.6 1.25 65 42 5 0.2 6 2 0.06 1.0 18 44 10 10 0.02 1214 20 147C006 5 10 1 10 0.81 0.01 1 0.33 5 20 0.13 1 0.50 0.5 0.17 8 3 5 0.2 2 2 0.02 0.5 3 6 10 10 0.02 250 20 241C008 5 23 30 10 4.13 0.08 1 0.91 55 69 0.18 1 2.66 0.5 3.76 47 36 5 0.2 4 2 0.12 1.1 23 13 10 10 0.05 2072 20 97C009 5 10 4 10 0.34 0.01 1 0.11 5 3 0.13 1 0.37 0.5 1.15 3 2 5 0.2 2 2 0.01 0.5 2 11 10 10 0.01 65 20 242C010 5 10 2 10 0.58 0.01 1 0.09 5 15 0.19 1 0.78 0.5 0.95 4 5 5 0.2 2 2 0.01 0.5 2 8 10 10 0.01 119 20 362CH01-20 5 110 14 58 3.06 0.08 1 1.08 10 57 0.02 1 2.33 1.0 0.39 61 96 5 0.2 8 2 0.12 0.8 30 40 10 10 0.12 1088 20 51