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Joint Ventures with Kirkland Lake Gold South Claims | HM Claim | East Claim | Kirkland Lake West JV | Gracie West | AK JV | Kirkland Hudson Claims South Claims JV Property Overview
Background In April 2007, Queenston and Kirkland Lake Gold Inc. (“KL Gold”) each purchased a 50% interest in 4 key mineral claims (52.3 ha) located in the heart of the Kirkland Lake gold camp. The property, referred to as the South Claims is located in Teck Township south of and adjacent to KL Gold’s producing Macassa mine and Queenston’s Amalgamated Kirkland property. The claims are strategically located and cover the southern projection of the New South Mine Complex ("SMC") currently being explored, developed and mined on the 5300’ level of the Macassa mine. There is a 1.5% - 3% sliding scale NSR royalty on the claims payable to the original vendor. KL Gold is the operator of the joint venture. Brief History In the early 1900’s, a 400 ft vertical shaft was sunk on the property near the Amalgamated Break. During that period, Canadian Kirkland Mines completed limited underground drifting on a series of gold-bearing veins and since that time no further exploration has been reported on the property.  North of the South Claims surface and underground exploration completed by KL Gold, on the Macassa property, discovered the ABM Zone in 2004 and the SMC in 2005. The best intersections from these zones include 0.50 ounces of gold per ton (opt) over a core length of 29 feet in hole SV04-08 and 2.30 opt over a core length of 90.4 feet in hole 50-627 respectively. It is interpreted that both the ABM and new South Zones trend onto the South Claims. As result of advanced underground exploration including diamond drilling and drifting KL Gold has now outlined a substantial high-grade gold reserve and resource on the Macassa property trending south of the Kirkland Lake Main Break. In July 2010 KL Gold announced a mineral inventory of 1.6 million ounces of gold grading 25.7 g/t In 2007 the JV commenced exploration on the South Claims property to explore the down dip potential of the SMC. This work included underground development towards and along the northern property boundary that provided a platform for exploration drilling. As a result of the drilling campaigns the JV has outlined to date in the Indicated category 88,000 t Au grading 47.0 g/t (132,000 oz) and in the Inferred category 120,000 t Au grading 42.5 g/t (165,000 oz) on the property that continues to remain open to the south east and west. Property Geology and Mineralization The northern portion of the South Claims is underlain by conglomerate and tuff of the Timiskaming Assemblage intruded by porphyry. The northeast-southwest tending Amalgamated Break cuts through the northern portion of the claims in the vicinity of the shaft. In the central portion of the property it is interpreted that the east-west trending 103 Break cuts the claims. This Break hosts the adjacent AK Zone on the Amalgamated Kirkland property. The southernmost claim is almost entirely underlain by a portion of the Murdock Stock, a small felsic intrusion composed principally of syenite. The contact of the Timiskaming Assemblage and Murdock Stock is marked by the east-east trending Larder Lake Break. There is no recorded gold mineralization documented on the South Claims. The SMC is a relatively flat lying gold zone that is fault controlled by structures trending east-west and dipping south. The SMC is located south of the 24 million ounce, steeply south-dipping, Kirkland Lake Main Break and is interpreted to be controlled by a linking structure between two major gold bearing breaks the Main Break to the north and the Larder Lake Break to the south. Unlike quartz-vein hosted gold mineralization typical along the Main Break, the SMC mineralization is characterized by a series of altered, silicified and pyritic stacked zones containing visible gold and telluride bounded by flat lying faults. The SMC remains open to the south east and west and there is strong potential for other SMC-type deposits to be discovered south of the Main Break throughout Teck Township. Mineral Resources The mineral resources on the South Claims were calculated and presented by Glenn Clark and Associates in a NI 43-101 report dated July 14, 2010. Mr. Clark a Professional Engineer also prepares the reserve and resource studies for KL Gold on the Macassa property. The current mineral resources on the South Claims property were determined from two campaigns of underground drilling supervised by the geological staff of KL Gold and calculated by Stew Carmicheal, P.Geo. Chief Exploration Geologist for KL Gold. Table Mineral Resources
The following lists the criteria employed by KL Gold in calculating reserves and resources for the Macassa Mine and South Claims JV property:
2007-10 Program Beginning late in 2007 the Queenston – KL Gold JV commenced an underground exploration program that was focused on exploring for the SMC on the South Claims property. During the first phase of that program the 5300’ level drift was extended southerly to the northern boundary of the JV property. From there the 5300 x-cut was driven both west and east to provide a diamond drilling platform to test the South Zone of the SMC onto the JV property. To the end of 2010 a total of 560 m of drifting and 24 underground diamond drill holes had been completed by the JV. In July 2008, Glen R. Clark and Associates Limited calculated the first NI 43-101 mineral resource on the property containing 39,100 t grading 38.1 g/t (indicated) and 66,225 t grading 42.5 g/t (inferred). As a result of the 2009 drilling this resource was upgraded on July 15, 2009 to 66,097 t grading 42.5 g/t Au (indicated) and 113,179 t grading 42.2 g/t (inferred). The 2010 drilling extended the SMC deposit a further 75 m further east. An updated NI 43-101 report, dated August 20, 2010, was completed by Glen Clark, P.Eng., of Glen R. Clark and Associates Limited, 88,000 t grading 47.0 g/t Au (measured + indicated) and 120,000 t grading 42.50 g/t Au (inferred). 
Property Overview
Background In February 2009, Queenston and KL Gold each purchased a 50% interest in one mineral claim (16 ha) in Teck Township. The claim referred to as the HM Claim is a single leased mineral claim in the heart of the camp south and adjacent to KL Gold’s Macassa mine (currently in production), north of Queenston’s Amalgamated Kirkland property and east of South Claims JV property. There is a 3% NSR royalty on the claims payable to the vendors. Brief History The only recorded history of past exploration on the property was 8 surface diamond drill holes completed by GLR Resources Inc. in 2005. Anomalous gold values were encountered in the drilling including 1.8 g/t Au over 4 m (hole HM05-08) and 2.4 g/t Au over 2.0 m (hole HM05-05) believed to be mineralization that forms part of the SMC discovered to the north on the Macassa mine property. Property Geology and Mineralization The HM Claim is underlain by conglomerate and tuff of the Timiskaming Assemblage to the north and underlain by porphyry to the south. The northeast-southwest trending Amalgamated Break is located south of the claim on the Queenston’s Amalgamated Kirkland property. In addition to the shallow gold mineralization intersected by GLR Resources in 2005, deep drilling by the Queenston – KL Gold JV intersected high grade mineralization in a new zone believed to be part of the SMC in 2009. The deep mineralization occurs in a quartz vein zone containing pyrite and visible gold hosted in porphyry. 2009-10 Program In 2009 the JV commenced a deep drilling program on the HM claim targeting the SMC. The drilling included one pilot hole collared on Queenston’s Amalgamated Kirkland property to the south and three wedge holes extended from surface holes previously drilled by Queenston. The 2009 drilling totalled 1,777.6 m and returned high-grade mineralization including 31.8 g/t over 2.3 m in hole AK08-2W4, 25.5 g/t over 1.6 m in hole AK09-2W5 and 59.5 g/t over 1.5 m in hole AK09-2W6. These intersections occur between 1,775.5 and 1,975.1 m below surface and the elevations are similar to the SMC some 300 m to the west. The 2010 drilling program consisted of two more wedge holes, hole HK05/10-W3 encountered two separate high grade intersections including 51.8 g/t Au over a core length of 2.2 m and 60.2 g/t Au over a core length of 1.0 m. The intersections occur between 1,737 and 1,987 m below surface. The second wedge hole AK10-10W2 encountered a new zone that assayed 22.1 g/t Au over 0.6 m (see press release dated September 20, 2010). Although the intercepts are at elevations similar to the SMC to the west it is too early to determine the true width of the mineralization and the relationship to the SMC.
Property Overview
Background In 2007 Queenston and KL Gold purchased the East Claim from a local vendor for $150,000 cash and a 2% NSR royalty with a buyback of one half (1%) for $1 million. The property has no reported work history and was purchased for its strategic location east of the SMC that is currently being explored by the JV to the west. Property Geology and Mineralization The East Claim is underlain by Timiskaming sediments and is cut by the Amalgamated Break. There is no reported mineralization on the claim.
Property Overview
Background In 2004, Queenston signed a formal joint venture with Newmont Mining Corporation of Canada Limited (“Newmont”) to earn a 50% interest in the 18 claim Kirkland Lake West property (“KLW”) located in Teck Township. The property lies west and adjacent to the Macassa mine and covers 1.8 km of the western projection of the Kirkland Lake Main Break (“KLMB”) and subsidiary gold structures that are currently being mined and explored by KL Gold.  In September 2005, Queenston formed a 50-50 joint venture with KL Gold to jointly explore the property from the adjacent Macassa mine. In January 2008, the Queenston and KL Gold JV purchased a 100% interest in the property from Newmont for a cash payment of $1 million. Newmont retains a 2-3% NSR royalty on the claims and the back-in right to purchase a 49% interest in the property by paying the JV 300% of the exploration expenditures required to outline a NI 43-101 mineral resource. Brief History During the 1930’s geological mapping and shallow drilling on KLW identified a gold structure believed to be the KLMB returning low gold values over narrow widths including 5.5 g/t over 0.6 m. Further mapping, stripping and drilling in the mid 1980’s led to the discovery of a second parallel structure, the “Hanging Wall Break”, located 40 m south of the KLMB assaying up to 13.0 g/t over .3 m on surface and 7.5 g/t Au over 0.7 m in drilling. From 1988 to 1991, Lac Minerals, then owner of the Macassa mine, drifted from the No. 3 Shaft onto the KLW property on four levels: 4750’, 5875’, 6450’ and 7050’. This development encountered the “04 Break”, a major producing structure at Macassa, on all levels; however, economic reserves were not established. The best drilling results from the 4750’ level included 24 g/t over 0.9 m and 9.3 g/t Au over 6.7 m. In 1991, prior to terminating exploration on the KLW, Lac mined 156 t from the 4750’ level averaging 17.5 g/t. In 1993-94, Cyprus Canada Inc. completed five drill holes including one which intersected a broad structural zone containing anomalous gold mineralization at 600 m below surface. Within this zone a 1.5 m interval assayed 2.9 g/t Au. Property Geology The northern portion of the property is underlain by sediments of the Timiskaming Group comprising primarily conglomerate and greywacke. On the southern portion of the property Timiskaming tuffs are intruded by an east-west trending body of basic syenite. A steeply south dipping WSW-ENE trending fault structure traverses the northern portion of the property. This fault is interpreted to represent the KLMB, an important gold bearing structure in the camp along which some 24 million ounces of gold has been produced from seven mines all located east of KLW. Along the eastern boundary of the property is the Amikougami Fault, a north-south trending structure along which rocks to the west are interpreted to have been displaced 120 m to the south and 130 m up. The southern portion of the property remains largely unexplored and holds potential to host the new South Mine Complex being explored and defined on the Macassa property further to the east. 2004-07Exploration In 2004-05 Queenston completed surface exploration consisting of linecutting, mechanical stripping-power washing, sampling, IP geophysics and diamond drilling. The objective of the program was to explore for ore grade gold mineralization along the camp’s main productive structural trend west of the Amikougami Fault. A total of 7 diamond drill holes (3,555 m) were completed testing targets outlined by the surface stripping and deep IP geophysics. Three holes were completed along the “04 Break” intersecting strong fault zones and quartz-carbonate veining. The best gold values were intersected in hole KW05-06 where three separate breaks assayed 1.1 g/t Au over 1.4 m, 3.1 g/t Au over 0.6 m and 1.1 g/t Au over 0.85 m. Three holes tested the “North-South Quartz Vein Zone” returning no significant values and hole KW-05-05 tested an Insight IP Array anomaly explained by faulting and veining with no significant gold values. Although the “04 Break” on the property remains largely untested by surface drilling, no further surface exploration was warranted on the property. It was however, strongly recommended to continue the underground exploration initiated by Lac Minerals in 1988 that encountered encouraging results on the 4750’ level of the property. The majority of production from the Kirkland Lake Camp was derived from the Main Break and “04 Break” east of the Amikougami cross-fault. A number of stopes were mined up to and cut off by the fault. In addition, a second break (“05 Break”) located north of the “04 Break” was mined to where it is also cut-off by the fault. In a study completed for Kirkland Lake Gold the offset on the Amikougami Fault has been determined as being 105-135 m (350-450 ft) west side up and 90-120 m (300-400 ft) west side south displacement. This interpretation encourages added potential for discovering ore along the “04 Break” west of the Amikougami Fault. To the end of June 2007, the joint venture completed three exploration programs on the property, one surface and two underground, representing an expenditure of CDN $1.7 million. This work included 735 feet (225 m) of drifting and crosscutting, 2,500 feet (790 m) of drift rehabilitation and 20 diamond drill holes (7 surface, 13 underground) totalling 11,608 feet (3,538 m). The underground exploration was carried out on the 4750’ level confirming the presence of the Main–04 Break extending 3,000 feet (915 m) westward into the property and best assay result from the drilling was 0.33 oz/ton over a core length of 2.2 feet (11.3 g/t over 0.7 m). The northern, 05 Break was also tested in the program returning a best assay of 0.096 oz/ton over 1.3 feet (3.3 g/t over 0.4 m).2010 Program Since 2007no exploration has been completed on the property as the JV is focusing on exploration efforts on the South Claims property located to the east. In 2011 the JV is planning no work on the Kirkland Lake West property.
Project Overview
Background In 2004, Queenston and KL Gold formed a 50%-50% JV to explore the western portion of the Kirkland Lake camp on property that both parties held varying interests dating back to the 1970’s. The property is adjacent to the KL West property where the parties are exploring for the western continuation of the Kirkland Lake Main-04 Break. The property comprises 21 patented, lease and unpatented claims. Brief History First exploration dates back to the 1920’s and 1930’s when surface prospecting and limited drilling targeted a variety of structures. No modern exploration was conducted prior to the formation of the JV Property Geology And Mineralization The Gracie West property is underlain by Timiskaming assemblage sedimentary and tuffaceous units striking generally at 60 degrees. The sequence dips 50 to 70 degrees south and faces south and is cut by a substantial (450 to 550 m wide), stock of mafic syenite in the central part of the property that is crudely sub parallel to the regional, east-northeast-trending deformation. Other intrusive rocks include late biotitic lamprophyres, Matachewan diabase dykes, and, syntectonic syenite porphyries. Structurally, the property covers two of the main deformation features in the Kirkland Lake camp – the Kirkland Lake Main Break in the north part of the property. 2008-10 Program Exploration on the Gracie West property commenced in late 2004 with a linecutting program followed by prospecting , magnetic and Induced Polarization surveys and diamond drilling (3 holes / 893 m) during 2005. The first hole was designed to test a shear zone containing anomalous gold (1320 ppb) and returned no significant values. The second hole was drilled to test the interpreted Main / 04 Break and intersected an altered corridor associated to the break at a tuff-sediment contact containing no significant gold values. The third hole was planned to test an unnamed break south of the mafic syenite body and encountered a 30 foot wide shear zone in tuff returning no gold values greater than 100 ppb.
Property Overview
Background In August 2010 Queenston and KL Gold announced an expansion to their 50-50 JVs; KL Gold will expend $400,000 in exploration expenses in the subsequent 12 months to earn a 50% interest in six 100% Company owned Amalgamated Kirkland claims and eight Kirkland Hudson claims. The AK claims were part of 27 mining claim units held under lease in southeastern Teck Township. 2011 Program There is a 7,300 m underground drilling program underway on the property, accessed from the 5,300’ level of the Macassa Mine, owned by Kirkland Lake Gold.
Property Overview
Background The Kirkland Hudson Property was acquired as part of an overall acquisition of Vault Minerals Inc. in April 2010. In August 2010, the Property became part of a strategic joint venture arrangement with Kirkland Lake Gold Inc. whereby Kirkland Gold is required to spend $400,000 on the South Claims JV to earn 50% in the Kirkland Hudson Property as well as 50% in seven claims of Queenston’s Amalgamated Kirkland Property. The Property has an underlying royalty of 2%. The Property has been explored through the adjacent Lakeshore Mine with limited underground development and drilling. In 2005-2006, Vault Minerals completed eight drill holes targeting multiple zones and returned some gold anomalous structures. The Property is 80 hectares in size. Property Geology and Mineralization Property geology consists of Timiskaming-aged sediments, volcanic tuffs and basic syenite to syenite porphyry intrusives. Mineralization, consisting of pyrite, gold, silver and molybdenum, is found in brittle to brittle-ductile shear-fracture systems associated with the Kirkland Lake Fault or Main Break and is anticipated to be very similar to Kirkland Camp mineralogy. 2011 Program and Future Since the acquisition by Queenston in April 2010 and subsequent strategic joint venture with Kirkland Lake Gold, no work has been undertaken on the Property. The Kirkland Hudson Property is anticipated to become a valuable asset as exploration activities on the South Mine Complex continues east towards the Property. |
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