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012H/16/2297

P.O. Box 374, Bishop’s Falls, NL A0H 1C0 Tel: 709-486-1247

Email: dave@silvertipexploration.ca

April 8, 2016 Trina Adams Geologist, Mineral Rights Dept. of Natural Resources P.O. Box 8700 St. John’s, NL Dear Ms. Adamse: Please find attached the assessment report covering 2015 exploration activities on Mineral Exploration Licence 020060M registered to Mr. Herb Froude. The licence is under option to Anaconda Mining Inc. and exploration expenditures amounted to $5,738.09. If you have any questions, please contact me at your convenience. Sincerely, Dave Evans P.Geo. Silvertip Exploration Consultants Inc.

Exploration Report Anaconda Mining Inc.

Mineral Exploration Licence 020060M Baie Verte Peninsula, Newfoundland

NTS 12H/16

Prepared for Anaconda Mining Incorporated

By David Evans M.Sc. P.Geo.

Silvertip Exploration Consultants Incorporated April 8, 2016

Mineral Licence # Claims Required Expenditure Actual Expenditure Excess

020060M 11 $6,782.82 (2023/04/18) $5,738.09 -$1,044.73

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Table of Contents

1.0 Summary ........................................................................................................................................... 1

2.0 Introduction ....................................................................................................................................... 1

3.0 Property Description and Location ..................................................................................................... 1

4.0 Accessibility and Infrastructure .......................................................................................................... 2

5.0 History of Mineral Exploration .......................................................................................................... 2

6.0 Geological Setting and Mineralization ............................................................................................... 4

6.1 Regional Geological Setting ..................................................................................................... 4

6.2 Local Geological Setting .......................................................................................................... 4

7.0 Deposit Types .................................................................................................................................... 5

8.0 Exploration Program .......................................................................................................................... 8

9.0 Results and Recommendations ........................................................................................................... 9

10.0 References ..................................................................................................................................... 12

Appendix I Sample Data and Assay Certificates .................................................................................... 13

List of Tables

Table 1. Mineral exploration licence 020060M. ....................................................................................... 1 Table 2. Exploration expenditure summary, Licence 020060M. ............................................................... 9 Table 3. Channel sample highlights trench AEtr15-17. ........................................................................... 11

List of Figures

Figure 1. Property location map, Licence 020060M, Froude Option. ........................................................ 3 Figure 2. Tectonostratigraphic map of Newfoundland (Hayes, 1987). ...................................................... 6 Figure 3. Simplified geology map of the Ming's Bight Peninsula (from Hibbard, 1983)............................ 7 Figure 4. Sample location map, trench AEtr15-17, Froude Option. ......................................................... 10

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1.0 Summary This is a summary of the 2015 exploration program conducted on mineral exploration licence 020060M registered to Herb M. Froude. The licence is located on the Baie Verte Peninsula near the community of Ming’s Bight and is under option to Anaconda Mining Incorporated. Work carried out on the licence included trenching and channel sampling as a follow up to a 2014 trenching program. The trenching successfully exposed additional gold mineralization associated with altered gabbro in trench AEtr15-17. An 11 m section of the trench assayed 1.77 g/t Au. 2.0 Introduction In 2012, Anaconda Mining entered into an option arrangement with Herb Froude to acquire a 100 percent interest in a mineral exploration licence (the “Froude Option”) adjacent to Anaconda’s Pine Cove gold mine. The licence is underlain by ophiolitic and cover sequence rocks of the Point Rousse Complex which is a highly prospective target for gold mineralization. In the fall of 2014, Anaconda initiated a trenching program on its Ming’s West project as a follow up to anomalous soil geochemical anomalies. Prior to Anaconda’s 2012 soil geochemistry survey there appears to have been little in the way of previous exploration on the portion of this licence covered by the trenching program. This program successfully exposed gabbro-hosted gold mineralization now referred to as the Argyle Zone. In the late fall of 2015, Anaconda carried out additional trenching on the Argyle Zone. 3.0 Property Description and Location Mineral exploration licence 020060M consists of 11 claims covering 275 hectares near the community of Ming’s Bight on the northern tip of the Baie Verte Peninsula, Newfoundland and Labrador (Figure 1). This report covers exploration activities carried out on that licence, details of which are presented in Table 1.

Licence Claims Registered Owner Report Due Required Expenditure Expenditure 020060M 11 Herb M. Froude 2017/06/19 $6,782.82 (2023/04/18) $5,738.09

Table 1. Mineral exploration licence 020060M.

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4.0 Accessibility and Infrastructure The Baie Verte Peninsula lies on the northeast coast of Newfoundland and is linked to the Trans-Canada Highway via Route 410. Baie Verte, the region’s largest town, lies approximately 65 km north of the Trans-Canada Highway. The area has a long mining and forestry history with Baie Verte, the major service center. The town provides major infrastructure with a regional hospital, restaurants, hotels, banking services and heavy equipment providers. The Froude Option lies approximately 8 km northeast of Baie Verte on a northeast-trending peninsula separating Baie Verte and Ming’s Bight. The Ming’s Bight highway (Route 418) cuts the southern portion of the licence. The abandoned Deer Cove access road which leaves Route 418 approximately 1.5 km southwest of Ming’s Bight provides access to the northern portion of the licence. The area is covered by a mixture of dense scrub (black spruce and balsam fir), old cutovers and bog. The terrain is rugged with an average elevation of about 50 m. Overburden varies from less than 0.5 m up to greater than 5 m in some of the linear valleys. Outcrop is typically less than 5 percent in inland areas and up to 100 percent in some coastal sections. 5.0 History of Mineral Exploration Overview The Baie Verte Peninsula has an extensive mining and mineral exploration history dating back to the mid-1800s when copper mineralization was discovered near Baie Verte, Tilt Cove and Betts Cove. These mines operated intermittently until about the First World War. In the late 1950s there was renewed interest in copper and mining was resumed at Tilt Cove from 1957 to 1967. The Rambler deposits south of Ming’s Bight were developed and produced from 1961 until 1982 and again from 1995 to 1996. Rambler Metals and Mining Canada Ltd. is currently mining the deeper levels of the Ming deposit and is considering developing the low grade footwall deposit beneath the Ming ore body. Gold mineralization was first reported from the Ming’s Bight area prior to 1867. Subsequent exploration lead to the discovery in 1903 of gold mineralization associated with banded iron formation northwest of Ming’s Bight. Substantial infrastructure was erected including a ten stamp mill and Wilfley concentrator. The Goldenville Mine operated sporadically from 1904 to 1906 and produced 158 oz. of gold.

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Figure 1. Property location map, Licence 020060M, Froude Option.

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In the mid-1980s geological comparisons to the Californian Mother Lode Belt focused mineral exploration on the Baie Verte Peninsula particularly the Ming’s Bight area. This intensive period of exploration produced approximately 120 new gold discoveries including the Pine Cove and Stog’er Tight deposits, the Deer Cove Main Zone and the Romeo and Juliet prospect. In 2003, Anaconda optioned a 60% interest in the Pine Cove project from New Island Resources Inc. (“New Island”). Anaconda placed the Pine Cove open pit mine into production in 2008 and up to the beginning of 2016 has extracted 76,379.34 ounces of gold. The company acquired the remaining 40% from New Island in 2011. For additional and more detailed information concerning the exploration history the reader is referred to Hibbard (1983), Evans (2004) and Pitman (2015). 6.0 Geological Setting and Mineralization 6.1 Regional Geological Setting The island of Newfoundland forms part of the Paleozoic Appalachian-Caledonian Orogenic Belt which on the island can be subdivided into distinct tectonostratigraphic zones including the Humber and Dunnage zones (Figure 2). These zone record the formation and destruction of the late Precambrian – early Paleozoic Iapetus Ocean. The Humber Zone represents the passive continental margin of Paleozoic North America and it comprises shelf-facies carbonate and siliciclastic rocks deposited upon crystalline Precambrian basement. The Dunnage Zone is often referred to as the vestiges of Iapetus as it contains sequences of ophiolitic and volcanic, volcaniclastic and sedimentary rocks of island arc and back-arc origins. The Baie Verte Peninsula occupies portions of both the Humber and Dunnage zones which are separated by a major arcuate, structural zone known as the Baie Verte Line. The Dunnage Zone comprises: i) Cambro-Ordovician ophiolitic sequences, the Baie Verte Oceanic Tract; ii) Ordovician volcanic/volcaniclastic cover sequences; iii) Silurian terrestrial volcanic and sedimentary rocks, which unconformably overlie the Ordovician sequences; and iv) Siluro-Devonian intrusive rocks. The protracted interaction between the Baie Verte Line and the sequences lying mainly to its east produced the prolific gold occurrences of the Baie Verte Belt. 6.2 Local Geological Setting

The Point Rousse Project is underlain by Cambro-Ordovician ophiolitic and cover-sequence rocks of the Point Rousse Complex, which is part of the Baie Verte Oceanic Tract of Skulski et. al. (2010). The Point Rousse Complex comprises a dismembered ophiolite sequence

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conformably overlain by a mafic volcanic–volcaniclastic cover sequence. The ophiolitic Point Rousse Complex consists of ultramafic and gabbroic rocks, sheeted dykes, and mafic volcanic rocks. The cover sequence consists of: banded magnetite and jasper iron formation (including the Goldenville Horizon); mafic volcanic rocks including high-Ti tholeiitic basalts; calc-alkaline basalt, clinopyroxene-phyric tuff and tuff breccia; and mafic epiclastic wackes and conglomerates. This cover sequence is correlated regionally with the Snooks Arm Group and where practical the formational nomenclature of the Snooks Arm Group is applied. The Point Rousse Complex lies in the core of the Baie Verte Flexure where the Baie Verte Line swings abruptly from a northeast-southwest to an approximately east-west orientation. Internally the complex is disposed in a broad, generally east-trending, structurally-modified synclinorium. Ophiolitic plutonic rocks lie to the north and south of the cover sequence which is exposed in the core of the syncline. The ophiolitic components are confined to structural blocks bounded by high angle and thrust faults which dip moderately to the northwest. The rocks of the Point Rousse Complex have been affected by at least four phases of regional deformation, D1 – D4. The main deformational event resulted from south-directed thrusting, accompanied by folding and shearing, of the Point Rousse Complex. This thrusting occurred along several parallel west-trending south directed reverse faults culminating with the Scrape Thrust, a ductile shear zone that juxtaposes the Point Rousse Complex over the Pacquet Harbour Group. South-southeast to south-trending transverse faults that dissect the west-trending thrust and reverse faults may represent lateral ramps or tear faults. Deformational fabrics related to this event have been affected by at least two younger events that have folded the older features. 7.0 Deposit Types The Point Rousse Complex is host to both orogenic-style gold and volcanogenic sulphide mineralization (Evans, 2004). Anaconda has identified three mineralized trends within the Point Rousse Project: the Scrape Trend, the Goldenville Trend, and the Deer Cove Trend. The majority of known gold occurrences including the significant deposits all sit within these trends. Gold mineralization appears to be largely restricted to the cover sequence rocks and is best developed in titanomagnetite-rich mafic intrusive or volcanic rocks and oxide-facies banded-iron formation. Leucoxene is common to most of the occurrences and its presence and genesis is thought to play a crucial role in host rock preparation. Known gold occurrences with the ophiolitic rocks of the Point Rousse Complex are few and typically small.

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Figure 2. Tectonostratigraphic map of Newfoundland (Hayes, 1987).

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Figure 3. Simplified geology map of the Ming's Bight Peninsula (from Hibbard, 1983).

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The gold is structurally controlled and localized within deformation zones subsidiary (2nd or 3rd order features) to major regional structures. These structures are generally pre- or syn-D2 since the mineralization is folded by F3 and F4 folds. Typically the variation in rock type, and resultant rheological contrast during deformation, appears to play an important role in mineralization since it is commonly the more competent of the rocks present which host gold. The gold occurs as either quartz vein-hosted as in the Romeo and Juliet prospect and the Deer Cove Main Zone, or as disseminated (altered-wall rock) style mineralization as in the Pine Cove and Stog’er Tight deposits. In the latter the gold is intimately associated with pyrite either within the host rock or within accompanying quartz-carbonate veins. At the Goldenville Mine quartz veins with narrow auriferous-pyritic halos are developed within the oxide-facies banded-iron formation and are typical of Banded Iron Formation (BIF) gold deposits. The Point Rousse gold mineralization typically exhibits a relatively narrow, but distinctive alteration halo dominated by Fe-carbonate, albite, sericite, chlorite and leucoxene. The ore mineralogy is relatively simple and is generally comprised of either free gold or as gold coating fractures/grain boundaries in pyrite. Silver and base metals can be present in minor amounts and the deposits typically contain only trace arsenopyrite. These deposits are typically non-acid generating due to the abundance of carbonate. Volcanic rocks of the cover sequence have the potential to host volcanogenic sulphide mineralization similar to the Rambler Deposits in the Pacquet Harbour Group. The Barry and Cunningham prospect, which is located on the coast approximately 2.5 km north of the community of Ming’s Bight, consists of small lenses of copper-rich massive sulphide mineralization. Zones of semi-massive to massive pyrite are also associated with the numerous bands of iron formation within the cover sequence. 8.0 Exploration Program Anaconda Mining Incorporated is focused upon building its gold resources in Newfoundland. The company has embarked upon a three pronged exploration program which includes: 1) a regional exploration component covering the mining leases and mineral exploration licences acquired through staking or option agreements; 2) evaluating known gold prospects as sources of incremental feed for the Pine Cove mill; and 3) exploration immediately adjacent to the Pine Cove deposit. In 2012, after a review of historic exploration data it was revealed that a significant portion of the western part of Licence 020060M had not been covered by soil geochemical surveys. A reconnaissance soil survey was carried out and several sites with elevated gold were identified.

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However, the soil data was not followed up until late fall 2014 when Anaconda commenced a trenching program to test the anomalies. Two trenches were excavated on Licence 020060M, but due to early freeze-up and snow only trench AEtr14-12 was washed and sampled. An 11 m section of the trench assayed 1.31 g/t Au (Evans, 2015). In the late fall of 2015 a single trench AEtr15-18 was excavated on Mineral Licence 020060M approximately 40 m west of the mineralized trench exposed in 2014 (Figure 4). Once again winter conditions hampered the trenching. Sample data and assay certificates are appended. Exploration expenditures for the licence totaled $5,738.09 (Table 2).

Item # Expense Geological Consultants Dave Evans (Grand Falls-Windsor)

2 days

Dave Copeland (St. John's) 2 days $2,350.00 Travel $1,867.50 Assays 34 $772.14 $4,989.64 Misc. 15% $748.45 Total $5,738.09

Table 2. Exploration expenditure summary, Licence 020060M. 9.0 Results and Recommendations Trench, AEtr15-17, was completed in late 2015 approximately 40 m west of the mineralization exposed by previous trenching. This trench exposed deformed and Fe-carbonatized and pyritized gabbro and was cleaned sufficiently to collect 34 channel samples. An 11 m section of the trench assayed 1.77 g/t Au. A summary of assay results is presented in Table 3 below. Follow-up is planned for 2016 including grid cutting, a ground magnetic and IP survey, additional prospecting, and expansion of existing trenches. David Evans M.Sc. P.Geo. Consulting Geologist Silvertip Exploration Consultants Incorporated April 8, 2016

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Figure 4. Sample location map, trench AEtr15-17, Froude Option.

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Sample Width Au g/t Sample Width Au g/t 166270 1 0.14 166287 1 0.26 166271 1 0.06 166288 1 0.49 166272 1 0.15 166289 1 2.94 166273 1 0.01 166290 1 2.41 166274 1 0.01 166291 1 1.88 166275 1 0.01 166292 1 0.63 166276 1 0.08 166293 1 2.91 166277 1 0.31 166294 1 0.43 166278 1 0.01 166295 1 1.19 166279 1 0.22 166296 1 2.65 166280 1 0.03 166297 1 0.38 166281 1 0.08 166298 1 3.56 166282 1 0.04 166299 1 0.14 166283 1 0.54 166300 1 0.67 166284 1 0.1 166301 1 0.03 166285 1 0.06 166302 1 0.05 166286 1 0.47 166303 1 0.25

Table 3. Channel sample highlights trench AEtr15-17.

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10.0 References Evans, D.T.W. 2004: Epigenetic gold occurrences, Baie Verte Peninsula, (NTS 12H/09,16 and 12I/01), Newfoundland. Mineral Resource Report 11, Geological Survey, Department of Natural Resources, 157 pages. 2015: Exploration Report Anaconda Mining Incorporated Mineral Exploration Licence 020060M, Baie Verte Peninsula NTS 12H/16. Unpublished report, Anaconda Mining Incorporated, 39 pages. Hayes, J.P. 1987: Unpublished geology map of Newfoundland. Newfoundland Department of Mines and Energy, Mineral Development Division. Hibbard, J.P. 1983: Geology of the Baie Verte Peninsula, Newfoundland. Newfoundland Department of Mines and Energy, Mineral Development Division, Memoir 2, 279 pages. Pitman, C., Copeland, D., Evans, D.T.W., O’Neill, P. and Slepcev, G. 2015: NI 43-101 technical report, mineral resource and mineral reserve update on the Pine Cove Mine and mineral resource estimate on the Stog’er Tight deposit, Point Rousse Project, Baie Verte, Newfoundland and Labrador, Canada. Anaconda Mining Incorporated unpublished report, 247 pages. Skulski, T., Castonguay, S., McNicoll, V., van Stall, C., Kidd, W., Rogers, N., Morris, W., Ugalde, H., Slavinski, H., Spicer, W., Moussallam, Y., and Kerr, I. 2010: Tectonostratigraphy of the Baie Verte oceanic tract and its ophiolitic cover sequence on the Baie Verte Peninsula. In Current research Newfoundland and Labrador Department of Natural Resources, Geological Survey, Report 10-1, pages 315-335.

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Appendix I Sample Data and Assay Certificates

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Trench_ID Sample UTME UTMN Length Au g/t AEtr15-17 166270 567527.736 5536171.872 1 0.14 AEtr15-17 166271 567528.7202 5536172.885 1 0.06 AEtr15-17 166272 567528.7067 5536173.885 1 0.15 AEtr15-17 166273 567528.6932 5536174.884 1 0.01 AEtr15-17 166274 567528.6797 5536175.884 1 0.01 AEtr15-17 166275 567529.6722 5536176.897 1 0.01 AEtr15-17 166276 567529.6588 5536177.887 1 0.08 AEtr15-17 166277 567529.6453 5536178.887 1 0.31 AEtr15-17 166278 567529.6317 5536179.886 1 0.01 AEtr15-17 166279 567530.616 5536180.899 1 0.22 AEtr15-17 166280 567530.6025 5536181.899 1 0.03 AEtr15-17 166281 567530.589 5536182.899 1 0.08 AEtr15-17 166282 567530.5754 5536183.898 1 0.04 AEtr15-17 166283 567531.5597 5536184.912 1 0.54 AEtr15-17 166284 567531.5597 5536184.912 1 0.1 AEtr15-17 166285 567531.5462 5536185.911 1 0.06 AEtr15-17 166286 567531.5327 5536186.911 1 0.47 AEtr15-17 166287 567532.517 5536187.924 1 0.26 AEtr15-17 166288 567532.5034 5536188.924 1 0.49 AEtr15-17 166289 567532.4899 5536189.923 1 2.94 AEtr15-17 166290 567532.4764 5536190.923 1 2.41 AEtr15-17 166291 567533.4689 5536191.936 1 1.88 AEtr15-17 166292 567533.4554 5536192.936 1 0.63 AEtr15-17 166293 567533.4418 5536193.936 1 2.91 AEtr15-17 166294 567533.4283 5536194.935 1 0.43 AEtr15-17 166295 567534.4126 5536195.948 1 1.19 AEtr15-17 166296 567534.3991 5536196.948 1 2.65 AEtr15-17 166297 567534.3855 5536197.948 1 0.38 AEtr15-17 166298 567534.372 5536198.947 1 3.56 AEtr15-17 166299 567535.3563 5536199.96 1 0.14 AEtr15-17 166300 567535.3428 5536200.96 1 0.67 AEtr15-17 166301 567536.3406 5536200.973 1 0.03 AEtr15-17 166302 567537.3331 5536201.987 1 0.05 AEtr15-17 166303 567538.3309 5536202 1 0.25

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