An Emerging Copper Company

Reserves and Resources

Pumpkin Hollow Mineral Resources

The project mineral resource estimate for the Western deposits is an update of a previous mineral resource estimate disclosed on August 22, 2013 and filed on SEDAR. The current mineral resource estimate for the open pit was disclosed May 28, 2015 and the related NI 43-101 Technical Report was filed on SEDAR in July 2015, with an effective date of April 15, 2015. The project mineral resource estimate for the Eastern deposits is an update of a previous mineral resource estimate disclosed on September 7, 2012 and filed on SEDAR. The current estimate for the underground was disclosed May 28, 2015 and the related NI 43-101 Technical Report was filed in July 2015, with an effective date of April 15, 2015. The estimates were prepared by the mineral resource and mining division of Tetra Tech by, or under the direction of, Dr. Rex Bryan, SME Registered Member, an independent Qualified Person as set forth by NI 43-101.

The expansion of the North deposit and the South deposit has merged the two open pits together with benefits in terms of a greater mineable reserves and operational synergies.

The open pit cutoff grade has been approximated at 0.15% Cu prior to completion of cost optimization and has been applied for purposes of resource statement only. To further approximate reasonable extraction, a cutoff grade of 0.15% Cu has been applied to Measured, Indicated and Inferred Resources constrained within a Geovia WhittleTM pit optimization assuming a Cu price of $3.75/lb and the parameters used for reserve pit optimization. Value has only been attributed to Cu for the pit optimization constraint. Fe resources have been reported with an independent Fe cutoff within the Cu optimized shell.

Constrained resources are not reserves and do not have demonstrated economic viability.

WESTERN DEPOSITS - MEASURED AND INDICATED RESOURCES - AS AT JULY 2015

Category Cutoff Grade
(%Cu)
Tons
(000)
Grade
(%Cu)
Contained
Copper
(000 lbs)
Gold
Grade
opt
Gold
(000 ozs)
Silver
Grade
opt
Silver
(000 ozs)
Cu Equiv.
%
Measured 0.15 271,291 0.42 2,298,892 0.001 394 0.048 12,932 0.45
Indicated 0.15 295,118 0.43 2,250,761 0.001 356 0.046 13,690 0.46
M&I Total 0.15 566,409 0.43 4,839,652 0.001 750 0.047 26,621 0.45
The mineral resources stated above are inclusive of mineral reserves that are reported elsewhere.

Mineral resources that are not mineral reserves do not have demonstrated economic viability.


WESTERN DEPOSITS - INFERRED RESOURCES - AS AT JULY 2015

Category Cutoff Grade
(%Cu)
Tons
(000)
Grade
(%Cu)
Contained
Copper
(000 lbs)
Gold
Grade
opt
Gold
(000 ozs)
Silver
Grade
opt
Silver
(000 ozs)
Cu Equiv.
%
Inferred 0.15 8,009 0.52 82,924 0.001 6 0.052 414 0.54
The mineral resources stated above are inclusive of mineral reserves that are reported elsewhere.

Copper equivalency is based on $3.00 per pound for copper, $1400 per ounce gold and $20 per ounce silver and metallurgical recoveries of 92%, 78% and 57.5% for copper, gold and silver respectively.

Mineral resources that are not mineral reserves do not have demonstrated economic viability.


The underground cutoff grade has been approximated at 0.75% Cu prior to completion of cost optimization and has been applied for purposes of resource statement only. To further approximate reasonable extraction, reporting of resources has been constrained to within the mineralized domains, with the exception of waste amongst the mineral zone interpretation that was confined with a waste solid for purposes of internal waste inclusion for the mine plan.

Constrained resources are not reserves and do not have demonstrated economic viability.

EASTERN DEPOSITS - MEASURED AND INDICATED RESOURCES - AS AT JULY 2015

Category Cutoff Grade
(%Cu)
Tons
(000)
Grade
(%Cu)
Contained
Copper
(000 lbs)
Gold
Grade
opt
Gold
(000 ozs)
Silver
Grade
opt
Silver
(000 ozs)
Cu Equiv.
%
Measured 0.75 12,142 1.60 388,606 0.006 74 0.127 1,541 1.71
Indicated 0.75 41,948 1.33 1,114,139 0.005 217 0.112 4,716 1.42
                   
M&I Total 0.75 54,090 1.39 1,502,744 0.005 291 0.116 6,257 1.49
The mineral resources stated above are inclusive of mineral reserves that are reported elsewhere.

Mineral resources that are not mineral reserves do not have demonstrated economic viability.


EASTERN DEPOSITS - INFERRED RESOURCES - AS AT JULY 2015

Category Cutoff Grade
(%Cu)
Tons
(000)
Grade
(%Cu)
Contained
Copper
(000 lbs)
Gold
Grade
opt
Gold
(000 ozs)
Silver
Grade
opt
Silver
(000 ozs)
Cu Equiv.
%
Inferred 0.75 29,167 1.09 635,788 0.003 87 0.064 1,875 1.14
The mineral resources stated above are inclusive of mineral reserves that are reported elsewhere.

Copper equivalency is based on $3.15 per pound for copper, $1200 per ounce gold and $20 per ounce silver and metallurgical recoveries of 89.3%, 67.3% and 57.3% for copper, gold and silver respectively.

Mineral resources that are not mineral reserves do not have demonstrated economic viability.


Iron Mineral Resource

The Pumpkin Hollow project has considerable resources of iron in the form of magnetite. The following tables include only those iron resources amenable to open-pit mining methods in the Western deposits. Possible mining, recovery and sale of a magnetite concentrate will be considered in an updated feasibility study.

An independent Fe cut-off grade has been applied to the resources shown. Portions of the Fe resource tonnage account for resources stated as Cu resource tonnage. Although an independent Fe cutoff has been applied, Fe resources have been spatially constrained by the pit optimization derived exclusively from Cu value as discussed above.

Category Cut-off Grade Tons Grade Contained
%Fe (million) %Fe Fe Tons (million)
Measured 20 201.5 31 62.6
Indicated 20 33.8 28.8 9.7
Measured + Indicated 20 235.3 30.7 72.3
Measured 30 98.7 37.6 37.1
Indicated 30 11.4 37.6 4.3
Measured + Indicated 30 110.1 37.6 41.4
Notes
    1. Mineral resources that are not mineral reserves do not have demonstrated economic viability. Mineral resources were prepared and determined in accordance with NI 43-101.
    2. Includes drilling through 2013.
    3. Includes North, South, and Southeast deposits
    4. Resources are constrained by a Geovia Whittletm optimization using $3.75/lbs Cu calculated with Measured, Indicated and Inferred resources with reserve mining and cost parameters

If an updated feasibility study demonstrates the iron resource to be economically viable, inclusion of iron in the open pit block model values is expected to significantly expand the size and tonnage of the North and South open pits, and lower waste tonnages and strip ratio.

Reserves and Resources