Revised Kemess North Pre-Feasibility Project

REVISED
KEMESS NORTH
PRE-FEASIBILITY PROJECT
OMENICA MINING DIVISION

BRITISH COLUMBIA
CENTRED ON:
UTM (NAD 83, Zone 9)

NTS 94E/2 & 94D/15
636 534E
6 326 373N
LATITUDE: 5700 North

LONGITUDE: 12650 West
J.H. Gray, PEng

R.J. Morris, PGeo
K.W. Major, PEng
A. Arik
4 June 2004
DISCLAIMER
This report was prepared for Northgate Exploration Ltd. by GR Technical Services Ltd.
The quality of information, conclusions and estimates contained herein are based on
industry standards for engineering and evaluation of a mineral project. The report is
based on: i) information available at the time of preparation, ii) data supplied by outside
sources, iii) engineering, evaluation, and costing by other technical specialists and iv)
the assumptions, conditions and qualifications set forth in this report. Cost models use
extensive information from the existing Kemess South operations, increasing the
probability that actual costs in the near term will fall within the accuracy of a Pre-
Feasibility Study. However, no warranty should be implied as to the accuracy, especially
with longer term estimates of forward looking economic assumptions for the future
operations such as but not limited to, metal prices, exchange rates, labour costs, and
energy, equipment, and supply costs.
EXECUTIVE SUMMARY
Property Description Location, Ownership and Current operations
The Kemess North deposit is part of the Kemess Property, which is located
approximately 430 km northwest of the city of Prince George, British Columbia, Canada,
at 5702 north longitude and 12647 west latitude. The property includes one active
mining lease (#354991) and 213 surrounding and contiguous mineral claims. At least
four additional mining leases are currently in the application process to cover the
Kemess North area.
Legal surveys have been completed for mining lease #354991. The mineral
claims covering the Kemess North deposit and the area to the north and west of the
proposed mine have been surveyed and it is proposed to convert these claims into
mining leases. The Kemess North deposit and associated occurrences are located on
the New Kemess 1, 2 and 3 claims.
The Kemess Property is owned and operated by Kemess Mines Ltd., a 100%
controlled subsidiary o f Northgate Exploration Limited. Kemess Mines Ltd. holds the
surface rights to the property through their mineral claims and mine lease.
The Kemess South deposit, located on mining lease #354991, currently supplies
mill-feed to a 52 000 tpd mill. In 2001, Northgate announced the discovery of a
significant deposit at Kemess North, which was the focus of major drilling campaigns
during 2002 and 2003.
The Kemess North project site is generally located in three north facing alpine
cirques with original ground surface ranging from 1,500 to 2,000 m elevation all above
tree line. Open pit mining will be located in the centre cirque and eastern cirques. The
southern pit wall will be bounded by the southern headwall of the eastern cirques. The
crusher and other infrastructure will be located at the pit rim in centre cirque. A natural
rock glacier is evident in the western cirque. No surface development has been planned
to date in the western cirque.
The climate is generally moderate, although snow can occur during any month.
Temperatures range from -35 to 30 and average annual precipitation amounts to 890
mm. Since mining will be scheduled for year round operations, 24 hours per day
equipment and procedures will need to be adaptable for the variations of 4 seasons in a
mountain environment. The current Kemess South operations will be suited for Kemess
north with some provision for more extreme weather conditions at the higher elevations
and provision for avalanche monitoring and control.
i
Access to the Kemess North project is provided by both air and road via the
current Kemess Operations. Personnel are from various locations in British Columbia
and Alberta. There are scheduled year-round flights from surrounding communities and
Vancouver. All season road access is from either the town of Mackenzie or Fort St.
James via the Omenica resource access road. A privately owned, 380 km power line
originating in Mackenzie in the south provides power to the mine area via the BC Hydro
grid.
Kemess Mines Ltd. holds surface rights through their mineral claims and mining
leases. Onsite infrastructure for the current operation consists of an office, maintenance
facilities, a camp, a mill, crushers and raw ore stockpile areas, access and service
roads, airstrip, explosives depot, and tailings facilities. The tailings pond capacity is
sufficient to meet the needs of the Kemess South ore body until its completion in 2008.
The Kemess North mining plan is based on utilizing the current facilities for ore
processing, accommodation, and support, plus new facilities for the Mining operation at
Kemess North. These include access roads, potential waste dump sites, a pit side
crusher and conveyor system to the current plant site, a field supervision and equipment
service centre adjacent to the pit and a new tailings pond located at Duncan Lake.
Preproduction stripping and construction of the Kemess North field service

facilities will commence 1 to 2 years in advance with Production beginning when the ore
transportation system from Kemess North is in place and the first pit side crusher is in
operation. There will be a transition period required where both Kemess South and
Kemess North mining operations are feeding the mill, which will continue until reserves
are exhausted at Kemess South. When mining is completed at Kemess South all
crushing capacity will be transferred to the Kemess North crusher station.
Tailings and waste dump facilities are being designed at Duncan Lake with
sufficient capacity for the Kemess North waste. This includes all mill tailings and mine
waste rock. Much of the mine waste rock is PAG material and is planned to be
deposited sub-aqueously in the tailings pond. Any NAG material within the pit will be
used for construction fill or deposited in waste dumps adjacent to the pit area but in the
area specified within the water management plan.
Property Geology
Andesite Volcanics (Takla Group-T3)
The property is predominantly underlain by a thick (>1,000 m) succession of

andesitic flows. The flows exhibit textures ranging from fine grained and massive to
porphyritic with medium grained and mostly phyric, subhedral augite phenocrysts. The
Takla volcanic rocks host a significant portion of the Au-Cu mineralization.
On surface, exposed in the cirque headwalls and some upper intersections of

drill intercepts is a bladed feldspar porphyritic unit. Due to the lack of bedding and/or
marker horizons, the inclination of the massive thick succession of Takla volcanics is
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difficult to ascertain but probably reflects the regional trend of flat lyi ng Mesozoic
assemblages.
Dacitic Polylithic Fragmental (Hazelton Group - H3:Toodoggone Formation)
Mantling the northern and eastern limits of the Kemess North area is a matrix
supported polylithic fragmental volcanic unit. The Polylithic Fragmental Dacite is an
enigmatic unit as it shows field relations suggestive of both an extrusive and intrusive
emplacement mechanism. The evidence suggests that basement structures and
conduits that allowed extrusion of the local Toodoggone volcanic assemblage underlie
the Kemess North area.
Quartz Monzonite/Quartz Diorite
These are intermediate intrusive units do not reach surface. The main quartz
monzonite mass beneath East Cirque hosts the bulk of the Cu-Au mineralization at
Kemess North.
Post-Mineral Dykes
Post-ore dykes, including feldspar porphyry and minor mafic varieties, cross cut
Takla volcanics and outcrop locally in cirque highwalls and along ridges. The feldspar
porphyry dykes also cross cut the Jurassic-Toodoggone fragmental unit and are
generally barren and unaltered. The relationship of the feldspar dykes with the larger
quartz diorite stocks is not clear, however they appear temporally late in the sequence
of events. Mafic dykes are generally thin (<1 m to 4 m), dark green and barren of
sulphides and veining.
Faults
At least three steeply dipping, northwest trending normal faults have been
inferred from surface mapping and drilling to transect the Kemess North property. Fault
spacing ranges from 500 m to 1,500 m and they are generally parallel to the Duncan
and Saunders Faults located west and east respectively.
Broken Zone
A flat-lying zone of intensely broken rock and multiple gouge zones (which
results in poor drilling conditions) occurs above the deposit, and is referred to as the
Broken Zone. The Broken Zone averages about 80 m from surface to competent
bedrock and is comprised of clay, multiple gouge zones and a pyritic-argillic alteration
component. Theories on the formation of the Broken Zone range from the effects of
present day weathering, porphyry related alteration zonation, to the tectonic end
products of shallow faulting and thrusting. The most plausible explanation is that the
Broken Zone and related phyllic alteration are due to pre-Toodoggone weathering
processes.
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Mineralization
Gold-copper mineralization forms an inclined tabular zone that is centred on the

East Cirque porphyritic monzodiorite. Alteration and mineralization is associated with,
and zoned both vertically and laterally from the quartz diorite/quartz monzonite intrusive
intersected at depth beneath the East Cirque.
The highest-grade Au-Cu zones occur at or near the quartz monzonite Takla
volcanic contact. This zone occurs mostly within the quartz monzonite stock and to a
lesser extent within the andesite adjacent to the intrusive stock. The protolith is
commonly completely replaced. The quartz monzonite/quartz diorite stock and
associated quartz-magnetite zone is interpreted as the heat source driving the porphyry
copper-gold system at Kemess North.
Grading outwards from the East Cirque stock into the Takla volcanics,
silicification decreases. Sericitization, commonly from the destruction of matrix and
phenocryst plagioclase, is pervasive in the Takla volcanic rocks. The uppermost
alteration zone is the phyllic or QSP zone, which consists mostly of sericite-chlorite-
quartz +/- pyrite and forms the extensive Broken Zone and bright orange-red outcrops at
surface. Pyrite is common throughout (5-7%), both disseminated and within vuggy
quartz veining. This alteration zone is mostly barren of any significant Cu and will often
show a slight increase in Au with depth. It has been postulated that this zone shows
similarities to an acid leached cap, however it lacks any form of supergene enrichment
in base metals, as occurs at Kemess South.
Overall, sulphide mineralization throughout the deposit consists of 2-3% pyrite,

with lesser amounts of chalcopyrite and traces of molybdenum. Pyrite occurs as
disseminations, fracture fillings, and veins up to a few centimetres wide generally
associated with quartz-anhydrite-magnetite veins and zones of quartz-magnetite
replacement. The mode of occurrence of chalcopyrite is similar except that veinlets are
rare and significant disseminations occur in zones of stronger quartz-magnetite stock
work and quartz-magnetite replacements. Gold and copper grades variably diminish
outward into the hanging wall and footwall. Total sulphide content in the core of the
deposit averages 3 -5%, rising to 5-7% in the pyrite-rich sericitic altered upper halo.
Moving west of East Cirque to the Nugget Zone, alteration and mineralization
becomes irregular as the intrusive units approximate steeply dipping dykes. The Nugget
Zone alteration is dominated by weak chlorite -biotite altered Takla volcanics commonly
with disseminated magnetite. Substantial gold-copper mineralization is present within
the Takla volcanics but at depths exceeding 400 m. The Nugget Zone generally exhibits
a higher gold to copper ratio than Kemess North, and rare narrow intersections of gold
grades of up to 8 g/t are present.
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Exploration
The Kemess North property represents a highly advanced project. The early
exploration work in the area identified a porphyry target but it wasnt until deep drilling in
2001 that significant gold and copper grades were located. Since 2001 exploration has
been directed at expanding the resource base in the proposed pit area by drilling 16
holes in 2001, 41 holes in 2002, and 19 holes in 2003.
Because the target is deep, geological mapping and geochemical techniques add
little value, likewise, surface and airborne geophysical exploration have contributed little.
The procedures followed in the field and through the interpretation stage of
exploration have been professional. Various crews under the supervision of professional
geologists carried out the exploration work. Since 2001 to the present day there has
been continuity in personnel both in the field and with the data interpretation. It is
considered that the reliability of the data obtained with exploration is very high.
Modelling Resources and Reserves
Kemess North is a large copper-gold porphyry deposit and is typical of porphyry

gold-copper deposits in the western cordillera. The deposit has a low-grade ore zone at
a depth of 150 m below the ground surface on the western side of the deposit and a
higher grade zone 300 to 550 m below surface on the eastern side. A 3-D Block Model
has been used to represent the Kemess North mineral Resources. The geology model
area used is large enough to include drill holes from the Nugget area to the west and
the Kemess East area. To restrict the resource estimate to defined geology units, four
major lithology zones were modeled as defined by the drillholes.
A summary of information from the database and geostatistical resource estimate

work includes the following:
198 drill holes.
40,237 copper assays.
39,821 gold assays.
Copper and gold show a correlation factor of 0.80.
Outlier high grade cutoffs were applied to both Copper and Gold. 14 Copper
assays were cut to 1.35% and 16 high grade Gold assays were cut to 4 g/t. The
cut grades were used in compositing.
5 m and 15 m fixed length composites were generated for comparison of the

composite length on grade dilution and loss effects with respect to the original
assays. The 5m composites were chosen for modelling which is reasonable for
this type of deposit.
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The influence of a few remaining high-grade composites were limited to a
maximum of 50 m during interpolation.
The composites were tagged with a Litho code according to the 3-D solid they
were included with.
Variograms (both grade and directional) using the 5m composites were studied
for Litho codes 5, 6, and 7. Kriging parameters were determined from the
variograms for Litho zones 5, 6, and 7.
A contact analysis was completed indicating that the transition zone across the
Litho boundaries is less than the typical drill spacing. Therefore a hard-boundary
approach was chosen to interpolate each Litho zone separately.
Eighteen drillholes with suspect down-hole surveys were found in the database.
Two models were built, one with all of the drill holes, where the suspect holes had their
down-hole surveys corrected, and the second with the 18 suspect drill holes removed.
The resulting models were very similar in contained resources however subsequent
mine planning work with the two models showed similar economic pit sizes for the two
models were achieved with only a 5% difference in input metal prices. With this
sensitivity it was decided for the mine planning work, to use the model including the
corrected holes since the assays are valid and excluding the holes is less
representative than using the corrected holes.
The grade interpolation method and search distances for kriging were based on
the Geostatistical analysis and variogram parameters. A minimum of 3 and a maximum
of 16 composites were used for the interpolations with maximum 4 composites from
each quadrant. The maximum search for the composites was limited to 200 m. The
general steps were:
A background interpolation was done using the inverse distance weighting

to a power of three without using the litho boundaries.
Separate 'Ordinary Kriging' (OK) runs were made for AU & CU for LITHO
codes 5, 6, & 7 (6 runs) using the specific interpolating parameters for
each metal by zone. For blocks that meet the selection criteria the
background values were over written.
The methodology employed for the grade interpolation of the model

followed the standard industry practices and is based on the extensive
experience on similar deposits.
The reserves Class codes were assigned based on the Geostatistical

analysis and the following items loaded into the model during the grade
interpolation runs.
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Resource Classification Criteria Used
1 2 3
Measured Resources Indicated Resources Inferred Resources
DIST = < 30 m DIST = 31-50 m DIST > 150
or and or
NCOMP = < 5 Other blocks that
DIST = 31-50 m or cannot be classified as
and 51 m < DIST < 150 m measured or indicated
NCOMP > = 5 and
NCOMP > = 5
or
51 m < DIST < 200 m
and
LITHO = 5, 6, or 7
Where DIST is the distance to the nearest drill hole from the centre of the block and
NCOMP is the number of composites used in the interpolation of a block.
Mineral Resources
The following Resource tables are based on the total Geological Model. They
only include material within the defined LITHO zones.
Summary of Measured Resources
Ordinary Kriging Inverse Distance

(power = 3)
Cu % Tonnes Mean Mean Mean Mean
Cutoff (Mt) Cu % Au g/t Cu % Au g/t
0.00 739.6 0.127 0.237 0.127 0.238
0.05 589.4 0.153 0.278 0.154 0.279
0.10 435.9 0.181 0.320 0.182 0.324
0.15 263.7 0.217 0.376 0.220 0.385
0.20 123.2 0.267 0.465 0.273 0.478
0.25 52.5 0.330 0.610 0.337 0.627
0.30 27.6 0.384 0.769 0.393 0.793
0.35 15.7 0.430 0.928 0.442 0.962
0.40 8.8 0.477 1.083 0.491 1.131
0.45 4.5 0.527 1.246 0.547 1.309
0.50 2.4 0.575 1.452 0.592 1.486
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Summary of Indicated Resources

(power = 3)
0.00 947.9 0.098 0.186 0.098 0.185
0.05 632.8 0.136 0.235 0.135 0.234
0.10 411.2 0.170 0.289 0.170 0.289
0.15 218.9 0.210 0.350 0.209 0.349
0.20 95.9 0.259 0.437 0.257 0.434
0.25 38.5 0.317 0.569 0.314 0.567
0.30 19.0 0.365 0.714 0.362 0.714
0.35 9.6 0.409 0.895 0.406 0.897
0.40 4.2 0.457 1.099 0.465 1.104
0.45 1.8 0.502 1.206 0.513 1.219
0.50 0.8 0.547 1.251 0.547 1.249
Summary of Inferred Resources

(power = 3)
0.00 337.1 0.040 0.068 0.040 0.068
0.05 74.1 0.131 0.164 0.131 0.164
0.10 41.9 0.175 0.217 0.175 0.217
0.15 28.4 0.196 0.234 0.196 0.234
0.20 11.2 0.234 0.307 0.234 0.307
0.25 2.9 0.276 0.397 0.276 0.397
0.30 0.27 0.357 0.542 0.357 0.542
0.35 0.18 0.376 0.589 0.376 0.589
0.40 0.06 0.407 0.646 0.407 0.646
Five individual areas were selected from the geologic model as manual checks
for grade and tonnage. The copper and gold grade estimates were calculated by
averaging the assay grades from all of the drill hole intercepts within the block. The
tonnage was calculated by using the averaged bulk density (SG) of the data from within
the block.
The estimated grades are very close to the modeled grades for both copper and
gold ranging from 7.0% to + 8.2% for Copper and 6.5% to +6.8% for Gold. The small
variance indicates the modelling method to be reasonable.
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Reserves
The Ultimate Economic pit limit is based on a Lerchs-Grossman pit optimization

evaluation of the resource in the 3-D block model. This evaluation includes the Project
Base economic parameters, and overall slope design parameters derived from
Geotechnical evaluation of the pit walls. The economic pit limited is also constrained to
only consider Measured and Indicated Reserve Class material to generate revenue. A
final pit design has been designed (P634) based on this Ultimate economic pit limit
study and from more detailed Geotechnical slope design parameters including high wall
haul roads. The Reserves within the P634 pit design are generated from 3-D block
model.
Mining recovery is estimated at 95% and mining dilution of 10% is applied at the
contact between ore and waste. The dilution grade is estimated at 0.08 g/t Au and
0.05% Cu which is the average grade of material below the incremental cutoff grade.
Interpolated SG is used.
A NSR cutoff has been determined for the Reserves calculation using the
following factors:
NSP (net smelter price); copper C$0.901/lb and gold C$11.753/g.which accounts
for offsite expense, smelting, and refining.
Mill recovery factor; 88.8% for copper and 61.5% for gold.
The reserves for the final pit limit (P634) based on an NSR cutoff of $2.2 are:
Reserve Estimate
Kemess North, Pit P634
Diluted Cu Au
Mineable (%) (g/t)
(tonnes x 106)
Proven 282.40 0.159 0.306
Probable 131.84 0.160 0.310
Total 414.24 0.160 0.307
The final pit design includes 335.09 million tonnes of waste for a strip ratio of 1:0.81.
Note that the reserve tonnages above are all included in the Resource tonnages listed
earlier.
The overall pit slopes and detailed bench design parameters have been provided
by Knight Pisold for the different sectors of the pit wall based on an aggressive 1.2
Factor of Safety. The slope design parameters used are contingent on certain operating
practices and monitoring as prescribed by Senior review Consultants Will Bawden PhD,
PEng of the University of Toronto, and Chuck Brawner PEng. Knight Pisold have
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indicated several design modifications required to the South wall of Pit P634. These
may increase the waste stripping by up to 10% but this is within the accuracy of the
reserves estimate and will not affect the overall economic viability of the design. These
modifications will be made during the Feasibility Design stage.
The LG sensitivity analysis was used to design the pit pushbacks. To enable a
more even annual strip ratio in the production scheduling, the first pushback will mine
the near surface lower grade ore on the west side. The deeper east side is split into 2
stages, a shallower north side and a deeper south side mining to the ultimate pit depth.
The first pushback has been further revised where the initial benches in the Pre-
stripping period are included as a Pre-Production phase. The size of the stages was
roughly determined to ensure that each have a sufficient bench width to enable efficient
mining operations and for all the stages, the design was pushed to the ultimate pit
lateral limit on three walls, with subsequent pushbacks expanding in one direction only.
This will enable much more efficient mining operations when adjacent pushbacks are
being mined at the same time.
The production schedule for Kemess North is run from the Pit Phase reserves.
All production will be from the owners fleet except for minor tonnages for the small
initial benches of each pushback. These will require smaller specialized equipment to
operate on the steep original ground at the top benches. The major mining equipment
from Kemess south will be transferred to Kemess North as ore and waste production is
reduced in Kemess South. To meet the higher strip ratio requirements, additional haul
trucks will be purchased. The ore annual ore targets are adjusted each year to reflect
the ore hardness and anticipated SAG mill through put according to the HARD (BWI)
value in the Pit Reserves.
Milling
The Kemess North ore will be processed in the existing Kemess plant, initially
with integrated co-production with the current Kemess South ore and as a stand-alone
operation after the Kemess South ore is depleted. During the co-production period the
plant capacity will be increased and an ore transportation system from Kemess North
will be installed. This will include an Underground ore conveyor system and pit-side
crushers. The current capacities, costs and metallurgical performance of the plant are
well defined and carry a high level of assurance into the Kemess North project
performance and cost estimates.
The metallurgical test work for Kemess North is based on metallurgical samples
taken from the exploration drillholes. The met samples were well located to represent
the deep ore for the Kemess North deposit. Future testing should also be done on the
shallow ore on the west side of the pit for more detailed prediction of operating
performance during the earlier years of the project.
The ores of Kemess North share a number of favourable characteristics with the
Hypogene ores of the Kemess South deposit:
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Both deposits carry clean sulphides without surface oxidation.
Impurity elements occur in extremely low concentrations.
The sulphides are coarse grained and are adequately liberated for rougher
flotation at a grind of K80 at 145 .
Ball mill work indices are low compared to a majority of porphyry deposits.
The average metal contents of North ores are slightly lower, copper at 0.20% Cu
versus 0.22% Cu and gold at 0.4 g/t Au versus 0.75 g/t for South ores.
The pyrite content of Kemess North averages 4% compared to 1% pyrite for the
South ores. Since pyrite contains finely disseminated gold, higher pyrite carries a
larger portion of gold to tailings.
The near surface ores of the North deposit are of slightly lower grade than those
of deeper zones.
The rougher flotation with Kemess North ores in essence is a bulk sulphide float.
Rougher concentrates have to be re-ground to a K80 of =20 microns for cleaner
flotation to produce quality concentrates.
Existing flotation cell capacity and de-watering equipment are adequate for
treatment of North ores.
Concentrates will be free of deleterious impurities.
The Net Neutralization Potential for all North composites is negative, therefore
the tailings will be acid generating unless stored under water cover.
Subsequent analytical work has been completed on the samples from the
flotation test work and determined that there was a relationship between Ag and Au in
the concentrate for the various pit zones. Silver grades have not been included in the
Mining reserves and have not been used in any of the economic pit limit/reserve
calculations. Small silver credits have been included in the financial modelling.
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Environmental
Environmental considerations for the Kemess North project have been integrated
with the Total Kemess property requirements for ongoing operation and final closure.
Klohn Crippen has been retained for this work, which covers Mine Waste Management,
Water Management, Environmental studies, and Mine Closure planning. Klohn
Crippens work involves the base line data studies, evaluations, process design and
costing as required to meet or exceed the regulations. These requirements have been
included in the mining and processing designs and schedules. The capital and
operating costs as determined by Klohn Crippen have also been used in the cost
modelling.
Permitting
The permitting process for the Kemess North Project is being carried out by
Northgate. The project entered the regulatory review process for mine development
approval in October, 2003. This will involve three levels of government: Province of
British Columbia, First Nations (4 Bands) and the Government of Canada and will be
concurrent with the applications for Project Permitting. The provincial permits will
establish the guidelines for environmental protection during the construction and
operating phases of the Kemess North Project.
The formal project review was initiated with the submission of the Kemess North
Project Description to the BC Environmental Assessment Office (EAO) in October,
2003. The EAO has the responsibility to notify all stakeholders and disseminate relevant
project information during the review process. The primary government agencies
involved are as follows:
Province of BC: Environmental Assessment Office, Ministry of Water, Land &

Air, Ministry of Energy & Mines, and Ministry of Sustainable Resources;
Government of Canada: Canadian Environmental Assessment Office,

Department of Fisheries & Oceans, Environment Canada, and Natural Resources
Canada; and
First Nations: Kwadacha FN, Gitxsan FN, Takla Lake FN, and
Tsay Keh Dene FN.
The target for the approval for all permits is May 2005.
Financial Modelling
The financial modelling for the project was undertaken by Northgate and Hatch to
evaluate the costs, cashflows, and financial returns for the Kemess North Project.
These are based on calculating the cashflow of integrated Kemess South and Kemess
North operations, the stand alone Kemess South operation and determining the
incremental financial impact of the Kemess North project. This is summarized as:
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Exchange Rate Cdn$/US$1.45
Metal Prices
Gold US $375/oz
Copper US $1.00/lb
Silver US $5.00/oz
Concentrate Treatment $62/tonne concentrate and
& Refining Charges $0.062/pound accountable
copper
Net Present Value (NPV) US$75 million
at a 5% cost of capital
IRR 8.9%
These assumptions represent Northgates estimates of the average metal price,

exchange rate and concentrate treatment and refining charges over the 2004-2020
period.
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TABLE OF CONTENTS
1. INTRODUCTION AND TERMS OF REFERENCE..................................................... 1

2. DISCLAIMER.................................................................................................................... 3
(a) Resource Modelling ............................................................................................. 3
(b) Legal and Ownership........................................................................................... 3
(c) Geotechnical ......................................................................................................... 3
(d) Tailings Impoundment and Environmental....................................................... 3
(e) Metallurgy and Infrastructure.............................................................................. 3
(f) Permitting and Community Relations ................................................................ 4
3. PROPERTY DESCRIPTION AND LOCATION .......................................................... 4
4. ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE &
PHYSIOGRAPHY ..........................................................................................................11
5. HISTORY.........................................................................................................................13
(a) Kemess South.....................................................................................................13
(b) Kemess North Project........................................................................................14
6. GEOLOGICAL SETTING .............................................................................................16
(a) Regional Geology...............................................................................................16
(b) Local Geology .....................................................................................................18
(c) Property Geology ...............................................................................................18
(i) Andesite Volcanics (Takla Group-T3) ...........................................18
(ii) Dacitic Polylithic Fragmental (Hazelton Group - H3:Toodoggone
Formation) .........................................................................................19
(iii) Quartz Monzonite/Quartz Diorite ...................................................19
(iv) Post-Mineral Dykes ..........................................................................20
(v) Broken Zone ......................................................................................20
7. DEPOSIT TYPE .............................................................................................................25
8. MINERALIZATION ........................................................................................................25
9. EXPLORATION..............................................................................................................27
10. DRILLING........................................................................................................................29
(a) Procedures ..........................................................................................................29
(b) Sample Length/True Thickness .......................................................................29
(c) Condemnation Drilling .......................................................................................30
(d) Collar Survey.......................................................................................................31
(e) Down-Hole Survey .............................................................................................31
11. SAMPLING METHOD AND APPROACH .................................................................37
12. SAMPLE PREPARATION, ANALYSIS AND SECURITY......................................38
13. DATA VERIFICATION ..................................................................................................40
14. ADJACENT PROPERTIES..........................................................................................41
15. MINERAL PROCESSING AND METALLURGICAL TESTING.............................44
16. MINERAL RESOURCE AND MINERAL RESERVE ESTIMATES .......................49
(a) Geological Model................................................................................................49
(b) Mineral Resources .............................................................................................54
(c) Bulk Density ........................................................................................................56
(d) Model Check .......................................................................................................57
(e) Reconciliation......................................................................................................57
i
(f) Mineral Reserve Estimate .................................................................................58
17. ECONOMIC PIT LIMITS AND MINE PLAN ..............................................................61
(a) Economic Pit Limits............................................................................................61
(b) Detailed Pit Designs...........................................................................................68
(c) Production Schedule ..........................................................................................83
18. INTERPRETATION AND CONCLUSIONS...............................................................85
19. RECOMMENDATIONS.................................................................................................88
(a) For Feasibility......................................................................................................88
(b) For Construction and Detailed design.............................................................88
20. REFERENCES ...............................................................................................................89
21. STATEMENT OF QUALIFICATIONS ........................................................................92
22. ADDITIONAL INFORMATION...................................................................................100
(a) Current Kemess Mining Operations ..............................................................100
(b) Kemess North Development...........................................................................101
(c) Integrated Production ......................................................................................103
(d) Recoverability Metallurgy and Mineral Processing ..................................103
(e) Markets Transportation and Smelting ........................................................104
(f) Contracts ...........................................................................................................104
(g) Environmental Considerations .......................................................................106
(h) Permitting Current Status ............................................................................108
(i) Taxes..................................................................................................................109
(j) Capital and Operating Cost Estimates..........................................................110
(k) Economic Analysis ...........................................................................................111
(l) Regional Potential ............................................................................................112
ii of 138
TERMINOLOGY AND ABBREVIATIONS
Abbreviation Definition
Au Gold
BFP Bladed feldspar porphyry
BQ 1.32 inch diameter core
BMWI Ball Mill Work Index
BWI Bond Work Index
Cat trenching mechanical trenching
CLASS Resource/Reserve classification code in 3 -D Block Model
CoG cutoff grade
Cu Copper
DIST Distance to closest composite during grade interpolation
EDA Exploratory Data Analysis
FoS Factor of safety
g/t grams per tonne
GR Tech GR Technical Services Ltd.
HQ 2.406 inch diameter core
IP Induced Polarization
KN Kemess North
KS Kemess South
LG Lerchs-Grossman Pit Optimization Routine
LITHO Lithology codes used in 3-D Block Model
m Metre
Ma Million years
Mt Million tonnes
Mm3 Million cubic metres
NAG Non-Acid Generating rock
NCOMP Number of Composites used in Grade Interpolation
NPV Net Present Value
Northgate Northgate Exploration Limited
NQ 1.775 inch diameter core
NSP Net Smelter Price
iii
Abbreviation Definition
NSR Net Smelter Return
NTS National Topographic System
PAG Potentially Acid Generating rock
PDC Project Design Criteria document
PROF Net profit calculation per block, inclusive of mining, milling, treatment,
refining
QA/QC Quality Assurance/Quality Control
QSP Quartz-sericite-pyrite
SAG Semi-Autogenous Grinding
SG Specific Gravity
Stripper Smoothed pit with ramps (Mine site terminology)
tpd Tonnes per day
TUC Technical Unit Cost
i v of 138
LIST OF FIGURES
Figure Page
1. Kemess Property Location Map 5
2. General Claim Outline 6
3. Detailed Kemess Area with Infrastructure Kemess South & Kemess 10

North
4. Regional Geology after Massey et al 2003. 22

Minfile Occurrences plotted by colour showing principal
commodities as follows: gold red, silver blue,
and copper green
5. Shows General Property Geology in Area Around Kemess North 23
6. Kemess North Geology - Diakow (2001) 24
7. Location map for 2003 Condemnation holes. Note area between 30

Kemess Lake (Lower camp) and CD-14B was not drilled as previous
work yielded negative results
8. Drill Hole Locations 32
9. Kemess Claim and Surrounding Properties 43
10. Pit 634 with Met Sample Drill Holes 46
11. Ultimate Pit Limit (P634) 59
12. Ultimate Pit Limits - Undiscounted 65
13. Ultimate Pit Limits - Discounted 66
14. Ultimate Pits Section View 67
15. Lerchs-Grossman Sensitivities 68
16. Lerchs-Grossman Pit Low Prices 70
17. Lerchs-Grossman Pit Split Final Stage 71
18. Lerchs-Grossman Pit Base Price 72
19. Pre-Strip Phase (P601) 75
v
Figure Page
20. Pit Phase 1 (P614) 76
21. Pit Phase 2 (P624) 77
22. Pit Phase 3 (P634) 78
vi of 138
LIST OF TABLES
Table Page
5.1 Production History from Kemess South 14
5.2 Summary of Exploration Work 15
6.1 Lithologic Units Comprising Stratigraphic Succession 17
9.1 Exploration Employees/Contractors 28
10.1 Drill Collar Location and Orientation Data 33
15.1 Metallurgy Samples with Drill Hole Reference 45
15.2 Summarized Kemess North Metallurgy 48
15.3 Silver Metallurgy for Kemess North 48
16.1 Resource Model Limits and Dimensions 51
16.2 Resource Classification Criteria Used 54
16.3 Summary of Measured Resources 55
16.4 Summary of Indicated Resources 55
16.5 Summary of Inferred Resources 56
16.6 Model Checks 57
16.7 Reserve Estimate, Proven Category Kemess North Pit P634 60
16.8 Reserve Estimate, Probable Category Kemess North Pit P634 60
16.9 Reserve Estimate, Proven and Probable Kemess North Pit P634 60
17.1 Economic Pit Design Parameters 61
17.2 ePit Slope Angles by Pit Sector 62
17.3 Slope design parameters (From Knight Pisold) 72
17.4 Road Design Parameters 72
17.5 NSR Grade Cutoff Bins for Reserves 78
17.6 Reserves for Pre-Production Pit (P601) 79
17.7 Reserves for Phase 1 Pit (P614) 80
17.10 Major Mine Equipment Fleet 84
17.11 Annual ROM Mill Feed 84
22.1 Kemess South Reserves and Resources 97
22.2 Production Summary 99
vii
Table Page
22.3 Metal Recovery Summary 100
22.4 Projected Operating Costs 106
22.5 IRR Sensitivity to Metal Prices 108
22.6 IRR Sensitivities 108
viii of 138
LIST OF APPENDICES
A. Kemess North Claims Status
B. Process Mill Flow Sheet
C. Management Structure & Personnel Organization Chart
D. Pit Slope Geotechnical Evaluation Knight Pisold Memorandum
ix
1. Introduction and Terms of Reference
GR Technical Services Ltd. (GR Tech) was retained by Northgate

Exploration Ltd. (Northgate) to assist with Mineral resource modelling and
Mining Engineering aspects of a revised Pre-Feasibility Study and to prepare a
Technical Report compliant with NI 43-101 for Northgates Kemess North
property in the Omenica Mining Division of British Columbia. GR Tech had been
previously involved in 2003 with a Pre-feasibility study on Kemess North.
Following the 2003 exploration and drilling program Northgate decided to revise
the previous Pre-Feasibility Study to include the 2003 exploration information.
The project will later be advanced to a Feasibility study level to support future
investment and production decisions. The purpose of this Technical Report is
therefore to use the new exploration information and design detail from the
Revised Pre-Feasibility Study to revise and upgrade the Resource and Reserve
estimates for the Kemess North Property.
Northgate has consolidated the exploration information of the Kemess

North property from previous owners and participants, which includes Kennco
Exploration Ltd. from 1966 to 1971, Getty Mines Ltd. and Shell Oil from 1975 to
1976, and El Condor Resources Ltd. from 1986 to 1992. Since 2000, Northgate
has conducted field exploration on the project. This includes drilling programs in
2000, 2001, 2002, and 2003.
Northgate has filed a Technical Report to the Canadian Securities

Regulatory Authorities in February 2002 including all the exploration information
up to 2001. The 2002 report included a statement of Resources for the deposit.
After the 2002 drilling, a Pre-Feasibility study was undertaken which justified
more drilling in 2003. Northgate did not publish a revised Resource estimate after
the Pre-Feasibility study pending further exploration and engineering studies.
This current Report now includes the 2003 drilling information and the results of
extensive Engineering work by various Independent Consultant groups.
Those involved in past and present evaluations of the Kemess North

property include:
Previous:
February 2002 Technical Report MRDI
2003 Pre-feasibility Report Hatch, NorWest, GR Technical Services Ltd., Klohn

Crippen, and Knight Pisold
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Current:
Revised Pre-Feasibility Report 2004 Hatch, GR Technical Services Ltd., Klohn

Crippen, and Knight Pisold
Information has been provided by Northgate and from field investigations

at the site. Verification of the data has been done. Since the Kemess North
project will be using equipment and infrastructure already in operation at
Northgates Kemess operations, the performance and cost data from the
operation has been used extensively for this evaluation and adapted as required
for Kemess North.
Jim Gray PEng of GR Tech has visited the property three times in the
course of this evaluation, to review the current operations and inspect the project
site. Denis Gaspe PEng visited the site in November 2003 to review the
operations, infrastructure, and operations management with respect to costing
and productivity for use in the Kemess North estimates. Bob Morris visited the
site in October 2003 to review onsite drilling and exploration information and to
review the site. Ongoing meetings with Hatch, Klohn Crippen, and Knight Pisold
have been held to review the results of field, Lab, and Engineering/Environmental
evaluation work these companies are performing for the respective Metallurgy,
Environmental, a nd Geotechnical aspects of the project.
Units of measure in this report are all metric and dollars are Canadian
currency with the exception of the market price of gold and copper which are
$US/oz and $US/lb respectively. These are converted to $Canadian fo r
economic pit limit evaluation and cash flow.
The reserves and resource stated in this report are stated in tonnes with
gold grades in grams per tonne (g/t) and copper grades in %. Gold and copper
equivalent grades have also been calculated for use as cutoff grades (CoG). The
equivalent grades and the economic pit limit designs are based on the following
assumptions:
Exchange rate : $1US = $1.40 Canadian
Gold Price: $US = 350/oz.
Copper Price: $US = 0.95/lb.
While these economic parameters are the basis of the ultimate economic pit limit
and the Reserves included in this report, financial models using price and costs
sensitivities are also run for the revised Pre-Feasibility study.
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2. Disclaimer
GR Techs work in preparing this Technical Report is based on information

provided by Northgate, public domain documents and on work carried out by
others. A list of data and information sources is listed in Section 20. GR Tech
used information from these parties assuming that it was executed to acceptable
Engineeri ng standards. Where relevant GR Tech has made comment on the
applicability of these other works or where the works are previous NI 43-101
documents the declarations of the reports Qualified Person are relied upon.
Further information or evaluation of other documents should be sought directly
from the parties involved.
(a) Resource Modelling
Geology, drill hole, and assay information was provided by Northgate and
has been reviewed GR Tech. Geo-statistical evaluation and Resource modelling
was done under contract to GR Tech by Abdullah Arik a Qualified Person in this
discipline, employed by Mintec Inc of Tucson, AZ. The results of this work were
reviewed and validated by GR Tech by comparing to previous estimates and spot
checking the Resource model.
(b) Legal and Ownership
The Kemess North property is located on the Claims and Mining Lease as
listed in Section 3 - Property Description and Location as provided by Northgate ,
the legal status and ownership of the property has not been verified by GR Tech.
(c) Geotechnical
GR Tech has relied on geotechnical work carried out by geotechnical

experts from Knight Pisold for the pit slopes. The slope design parameters used
are also contingent on certain operating practices and monitoring as prescribed
by review Senior Consultants Will Bawden PhD, PEng of the University of
Toronto, and Chuck Brawner PEng.
(d) Tailings Impoundment and Environmental
GR Tech has relied on work by Klohn Crippen for the Tailing Dam design,
water management, and environmental issues for Kemess North.
(e) Metallurgy and Infrastructure
GR Tech has relied on work by Hatch for the Processing Metallurgy and
Infrastructure design. This includes the capital and operating cost estimates in
these areas.
3 of 138
(f) Permitting and Community Relations
All permitting requirements and Community Relations for the Kemess North
project have been undertaken by Northgate. This Technical Report includes the
Engineering, Environmental and other technical aspects of the Kemess North
project, required to meet the pertinent regulatory requirements. On this basis, it
should be reasonably expected that permits will be granted.
3. Property Description and Location
The Kemess North deposit is part of the Kemess Property, which covers
35,312 ha. The property is located approximately 430 km northwest of the city of
Prince George, British Columbia, Canada, at 5702 north longitude and 12647
west latitude (see Figure 1). The property includes one active mining lease
(#354991) and 213 surrounding and contiguous mineral claims, which cover
more than 34,450 hectares. At least four additional mining leases are currently in
the application process to cover the Kemess North area. The claims fall within
the Omenica Mining Division of British Columbia located on NTS map sheets
94D/15, 94E/06, 07, 16 and 17 (see Figure 2).
Figure 3 also shows the Kemess North project area in relation to the
current Kemess South operations, and the overall property position.
Legal surveys have been completed for mining lease #354991. The
mineral claims covering the Kemess North deposit and the area to the north and
west of the proposed mine (New Kemess 1, New Kemess 2, DC 1 to 5, Gap and
Overlap) have been surveyed and it is proposed to convert these claims into
mining leases. The Kemess North deposit and associated occurrences are
located on the New Kemess 1, 2 and 3 claims (see Figure 3).
The Kemess Property is owned and operated by Kemess Mines Ltd., a

100% controlled subsidiary of Northgate Exploration Limited. Kemess Mines Ltd.
holds the surface rights to the property through their mineral claims and mine
lease. There is a placer reserve covering the area, making placer mining in the
area illegal.
The Kemess South deposit, located on mining lease #354991, currently

supplies mill-feed to a 52 000 tpd mill. In 2001, Northgate announced the
discovery of a significant deposit at Kemess North, which was the focus of major
drilling campaigns during 2002 and 2003.
4 of 138
Figure 1: Kemess Property Location Map
5 of 138
Figure 2: General Claims Outline
Appendix A outlines the relevant claim information for the property as

listed with Ministry of Sustainable Resource Management BC.
6 of 138
The location of the Kemess North project site and the other
operations and infrastructure for the Kemess South Operations, are shown
on Figure 3. The Kemess North project site is generally located in three
north facing alpine cirques with original ground surface ranging from 1,500
to 2,000 m elevation all above tree line. Open pit mining will be located in
shallower lower grade mineralization in the centre cirque and deeper higher
grade mineralization in the eastern cirque. The southern pit wall will be
bounded by the southern headwall of the centre and eastern cirques.
The crusher and other infrastructure will be located at the pit rim in
centre cirque. A natural rock glacier is evident in the western cirque. No
surface development has been planned to date in the western cirque.
There are currently royalties of 1.6% of gross revenues to Trilon on

the Kemess South operation. Northgate states that there are no royalties or
other financial encumbrance against the Kemess North project.
The current Kemess Operations operate under the following permits;

Kemess North permit requirements will be very similar:
M96-03 Project Approval Certificate (Issued April 29, 1996)
M206 Approving Work System & Reclamation Program
PE 15335 (Main Effluent Permit) - Tailings Storage Facility &

Associated Works, RBC, Mill & Accommodation Site Runoff & Open
Pit Water issued December 8, 1998.
PR14928 Refuse to the Ground/Active Waste Rock Dump issued

July 29, 1997
AR15157 Refuse and Air Contaminants from the Construction Camp

issued September 9, 1997
BCG07761 Special Waste Consignor Identification Number issued

February 18, 1998
Explosives Storage and Use Permits
No. 682 - The main Magazine storage of explosives and

detonators issued January 21, 1998
No. 1168 - Magazine storage for avalanche explosives and

detonators issued February 14, 1997
7 of 138
OTH00123 Gas Permit issued October 27, 1998, expiry date
October 31, 1999
Annual Boiler Operator Certificates
09-12586-99 Radioisotope License
080221125 Radio License issued March 25, 1997
10943 MoTH Road Use Permit (367.3 km to 435.22 km)
Road Use Permits (RUP) MOF - Issued December 10, 1996
01-7829.01-99 (Finlay Rd)
01-7829.08-99 (Finlay Osilinka Rd)
01-9147.01-99 (Thutade Forest Service Rd)
01-SS22414-97 (24 Small rd sections, i.e. Nation Dump Rd,

Modeste Mainline, Blackpine FSR, Manson Dump Rd)
Special Use Permits (SUP) MOF - Issued February 21, 1997
S17447 (Mine site Access Roads)
S22850 (Cheni Mine Road transfer) includes old S13088
S22376 (Power Line sections 1-5)
License to Cut
L43054 (mine site)
110851 Conditional Water License (East Kemess Creek, Serrated

Creek. & South Kemess Creek.)
110454 Conditional Water License Kemess Lake
8 of 138
MX-13-69 Mineral & Coal Exploration Activities & Reclamation Permit
Waste Rock Dump Permit
PE 15257 Air Emissions pending
Land Farming pending
Environmental obligations for the current operation include:
Presently, Kemess South has a Reclamation & Closure plan

document with the BC Ministry of Energy and Mines. The Reclamation &
Closure plan is updated every 5 years. During the operational phase, the
primary focus of the Reclamation & Closure plan is reclamation. Upon mine
closure, the Reclamation & Closure plan will focus on permanent closure.
Upon closure Northgate will submit another updated Reclamation & Closure
plan that will lay out the closure plan and time lines for implementation.
There are no provincial fixed time lines for completion of the closure
plan - however it must be reasonable. Therefore, to propose the plan to be
completed over a 10 year period would likely be viewed as unreasonable.
However, to suggest the closure plan will start within 12 to 24 months and
be completed within 5 years should be acceptable. The BC Ministry of
Energy and Mines are willing to consider a variety of factors that may delay
closure - i.e. economics of "related" mine development (Kemess North),
continued use of various components of the operation, staging various re-
vegetation efforts, to ensure the long-term is successful.
9 of 138
Figure 3: Detailed Kemess Area with Infrastructure Kemess South
& Kemess North
10 of 138
4. Accessibility, Climate, Local Resources, Infrastructure &
Physiography
The Kemess Property is located in the mountainous area east of the

Spatsizi Plateau and west of the Swannell Ranges near Thutade Lake
approximately 250 km north of Smithers and 430 km northwest of Prince
George at 5702 north longitude and 12647 west latitude. The property
spans the boundary between the 94E and 94D NTS sheets and is within the
Omenica Mining Division.
Broad, open, drift and moraine covered valleys characterize the area,
which also has sub -alpine plateaus and rugged incised peaks and cirques.
Elevations range from 1 ,200 m to 2,000 m, with the tree line occurring at
approximately 1,500 m. All the work completed during the 2002 and 2003
drill programs occurred above tree line in three cirques, which open to the
north forming a common southern headwall. Lower elevations on the
property are moderately vegetated with spruce-willow-birch forest, while
poorly drained areas form peat bogs populated by alder brush, willow, and
stunted spruce trees.
The climate is generally moderate, although snow can occur during

any month. Temperatures range from -35 to 30 and average annual
precipitation amounts to 890 mm. In 2002 snow did not leave the higher
elevations until late June.
Since mining will be scheduled for year round operations, 24 hours

per day equipment and procedures will need to be adaptable for the
variations of 4 seasons in a mountain environment. This will include dry
conditions in summer and wet in spring break-up and autumn, and snow and
drifting snow in winter. The current Kemess South operations will be suited
for Kemess north with some provision for more extreme weather conditions
at the higher elevations and provision for avalanche monitoring and control.
It can be expected that there will be more lost operating days at Kemess
North than Kemess South principally due to poor visibility.
Access to the Kemess North project is provided by both air and road
via the current Kemess Operations. There are scheduled year-round flights
from Smithers, Prince George, Vancouver, Kelowna, Kamloops and
Williams Lakes to Kemess from Monday to Thursday. All season road
access is from either the town of Mackenzie or Fort St. James via the
Omenica resource access road.
A privately owned, 380 km power line originating in Mackenzie in the

south provides power to the mine area via the BC Hydro grid.
Personnel are from various locations in British Columbia and Alberta.

Operations and maintenance personnel work a 14-day on 14-day off
11 of 138
schedule while some technical and management personnel work a 4-day in
and 3-day off rotation.
Kemess Mines Ltd. holds surface rights through their mineral claims
and mining leases. Onsite infrastructure for the current operation consists of
an office and maintenance building, a 400-person camp, a mill building,
maintenance and office complex, crushers and raw ore stockpile areas,
access and service roads, airstrip, explosives depot, and tailings facilities.
The tailings pond capacity is sufficient to meet the needs of the Kemess
South ore body until its completion in 2008.
The Kemess North mining plan is based on utilizing the current

facilities for ore processing, accommodation, and support, however an ore
transportation and local infrastructure to service the new Mining operation at
Kemess North will be needed as well as a new tailings pond. These include
access roads, potential waste dump sites, a pit side crusher and conve yor
system to the current plant site, a field supervision and equipment service
centre adjacent to the pit and a new tailings pond located a t Duncan Lake.
Preproduction stripping and construction of the Kemess North field

service facilities will commence 1 to 2 years in advance of the startup of ore
production from Kemess North. Production will begin when the ore
transportation system from Kemess North is in place and the first pit side
crusher is in operation. There will be a transition period required where both
Kemess South and Kemess North mining operations are feeding the mill as
mining equipment is shifted over from Kemess South to Kemess North. This
transition will commence when the crusher is in place at Kemess North and
will continue until reserves are exhausted at Kemess South. When mining is
completed at Kemess South all crushing capacity will be transferred to the
Kemess North crusher station.
Tailings and waste dump facilities are being designed at Duncan

Lake with sufficient capacity for the Kemess North waste. This includes all
mill tailings and mine waste rock. Much of the mine waste rock is PAG
material and is planned to be deposited sub-aqueously in the tailings pond.
Any NAG material within the pit will be used for construction fill or deposited
in waste dumps adjacent to the pit area but in the area specified within the
water management plan.
12 of 138
5. History
The history of the Kemess operations record earlier discoveries in the

Kemess North area however the first exploitable open pit deposit was
outlined for the current Kemess South ore body. The following brief history
for the Kemess South area is from MRDIs December 2001 Technical
Report (p 6-1).
(a) Kemess South
Pacific Ridge Resources Ltd. (Pacific Ridge) staked the area of the
Kemess South deposit in 1983. Exploration programs were subsequently
carried out by Pacific Ridge Resources Ltd. and Anaconda Canada Ltd.
(Anaconda) in 1984; St. Philips Resources Inc. (St. Philips) in 1988 and the
Kemess South Joint Venture between El Condor Resources Ltd. (El Condor)
(60%), operator, and St. Philips Resources Ltd. (40%) from 1990 to 1993. In
1991, Rio Algom Explorations Inc. (Rio Algom) acquired claims adjoining the
west and south sides of the Kemess South Joint Venture claim holdings.
The initial work on the property by Pacific Ridge and Anaconda

consisted of a limited diamond -drilling program to test a gold-copper-
molybdenum soil geochemical a nomaly. This drilling identified porphyry-
style gold-copper-molybdenum mineralization, but grades were considered
too low and the property was dropped. St. Philips carried out IP surveys,
geochemical surveys and reverse circulation drilling, which marginally
expanded the mineralized area: The Kemess South Joint Venture completed
a major delineation diamond drilling program and various ancillary works,
including IP and geochemical surveys. In 1992, Rio Algom drilled five holes
totalling 1,745 m to further delineate the deeply buried western extension of
the Kemess South deposit. In late 1993 the Kemess South Joint Venture
acquired the claims held by Rio Algom. By the end of 1993 a total of 26,314
m of diamond drilling in 156 holes had outlined a substantial gold-copper
deposit that was amenable to open pit development.
In 1994 the Kemess South Joint Venture conducted a 9-hole, 1,867

m in-filling drilling program. In 1996, Royal Oak Mines Inc. (Royal Oak)
acquired the Kemess South property and drilled 22 due diligence holes
totalling 3,316 m.
In 1998 Royal Oak commenced Operations from the Kemess South

ore body. These operations went into receivership in 1999. In 2000
Northgate Exploration bought the property out of receivership. Production
from the property since the original start-up is given in Table 5.1. This also
indicates the original reserves and the current stated reserve as of year end
2003.
13 of 138
Table 5.1
Production History from Kemess South
Operator Year Waste Ore Grades Metal

Tonnes Tonnes Cu % Au g/t Cu Au
lbs x 1000 oz
Royal Oak 1998 1,950,000 7,482,909 0.220 0.6* 9,687 69,804
Royal Oak 1999 6,447,355 14,113,460 0.212 0.644 21,389 213,791
Northgate 2000 20,530,155 14,089,000 0.222 0.779 50,389 225,994
Northgate 2001 17,592,635 15,366,500 0.251 0.855 66,300 277,100
Northgate 2002 25,533,575 17,308,300 0.236 0.724 72,863 282,256
Northgate 2003 35,239,000 18,633,000 0.225 0.702 76,177 294,117
Remaining 77,040,976 91,715,448 0.227 0.699 459,000 2,061,000
*Estimate as figures from this period are not considered reliable
(b) Kemess North Project
The Kemess North project will be an expansion into a new production

area for the Kemess operations. The following exploration history specific to
the Kemess North project area has been adopted from Edmunds and
LaPeare (2002).
The earliest reports of exploration activity in the area date back to the
discovery of placer gold at the mouth of McConnell Creek in 1889. Several
years later there was a brief staking rush in 1907 and prospecting remained
active in the area through the early 1920s resulting in a placer discovery at
McClair Creek. Cominco Ltd. was active in the area in the 1930s exploring
for base metals. During this period Emile Bronlund discovered and staked
several skarn showings; the Cairn showing is a nearby occurrence from this
era that is located on Duncan Ridge, 6 km west of Kemess North.
In 1966 Kennecott focused on the area searching for Cu-porphyry

systems using stream geochemical techniques and prospecting; this work
resulted in claim staking and field work on several prospects including
Kemess North, Pine, Fin, Chapelle (also known as Baker), Shasta and
Lawyers. The latter three deposits are gold-silver epithermal vein systems
that eventually produced during the early 1980s. Kennecotts work opened
the area up with respect to potential for Cu-Au porphyry systems, and the
ensuing work at Kemess North is summarized below in Table 5.2.
14 of 138
Table 5.2
Summary of Exploration Work
Period Company Work Completed

1966 - Kennco Regional stream and soil geochemistry, staked
1971 Explorations 100 2-post mineral claims, mapping @1:9600
Ltd. scale and completed 232 m of x-ray core
drilling in 8 holes.
1975 - Getty Mines Optioned property from Kennco and completed
1976 Ltd. 1:4800 scale mapping, orthomapping, re-
and Shell Oil staking, geochemical surveying and 2,065 m
of diamond drilling in 13 holes (75-18 to 75-
30). Option dropped in 1977.
1986 - El Condor In 1986 El Condor optioned the property from
1992 Resources Ltd. Kennco and commenced sustained exploration
that resulted in the discovery at Kemess
South. Over a 6 year period at Kemess North,
El Condor collected 1 ,025 rock samples and
5,402 soil samples, completed 76.85 km of IP,
and drilled 14,327.92 m of core in 69 holes.
Additional work included 167 km of line cutting,
54.5 km of roads, and 475 m of cat trenching.
A resource of 157 Mt @ 0.37g/t Au and 0.18%
Cu resulted at Kemess North.
2000 Northgate Completed 4,104.48 m of diamond drilling in
Exploration 12 holes identified a new higher-grade
Ltd. porphyry zone located east of El Condors
discovery. This work increased the resource at
Kemess North to 360 Mt @ 0.299 g/t Au and
0.154% Cu.
Exploration 16 holes which increased resources to 442 Mt
Ltd. @ 0.40 g/t Au and 0.23% Cu.
Exploration 58 holes (41 holes on Kemess North, 5 on
Ltd. Kemess East, and 12 at Nugget).
2003 Northgate Completed 10 003 m of diamond drilling in 43
Exploration holes (19 holes on Kemess North, 9 at
Ltd. Kemess Centre, 12 at Nugget, and 3 on
Duncan Ridge).
15 of 138
6. Geological Setting
This section has been adopted from Edmunds and LaPeare (2002).
(a) Regional Geology
Kemess occurs at the southern end of the Toodoggone mining camp,

which describes a collection of occurrences and deposits found in Mesozoic
volcanic rocks of the eastern Stikine Arch. Large-scale structures are
present in the area, with a major terrain boundary present just 25 km east of
the project area. The area is known for its Cu-Au porphyry deposits and low
sulphidation epithermal Au-Ag vein deposits. Potential also exists for
mesothermal vein deposits, skarn deposits, volcanic associated massive
sulphide deposits and red-bed Cu deposits.
Mesozoic arc-related volcanic rocks that comprise the eastern margin

of the Intermontane Belt underlie the district over an area measuring 100 km
by 40 km. The oldest rocks in the belt are Permian Asitka Group, which are
disconformably overlain by upper Triassic Takla Group, which are in turn
unconformably overlain by lower-middle Jurassic Hazelton Group;
overlapping all these assemblages to the west are upper Cretaceous Sustut
Group sediments. The lithologic units comprising the stratigraphic
succession are described in Table 6.1.
Intrusive rocks are prevalent in the area and have been categorized
as late Triassic Alaskan-type ultramafics such as pyroxene diorite,
hornblende gabbro and pyroxenite. Economically more significant are the
early Jurassic intrusives of the Black Lake suite, which are granodiorite,
hornblende diorite, pyroxene quartz-diorite, quartz-monzonite and quartz
monzodiorite. Important plutonic masses are the Duncan Lake stock (197.3
Ma), the Sovereign stock (202.7 Ma) and the Maple Leaf pluton (199.6 Ma).
The latter hosts the Cu-Au deposit at Kemess South.
For the most part the volcanic Mesozoic assemblages are upright, shallowly
dipping to flat-lying sequences crosscut by high angle north to northwest
trending faults. Significant structures are the Finlay-Ingenika and Moosevale
fault systems, which bound the eastern margin of the belt. These structures
are dextral strike-slip features that are related to the terrain bounding faults
between the Intermontane and Omenica belts.
16 of 138
Table 6.1: Regional Stratigraphy (Cope, 1992)
Age Lithostratigraphic Description

Unit
Cretaceous Sustut Group Sustut rocks grade from Brothers

Peak Formation conglomerate,
sandstone, mudstone with minor
tuffaceous units down to the basal
Tango Creek Formation polymictic
conglomerate, sandstone, mudstone
with minor lignite seams.
LM - Jurassic Hazelton Group Uppermost unit, Smithers Formation

is dominated by greywacke, lithic
sandstone, siltstone, tuffaceous
shale, volcanic breccia,
conglomerate and limestone. Below
lies the Nilkitkwa Formation, which is
mainly shale, greywacke, andesitic-
rhyolitic tuff with minor limestone. In
the Kemess area the quartz phyric
volcaniclastic rocks of the
Toodoggone Formation are believed
to be correlative to the Nilkitkwa. The
basal assemblage, Telkwa
Formation comprises basaltic to
rhyolitic pyroclastic and flowrocks.
U. Triassic Takla Group Highest units are Moosevale

Formation augite porphyry, breccia,
sandstone and mudstone. Central
assemblage is Savage Mounting
Formation comprised of flows and
pyroclastic augite porphyritic
volcanic rocks. Base of the exposed
sequence is Dewar Formation
argillite, limestone and siltstone.
Mid Asitka Group Uppermost units are dominated by

Pennsylvanian limestone and tuff, which give way to
Permian a middle assemblage of basaltic
flows and rhyolite. The lowermost
units are basalt, argillite and
limestone.
17 of 138
(b) Local Geology
More local to Kemess North are the Duncan and Saunders Faults, which are
north-northwest normal block fault structures. Thrust faulting is present in
the district and is interpreted as Eocene or younger; displacement believed
to be towards the northeast and effects rocks from the Takla up to Sustut
sediments.
The district represents the results of three superimposed volcanic arc

building stages that began in the upper Paleozoic. Marine volcanic and
sedimentary successions dominated until the lower-middle Jurassic, when
continental, quartz-normative volcanism began with the deposition of the
Hazelton Group-Toodoggone Formation sequences. The pluto nic rocks of
the Black Lake suite are coeval with the Toodoggone sequence and are
likely co-magmatic. Block faulting has juxtaposed panels of varying depth
into the magmatic and volcanic systems. The structures and intrusives likely
had a strong influence on the eventual positioning of volcanic centres.
The Kemess North property is underlain by upper Triassic (Takla

Group) andesite/basaltic volcanics and to a lesser extent lower Jurassic
(Toodoggone Formation) dacitic fragmental volcanics. Stocks, dykes and
possible sills of quartz monzonite/quartz diorite composition have intruded
the Takla succession and are also lower Jurassic in age. Structurally the
deposit area is transected by steeply dipping north to northwest trending
normal faults. A laterally extensive, shallow dipping to flat lying, highly
fractured broken zone occurs at or close to surface.
(c) Property Geology
(i) Andesite Volcanics (Takla Group-T3)
The property is predominantly underlain by a thick (>1,000 m)

succession of andesitic flows. The flows exhibit textures ranging from fine
grained and massive to porphyritic with medium grained and mostly phyric,
subhedral augite phenocrysts. Less common are phenocrysts of
plagioclase. The fine-grained matrix is mostly comprised of plagioclase,
quartz, and chlorite. The plagioclase is usually sericitized. Rare intersections
of auto-brecciated flows occur as coarse sub-rounded andesitic clasts within
both phyric and finer grained flows. The Takla volcanic rocks host a
significant portion of the Au-Cu mineralization.
On surface, exposed in the cirque headwalls and some upper

intersections of drill intercepts is a bladed feldspar porphyritic unit. It exhibits
a very well developed porphyritic texture with bladed felted laths of
plagioclase up to 1.5 cm long within a finer grained dark gray matrix. Its
texture suggests a hypabyssal origin or possibly an extrusive dome type
emplacement.
18 of 138
Due to the lack of bedding and/or marker horizons, the inclination of
the massive thick succession of Takla volcanics is difficult to ascertain but
probably reflects the regional trend of flat lying Mesozoic assemblages.
(ii) Dacitic Polylithic Fragmental (Hazelton Group -

H3:Toodoggone Formation)
Mantling the northern and eastern limits of the Kemess North area is
a matrix supported polylithic fragmental volcanic unit. Sub -rounded angular
coarse fragments of bladed feldspar porphyry, andesite, monzonite and rare
quartz-feldspar porphyry or chert occur within a siliceous (dacite) matrix.
Lithic proportion to matrix is inconsistent ranging from 1-30% volumetrically,
with clast size varying from lapilli to blocks. The matrix is fine-grained, dark
gray comprised of 10-30% medium grained feldspar and diagnostic (5%)
quartz phenocrysts. Magnetite is common as an accessory mineral
occurring as very fine-grained disseminations as is distinctive zeolite-calcite
veinlets. Propyllitic (epidote-calcite-pyrite) alteration is dominant within the
fragmental, however narrow (10-20 m) zones of phyllic (quartz-sericite-
pyrite) alteration are present near discordant contacts with the Takla Group.
The phyllic sections can carry anomalous gold concentrations.
The Polylithic Fragmental Dacite is an enigmatic unit as it shows field

relations suggestive of both an extrusive and intrusive emplacement
mechanism. Diamond drill sections in East Cirque show a WNW striking
steeply south dipping irregular contact between mineralized Takla andesite
and the dacitic fragmental, and in one instance quartz-phyric polylithic
fragmental occurs within monzonite (KN-02-05 @ 524.68 m). In Central
Cirque an unaltered flat lying dacitic fragmental unit overlies quartz-sericite
altered mineralized Takla Group (KN-02-55). At the Nugget Zone a thin (5
m) zone of the dacitic fragmental crosscuts Takla Group andesite (KN-02-50
@ 404.4 m). Commonly present within the dacitic fragmental are inclusion-
rich irregular granitoid masses typically logged as crowded feldspar
porphyry or monzonite. These masses are interpreted to be younger sub-
volcanic intrusives related genetically to the Toodoggone Formation.
The evidence suggests that basement structures and conduits that

allowed extrusion of the local Toodoggone volcanic assemblage underlie the
Kemess North area.
(iii) Quartz Monzonite/Quartz Diorite
These intermediate intrusive units are comprised of subhedral

phenocrysts of 50% plagioclase and <10% quartz set in a groundmass of
quartz-feldspar-chlorite +/- biotite with accessory minerals including;
magnetite, apatite, carbonate, rutile, ilmenite, sphene. The quartz monzonite
does not reach surface and outcrop. To remain consistent with earlier work
the field-term monzodiorite and quartz monzonite has been retained,
19 of 138
however petrographic work shows that the mineralized granitoid underlying
East Cirque is more correctly classified as a quartz diorite due to the paucity
(< 5% to absent) of alkali feldspars.
The main quartz monzonite mass beneath East Cirque hosts the bulk
of the Cu-Au mineralization at Kemess North.
(iv) Post-Mineral Dykes
Post-ore dykes, including feldspar porphyry and minor mafic varieties,

cross cut Takla volcanics and outcrop locally in cirque highwalls and along
ridges. The feldspar porphyry dykes also cross cut the Jurassic-Toodoggone
fragmental unit. The feldspar dykes commonly exhibit pervasive dark pink
hematite within the matrix and as staining of the medium grained feldspar
phenocrysts. Due to the pink colour of the feldspars, these dykes take the
field term syenite and are generally barren and unaltered. The relationship
of the feldspar dykes with the larger quartz diorite stocks is not clear,
however they appear temporally late in the sequence of events. Mafic dykes
are generally thin (<1 m to 4 m), dark green and barren of sulphides and
veining. Observations from regional mapping suggest they are related to the
volcanic strata interbedded within Sustut Group sedimentary rocks and are
interpreted as Cretaceous.
At least three steeply dipping, northwest trending normal faults have

been inferred from surface mapping and drilling to transect the Kemess
North property. Fault spacing ranges from 500 m to 1 ,500 m and they are
generally parallel to the Duncan and Saunders Faults located west and east
respectively.
(v) Broken Zone
A flat-lying zone of intensely broken rock and multiple gouge zones

(which results in poor drilling conditions) occurs above the deposit, and is
referred to as the Broken Zone. The Broken Zone averages about 80 m
from surface to competent bedrock and is comprised of clay, multiple gouge
zones and a pyritic-argillic alteration component. The interface between the
Broken Zone a nd the underlying competent volcanics is generally sharp
where phyllic meets chlorite-biotite alteration assemblages. The post-
mineral porphyritic feldspar dykes remain unaltered and competent within
the Broken Zone phyllic alteration.
There are several hypotheses for the formation of the Broken Zone.
The theories range from the effects of present day weathering, porphyry
related alteration zonation, to the tectonic end products of shallow faulting
and thrusting. Key features to consider are that the broken zone underlies
and is adjacent to highly competent, unaltered, siliceous Toodoggone
fragmental rocks. This suggests that the alteration occurred in the early
20 of 138
Jurassic before the emplacement of the dacitic fragmental unit. The most
plausible explanation is that the Broken Zone and related phyllic alteration
are due to pre-Toodoggone weathering processes.
21 of 138
Figure 4: Regional Geology after Massey et al 2003
Minfile Occurrences Plotted by Colour Showing Principal
Commodities as Follows:
Gold Red,
Silver Blue,
Copper Green
22 of 138
Figure 5: Shows the General Property Geology
in the Area around Kemess North (Diakow 2001)
23 of 138
Figure 6: Kemess North Geology - Diakow (2001)
24 of 138
7. Deposit Type
Kemess North is a large copper-gold porphyry deposit and is typical

of porphyry gold-copper deposits in the western cordillera. The deposit has
a low-grade ore zone at a depth of 150 m below the ground surface on the
western side of the deposit and a higher grade zone 300 to 550 m below
surface on the eastern side. The deposit is hosted by potassic-altered Takla
Group volcanic rocks and is cente red on porphyritic monzodiorite dykes.
Higher-grade copper-gold mineralization is characterized by secondary
biotite in volcanic host rocks.
Porphyry style Au/Cu mineralization occurs within the Takla volcanic

rocks and intermediate intrusive rocks associated with weak to pervasive
propyllitic, potassic (biotitic), and phyllic alteration assemblages. Alteration
of Toodoggone assemblages ranges from fresh to weak propyllitic and is
generally barren of significant sulphides and ore grade mineralization.
A 3-D Block Model has been used to represent the Kemess North
mineral Resources. Mintecs MineSight software, an industry proven
software system, has been used for the modelling . The geology model area
used is large enough to include drill holes from the Nugget area to the west
and the Kemess East area. It also extends sufficiently outside the drilled off
area to include waste material which will fall within the ultimate pit design.
To restrict the resource estimate to defined geology units, four major
lithology zones were modeled as defined by the drillholes. Although multiple
rock types were recorded in the drill logs these are grouped together into the
four main lithologies. Three of the lithologies represent potential ore
material, while the fourth lithology represents rock types known as barren or
low grade mineralization. Any undefined areas within the model boundaries
are therefore designated as waste since these are areas that do not have
sufficient drill hole assay spacing to delineate a continuous Lithology zone.
Details of the 3-D Block model and Resource/Reserve estimation are
included in Section 16.
8. Mineralization
This section has been adopted from Edmunds and LaPeare (2002).
Gold-copper mineralization forms an inclined tabular zone that is

centred on the East Cirque porphyritic monzodiorite, which from structural
contours, strikes east-west and dips 20 to the south. The quartz
diorite/quartz monzonite intrusive exhibits an irregular upper contact with
various peaks and troughs. The general east west strike and shallow south
dip geometry is consistent for over 400 metres (10660E to 10180E).
Between 10260E and 10160E the tabular morphology disappears and the
monzonite occurs as wide dykes (10 m to 100 m) within Takla volcanics.
The change in geometry for the monzonite could be due to the effects of
25 of 138
cross-faulting that have down-dropped the tabular upper contact present in
East Cirque, or the rheologic conditions during intrusion changed going
towards the west whereby steep fracture infilling was preferred over
stopeing.
Alteration and mineralization is associated with, and zoned both

vertically and laterally from the quartz diorite/quartz monzonite intrusive
intersected at depth beneath the East Cirque.
The highest-grade Au-Cu zones occur at or near the quartz

monzonite Takla volcanic contact associated with quartz-magnetite
veining and overprinting pyrite-chalcopyrite veining. The zone comprises 50-
60% fine -grained quartz, 20-30% magnetite, 5-10% pyrite, 1% chalcopyrite,
with accessory hematite and anhydrite occurring over widths from less than
10 m to greater than 150 m. Quartz habit varies from high-density parallel
quartz veining to pervasive silicification with magnetite. This zone occurs
mostly within the quartz monzonite stock and to a lesser extent within the
andesite adjacent to the intrusive stock. The protolith is commonly
completely replaced. The quartz monzonite/quartz diorite stock and
associated quartz-magnetite zone is interpreted as the heat source driving
the porphyry copper-gold system at Kemess North.
Grading outwards from the East Cirque stock into the Takla
volcanics, silicification decreases gradually to fine-grained assemblages of
chlorite-biotite-sericite, which volumetrically constitutes the bulk of the
mineralization. This pattern is a broad generalization and there are areas of
either potassic (biotitic) or propyllitic (chloritic) alteration that also have an
irregular and patchy outline in plan and cross section.
Sericitization, commonly from the destruction of matrix and

phenocryst plagioclase, is pervasive in the Takla volcanic rocks.
Accompanying sericitization are assemblages of quartz-anhydrite-ankerite-
magnetite veinlets with disseminated pyrite -chalcopyrite mineralization.
Present over the entire area in all rock units except the late mafic dykes are
barren pinkish zeolite -carbonate veins, which post-date and crosscut the
above vein types and rock units.
The uppermost alteration zone is the phyllic or QSP zone, which

consists mostly of sericite-chlorite-quartz +/- pyrite and forms the extensive
Broken Zone and bright orange-red outcrops at surface. Pyrite is common
throughout (5-7%), both disseminated and within vuggy quartz veining. This
alteration zone is mostly barren of any significant Cu and will often show a
slight increase in Au with depth. It has been postulated that this zone shows
similarities to an acid leached cap, however it lacks any form of supergene
enrichment in base metals, as occurs at Kemess South.
26 of 138
Overall, sulphide mineralization throughout the deposit consists of 2-
3% pyrite, with lesser amounts of chalcopyrite and traces of molybdenum.
Pyrite occurs as disseminations, fracture fillings, and veins up to a few
centimetres wide generally associated with quartz-anhydrite-magnetite veins
and zones of quartz-magnetite replacement. The mode of occurrence of
chalcopyrite is similar except that veinlets are rare and significant
disseminations occur in zones of stronger quartz-magnetite stock work and
quartz-magnetite replacements. Gold and copper grades variably diminish
outward into the hanging wall and footwall. Total sulphide content in the core
of the deposit averages 3-5%, rising to 5-7% in the pyrite -rich sericitic
altered upper halo.
Petrography shows a varying degree of accessory minerals

throughout all rock types and alteration zones including; rutile, leucoxene,
sphene, anhydrite, gypsum, epidote, zeolite, alunite, molybdenite,
phlogopite, prehnite, apatite.
Moving west of East Cirque to the Nugget Zone, alteration and

mineralization becomes irregular as the intrusive units approximate steeply
dipping dykes. This zone occurs within a broad sericitic alteration zone with
irregular zones o f chlorite-biotite alteration. Significant widths of gold-copper
mineralization occur within Takla volcanics adjacent and proximal to these
monzonite apophyses substantially adding to the mineralized volume.
The Nugget Zone alteration is dominated by weak chlorite -biotite

altered Takla volcanics commonly with disseminated magnetite. Substantial
gold-copper mineralization is present within the Takla volcanics but at
depths exceeding 400 m. In this area it appears that a similar style of
mineralization is present, as compared to East Cirque, however the sulphide
system does not overlap the quartz-magnetite portion, rather occurring well
above it (KN-02-43). The Nugget Zone generally exhibits a higher gold to
copper ratio than Kemess North, and rare narrow intersections of gold
grades of up to 8 g/t are present.
9. Exploration
The Kemess North property represents a highly advanced project.

The early exploration work in the area identified a porphyry target but it
wasnt until deep drilling in 2001 that significant gold and copper grades
were located. Since 2001 exploration has been directed at expanding the
resource base in the proposed pit area by drilling 16 holes in 2001, 41 holes
in 2002, and 19 holes in 2003.
Because the target is deep, geological mapping and geochemical

techniques add little value, likewise, surface and airborne geophysical
exploration have contributed little. Since the last work by El Condor in 1992,
there has been no surface soil or rock sampling on the property, nor has
27 of 138
there been any trenching. Surface work has been confined to access road
and drill site construction. A recently completed regional airborne
geophysical program will be of great interest as it may add to the
understanding of the volcanic and intrusive events in the area. It is
suspected that the program will have little impact for the reserve estimate on
the Kemess North project.
The procedures followed in the field and through the interpretation

stage of exploration have been professional. Various crews under the
supervision of professional geologists carried out the exploration work (see
Table 9 .1). From 2001 to the present day, there has been continuity in
personnel both in the field and with the data interpretation. It is considered
that the reliability of the data obtained with exploration is very high.
Table 9.1
Exploration Employees/Contractors
Job Function Supervisor Contractors

A. Geology
2001 Hibbitts (NGX) A. Bray
2002 Hibbitts (NGX) B. La Peare
B. Mercer
E. Ramsay
J. Mazvihwa
C. Edmunds
2003 C. Edmunds M. Russer
B. Kay
R. Konst
A. Tsaloumas
L. Lindinger
B. Laboratory
2001 Bondar-Clegg
2002 ALS Chemex
2003 ALS Chemex
C. Drilling
2001 Britton Bothers
28 of 138
10. Drilling
Since May 2002, two summer drill programs have been completed on
the Kemess North property. Britton Bothers Diamond Drilling of Smithers,
BC completed this work. In total, 198 holes have been completed for a
cumulative of 77,210 m of drilling. Up to four drill rigs were used on the
property, three on skids and one helicopter portable.
(a) Procedures
The procedures used to locate exploration drill holes is as follows: the

proposed drill site is located in the field by a geologist using a hand -held
GPS unit; the site is built using a bulldozer and the drill rig pulled onto the
site. The orientation of the drill hole is set by the geologist with a set of
pickets to provide the azimuth and specify the inclination of the hole.
Because of the depth of the mineralization, most of the drill holes have been
drilled at steep angles, approaching vertical. Exceptions to this rule are
holes drilled for geotechnical studies. There are 53 holes drilled at dips
between 45 and 75 degrees, with various azimuth orientations. The
remaining 145 holes have been drilled at steep angles, greater than 75.
All of the drilling on the property has been continuous core diamond
drilling. Because of the broken zone at surface, drilling procedures include
setting surface casing then drilling with large diameter HQ core. Once
through the broken zone, and into more solid rock, the drillers generally
reduced to NQ core to complete the hole. Upon completion of the hole, all of
the drill pipe is removed from the hole, though the surface casing is left to
mark the hole location.
(b) Sample Length/True Thickness
Sample length was determined by the geology of the deposit, an

attempt was made not to allow samples to cross lithological boundaries.
With NQ size drill core, sample lengths were generally 2 m, while with HQ
core; sample lengths were reduced to 1.5 m. The majority of the assay
intervals, approximately 60%, are 2m in length, with the remainder mostly
less than 2 m. The average assay interval is 1.8 m.
The term true thickness is not generally applicable to porphyry

deposits as the entire rock mass is potentially ore grade material and there
is no readily apparent preferred orientation to the mineralization. Because of
the potential of ore grade material through the entire length of the hole,
sampling was generally continuous from the top to the bottom. The
mineralization is generally confined to three main lithologies, hypogene
monzonite, Takla BFP (bladed feldspar porphyry) and Takla volcanics.
These lithologies form large massive bodies underlying the central and
eastern cirques. The mineralization is generally flat lying within the various
29 of 138
lithologies. The mineralized Takla volcanic and intrusive rocks show
generally vertical contacts. The higher-grade monzodiorite intrusive in the
East Cirque appears to be an inclined tabular body, dipping 20 to the south.
(c) Condemnation Drilling
A series of condemnation holes were drilled to confirm that there was

little or no potential ore material underlying proposed facilities and access
routes.
Figure 7: Location map for 2003 Condemnation holes.

Note area between Kemess Lake (Lower camp) and CD-14B was not
drilled as previous work yielded negative results
CD-01
CD-02
CD-03
CD-07 CD-05 CD-18

CD-04
Proposed
Plant Site KN-03-09
CD-06
CD-08
Kemess North
Pit Centre
CD-09
CD-10
CD-19
CD-11
CD-12
CD-13B
CD-14B
0 1,000 2,000
meters
30 of 138
(d) Collar Survey
Survey control for the drill hole collars was by GPS using a base
station that provided real-time correction such that sub -centimeter accuracy
was achieved.
(e) Down-Hole Survey
During the 2002 drill program, several Sperry-Sun magnetic survey

instruments were used to complete down-hole surveying. Because of the
inherent magnetite content of the rock and mechanical problems with some
of the units, some of the surveys are suspect.
In 2003, the Flex-IT down-hole survey tool was used. The Flex-IT tool
records the ambient magnetic field while it determines the orientation of the
drill hole at a certain depth. Errant readings on the Fle x-IT are either
removed from the file when over or under-limit magnetics are encountered,
or their effects are minimized by adjacent readings that are true magnetic
north.
The 2003 down-hole survey data was compiled for the Kemess North
area and plotted by hole deviation (azimuth only) versus hole depth. A
regression between the two variables, azimuth and depth, was determined.
For each of the 2003 holes in the potential pit area the regression equations
were derived and tabulated to determine an average slope constant and Y-
intercept. Using this average figure, the down-hole survey files for the 2000-
2002 drilling were revisited. Holes that exhibited counter-clockwise deviation
or sharp bends were re-calculated. In total 18 suspect drill holes were
considered inconsistent with the hole trends derived from the Flex-IT data.
Plots of these holes and drilling experience also confirm that the down hole
surveys of these 18 holes are suspect.
The influence of this re-calculation shows that some of the earlier

holes plotted as much as 70 m from their re-calculated position at the
bottom of the hole , and two of the holes are not within the ultimate pit limit.
Because of the uncertainty of these down-hole surveys, several tests were
completed at the computer modelli ng stage. The first test was to build the
model with the drill hole traces of the suspected holes corrected using the
trend based on the regression equation and determine a resource estimate.
The second test was to remove the corrected holes from the database and
re-build the model. A comparison of the two model builds showed that
excluding these 18 holes has little effect on the resource quantities in the
model (see Geostatistical Analysis and Interpolation Methodology Kemess
North. Author: Abdullah Arik, March 2004), It does however, have a
significant effect on the ultimate pit limits at the base economic parameters
used in the study (see Section 17). Removing these holes from the data
base does not check the sensitivity of the project to the location of the holes.
31 of 138
Because the assays for these holes are valid they have been included as
corrected, with a recommendation to re-run the down hole survey with the
Flex-IT tool, if possible , or twin a few of the more important holes. This hole
twinning can have other benefits with respect to the Geo-Statistical analysis.
Figure 8: Drill Hole Locations
32 of 138
Table 10.1: Drill Collar Location and Orientation Data
Survey Coordinates
Hole # Easting Northing Elevation Azimuth Dip Depth
KN-00-01 9,662.980 15,573.870 1,751.070 180.000 -70.000 131.100
KN-00-02 9,659.790 15,960.280 1,702.540 0.000 -90.000 150.900
KN-00-03 9,959.000 15,689.360 1,702.150 0.000 -90.000 399.300
KN-00-04 10,158.770 15,808.870 1,720.120 0.000 -90.000 399.300
KN-00-05 10,162.220 15,963.830 1,719.440 0.000 -90.000 399.300
KN-00-06 9,862.070 15,641.100 1,715.100 0.000 -90.000 113.100
KN-00-07 10,062.730 15,736.210 1,694.330 180.000 -60.000 129.540
KN-00-09 10,126.670 16,069.310 1,700.240 0.000 -90.000 388.620
KN-01-01 10,159.390 16,164.800 1,722.000 176.500 -84.250 585.220
KN-01-02 10,156.080 16,284.980 1,736.980 181.500 -84.750 554.740
KN-01-06 10,411.170 16,139.510 1,710.930 300.000 -80.000 597.710
KN-01-07 10,421.670 16,240.150 1,706.120 0.000 -81.000 600.500
KN-01-08 10,454.830 16,297.370 1,692.060 90.000 -87.000 167.740
KN-01-09 10,467.340 16,381.440 1,672.660 149.250 -88.250 499.900
KN-01-10 10,581.550 16,289.270 1,644.320 118.500 -88.500 554.740
KN-01-11 10,667.020 16,355.750 1,597.530 0.000 -90.000 472.440
KN-01-13 10,664.810 16,271.840 1,624.930 64.000 -88.500 621.800
KN-01-14 10,765.920 16,299.450 1,588.040 101.500 -89.500 281.030
KN-01-15 10,665.790 16,164.710 1,664.270 128.500 -89.500 627.900
KN-01-16 10,569.420 16,473.561 1,603.770 79.500 -88.500 320.040
KN-01-17 10,561.290 16,095.530 1,688.530 0.000 -90.000 756.100
KN-02-02 10,557.000 16,377.650 1,624.710 0.000 -90.000 224.640
KN-02-06 10,159.780 16,341.220 1,750.300 180.000 -85.000 602.590
KN-02-07 10,461.190 15,933.830 1,724.970 0.000 -80.000 737.000
KN-02-10 10,053.570 16,264.580 1,682.710 0.000 -90.000 502.010
KN-02-11 10,157.510 16,489.490 1,784.890 180.000 -85.000 496.820
KN-02-12 10,559.440 15,989.110 1,705.170 0.000 -90.000 688.380
KN-02-14 10,062.020 15,871.370 1,692.160 0.000 -90.000 616.610
KN-02-15 9,960.290 15,904.200 1,687.780 0.000 -90.000 650.000
KN-02-17 10,062.930 15,994.110 1,683.080 0.000 -90.000 703.140
KN-02-18 10,654.110 16,067.110 1,686.400 0.000 -90.000 736.700
KN-02-20 10,456.660 16,361.900 1,677.800 0.000 -75.000 458.700
KN-02-21 10,069.650 16,156.510 1,678.020 0.000 -90.000 621.000
KN-02-22 10,759.920 15,976.200 1,694.260 0.000 -85.000 721.460
KN-02-23 8,845.280 15,091.100 1,831.530 0.000 -75.000 1,011.020
KN-02-24 10,551.960 16,192.210 1,679.130 0.000 -90.000 710.180
KN-02-26 9,858.310 16,050.750 1,672.380 0.000 -90.000 102.720
KN-02-28 9,755.060 15,761.200 1,743.220 0.000 -90.000 623.930
KN-02-29 10,360.950 15,729.460 1,765.960 0.000 -90.000 785.850
KN-02-30 8,355.180 15,596.850 1,726.610 0.000 -70.000 450.190
KN-02-31 9,838.940 16,223.120 1,649.510 0.000 -70.000 325.850
KN-02-32 11,011.570 15,445.360 1,852.170 180.000 -60.000 469.390
KN-02-33 9,960.680 16,120.840 1,663.650 0.000 -90.000 508.100
KN-02-34 8,332.290 15,036.080 1,755.710 0.000 -70.000 815.950
KN-02-35 9,859.200 16,132.860 1,665.290 0.000 -90.000 580.640
KN-02-36 9,929.730 16,218.360 1,653.040 0.000 -90.000 587.000
KN-02-37 10,094.000 15,156.670 1,889.030 180.000 -70.000 488.000
KN-02-38 9,865.100 15,997.100 1,678.210 0.000 -90.000 625.610
KN-02-39 10,161.780 15,878.690 1,723.550 0.000 -90.000 675.740
33 of 138
Survey Coordinates
KN-02-40 8,345.980 15,290.020 1,737.580 0.000 -70.000 690.980
KN-02-41 11,459.570 15,760.550 1,803.930 180.000 -70.000 490.730
KN-02-42 9,759.570 16,153.240 1,672.210 0.000 -80.000 480.650
KN-02-43 8,837.710 15,010.310 1,808.590 0.000 -80.000 703.170
KN-02-44 10,055.650 16,363.460 1,688.350 0.000 -90.000 151.490
KN-02-46 10,059.170 16,314.960 1,687.060 0.000 -90.000 570.580
KN-02-47 9,659.200 16,040.680 1,690.490 180.000 -70.000 543.460
KN-02-48 8,962.280 15,087.730 1,875.250 0.000 -90.000 605.640
KN-02-49 9,064.140 15,070.880 1,890.340 0.000 -90.000 669.820
KN-02-50 8,839.970 14,910.030 1,746.570 0.000 -80.000 623.320
KN-02-51 9,069.600 14,969.850 1,877.630 0.000 -90.000 668.290
KN-02-52 8,867.360 14,793.800 1,748.760 0.000 -90.000 660.670
KN-02-55 9,457.770 15,768.000 1,780.310 0.000 -90.000 572.260
KN-02-56 8,751.880 15,005.360 1,758.720 0.000 -80.000 542.070
KN-75-18 9,835.860 16,006.950 1,675.280 0.000 -90.000 75.290
KN-75-19 9,713.910 15,955.330 1,698.940 0.000 -90.000 86.720
KN-75-20 9,535.160 16,019.700 1,697.670 0.000 -90.000 185.010
KN-75-21 9,473.680 16,120.330 1,694.160 0.000 -90.000 215.490
KN-75-22 9,736.490 16,132.800 1,675.920 0.000 -90.000 26.060
KN-76-23 8,647.850 15,340.080 1,848.240 0.000 -90.000 115.210
KN-76-24 8,666.530 15,175.970 1,836.130 0.000 -90.000 118.260
KN-76-25 10,027.500 15,936.360 1,684.270 0.000 -90.000 319.430
KN-76-26 9,871.490 15,754.750 1,695.680 0.000 -90.000 308.460
KN-76-27 9,777.970 15,930.560 1,691.010 0.000 -90.000 210.310
KN-76-28 9,775.940 16,122.090 1,672.980 0.000 -90.000 215.800
KN-76-29 10,062.330 15,813.200 1,688.530 0.000 -90.000 188.370
KN-89-1 10,160.020 16,200.450 1,729.060 173.000 -45.000 152.400
KN-89-2 10,140.980 16,317.830 1,733.400 175.000 -45.000 149.350
KN-89-3 10,423.830 16,127.950 1,707.350 185.000 -50.000 145.080
KN-89-4 10,434.580 16,002.550 1,717.120 185.000 -45.000 152.400
KN-89-5 10,055.860 16,265.770 1,683.750 184.000 -45.000 132.590
KN-90-10 10,181.960 16,048.100 1,728.630 176.000 -46.000 200.250
KN-90-11 10,297.560 15,815.880 1,747.140 140.000 -46.000 200.250
KN-90-12 10,288.760 15,874.850 1,764.270 43.000 -45.000 96.620
KN-90-13 10,441.600 15,881.760 1,727.430 182.000 -45.000 200.250
KN-90-14 10,389.740 15,988.490 1,735.950 223.000 -46.500 123.750
KN-90-15 10,210.270 15,710.740 1,745.790 140.000 -45.000 200.250
KN-90-16 10,166.320 15,868.250 1,725.310 50.000 -46.500 200.250
KN-90-17 9,990.330 15,967.560 1,679.170 180.000 -65.000 163.680
KN-90-6 8,458.150 15,548.390 1,748.260 175.000 -45.000 196.290
KN-90-7 8,453.570 15,694.680 1,699.410 180.000 -45.000 200.250
KN-90-8 8,767.240 15,531.960 1,734.690 152.000 -50.000 203.300
KN-90-9 9,312.490 16,143.020 1,764.960 0.000 -90.000 218.540
KN-91-31 9,857.820 15,963.380 1,682.890 0.000 -90.000 282.550
KN-91-32 9,859.790 15,864.030 1,690.070 0.000 -90.000 306.930
KN-91-33 9,759.210 15,859.790 1,708.040 0.000 -90.000 306.930
KN-91-34 9,956.320 15,852.580 1,692.520 0.000 -90.000 282.550
KN-91-35 10,060.130 15,957.950 1,686.930 0.000 -90.000 282.550
KN-91-36 9,755.770 15,761.670 1,743.190 0.000 -90.000 261.620
KN-91-37 9,653.780 15,859.520 1,736.310 0.000 -90.000 331.310
KN-91-38 9,553.450 15,956.890 1,703.270 0.000 -90.000 297.790
34 of 138
Survey Coordinates
KN-91-39 9,858.390 15,960.620 1,683.400 0.000 -90.000 82.300
KN-91-40 9,858.620 15,866.970 1,689.400 0.000 -90.000 79.750
KN-91-41 9,662.400 16,057.610 1,686.120 0.000 -90.000 282.550
KN-91-42 9,754.510 16,058.390 1,682.630 0.000 -90.000 282.550
KN-91-43 9,858.690 16,057.470 1,672.650 0.000 -90.000 273.400
KN-91-44 9,955.170 16,057.730 1,665.760 0.000 -90.000 270.350
KN-91-45 10,057.430 16,058.110 1,678.510 0.000 -90.000 276.450
KN-91-46 9,957.470 15,757.070 1,694.130 0.000 -90.000 340.470
KN-91-47 9,658.470 15,755.950 1,762.700 0.000 -90.000 367.890
KN-91-48 9,559.070 15,857.140 1,743.140 0.000 -90.000 338.940
KN-91-49 9,555.450 15,756.910 1,752.920 0.000 -90.000 431.290
KN-91-50 9,660.940 15,656.020 1,741.060 0.000 -90.000 443.480
KN-91-51 9,757.670 15,657.320 1,738.500 0.000 -90.000 337.410
KN-91-52 8,873.880 15,756.100 1,626.500 0.000 -90.000 154.530
KN-91-53 8,897.850 15,568.100 1,652.500 0.000 -90.000 154.530
KN-91-54 8,908.830 15,426.090 1,710.500 0.000 -90.000 212.450
KN-91-55 9,109.860 15,578.060 1,666.500 0.000 -90.000 169.770
KN-91-56 9,062.890 15,764.070 1,640.500 0.000 -90.000 154.530
KN-91-57 9,088.910 15,891.060 1,638.500 0.000 -90.000 54.250
KN-92-63 8,837.110 15,189.310 1,853.700 0.000 -90.000 165.500
KN-92-64 8,836.860 15,010.230 1,807.600 0.000 -90.000 199.700
KN-92-66 8,293.980 15,116.580 1,707.400 0.000 -90.000 151.800
KN-92-67 8,287.820 15,264.650 1,690.910 0.000 -90.000 148.700
KN-92-68 9,014.490 14,914.230 1,857.200 270.000 -60.000 132.300
KN-92-69 9,050.530 14,756.210 1,844.900 0.000 -90.000 125.900
KN-92-70 9,163.050 14,605.680 1,764.560 0.000 -90.000 150.000
KN-92-75 10,492.890 16,102.470 1,700.720 0.000 -90.000 252.400
KN-92-76 10,695.130 16,108.760 1,678.160 0.000 -90.000 197.500
KN-92-77 10,501.790 15,954.890 1,711.340 0.000 -90.000 228.000
KN-92-78 10,728.350 15,979.310 1,695.610 0.000 -90.000 203.300
KN-92-79 10,934.760 16,021.320 1,695.610 0.000 -90.000 172.800
KN-92-80 10,714.270 15,838.950 1,710.970 0.000 -90.000 118.000
KN-92-81 10,450.720 16,197.050 1,699.120 0.000 -90.000 294.700
KN-92-82 9,040.850 15,058.270 1,887.170 0.000 -90.000 90.500
KN-92-83 9,559.320 15,647.800 1,772.560 0.000 -90.000 264.300
KN-92-84 9,430.490 16,065.500 1,722.400 0.000 -90.000 166.700
KN-92-85 9,449.940 15,973.580 1,731.900 0.000 -90.000 181.700
KN-92-86 10,596.850 16,109.640 1,683.900 0.000 -90.000 252.100
KN-92-87 10,551.380 16,194.700 1,679.300 0.000 -90.000 316.100
KN-00-08 10,261.630 15,897.930 1,776.900 0.000 -80.000 454.200
KN-00-10 10,225.930 15,790.360 1,747.940 0.000 -80.000 521.210
KN-00-11 10,398.410 15,944.160 1,733.800 340.000 -80.000 509.020
KN-00-12 10,282.240 16,018.290 1,794.380 340.000 -80.000 674.000
KN-01-03 10,265.770 16,117.460 1,787.190 0.000 -80.000 600.500
KN-01-04 10,268.010 16,207.840 1,792.530 2.000 -80.500 597.410
KN-01-12 10,259.500 16,276.930 1,803.180 0.000 -72.500 548.640
KN-02-01 10,458.930 16,139.050 1,699.050 0.000 -80.000 623.930
KN-02-03 10,460.780 16,033.030 1,707.690 0.000 -80.000 770.230
KN-02-04 10,578.570 16,289.420 1,645.410 0.000 -75.000 451.000
KN-02-05 10,356.230 16,236.270 1,736.820 0.000 -85.000 590.400
KN-02-08 10,249.180 16,367.610 1,818.000 0.000 -70.000 423.700
35 of 138
Survey Coordinates
KN-02-09 10,358.300 16,320.290 1,736.580 0.000 -85.000 578.210
KN-02-13 10,360.320 16,046.030 1,738.060 0.000 -85.000 691.000
KN-02-16 10,362.250 15,844.150 1,740.970 0.000 -85.000 804.000
KN-02-19 10,364.550 16,440.961 1,729.900 0.000 -85.000 469.390
KN-02-25 10,759.920 15,976.200 1,694.260 180.000 -75.000 764.130
KN-03-01 9,070.000 14,876.030 1,864.930 0.000 -90.000 643.430
KN-03-02 9,253.790 14,997.170 1,895.900 0.000 -80.000 648.300
KN-03-03 9,266.120 15,184.130 1,916.510 0.000 -90.000 695.000
KN-03-04 8,843.880 15,209.740 1,857.830 0.000 -75.000 657.500
KN-03-05 8,563.900 14,930.060 1,706.270 0.000 -90.000 524.300
KN-03-06 9,471.260 15,337.630 1,930.280 180.000 -80.000 650.500
KN-03-07 9,430.930 15,546.520 1,852.760 180.000 -85.000 570.500
KN-03-08 8,759.960 15,218.760 1,850.950 0.000 -85.000 566.000
KN-03-09 8,985.790 16,591.539 1,493.290 0.000 -50.000 349.600
KN-03-10 8,859.810 15,694.450 1,632.790 0.000 -65.000 449.000
KN-03-11 9,245.500 15,667.670 1,747.510 0.000 -80.000 572.100
KN-03-12 9,076.040 15,381.490 1,719.840 0.000 -90.000 558.400
KN-03-13 9,662.070 15,835.470 1,741.570 180.000 -85.000 475.500
KN-03-14 10,162.700 16,006.150 1,718.370 0.000 -90.000 518.200
KN-03-15 10,456.500 16,033.400 1,707.700 80.000 -45.000 153.920
KN-03-16 9,960.540 15,998.020 1,672.500 0.000 -85.000 442.600
KN-03-17 10,456.500 16,033.400 1,707.700 260.000 -45.000 406.300
KN-03-18 10,062.130 16,088.180 1,678.180 0.000 -90.000 457.200
KN-03-19 10,763.430 16,081.770 1,683.830 90.000 -45.000 397.100
KN-03-20 10,760.230 16,078.360 1,683.700 0.000 -82.000 438.000
KN-03-21 9,960.450 16,307.870 1,653.300 0.000 -90.000 151.500
KN-03-22 10,020.430 16,211.880 1,666.230 0.000 -90.000 148.400
KN-03-23 9,651.100 16,150.800 1,674.770 0.000 -90.000 90.000
KN-03-24 9,681.410 16,251.370 1,653.230 0.000 -90.000 102.700
CD-03 8,527.670 17,171.221 1,416.860 0.000 -90.000 294.700
CD-04 8,985.970 16,594.449 1,493.250 180.000 -65.000 340.500
CD-05 9,540.200 16,640.859 1,554.490 0.000 -70.000 313.000
CD-06 8,984.280 16,087.570 1,608.130 180.000 -70.000 305.100
CD-07 8,299.440 16,629.980 1,558.450 0.000 -70.000 316.100
CD-18 10,764.390 16,682.180 1,547.000 0.000 -80.000 451.100
DH-03-14 10,701.100 16,772.520 1,541.000 0.000 -90.000 16.750
KN-02-53 8,538.420 15,115.090 1,809.550 180.000 -80.000 40.040
KN-02-57 10,939.800 16,023.930 1,695.890 93.000 -60.000 429.000
KN-02-58 10,059.820 16,310.460 1,687.420 6.000 -60.000 591.000
KP-03-01 10,395.320 16,224.400 1,717.120 260.000 -50.000 688.100
KP-03-02 10,402.090 16,302.830 1,711.260 330.000 -65.000 529.600
KP-03-03 10,501.840 16,302.050 1,672.980 30.000 -60.000 551.800
KP-03-04 10,615.180 16,177.830 1,673.080 90.000 -65.000 499.090
KP-03-05 10,499.580 16,106.070 1,699.320 130.000 -60.000 480.800
KP-03-06 10,355.000 16,095.750 1,737.090 200.000 -60.000 501.520
KP-03-07 9,860.270 15,942.360 1,683.900 230.000 -65.000 453.200
KN-02-54 10,162.410 15,915.340 1,718.710 180.000 -55.000 557.010
36 of 138
11. Sampling Method and Approach
Pincock Allan Holts Vancouver based consulting group, was hired to

develop a sampling program for the project prior to the 2002 exploration
season, the same program was carried forward to the 2003 season. The
quality assurance/quality control (QA/QC) program established in 2002 and
continued in 2003 included blind duplicate, blank, and standard samples.
Blind duplicate samples were used to monitor and measure precision

as well as bias. Blank samples represent material with very low
concentrations of copper and gold and were used to test for contamination
of the samples. Standard samples and assay checks were used to test the
degree of accuracy. In total, 1,109 samples were sent for quality control
purposes, as blind duplicates, blanks or standards, representing
approximately one in every 26 samples or 3.9% of the samples collected
during 2002 and 2003.
It was concluded that results reported by Chemex Labs were within

acceptable error limits with respect to accuracy. The testing of precision
indicated results show up to 7% variation for gold and 1.5% variation for
copper, both values indicating precise results. The amount of contamination
was deemed to be minimal.
Samples from the Kemess North project are totally drill core based,
there are no trench or grab samples in the database. Sample intervals were
determined by a geologist, according to lithology, and ranged from 0.3 to 2.0
m, with the average length of samples being 1.8 m. Core was split using a
diamond saw. Because of the low-grade nature of the mineralization, and
difficulty determining potential ore from non-ore material, the entire drill hole
is sampled. Once in a uniform rock type, the sample spacing was generally
2.0 m. The maximum 2 m-sample length was chosen so that more detail
could be gained concerning the distribution of grade. As well, the 2 m core
length provides a representative sample weight for NQ core. For HQ core, a
maximum sample length of 1.5 m was applied.
The Kemess North project area is approximately 4,000 m in an

east/west direction and 2 ,700 m north/south and over 1, 000 m vertical. For
the most part, the drill hole spacing is less than 100 m, though the deepest
portions of the potential pit area have approximately 100 m-drill hole
spacing.
The current database contains 198 drill holes with an average length
of 390 m, with the majority in the 200 m to 600 m range. There are a few
short holes less than 100 m, while the deepest hole is 1 ,011 m.
The Broken Zone, which presents challenging drilling conditions,

covers much of the property. Historically, drilling an HQ diameter hole (64
37 of 138
mm core) to act as casing for NQ (48 mm core), which usually was used to
complete the hole, has solved the problem. In rare instances reduction to
BQ (37 mm core) was necessary to reach target depth. The core recovery is
very high with an average of ~70% in the Broken Zone, and ~100% in the
remainder.
A test was conducted to compare assay results from holes with steep
angles to holes with shallow angles. In total 29 holes were drilled at shallow
angles (less than -60) so that oriented core could be obtained to assist with
the geotechnical program. It was found that there is no significant grade
variation between the two data sets. Because the angle holes tested various
different directions, it appears likely that there is no preferred vein
orientation in the deposit that could be missed with steep drilling.
The term true thickness is not generally applicable to porphyry

deposits as the entire rock mass is potentially ore grade material and there
is no preferred orientation to the mineralization. Because of the potential of
ore grade material through the entire length of the hole, sampling was
generally continuous from the top to the bottom. The mineralization is
generally confined to three main lithologies, hypogene monzonite, Takla
BFP (bladed feldspar porphyry) and Takla volcanics. These lithologies form
large massive bodies underlying the central and eastern cirques. The
mineralization is generally flat lying within the various lithologies. The
mineralized Takla volcanic and intrusive rocks show generally vertical
contacts. The higher-grade monzodiorite intrusive in the East Cirque
appears to be an inclined tabular body, dipping 20 to the south.
It is our opinion that the sampling and assay program was carried out
with the reasonable care and skill expected of the engineering profession.
12. Sample Preparation, Analysis and Security
Drilling since 2001 has been the most important exploration carried
out on the Kemess North property. This new drilling forms the basis of the
mineable resource as the pre-2001 drilling was not deep enough to test the
higher-grade zones. As well, more than of the assays have been
completed since 2001. The evaluation of the sample Preparation, Analysis,
and Security has therefore been focused on the 2001 and later activities.
The drill core was logged by a small team of geologists, split using a
rock saw, and then samples were passed through primary crushing. During
the 2002 program, a portable sample preparation lab was leased from ALS
Chemex. For the 2003 program, a sample -bucking facility was built near the
mill area.
The core samples were dried then crushed to 80% passing 10 mesh
at the mine site. Each sample is riffled twice with one split being retained at
38 of 138
the mine, and a 250 g sample sent to the lab. The remainder of the sample
was discarded.
The portion of sample retained at the mine site is kept in a plastic bag
with a sample tag and stored in a plastic pail. The portion of the sample sent
to the lab was placed in a plastic bag with a sample tag, shipped in a plastic
pail with two security tags, the pail top was sealed and taped. A submission
sheet was sent along with each pail of samples that included the name of
the sample preparation person, the date, the sample numbers, the number
of samples, and the numbers of the security tags.
The core storage site near Kemess Lake is a well-organized facility.

The remaining cores are still in core boxes and are available for geology
reviews as well as check assays.
Work completed by employees of the company included core logging,

sample layout, sample splitting and preliminary sample preparation. A
professional geologist oversaw all of the work from core logging to sample
splitting, while the Chief assayer at the mine oversaw the preliminary sample
preparation, and shipping.
Chemex Labs carried out more than 76% of the total assays for this
project. The lab is widely used by the mining and exploration industry and
carries the highest certification as registered assayers, including ISO 9002,
ISO:9001:2000, and they are working towards ISO 17025.
In total, excluding quality control samples, 28,831 samples were

submitted to Chemex for copper and gold analyses during the 2002 and
2003 field seasons (the samples from the 2002 and 2003 programs
represent more than 76% of the total assay data). The copper analyses
were completed by atomic absorption spectrometry (AA), following a triple
acid digestion. Gold analyses were completed by standard one assay ton
fire assay with AA finish.
The remaining 24% of the assay work was carried out by various
other labs for the earlier exploration companies including Kennco, Getty,
Shell Oil, and El Condor. Historical records of the Sampling, Analysis, and
Security of this earlier work are not available. Most of this work is for shallow
drilling and the project is sensitive to the deeper part of the deposit.
It is our opinion that the sampling and assay program was carried out
with the reasonable care and skill expected of the engineering profession.
39 of 138
13. Data Verification
In total, three days were spent at the Kemess mine site verifying the
geological database, as well as at least three days doing verification in the
office. During the field check, six drill holes were visited, the holes have
been left with the surface casing in place; the collars are marked with pieces
of 4x4 wood stuck into the casing pipe and metal labels nailed to the posts.
As well as the six holes visited, many more collar markers were visible. The
area has many roads that have been built to access drill sites.
The second step with the field verification was to visit the core
storage area. All of the core is stored in racks, which are well built, marked
and mapped out. A legend is available showing where each hole is stored
by rack number. All of the core is split with a diamond saw and weather
resistant sample tags have been used to mark sample intervals. The tags
are stapled to the edge of the core box at the beginning of the sample
interval. Depth markers have been converted to metric. Sample numbers
correspond with core logging sheets. Sample lengths were between 1.5 m
and 2.0 m. It was observed that there have been samples taken for SG
testing and metallurgical testing; both sample sets were well marked in the
core boxes.
The database verification process included comparing original, hand -

written geology core logging sheets with the database, which is computer
based. Items checked included drill hole number, hole orientation,
lithologies, depths of lithologies and sample numbers. Sample numbers and
assay results were checked against original lab reports. In total, the
database was verified using 33 drill holes from within the potential mine
area, representing approximately 35% of the total. It was determined that
sample numbers and lithology depths on core-logging sheets correspond to
the database. As well, assay results reported in the database correspond
with hard copy assay sheets provided by the laboratory.
Lithology and alteration codes in the database do not always agree

with the original core logging sheets. The problem appears to be the
enormous amount of data and the fact that numerous geologists have
logged the drill holes over a period of many years. This potential problem
was overcome by amalgamating the lithology into four lithology and three
alteration blocks to represent the deposit. These more global units were
modelled wire-framed 3 -D solids and then drill hole lithologies and alte ration
were back-coded according to the 3-D lithology or alteration block that
portion of the hole was in.
The verification program has been limited to a significant number of

holes, but not all of them. In total 47 drill holes were checked out of a total of
93 holes in the potential pit area. The data verified was deemed to be
representative of the database and the potential mine area. It is believed
40 of 138
that the work completed by the exploration group has been diligent and has
been carried out with care and skill expected of the engineering profession.
14. Adjacent Properties
From: Northgate Exploration Limited, Press Release, Tuesday

November 25, 2003, 7:09pm ET. The authors were Chris Rockingham and
Carl Edmunds.
The exploration staff investigated several mineral occurrences in the

Kemess mine and Kemess North areas during the 2003 field season. In total
24 diamond drill holes were completed for a total of 10,003 m, an airborne
geophysical survey, prospecting and geological mapping was completed.
Highlights of this work include the following:
Nugget Zone
The bulk of the drilling was directed towards locating a nearer-surface

extension of the porphyry gold-copper system at the Nugget Zone, one
kilometre southwest of Kemess North. In total, 12 holes were drilled at the
Nugget Zone in 2003 as a follow-up to last years discovery of porphyry
mineralization. The most significant hole is KN-03-12 that intersected
419.4 m of 0.38g/t gold and 0.13% Cu from 24.4 m to 443.8 m. While the
extent of the mineralization is not ye t defined, this near-surface discovery
leaves open the possibility of developing a small open pit adjacent to
Kemess North, that could further increase throughput to the Kemess mill
once the Kemess North project is brought up to full production in 2010.
A preliminary review of the Nugget property was undertaken. Several

drill sites were visited in the field, and some of the drill core was inspected.
As well, several of the drill hole files were compared with the database to
ensure data integrity.
Duncan Ridge
Several occurrences of skarn/carbonate replacement type

mineralization were identified on the Kemess property during the 2003
exploration season. These occur in the Permian aged rocks that
stratigraphically underlie the Kemess deposits. The most interesting
occurrence is located on Duncan Ridge, five kilometre west of Kemess
North, where hole DR-03-01 intersected 11.75m of 0.8% Cu, 2.24% Zn and
12.7g/t silver from 311.9 m to 323.65 m. While this intersection is well below
the surface of Duncan Ridge, if an economic deposit is eventually defined, it
could be accessed with a relatively short adit from either side of the ridge.
Follow-up work next year will consist of deep penetrating down-hole
electromagnetic surveys to assist in planning further drill holes.
41 of 138
Other Areas of Interest
The Bear Claims were staked, to the south of and adjacent to the
existing Kemess claim block. The oxidized Toodoggone volcanic rocks that
originally covered the south area of the Kemess South open pit hindered
exploration in this area at the time of discovery and delineation of the
deposit because induced polarization geophysical surveys were unable to
detect the covered part of the deposit. The company will integrate the results
of this years airborne geophysical survey with a deep penetrating ground
geophysical survey, to be carried out in 2004, in order to identify conductive
argillic alteration zone that may be associated with any other hidden
porphyry deposits.
Prospecting on the Kemess property and other claims in the district

has identified several higher-grade, precious metal and base metal
showings that require further examination. The most interesting of these
new occurrences are the Hilda and Archie showings. The Hilda showing is a
series of angular boulders in clay rich till 2.5 km east-northeast of the
eastern cirque at Kemess North. The average grade of eight selected grab
samples was 5g/t gold, 44g/t silver, 0.84% Cu, 2.5% zinc and 1% lead.
Based on the available data, these are interpreted to be from a mesothermal
vein, similar to the geological setting at Comincos former Snip Mine where
just over one million ounces was mined at an average grade of 25g/t Au.
The Archie showing is a narrow quartz magnetite vein occurrence

with visible gold that may be indicative of a sheeted vein type system with
bulk tonnage potential.
Both of these occurrences were discovered late in the season, and as

a result, a more detailed follow-up will not commence until the 2004
exploration season begins in June.
42 of 138
Figure 9: Kemess Claim and Surrounding Properties
Figure 9 shows the mineral tenures adjacent to Northgates mining

claims at Kemess. The most significant and nearest mineral occurrence is
the Pine Prospect on ground controlled by Stealth Minerals. A pre 43-101
resource statement prepared by Stealth geologists estimates the Pine Cu-
43 of 138
Au prospect to host 160 Mt grading 0.50 g/t Au and 0.20% Cu defined by 34
drill holes of 7,889 m. Exploration work planned for 2004 by Stealth includes
6,000 m of drilling on a series of epithermal gold and silver occurrences
located to the north and east of the map area. Stealths extensive land
holdings in the Toodoggone District cover 288 km 2.
Finlay Minerals controls 18.2 km2 of mining claims immediately

adjacent and north of the Kemess North deposit on the Atty Property. The
most significant mineral occurrence is referred to as the Atty. This is a
300 ha Cu-Au soil anomaly hosted in pyritic Takla volcanic rocks within
which there is a 10 ha IP chargeability anomaly. To date, the property has
not been drilled, but significant work is planned for 2004.
Auterra Ventures holds 4 patented claims on Duncan Ridge totalling

83 ha, known as the Cairn Property. The property is one of the oldest claims
in the district and has occurrences of structurally-controlled veins, shears,
breccias and carbonate replacement/skarn mineralization from which a
highly selected grab sample assayed 9.99% Cu, 245 g/t Ag, 8.8% Zn and
0.6% Pb.
15. Mineral Processing and Metallurgical Testing
Hatch was retained to evaluate the metallurgical aspects of the

project and input to the completion of the revised project Pre-Feasibility
Study and financial model. Hatchs predictions of plant recovery and
processing performance, capacities, and costs have also been used as
inputs to the economic pit limit evaluation.
The Kemess North ore will be processed in the existing Kemess

plant, initially with integrated co-production with the current Kemess South
ore and eventually, after 4 years, as a stand-alone operation. During the co-
production period the plant capacity will be increased and an ore
transportation system from Kemess North will be installed. This will include
an Underground ore conveyor system and pit-side crushers. The current
capacities, costs and metallurgical performance of the plant a re well defined
and carry a high level of assurance into the Kemess North project
performance and cost estimates. The important points for evaluation for the
Kemess North Mineral Project are the metallurgical sampling, prediction of
metallurgical performance through the known Kemess mill, and the
performance and cost estimates for the new plant expansion and ore
transportation systems.
The relevance of the metallurgical testing is dependant on the

location of the metallurgical samples with respect to the Mi ne plan. Table
15.1 lists the metallurgical test samples referenced in the Konigsmann
report of May 2003 and the drillholes they were taken from. Figure 10 shows
a plot of these met samples over plotted on the ultimate pit design (P634).
44 of 138
This indicates that the met samples were well located to represent the deep
ore for the Kemess North deposit. Future testing should also be done on the
shallow ore on the west side of the pit for more detailed prediction of
operating performance during the earlier years of the project. Since the
project viability is dependant on the performance of the deep, higher grade
ore, and during the earlier schedule periods plant feed will also be provided
from Kemess South, these shallower samples are not considered to be
critical to the project viability.
Table 15.1: Metallurgy Samples with Drill Hole References
Sample
Drill Holes
#
1 KN-00-12 KN-02-01 KN-02-04 KN-02-05 KN-02-09
2 KN-02-01 KN-02-03 KN-02-05 KN-02-07 KN-02-09 KN-02-13 KN-02-16 KN-02-24
3 KN-02-01 KN-02-03 KN-02-05 KN-02-13 KN-02-16 KN-02-18 KN-02-24
4 KN-01-17 KN-02-01 KN-02-03 KN-02-07 KN-02-13 KN-02-16 KN-02-24
5 KN-02-0102-03 KN-02-06 KN-02-07
6 KN-02-01 KN-02-04 KN-02-05 KN-02-06 KN-02-09
7 KN-02-05 KN-02-06 KN-02-09
8 KN-02-05 KN-02-08 KN-02-09
9 KN-02-01 KN-02-03
10 KN-02-01 KN-02-04 KN-02-06
11 KN-02-01 KN-02-05 KN-02-06 KN-02-09 KN-02-10 KN-02-21
12 KN-02-01 KN-02-05 KN-02-06 KN-02-08 KN-02-09 KN-02-21
13 KN-02-16 KN-02-18 KN-02-24
14 KN-02-13 KN-02-16 KN-02-24
15 KN-02-13 KN-02-24
16 KN-02-14 KN-02-17 KN-02-21
17 KN-02-14 KN-02-17 KN-02-36 KN-02-39
18 KN-02-10 KN-02-17 KN-02-21 KN-02-39
19 KN-02-03 KN-02-07 KN-02-24
20 KN-02-03 KN-02-07 KN-02-13 KN-02-24
21 KN-02-03 KN-02-07 KN-02-13 KN-02-16 KN-02-24
22 KN-02-03 KN-02-13
23 KN-02-03 KN-02-07 KN-02-13 KN-02-15
24 KN-02-15 KN-02-33 KN-02-36
25 KN-02-10 KN-02-14 KN-02-15 KN-02-17 KN-02-21 KN-02-46
26 KN-02-14 KN-02-15 KN-02-17 KN-02-21 KN-02-39
27 KN-02-14 KN-02-15 KN-02-17 KN-02-38 KN-02-39
28 KN-02-15 KN-02-33
29 KN-02-01 KN-02-13 KN-02-14 KN-02-15 KN-02-15 KN-02-16 KN-02-17 KN-02-33 KN-02-39
30 KN-02-14 KN-02-15 KN-02-17 KN-02-39
45 of 138
Figure 10: Pit 634 with Met Sample Drill Holes
The following is from Hatch summarizing the metallurgical test work.
The metallurgy of the Kemess North deposit has been investigated by

Northgate. A report titled Summary Report on Process Development
Treatment of Ores from the Kemess North Deposit was issued by Klaus
Konigsmann PEng, in May 2003. Hatch concurs with these findings and the
sections below have been extracted from the Konigsmann report.
Interpretation of the Kemess North metallurgy has been based o n

laboratory results attained at Lakefield Research over the period January to
May 2003. The Lakefield report was titled An Update of Metallurgical
Testing of Kemess Ores, June 10, 2003. Lakefield completed additional
variability testing on the Kemess North ores and issued a supplementary
report in November 2003 essentially confirming the previous work.
46 of 138
Additional metallurgical reports referenced are Amtel Ltd.s Kemess
North Preliminary Metallurgical Testing June 2001, Characterisation of
Copper and Gold occurrences in Composites of the Kemess North Deposit,
Summer 2002 and Gold Deportment in Copper Cleaner Scavenger
Tailings, May 2003.
The ores of Kemess North share a number of favourable

characteristics with the Hypogene ores of the Kemess South deposit:
Both deposits carry clean sulphides without surface oxidation.
Impurity elements occur in extremely low concentrations.
The sulphides are coarse grained and are adequately liberated for
rougher flotation at a grind of K80 at 145 .
Ball mill work indices are low compared to a majority of porphyry

deposits.
Ball mill work indices for samples of two recent plant surveys were
13.8 and 15.0 kWh/t. The BMWI for the sample used in laboratory
testing was only 12.5, well below average. The samples of Kemess
North averaged 13.8 kWh/t.
The average metal contents of North ores are slightly lower, copper
at 0.20% Cu versus 0.22% Cu and gold at 0.4 g/t Au versus 0.75 g/t
for South ores.
The pyrite content of Kemess North averages 4% compared to 1%

pyrite for the South ores. Since pyrite contains finely disseminated
gold, higher pyrite carries a larger portion of gold to tailings.
The near surface ores of the North deposit are of slightly lower grade
than those of deeper zones.
The rougher flotation with Kemess North ores in essence is a bulk

sulphide float. Rougher concentrates have to be re-ground to a K80
of =20 microns for cleaner flotation to produce quality concentrates.
Existing flotation cell capacity and de-watering equipment are

adequate for treatment of North ores.
Concentrates will be free of deleterious impurities.
The ultimate settling density of North tailings is at least 66 % solids at

a pulp density of 1.74.
47 of 138
The Net Neutralization Potential for all North composites is negative,
averaging -50 tons CaCO3/1000t of tailings. The tailings will be acid
generating unless stored under water cover.
The results of the Lakefield metallurgical test work on seven

composites from different ore zones led to the following projection of plant
performance:
Table 15.2: Summarized Kemess North Metallurgy
Ore Type Bond Ball Copper Copper Gold

Mill Work Concentrate Recovery Recovery
Index Grade
% Cu Cu % Au%
Near Surface Ores 15.1 23 85 61
Upper Zone Ores 12.8 22 to 24 86 60
Middle Zone Ores 14.2 22 to 24 86 50 to 60
Lower Zone Ores 14.4 24 to 26 92 60 to 70
Subsequent analytical work has been completed on the samples from

the flotation test work and determined that there was a relationship between
Ag and Au in the concentrate for the various pit zones. These results have
been summarized in Table 15.3 .
Table 15.3: Silver Metallurgy for Kemess North
Ore Type Silver Recovery Ag/Au

Ag % (in concentrate)
Near Surface Ores 40 to 45 2.9

Upper Zone Ores 40 to 45 3.3
Middle Zone Ores 40 to 45 3.0
Lower Zone Ores 50 to 55 3.0
48 of 138
16. Mineral Resource and Mineral Reserve Estimates
The Geological modelling, mine planning, and Resource/Reserve

estimating was done using MineSight mine planning software from Mintec,
a well accepted and proven software system in the industry. The Geological
model was built by Abdullah Arik of Mintec, a Geostatistician and Qualified
Person as listed in Section 21.
(a) Geological Model
Adapted from: Mintec Ltd., Geostatistical analysis and interpolation

methodology Kemess North. Author: Abdullah Arik, March 2004.
The resource estimate has been determined from a 3 -D block model

of the deposit. The model was built with 20 m x 20 m x 15 m size blocks
covering a volume 4 ,000 m in an east/west direction, 2 , 700 m north/south,
and 1 , 000 m vertical. A geostatistical analysis of the database was
completed and interpolation methodology and parameters determined.
A summary of information from the database and geostatistical

resource estimate work includes the following:
198 drill holes.
40,237 copper assays.
39,821 gold assays.
1.35% Cu was used as an outlier cutoff grade for copper; 14 assays

are higher than the cutoff for copper.
4.0 g/t Au was used as an outlier cutoff grade for gold; 16 assays are
higher than the cutoff for gold.
Copper and gold show a correlation factor of 0.80.
Outlier high grade cutoffs were applied to both Copper and Go ld. 14
Copper assays were cut to 1.35% and 16 high grade Gold assays
were cut to 4 g/t. The cut grades were used in compositing.
5 m and 15 m fixed length composites were generated for

comparison of the composite length on grade dilution and loss effects
with respect to the original assays.
49 of 138
Dilution effects of composites were studied. Dilution was calculated to
range, depending on litho type, between 5.4% and 13.5% for the 5 m
composites and 8% and 18.5% for the 15m composites. Metal losses
were calculated to be between 1.5% and 11.7% for the 5 m
composites, and 1.4% and 16.7% for the 15m composites, again
depending on litho type. The 5m composites were chosen which is
reasonable for this type of deposit.
The influence of a few remaining high-grade composites were limited

to a maximum of 50 m during interpolation.
Five lithology codes were used:
0 = undefined lithologies;
4 = Toodoggone; mainly waste material;
5 = Hypogene monzodiorite;
6 = Takla volcanics; and
7 = Takla BFP.
3-D solid wire frame models based on the drill hole intercepts were
provided by Northgate for the above Litho types. The composites
were then tagged with a Litho code according to the 3-D solid they
were included in on a majority (length) basis.
Variograms (both grade and directional) using the 5m composites

were studied for Litho codes 5, 6, and 7. The trend of the
mineralization was determined using the directional variograms and
the subsequent contouring of these variograms. The ranges of
influence of the grades were based on the shape of the variograms.
The variograms resulted in a nested type structure for modelling,
indicating generally a good correlation in short ranges of 40 m to
60 m, and continuing but decreased correlations in the longer ranges,
150 m to 250 m. Kriging parameters were determined from the
variograms for Litho zones 5, 6, and 7.
A contact analysis was completed; this study indicated that the

transition zone across the Litho boundaries, ranged from 30 m to
50 m depending on location and litho code. As this distance is less
than the typical drill spacing, a hard-boundary approach, interpolating
each Litho zone separately, is justified.
50 of 138
Since it was not possible to correct or re-survey the 18 suspect holes,
two models were built, one with all of the drill holes, where the suspect holes
had their down hole surveys corrected, and the second with the 18 suspect
drill holes removed (see Section 10, Down Hole Survey). The intention was
that these holes would be added back in later, after the corrected surveys
were verified. Subsequent mine planning work with the two models, using
the project base economic parameters, showed a significant reduction in the
economic pit size with the model with the holes missing. Similar pit sizes for
the two model were achieved with only a 5% difference in price. With this
sensitivity it was decided for the mine planning work, to use the model
including the corrected holes since the assays are valid and excluding the
holes is less representative than using the corrected holes.
The modelling process was identical for the 2 models. The 3 -D block
models included the following dimensions. The block height was chosen to
match the bench height for the mining equipment being used in the mine
plan.
Table 16.1: Resource Model Limits and Dimensions
Minimum Maximum Block Size No. of Blocks

East 8,000 12,000 20 200
North 14,500 17,200 20 135
Elevation 850 2005 15 77
The items in the block model include the following general

description:
TOPO Portion of the block below topography (%)
Grades Interpolated values from drill holes
Zones Numeric code values assigned from 3-D solids, etc.
ORE% Portion of the block that is within the mineralized zone
Classes Numeric codes assigned during interpolation
Values Calculated from other items and input variable. Includes

economic design variables.
51 of 138
The 3-D Block models for Kemess North include the following items:
Item Minimum Maximum Precision Description

TOPO 0 100 1 Topography%
CUKRG 0 2 0.001 Cu% from kriging
CUIDW 0 2 0.001 Cu% from IDW interpolation
CUPLY 0 2 0.001 Cu% from polygonal method
AUKRG 0 4 0.001 Au g/t from kriging
AUIDW 0 4 0.001 Au g/t from IDW interpolation
AUPLY 0 4 0.001 Au g/t from polygonal method
LITHO 0 10 1 Rock type
DIST 0 500 1 Distance to nearest hole (m)
NCOMP 0 50 1 Number of composites used
NDH 0 25 1 Number of dhs used
KRGVR 0 4 0.001 Kriging variance
CUEQ 0 4 0.001 Extra
AUEQ 0 8 0.001 Extra
ORE% 0 100 1 Ore Percent
SG 0 5 0.01 Extra
CLASS 0 5 1 Resource classification codes
Other1 Other economic items
Other2 Other material Characteristics
Values were assigned or interpolated to the blocks in the model

as follows:
TOPO Assigned based on the project topography surface
LITHO Assigned from the 3 -D solids. Value assigned is for

majority Litho zone if multiple zo nes intersect a block.
ORE% Calculated as the percent within the Litho Zones. Blocks

without a LITHO code or with LITHO = 0 have ORE%
and therefore report to waste.
AU Interpolated from 5 m composites using geology

matching based on LITHO code. AUKRG uses kriging,
AUIDW uses inverse distance weighting, and AUPLY
uses the polygonal method. The interpolation steps are
listed below.
52 of 138
CU Interpolated from 5 m composites using geology
matching based on LITHO code. CUKRG uses kriging,
CUIDW uses inverse distance weighting, and CUPLY
uses the polygonal method. The interpolation steps are
listed below.
CUEQ Calculated from the kriged copper and gold grades and
the project base design parameters.
AUEQ Calculated from the kriged copper and gold grades and
the project base design parameters.
CLASS The Resource/Reserve Classification code:

1 = Measured/Proven
2 = Indicate/Probable
3 = Inferred
The grade interpolation method and search distances for kriging were
based on the Geostatistical analysis and variogram parameters. A minimum
of 3 and a maximum of 16 composites were used for the interpolations with
maximum 4 composites from each quadrant. The maximum search for the
composites was limited to 200 m. The general steps were:
A background interpolation was done using the inverse distance

weighting to a power of three without using the litho boundaries. The idea
with the background interpolation was to assign grades to all the blocks with
no litho codes and those with litho code 4. Search distances were limited to
200m, wi th a limited vertical search of one bench. These background values
were assigned to both the kriged and IDW grade values
Separate IDW runs were made for AU & CU for LITHO codes 5, 6, &
7 (6 runs) using the specific interpolating parameters for each metal b y
zone. For blocks that meet the selection criteria the background values were
over written.
Separate Ordinary Kriging (OK) runs were made for AU & CU for
LITHO codes 5, 6, & 7 (6 runs) using the specific interpolating parameters
for each metal by zone. For blocks that meet the selection criteria the
background values were over written.
The reserves Class codes were assigned based on the Geostatistical

analysis and the following items loaded into the model during the grade
interpolation runs.
DIST - Distance to the nearest drill hole from the centre of

the block
53 of 138
NCOMP - Number of composites used in the interpolation of a
block
LITHO - Rock codes 5, 6, & 7
The distances used in the resource CLASS item were deduced from
the ranges of the global indicator variogram determined for CU within L ITHO
5, 6, and 7 zones. These are listed in Table 16.2. The 50 m-distance used in
the measured classification was deduced from the range of the first structure
of the indicator variogram. The 150 m-distance used for the indicated
resource category was derived based on the range of the same variogram
corresponding approximately to 80% of the sill. The variogram range for the
second structure extends up to 285 m, but the correlation between
composites beyond 200 m is not significant.
Table 16.2: Resource Classification Criteria Used
1 2 3
Measured Resources Indicated Resources Inferred Resources
DIST = < 30 m DIST = 31-50 m DIST > 150
or and or
NCOMP = < 5 Other blocks that
DIST = 31-50 m or cannot be classified as
and 51 m < DIST < 150 m measured or indicated
NCOMP > = 5 and
NCOMP > = 5
or
51 m < DIS T < 200 m
and
LITHO = 5, 6, or 7
(b) Mineral Resources
The following Resource and Reserve tables are based on the All Drill
Hole model and summarize the measured, indicated, and inferred
resources for the total Geological Model.
54 of 138
Table 16.3: Summary of Measured Resources

(power = 3)
0.00 739.6 0.127 0.237 0.127 0.238
0.05 589.4 0.153 0.278 0.154 0.279
0.10 435.9 0.181 0.320 0.182 0.324
0.15 263.7 0.217 0.376 0.220 0.385
0.20 123.2 0.267 0.465 0.273 0.478
0.25 52.5 0.330 0.610 0.337 0.627
0.30 27.6 0.384 0.769 0.393 0.793
0.35 15.7 0.430 0.928 0.442 0.962
0.40 8.8 0.477 1.083 0.491 1.131
0.45 4.5 0.527 1.246 0.547 1.309
0.50 2.4 0.575 1.452 0.592 1.486
Table 16.4: Summary of Indicated Resources

(power = 3)
0.00 947.9 0.098 0.186 0.098 0.185
0.05 632.8 0.136 0.235 0.135 0.234
0.10 411.2 0.170 0.289 0.170 0.289
0.15 218.9 0.210 0.350 0.209 0.349
0.20 95.9 0.259 0.437 0.257 0.434
0.25 38.5 0.317 0.569 0.314 0.567
0.30 19.0 0.365 0.714 0.362 0.714
0.35 9.6 0.409 0.895 0.406 0.897
0.40 4.2 0.457 1.099 0.465 1.104
0.45 1.8 0.502 1.206 0.513 1.219
0.50 0.8 0.547 1.251 0.547 1.249
55 of 138
Table 16.5: Summary of Inferred Resources

(power = 3)
0.00 337.1 0.040 0.068 0.040 0.068
0.05 74.1 0.131 0.164 0.131 0.164
0.10 41.9 0.175 0.217 0.175 0.217
0.15 28.4 0.196 0.234 0.196 0.234
0.20 11.2 0.234 0.307 0.234 0.307
0.25 2.9 0.276 0.397 0.276 0.397
0.30 0.27 0.357 0.542 0.357 0.542
0.35 0.18 0.376 0.589 0.376 0.589
0.40 0.06 0.407 0.646 0.407 0.646
Because of the questionable orientation, and therefore the ultimate

location, of eighteen drill holes, a test was made to compare the geologic
model with the orientation of the eighteen holes corrected and in the
database, compared to the model with the eighteen holes deleted from the
database.
The variation between the two models is considered very minor and it
falls within the margin of error for the resource calculation. The difference is
more pronounced when the effects of the economic design parameters are
applied in the ultimate pit limit qualification. This is discussed in Section (c)
below.
(c) Bulk Density
A great deal of effort has gone into the determination of the b ulk
density (referred to as SG) for the deposit. In total, more than 2,200
measurements have been performed and a weighted mean SG of 2.70 has
been determined. Four different sets of data are available, pre-1999
samples, as well as samples from 2000, 2002, and 2003. Sample material
has ranged from whole core samples 15 cm to 20 cm long for the 2003
work, quartered core for the 2000 and 2002 samples, and crushed coarse-
reject material for the pre-1999 samples. The 2003 lab work was by
Lakefield Research using their wax immersion method.
In order to determine a realistic SG for the proposed pit area, the SG

sample results were interpolated into the 3-D block model. Because of the
high number of samples and their distribution within the proposed pit it was
decided to use the interpolated SG for resource and reserve calculations .
56 of 138
The range of SG values by bench was from 2.63 to 2.72 showing a weak
trend of increasing SG with depth.
An SG of 2.66 was calculated as a default for waste material. This is

a tonnage weighted average for waste/grade categories below the
incremental economic cut-off (NSR<2.2). Similarly a default SG of 2.668
was calculated for material above the economic cutoff, for material that
didnt receive an interpolated SG value. The range in SG values for waste
material was from 2.655 to 2.674, showing very little variation (-0.2% to
+0.5% about an SG of 2.66).
(d) Model Check
Five individual segments or regions were selected from the geologic

model as manual checks for grade and tonnage. The regions each
measured 105 m high (elevation), 200 m long (north/south), and 100 m wide
(east/west). The copper and gold grade estimates were calculated by
averaging the assay grades from all of the drill hole intercepts within the
block. The tonnage was calculated by using the averaged bulk density (SG)
of the data from within the region. The comparisons are made on in situ
modeled quantities with no mining losses, dilution or cutoff grades applied.
The results are shown in Table 16.6.
Table 16.6: Model Checks
Block Estimated Variance Estimated Variance Estimated Variance

Tonnes From Cu % From Au g/t From
(Mt) Model Model Model
1 5.859 -12.8% 0.177 +8.2% 0.308 +3.6%
2 5.727 -10.8% 0.151 -3.2% 0.207 -5.5%
3 5.586 -14.2% 0.212 +7.3% 0.350 +6.8%
4 5.752 -7.1% 0.256 -7.0% 0.511 -6.5%
5 5.515 -12.3% 0.136 +1.5% 0.298 +4.4%
As shown the estimated grades are very close to the modeled grades
for both copper and gold. The estimated tonnage is consistently lower than
the model but the variance is well within the margin of error for the resource
calculation.
(e) Reconciliation
A reconciliation for the Kemess South mine was completed and

reported on in February, 2002 by MRDI. The reconciliation considered the
copper and gold grades and tonnage from the MineSight computer-
generated model relative to the actual mined volumes. MRDI reported that
57 of 138
original copper analyses are supported by production history (as reconciled
between the geologic model to blast hole and milled ore). Generally good
agreement for average grade copper values were observed while gold
exceeded expectations by an average of 15%. Annual reconciliation and
comparison of milled production to the block model showed good agreement
for copper.
(f) Mineral Reserve Estimate
The Ultimate Economic pit limit is based on a Lerchs-Grossman pit

optimization evaluation of the resource in the 3-D block model. This
evaluation includes the Project Base economic parameters, and overall
slope design parameters derived from Geotechnical evaluation of the pit
walls. (See Section 17 and Table 17.1 for details ). The economic pit limited
is also constrained to only consider Measured and Indicated Reserve Class
material to generate revenue. A final pit design, Pit 634, has been designed
based on this Ultimate economic pit limit study and from more detailed
Geotechnical slope design parameters including highwall haul roads. (See
Figure 11) The ultimate pit is made up of a Pre-strip phase and 3 production
phases as discussed in the pit design Section 17.
The Reserves within the P634 pit design are generated from 3-D
block model incorporating the following steps:
Material below topography is accounted for by the TOPO item

in the model.
A Partial is calculated as the portion of the block within the pit

based on the P634 pit design.
The Volume of ore within a block is determined by

the ORE%.
The ore portion of each block is mined first up to the amount of

material that exists within the pit.
(TOPO X Partial).
Mining recovery is estimated at 95% and is applied to each block of

ore. Contact dilution is at the contact between ore and waste, and is
estimated at 10% for blocks with 10% to 100% ore in them. When the
ORE% in a block, is less than 10%, dilution is not added. A contact block
has ORE% less than 100%. The dilution grade is estimated at 0.08 g/t Au
and 0.05% Cu which is the average grade of material below the incremental
cutoff grade. The interpolated SG is then applied to convert the calculated
bank cubic meters to tonnes. For blocks that dont have an interpolated SG,
a default value of 2.668 is applied for ore and 2.66 for waste.
58 of 138
Figure 11: Ultimate Pit Limit (P634)
Cutoff grade has been determined by using the following factors,

including:
NSP (net smelter price); copper C$0.901/lb and gold C$11.753/g.
Mill recovery factor; 88.8% for copper and 61.5% for gold.
Conversion factor; 2204.62 lb/tonne for copper and 31.1033g/oz

for gold.
59 of 138
Table 16.7: Reserve Estimate, Proven Category
NSR Bin In Situ In Situ Mineable Cu Au

(bcm x 106) (tonnes x 106) (tonnes x 106) (%) (g/t)
2.20 2.38 3.73 9.89 9.41 0.066 0.156
2.38 3.38 24.26 64.53 61.42 0.085 0.190
3.38 4.03 13.86 36.90 35.14 0.115 0.230
4.03 5.00 23.20 61.58 58.57 0.145 0.271
>5.00 46.42 123.89 117.86 0.226 0.419
Total 111.47 296.79 282.40 0.159 0.306
Table 16.8: Reserve Estimate, Probable Category


2.20 2.38 2.65 6.99 6.69 0.062 0.164
2.38 3.38 11.71 31.04 29.62 0.083 0.191
3.38 4.03 63.38 16.84 16.03 0.118 0.224
4.03 5.00 10.09 26.93 25.60 0.147 0.268
>5.00 21.22 56.62 53.91 0.233 0.438
Total 52.01 138.42 131.85 0.160 0.310
Table 16.9: Reserve Estimate, Proven and Probable


2.20 2.38 6.38 16.88 16.10 0.064 0.159
2.38 3.38 35.97 95.57 91.04 0.084 0.190
3.38 4.03 20.20 53.74 51.17 0.116 0.228
4.03 5.00 33.30 88.51 84.17 .146 0.270
>5.00 67.63 180.51 171.76 0.228 0.425
Total 163.48 435.21 414.24 0.160 0.307
The final pit indicates a strip ratio of 1:0.81 (tonnes ore to tonnes
waste).
60 of 138
17. Economic Pit Limits and Mine Plan
The entire mine planning for the Kemess North mineral property is
based on work done with MineSight a suite of software well proven in the
industry. This includes the 3-D block model described in Section 16, as well
as pit optimization, detailed design, and production scheduling.
In addition to the geology information used for the block model, other
data used for the mine planning includes the base economic parameters,
costs data from the February 2003 pre-feasibility study, Geotechnical slope
design parameters, metallurgical recoveries, and project design through put
targets. All design work is based on using the existing mining equipment
from Kemess South.
(a) Economic Pit Limits
The economic pit limit was determined using the ePit optimization
routines in MineSight which are based on the Lerchs-Grossman algorithm
(LG) and have been run to account for time value discounting. The LG runs
against the 3D Block model evaluating the costs and revenues of the blocks
within potential pit shells. The routine expands downwards and outwards
from economic surface mineable mineralization, until the last increment is at
break-even economics.
Base Design Criteria Prices, Recoveries, Costs, Ore Class
The Base Design criteria for the ePit routine are listed in Table 17.1.
The mine costs were also increased by $0.02 per bench below 1,615
elevation to account for increased haulage and pit dewatering costs as the
pit deepens. The Net Minesite Price is the market price minus all offsite
charges for concentrate transportation, smelting, refining etc.
Table 17.1: Economic Pit Design Parameters
Units Copper Gold

Net Minesite Price $Can/lb $0.901 NA
$Can/gm NA $11.753
Met. Recovery % 88.8% 61.5%
Base Mining Cost $/tonne mined $1.03 $1.03
Local Overhead and Milling $/tonne milled $2.93 $2.93
Cost
Resource Class Code 1&2 1&2
Mining Rate Benches per 10 10
year
Discount Factor % 8% 8%
61 of 138
Slope parameters
The overall slope design parameters from Knight Pisold in Table

17.2. The pit slope parameters are based on a Factor of Safety of 1.2 which
is deemed achievable and safe by Geotechnical specialists, if controlled
blasting techniques, groundwater depressurization, and high wall operating
practices are implemented. The operations planning and budgeting costing
and specialty equipment have been revised to reflect this increased control
requirement.
Table 17.2: ePit Slope Angles by Pit Sector
Azimuth 0 35 80 90 135 230 240 260 270 330

Slope 51 51 52 47 45 45 47 47 52 52
Block Discounting
The economic effect of the time delay of ore revenues versus the cost
of stripping the over-lying waste is accentuated in the Kemess North ore
body because of the deep high grade zone and its effect on the economic pit
limits. This is often evaluated using the Whittle 4d or 4x analysis but an
equally effective method is to apply a discount factor to each block. In this
way for each sector of the pit wall, for each incremental shell, the time
discounted revenues from ore grade blocks are evaluated against the time
discounted overlying waste. For example , while examining the next
incremental skin or pit shell the LG at any point on the pit wall may show
that the revenues from the ore in the next block in that pit sector may be
greater than the cost overlying waste up to surface. However, when the time
delay between the revenues and the stripping costs are considered, the next
pit incremental expansion may not be economic. Although the actual years
that the revenues and costs are incurred is not known when the LG is
evaluating each incremental expansion, it is the difference between the two
time periods that determines if the sector is a cash positive expansion. The
discount rate for this LG analysis is 8% and assuming the final pit
pushbacks will be designed to keep the bench advance rate to 10 benches
per year.
Resource Class
Finally, the LG was also restricted to include only Measured and

Indicated Resource Class material in the revenues (CLASS= 1&2). Any
Inferred (CLASS=3) material is costed as waste and zero revenue.
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Ultimate Pit Limit by Lerchs-Grossman Pit Optimization
The ultimate economic limit, pit shells are shown in Figure 12 & 13 on
an undiscounted and discounted basis and in section view in Figure 14. Ore
grade material from the Block model (NSR > 2.2) is also shown as a 3-D
solid in these figures.
Sensitivities
A series of LG pit designs were run keeping the costs the same but reducing
the metal prices. At low prices only low cost mineralized material is mineable
(high grade &/or low strip ratio) and as the prices are increased the pit limits
expand. These sensitivity cases are shown in Figure 15.
From the sensitivity graph the following points are noted:
In the undiscounted cases deep ore is mined in Pit 8 (or greater),
which is based on 96% of base prices. This gives a small downside
price cushion.
The deep ore is only mined with full Base Case pricing (Pit 10) or
greater in the discounted cases.
After opening up the deep pit, the pit expands fairly evenly as the
price increases.
From this analysis, the detailed pit designs were based on the
discounted P10 pit shell which corresponds to the full project base case
prices. A discount rate less than 8%, a bench advance greater than 10 per
year, or lower costs/higher prices than the project base parameters will
improve the economics within this pit shell. However the opposite is also
true.
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Figure 12: Ultimate Pit Limits - Undiscounted
64 of 138
Figure 13: Ultimate Pit Limits - Discounted
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Figure 14: Ultimate Pits Section View
66 of 138
Figure 15: Lerchs-Grossman Sensitivities
LG Sensitivity
(Pit 10 is Base Case Prices)
350000
300000
250000
200000 Ore KTonnes Undiscounted

X 1000
Ore KTonnes Discounted

150000
Net $ Value Undiscounted
100000
Net $ Value Discounted
50000
0
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
-50000
Pit Number
Note: Net$ value is relative. Full cash flow analysis is required to determine
project NPV.
67 of 138
(b) Detailed Pit Designs
Selection of Pushbacks
The LG sensitivity analysis was also useful to determine were to

design the pit pushbacks. The pit shell opening up the lower grade, but
lower strip ratio, west side of the deposit, produces ore earlier in the
schedule suitable for a first stage of mining. The next major increment is to
the full economic pit depth on the east side. To enable a more even annual
strip ratio in the production scheduling, this eastern pushback was split into
2 stages, a shallower north side and a deeper south side mining to the
ultimate pit depth. The size of the stages was roughly determined to ensure
that the resultant Phase 2 & Phase 3 each have a sufficient bench width to
enable efficient mining operations. For each of the 3 stages the design was
pushed to the ultimate pit lateral limit on three walls, with subsequent
pushbacks expanding in one direction only. This will enable much more
efficient mining operations when adjacent pushbacks are being mined at the
same time. Figures 16, 17, and 18 indicate the general location of the
pushbacks as the increasing metal prices used in the LG routine, expands
the economic mining limit.
Detailed Slope and Ramp Parameters
The overall pit slopes and detailed bench design parameters ha ve

been provided by Knight Pisold for the different sectors of the pit wall and
are listed in Table 17.3.
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Figure 16: Lerchs-Grossman Pit Low Prices
69 of 138
Figure 17: Lerchs-Grossman Pit Split Final Stage
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Figure 18: Lerchs-Grossman Pit Base Price
71 of 138
Table 17.3: Slope Design Parameters (From Knight Pisold)
Pit Design Bench Face Overall Slope Operational Requirements

Sector Angle (deg) Angle (deg)
N 65 51* 70 m groundwater depressurization, D=0.85 for
good controlled production blasting
NE 70 52 70 m groundwater depressurization, D=0.85 for
SE 60 47 70 m groundwater depressurization, D=0.85 for
S 60 45 100 m groundwater depressurization, D=0.7 for
excellent controlled blasting, but stress relief will
cause additional disturbance, D=0.85 will be more
realistic. A maximum of 48 degree intervals
SW 60 47 70 m groundwater depressurization, D=0.85 for
W 70 47 50 m groundwater depressurization, D=0.85 for
NW 70 52 70 m groundwater depressurization, D=0.85 for
*Slope angle is controlled by kinematic stability considerations
Included in the detailed designs are the high wall access roads.
These are designed at a maximum grade of 10%. The road allowance has
been made for haulage lanes and lateral berms suitable to meet regulatory
road width requirements for the Euclid R260 haul trucks in the mine fleet.
The majority of the roads are design as two way but for the bottom 2
benches of the ramp in each push back this has been reduced to single
lane. This will be suitable since traffic is reduced as the work space
becomes restricted. Ramp access is not designed for the last 2 benches of
Stage 2 & 3 under the assumption that internal ramps can be used for the
majority of the material and then the ramp is excavated upon retreat with a
backhoe and smaller salvage equipment from the ancillary fleet. The details
of the ramp design parameters are given Table 17.4 .
Table 17.4: Road Design Parameters
# of Width Grade
lanes
Main Ramp 2 30m. 10%
Last 2 benches of Ramp 1 22.6m. 10%
Last 2 benches of Pit Phase None NA NA
72 of 138
Subsequent to the pit design Knight Pisold reviewed the final P647
design with the combined designed overall slope angles and the high wall
ramps (see Appendix D). This review continues to indicate that the pit wall
slopes as designed, are aggressive but achievable with effective controlled
excavation techniques and groundwater depressurization with the exception
of the South slope. Because of the increased slope height with the current
design, the Factor of Safety (FoS) drops below 1.2 for a narrow sector of the
pit where the south pit wall cuts through the mountain peak. Design changes
will be required for the Feasibility Study to address this shortfall. Possible
solutions are to reduce the overall slope angle in this sector or to reduce the
overall slope height by excavating the top off the mountain peak. In the
worst case, reducing the slope by 100 m vertically, by removing the total
mountain peak will require 32 million tonnes of excavation. This would
increase the pit waste by 10%, which is within the accuracy of the Pre-
feasibility. A more thorough design will likely be able to reduce this extra
waste requirement. This design work will need to be addressed in the
Feasibility Study; however at this stage the Pre-feasibility pit design and
reserves are reasonably valid.
Phase Designs
The resultant 3 pit phase designs are given in Figures 20 to 22. The
upper benches in Phase 1 are shown as a separate Pre-strip phase which is
mined in the pre-production period to expose ore. This is shown in
Figure 19.
Grade Bins by NSR Cutoff
The reserve reports have the ore broken into grade bins for
production schedule optimization. These grade bins are based on the NSR
value of each block, which is calculated from the ore grades in each block,
the net smelter metal price, and the plant recovery for gold and copper. The
net smelter price is base on the base project parameter market price and
$US exchange rate, and offsite transportation, smelting, and refining
charges, etc. The NSR cutoff values ($/Tonne) used in the reserve reports
are set to report ore grade bins which cover full and incremental ore cost.
The incremental cutoffs are based on the fact that the LG only expands the
economic pit limit if the ore grade blocks can cover all costs (Decision
Blocks). Any blocks that are internal in the pit (Internal Blocks) will be mined
anyway to get to the decision blocks so they can still contribute positively to
cash flow if their metal content can cover costs downsteam of mining.
Different levels of downstream costs were considered to cover the overhead
costs and other high grade bins are also defined. The NSR cutoffs also
include a rehandle cost to allow for stockpiling. The Table 17.5 describes the
NSR cutoffs used in the reserve reports.
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Figure 19: Pre-Strip Phase (P601)
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Figure 20: Pit Phase 1 (P614)
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77 of 138
Table 17.5: NSR Grade Cutoff Bins for Reserves
Grade Bin Label Description

2.2 Ore/Waste Material below this is wasted
Cutoff
2.2 to 2.38 Sub Grade Requires improved prices or reduced costs at end
Cutoff of mine life
2.38 to Mill Cutoff Covers Milling Costs
3.38
3.38 to Internal Cutoff Covers Milling and O/H costs
4.03
4.03 to 5.0 Mine Cutoff Covers Mining Milling & O/H costs
> 5.0 High Grade
Phase Reserves
Pit reserves for these designs were calculated using the 3D block
model. The mining losses and dilution included in these reports are the
same as described in Section 16. The following tables include the material
by class, and Diluted grade values. Grades are based on the kriged value in
the Block Model and are in % for Copper and g/t for Gold. The HARD value
is the Bond Work Index (BWI) and is used in scheduling to vary the annual
ore production through the mill. Tables 17.6, 17.7, 17.8 and 17.9 list the
reserves for each mining phase.
78 of 138
Table 17.6: Reserves for Pre-Production Pit (P601)
In situ In situ Run of
Zone Zone Ore Ore Mine Diluted Grades
Name No. Cutoff (BCMS) (Tonnes) (Tonnes) NSR CU AU KRG Hard
KRG
PROV 1 0.0 2.38 90,840. 245,906. 236,743. 2.276 0.0604 0.1658 13.90
2.38 3.38 521,400. 1,379,737. 1,327,976. 2.873 0.0787 0.2036 14.23
3.38 4.03 239,580. 632,398. 605,476. 3.648 0.1025 0.2522 14.42
4.03 5.00 103,680. 268,863. 260,118. 4.380 0.1175 0.3114 14.15
>= 5.00 30,000. 76,920. 73,074. 5.408 0.1390 0.4092 14.70
Totals: 985,500. 2,603,824. 2,503,387. 3.235 0.0885 0.2290 14.25
PROB 2 0.0 2.38 57,240. 150,376. 145,989. 2.266 0.0506 0.1873 14.32
2.38 3.38 356,101. 952,520. 929,950. 2.957 0.0809 0.2066 14.05
3.38 4.03 132,960. 350,431. 339,173. 3.696 0.1037 0.2522 14.27
4.03 5.00 100,680. 262,046. 253,642. 4.470 0.1233 0.3104 14.37
>= 5.00 29,520. 75,962. 79,994. 5.329 0.1366 0.3515 13.26
Totals: 676,501. 1,791,335. 1,748,748. 3.371 0.0915 0.2355 14.13
Summary 0.0 2.38 148,080. 396,281. 382,731. 2.272 0.0567 0.1740 14.06
In Situ In Situ Run of Waste Grades

Bench Ore Ore Mine Total ROM Diluted CU AU KRG
Toe (BCMS) (Tonnes) (Tonnes) (Tonnes) S/R NSR KRG Hard
1,825.0 0. 0. 0. 15322. -1.00 -1.000 -1.0000 -1.0000 -1.00
1,810.0 0. 0. 0. 428686. -1.00 -1.000 -1.0000 -1.0000 -1.00
1,795.0 780. 2,122. 5,148. 1,305,978. 253.71 2.787 0.0634 0.1186 5.36
1,780.0 64,140. 174,461. 178,266. 2,161,512. 12.13 2.635 0.0757 0.1692 13.46
1,765.0 246,420. 665,792. 649,729. 3,214,634. 4.95 2.735 0.0788 0.1804 14.01
1,750.0 509,880. 1,355,785. 1,297,392. 3,925,457. 3.03 3.244 0.0894 0.2282 14.40
1,735.0 840,781. 2,196,999. 2,121,601. 4,682,138. 2.21 3.545 0.0945 0.2550 14.22
Total 1,662,001. 4,395,159. 4,252,135. 15,733,726. 3.70 3.291 0.0897 0.2317 14.20
79 of 138
Table 17.7: Reserves for Phase 1 Pit (P614)
Name No. Cutoff (BCMS) (Tonnes) (Tonnes) NSR CU AU Hard
KRG KRG
PROV 1 0.0 2.38 1,151,040. 3,050,816. 2,907,671. 2.291 0.0696 0.1466 14.36
2.38 3.38 8,361,240. 22,229,232. 21,161,620. 2.2905 0.0908 0.1800 14.69
3.38 4.03 5,503,920. 14,656,754. 13,974,028. 3.702 0.1185 0.2219 14.46
4.03 5.00 9,423,780. 25,117,896. 23,882,362. 4.518 0.1447 0.2714 14.43
>= 5.00 13,851,360. 37,573,680. 35,745,112. 5.995 0.1932 0.3571 14.46
Totals: 38,291,340. 102,628,376. 97,670,792. 4.526 0.1448 0.2722 14.50
PROB 2 0.0 2.38 338,700. 896,144. 868,563. 2.296 0.0691 0.1468 14.19
2.38 3.38 3,033,540. 8,051,396. 7,723,994. 2.917 0.0889 0.1848 14.34
3.38 4.03 2,401,800. 6,418,572. 6,124,266. 3.708 0.1142 0.2330 14.35
4.03 5.00 3,736,440. 10,059,201. 9,562,505. 4.519 0.1437 0.2743 14.32
>= 5.00 4,249,380. 11,568,613. 11,019,937. 5.767 0.1853 0.3441 14.30
Totals: 13,759,860. 36,993,924. 35,299,264. 4.363 0.1377 0.2662 14.32
Summary 0.0 2.38 1,489,740. 3,946,960. 3,776,234. 2.292 0.0695 0.1467 14.32
2.38 3.38 11,394,780. 30,280,628. 28,885,614. 2.908 0.0903 0.1813 14.59
3.38 4.03 7,905,720. 21,075,326. 20,098,294. 3.704 0.1172 0.2253 14.43
4.03 5.00 13,160,220. 35,177,096. 33,444,868. 4.518 0.1444 0.2722 14.40
>= 5.00 18,100,740. 49,142,292. 46,765,048. 5.941 0.1913 0.3540 14.42
Totals: 52,051,200. 139,622,304. 132,970,048. 4.483 0.1429 0.2706 14.45

Bench Ore Ore Mine Total ROM Diluted CU AU
Toe (BCMS) (Tonnes) (Tonnes) (Tonnes) S/R NSR KRG KRG Hard
1,915.0 0. 0. 0. 10,374. -1.00 -1.000 -1.0000 -1.0000 -1.00
1,900.0 0. 0. 0. 58,733. -1.00 -1.000 -1.0000 -1.0000 -1.00
1,885.0 0. 0. 0. 156,408. -1.00 -1.000 -1.0000 -1.0000 -1.00
1,870.0 0. 0. 0. 133,904. -1.00 -1.000 -1.0000 -1.0000 -1.00
1,855.0 0. 0. 0. 239,879. -1.00 -1.000 -1.0000 -1.0000 -1.00
1,840.0 0. 0. 0. 300,088. -1.00 -1.000 -1.0000 -1.0000 -1.00
1,825.0 0. 0. 0. 495,242. -1.00 -1.000 -1.0000 -1.0000 -1.00
1,810.0 0. 0. 0. 554,577. -1.00 -1.000 -1.0000 -1.0000 -1.00
1,795.0 0. 0. 0. 872,180. -1.00 -1.000 -1.0000 -1.0000 -1.00
1,780.0 0. 0. 0. 1,084,436. -1.00 -1.000 -1.0000 -1.0000 -1.00
1,765.0 0. 0. 0. 1,656,514. -1.00 -1.000 -1.0000 -1.0000 -1.00
1,750.0 89,460. 239,162. 252,260. 2,037,984. 8.08 2.498 0.0674 0.1666 12.34
1,735.0 445,500. 1,162,825. 1,139,136. 3,073,877. 2.70 2.600 0.0670 0.1919 13.29
1,720.0 1,463,400. 3,785,270. 3,638,288. 3,130,435. 0.86 3.386 0.0908 0.2441 13.94
1,705.0 1,862,460. 4,841,808. 4,676,452. 3,503,775. 0.75 3.823 0.1038 0.2705 13.81
1,690.0 2,478,660. 6,465,274. 6,171,765. 3,216,950. 0.52 4.081 0.1160 0.2795 13.87
1,675.0 3,823,080. 10,026,903. 9,561,576. 3,367,406. 0.35 4.635 0.1428 0.2912 13.85
1,660.0 4,381,080. 11,556,439. 10,998,975. 3,224,111. 0.29 4.929 0.1621 0.2856 13.88
1,645.0 4,736,100. 12,531,499. 11,923,718. 3,674,882. 0.31 4.714 0.1562 0.2701 14.02
1,630.0 4,112,880. 10,944,303. 10,414,314. 4,272,444. 0.41 4.788 0.1564 0.2800 14.29
1,615.0 3,892,740. 10,437,406. 9,926,498. 5,134,228. 0.52 4.618 0.1520 0.2675 14.49
1,600.0 3,359,640. 9,041,581. 8,597,332. 4,966,880. 0.58 4.497 0.1482 0.2601 14.66
1,585.0 3,418,080. 9,260,089. 8,798,650. 4,457,956. 0.51 4.303 0.1376 0.2593 14.66
1,570.0 2,940,840. 8,078,360. 7,674,441. 3,573,829. 0.47 4.320 0.1366 0.2644 14.92
1,555.0 2,857,800. 7,886,160. 7,494,985. 3,223,883. 0.43 4.397 0.1378 0.2717 15.19
1,540.0 2,608,380. 7,169,952. 6,814,557. 1,625,620. 0.24 4.326 0.1388 0.2595 15.36
1,525.0 2,491,140. 6,829,256. 6,489,358. 1,134,493. 0.17 4.459 0.1439 0.2655 15.33
1,510.0 2,029,800. 5,534,012. 5,257,312. 571,050. 0.11 4.484 0.1462 0.2636 15.02
1,495.0 1,809,120. 4,914,232. 4,668,520. 425,044. 0.09 4.603 0.1474 0.2771 14.95
1,480.0 1,224,360. 3,350,283. 3,182,768. 313,183. 0.10 4.850 0.1548 0.2931 14.37
1,465.0 1,057,380. 2,907,833. 2,762,442. 176,952. 0.06 4.749 0.1595 0.2677 14.21
1,450.0 583,200. 1,592,004. 1,512,404. 79,600. 0.05 4.870 0.1614 0.2799 14.13
1,435.0 386,100. 1,067,651. 1,014,268. 53,382. 0.05 4.538 0.1477 0.2675 14.52
Total 52,051,200. 139,622,304. 132,970,032. 60,800,304. 0.46 4.483 0.1429 0.2706 14.45
80 of 138
Name No. Cutoff (BCMS) (Tonnes) (Tonnes) NSR CU KRG AU KRG Hard
PROV 1 0.0 2.38 1,840,560. 4,858,974. 4,622,290. 2.284 0.0608 0.1675 12.87
2.38 3.38 12,158,041. 32,365,262. 30,795,542. 2.864 0.0780 0.2056 12.80
3.38 4.03 6,395,820. 17,037,772. 16,209,376. 3.700 0.1083 0.2472 12.81
4.03 5.00 10,825,404. 28,724,876. 27,321,516. 4.528 0.1416 0.2804 12.83
>= 5.00 21,917,108. 57,991,944. 55,159,684. 6.906 0.2197 0.4183 13.79
Totals: 53,136,932. 140,978,816. 134,108,400. 4.947 0.1523 0.3120 13.22
PROB 2 0.0 2.38 1,094,100. 2,893,205. 2,762,639. 2.284 0.0588 0.1720 13.17
2.38 3.38 5,155,500. 13,722,186. 13,064,263. 2.840 0.0753 0.2088 12.97
3.38 4.03 2,102,220. 5,656,791. 5,377,084. 3.699 0.1134 0.2349 13.06
4.03 5.00 4,215,780. 11,245,503. 10,689,494. 4.544 0.1429 0.2797 12.84
>= 5.00 10,933,680. 28,903,346. 27,511,422. 7.031 0.2236 0.4255 13.90
Totals: 23,501,280. 62,421,032. 59,404,904. 5.139 0.1588 0.3225 13.40
Summary 0.0 2.38 2,934,660. 7,752,179. 7,384,929. 2.284 0.0600 0.1692 12.99
2.38 3.38 17,313,540. 46,087,448. 43,859,804. 2.857 0.0772 0.2065 12.85
3.38 4.03 8,498,040. 22,694,564. 21,586,460. 3.700 0.1096 0.2441 12.87
4.03 5.00 15,041,184. 39,970,380. 38,011,008. 4.532 0.1420 0.2802 12.83
>= 5.00 32,850,788. 86,895,288. 82,671,104. 6.948 0.2210 0.4207 13.83
Totals: 76,638,208. 203,399,840. 193,513,296. 5.006 0.1543 0.3152 13.27

Bench Ore Ore Mine Total ROM Diluted CU KRG AU KRG
Toe (BCMS) (Tonnes) (Tonnes) (Tonnes) S/R NSR Hard
1,810.0 0. 0. 0. 9558. -1.00 -1.000 -1.0000 -1.0000 -1.00
1,795.0 0. 0. 0. 16058. -1.00 -1.000 -1.0000 -1.0000 -1.00
1,780.0 0. 0. 0. 60035. -1.00 -1.000 -1.0000 -1.0000 -1.00
1,765.0 0. 0. 0. 69724. -1.00 -1.000 -1.0000 -1.0000 -1.00
1,750.0 0. 0. 0. 109605. -1.00 -1.000 -1.0000 -1.0000 -1.00
1,735.0 0. 0. 0. 133539. -1.00 -1.000 -1.0000 -1.0000 -1.00
1,720.0 495,023. 1,287,288. 1,233,886. 4,774,017. 3.87 3.159 0.0840 0.2302 14.12
1,705.0 945,840. 2,454,181. 2,340,869. 5,635,949. 2.41 3.009 0.0774 0.2261 13.64
1,690.0 1,543,560. 3,996,980. 3,806,527. 6,918,189. 1.82 3.179 0.0820 0.2389 13.14
1,675.0 1,866,000. 4,858,117. 4,623,041. 8,120,304. 1.76 3.260 0.0875 0.2369 12.64
1,660.0 2,070,180. 5,379,598. 5,110,619. 8,617,727. 1.69 3.327 0.0892 0.2427 12.41
1,645.0 2,245,860. 5,819,771. 5,528,783. 8,944,942. 1.62 3.284 0.0901 0.2344 12.31
1,630.0 2,590,980. 6,730,563. 6,398,733. 8,566,574. 1.34 3.392 0.0938 0.2401 12.28
1,615.0 2,597,700. 6,735,938. 6,405,404. 9,176,936. 1.43 3.399 0.0966 0.2343 12.25
1,600.0 2,732,760. 7,109,514. 6,761,868. 9,332,374. 1.38 3.500 0.1024 0.2341 12.11
1,585.0 2,877,540. 7,609,321. 7,239,816. 9,878,626. 1.36 3.457 0.1025 0.2280 12.08
1,570.0 3,552,060. 9,464,578. 8,997,611. 8,891,560. 0.99 3.546 0.0993 0.2480 12.48
1,555.0 3,780,060. 10,078,378. 9,586,986. 9,126,975. 0.95 3.826 0.1106 0.2591 12.85
1,540.0 3,708,240. 9,925,131. 9,444,534. 8,345,110. 0.88 4.016 0.1244 0.2516 12.98
1,525.0 3,828,060. 10,273,842. 9,769,545. 7,497,488. 0.77 4.359 0.1379 0.2661 13.06
1,510.0 3,815,040. 10,265,320. 9,759,884. 6,472,212. 0.66 4.640 0.1462 0.2848 13.24
1,495.0 3,853,260. 10,414,636. 9,904,866. 5,827,650. 0.59 4.873 0.1520 0.3028 13.46
1,480.0 3,863,220. 10,486,078. 9,968,036. 4,825,716. 0.48 5.112 0.1618 0.3121 13.46
1,465.0 3,933,600. 10,624,618. 10,099,651. 4,067,339. 0.40 5.224 0.1646 0.3208 13.27
1,450.0 3,948,960. 10,718,325. 10,196,503. 2,750,240. 0.27 5.512 0.1749 0.3354 13.48
1,435.0 3,806,880. 10,190,607. 9,692,038. 2,624,124. 0.27 5.697 0.1846 0.3371 13.85
1,420.0 3,331,860. 8,868,027. 8,438,713. 2,318,326. 0.27 5.575 0.1786 0.3347 13.96
1,405.0 2,786,880. 7,349,307. 6,999,068. 2,330,872. 0.33 5.934 0.1904 0.3550 14.08
1,390.0 2,410,080. 6,312,039. 6,015,230. 1,727,342. 0.29 6.231 0.2003 0.3714 14.38
1,375.0 2,228,340. 5,807,128. 5,538,696. 1,496,228. 0.27 6.527 0.2120 0.3827 14.29
1,360.0 1,832,349. 4,757,936. 4,535,699. 1,096,720. 0.24 7.347 0.2344 0.4413 14.28
1,345.0 1,699,500. 4,405,132. 4,200,535. 773,784. 0.18 8.194 0.2609 0.4930 14.16
1,330.0 1,365,780. 3,658,048. 3,487,674. 259,177. 0.07 9.326 0.3024 0.5468 14.31
1,315.0 1,174,200. 3,141,147. 2,984,090. 161,571. 0.05 10.362 0.3255 0.6393 14.65
1,300.0 791,280. 2,109,049. 2,003,596. 105,452. 0.05 10.963 0.3373 0.6934 14.57
1,285.0 600,720. 1,596,365. 1,516,546. 79,818. 0.05 11.880 0.3600 0.7652 14.54
1,270.0 362,400. 972,900. 924,255. 48,645. 0.05 13.043 0.3982 0.8328 14.50
Total 76,638,216 203,399,888. 193,513,296. 151,190,512. 0.78 5.006 0.1543 0.3152 13.27
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Name No. Cutoff (BCMS) (Tonnes) (Tonnes) NSR CU KRG AU KRG Hard
PROV 1 0.0 2.38 649,560. 1,729,989. 1,643,489. 2.277 0.0729 0.1371 12.77
2.38 3.38 3,219,300. 8,555,371. 8,130,735. 2.839 0.0977 0.1543 12.83
3.38 4.03 1,718,700. 4,572,714. 4,351,908. 3.692 0.1313 0.1896 12.98
4.03 5.00 2,849,580. 7,468,683. 7,101,512. 4.522 0.1608 0.2328 12.89
>= 5.00 10,616,931. 28,251,538. 26,881,244. 8.599 0.2817 0.5005 13.54
Totals: 19,054,072. 50,578,296. 48,108,888. 6.364 0.2120 0.3619 13.24
PROB 2 0.0 2.38 1,157,400. 3,055,086. 2,913,293. 2.274 0.0635 0.1593 13.17
2.38 3.38 3,166,020. 8,312,042. 7,902,706. 2.796 0.0908 0.1652 12.96
3.38 4.03 1,701,480. 4,410,786. 4,190,247. 3.690 0.1293 0.1950 12.58
4.03 5.00 2,039,940. 5,367,272. 5,098,908. 4.521 0.1620 0.2301 12.89
>= 5.00 6,006,480. 16,069,363. 15,294,082. 8.881 0.2862 0.5285 13.69
Totals: 14,071,320. 37,214,548. 35,399,236. 5.736 0.1878 0.3345 13.24
Summary 0.0 2.38 1,806,960. 4,785,074. 4,556,782. 2.275 0.0669 0.1513 13.03
2.38 3.38 6,385,320. 16,867,414. 16,033,441. 2.818 0.0943 0.1596 12.89
3.38 4.03 3,420,180. 8,983,500. 8,542,155 3.691 0.1303 0.1923 12.78
4.03 5.00 4,889,520. 12,835,954. 12,200,420. 4.521 0.1613 0.2317 12.89
>= 5.00 16,623,411. 44,320,900. 42,175,328. 8.701 0.2833 0.5107 13.59
Totals: 33,125,392. 87,792,840. 83,508,120. 6.098 0.2017 0.3503 13.24

1990.0 0. 0. 0. 38,144. -1.00 -1.000 -1.0000 -1.0000 -1.00
1975.0 0. 0. 0. 129,595. -1.00 -1.000 -1.0000 -1.0000 -1.00
1960.0 0. 0. 0. 140,927. -1.00 -1.000 -1.0000 -1.0000 -1.00
1945.0 0. 0. 0. 189,286. -1.00 -1.000 -1.0000 -1.0000 -1.00
1930.0 0. 0. 0. 182,104. -1.00 -1.000 -1.0000 -1.0000 -1.00
1915.0 0. 0. 0. 375,379. -1.00 -1.000 -1.0000 -1.0000 -1.00
1900.0 0. 0. 0. 500,825. -1.00 -1.000 -1.0000 -1.0000 -1.00
1885.0 0. 0. 0. 927,755. -1.00 -1.000 -1.0000 -1.0000 -1.00
1870.0 0. 0. 0. 863,276. -1.00 -1.000 -1.0000 -1.0000 -1.00
1855.0 0. 0. 0. 1,029,580. -1.00 -1.000 -1.0000 -1.0000 -1.00
1840.0 0. 0. 0. 1,027,984. -1.00 -1.000 -1.0000 -1.0000 -1.00
1825.0 0. 0. 0. 1,248,710. -1.00 -1.000 -1.0000 -1.0000 -1.00
1810.0 0. 0. 0. 1,321,931. -1.00 -1.000 -1.0000 -1.0000 -1.00
1795.0 0. 0. 0. 1,549,853. -1.00 -1.000 -1.0000 -1.0000 -1.00
1780.0 0. 0. 0. 1,599,132. -1.00 -1.000 -1.0000 -1.0000 -1.00
1765.0 0. 0. 0. 1,717,304. -1.00 -1.000 -1.0000 -1.0000 -1.00
1750.0 1,740. 4,733. 6,062. 1,798,542. 296.69 2.200 0.0456 0.1668 10.16
1735.0 6,540. 17,789. 20,031. 1,961,608. 97.93 2.232 0.0454 0.1812 11.56
1720.0 3,900. 10,608. 11,644. 2,860,172. 245.64 2.386 0.0516 0.1894 11.86
1705.0 6,240. 16,960. 16,112. 3,306,100. 205.20 2.211 0.0480 0.1891 13.72
1690.0 109,080. 281,395. 267,326. 3,619,522. 13.54 2.371 0.0405 0.2293 13.70
1675.0 53,760. 141,239. 137,309. 4,527,137. 32.97 2.317 0.0454 0.2072 13.40
1660.0 65,760. 169,819. 161,328. 4,609,030. 28.57 2.447 0.0675 0.1737 13.90
1645.0 115,980. 303,741. 288,554. 4,723,178. 16.37 2.469 0.0664 0.1793 13.38
1630.0 276,300. 715,895. 680,101. 4,496,968. 6.61 2.490 0.0683 0.1779 13.63
1615.0 323,400. 843,954. 801,757. 4,706,631. 5.87 2.521 0.0708 0.1761 13.54
1600.0 332,220. 865,839. 822,547. 4,913,571. 5.97 2.538 0.0716 0.1765 13.99
1585.0 367,800. 964,956. 916,709. 5,040,604. 5.50 2.680 0.0758 0.1858 13.61
1570.0 483,840. 1,289,209. 1,224,749. 4,844,483. 3.96 2.543 0.0702 0.1805 13.15
1555.0 489,900. 1,298,678. 1,233,744. 4,995,952. 4.05 2.555 0.0764 0.1671 13.09
1540.0 612,240. 1,589,096. 1,509,641. 4,698,890. 3.11 3.012 0.1011 0.1700 12.87
1525.0 811,680. 2,097,879. 1,992,985. 4,291,068. 2.15 3.558 0.1177 0.2050 12.88
1510.0 981,180. 2,524,732. 2,398,496. 3,835,130. 1.60 3.934 0.1338 0.2179 12.78
1495.0 1,020,240. 2,640,606. 2,510,143. 3,832,645. 1.53 3.811 0.1274 0.2162 12.54
1480.0 1,167,600. 3,039,297. 2,887,333. 3,375,074. 1.17 4.126 0.1406 0.2278 12.53
1465.0 1,287,000. 3,333,148. 3,166,490. 3,088,386. 0.98 4.111 0.1384 0.2311 12.53
1450.0 1,350,540. 3,522,692. 3,348,120. 2,697,732. 0.81 4.116 0.1415 0.2240 12.55
1435.0 1,545,660. 4,023,320. 3,823,718. 2,133,581. 0.56 4.133 0.1429 0.2230 12.49
1420.0 1,547,700. 4,042,845. 3,840,704. 1,705,926. 0.44 4.396 0.1537 0.2330 12.26
1405.0 1,722,060. 4,525,321. 4,303,752. 1,756,262. 0.41 4.578 0.1617 0.2386 12.41
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1390.0 1,762,440. 4,645,725. 4,421,268. 1,325,403. 0.30 4.580 0.1596 0.2435 12.39
1375.0 1,783,379. 4,750,944. 4,519,660. 1,110,662. 0.25 4.819 0.1710 0.2489 12.65
1360.0 1,724,031. 4,632,754. 4,402,684. 957,892. 0.22 5.363 0.1920 0.2733 12.92
1345.0 1,686,000. 4,506,998. 4,286,347. 932,493. 0.22 5.618 0.1969 0.2959 13.09
1330.0 1,562,640. 4,206,172. 4,006,825. 756,573. 0.19 6.308 0.2219 0.3284 13.25
1315.0 1,581,120. 4,304,193. 4,101,512. 438,931. 0.11 7.283 0.2545 0.3824 14.42
1300.0 1,527,660. 4,104,676. 3,907,272. 229,999. 0.06 8.489 0.2887 0.4675 14.70
1285.0 1,481,820. 3,971,514. 3,776,070. 216,457. 0.06 9.140 0.2974 0.5377 14.55
1270.0 1,229,040. 3,301,376. 3,142,572. 164,271. 0.05 10.745 0.3290 0.6819 14.44
1255.0 1,347,780. 3,622,258. 3,447,409. 191,753. 0.06 12.741 0.3838 0.8242 14.31
1240.0 963,720. 2,607,249. 2,476,886. 169,731. 0.07 13.436 0.4058 0.8686 14.26
1225.0 753,540. 2,050,034. 1,956,928. 157,767. 0.08 11.845 0.3627 0.7483 14.17
1210.0 484,980. 1,320,256. 1,263,639. 65,798. 0.05 8.760 0.2811 0.5204 13.68
1195.0 380,280. 1,035,709. 983,924. 75,626. 0.08 8.806 0.2882 0.5149 13.44
1180.0 112,320. 305,762. 290,474. 18,799. 0.06 9.856 0.3291 0.5605 13.36
1165.0 62,280. 163,472. 155,299. 27,935. 0.18 9.424 0.3098 0.5478 13.30
Total 33,125,392. 87,792,840. 83,508,112. 107,500,072. 1.29 6.098 0.2017 0.3503 13.24
(c) Production Schedule
Basic Criteria
The production schedule for Kemess North is run from the Pit reserve
files listed above. All production will be from the owners fleet except for
minor tonnages for the small initial benches of each pushback. These will
require smaller specialized equipment to operate on the steep original
ground at the top benches. The major mining equipment from Kemess
South will be transferred to Kemess North as ore and waste production is
reduced in Kemess South. The full integrated Kemess South, Kemess North
production schedule is included in Section 22C. To meet the higher strip
ratio requirements additional haul trucks will be purchased. The production
equipment fleet used in the Life of Mine Production schedule is listed in
Table 17.10. This schedule is based on the annual Mill Feed ore production
listed in Table 17.11. The ore targets are adjusted each year to reflect the
ore hardness and anticipated SAG mill through put according to the HARD
(BWI) value in the Pit Reserves. The mill feed in some years includes
material from stockpiles and Mined ore in some years is sent to stockpile.
The full Kemess North production schedule is given in Section 22C as part
of the Integrated Kemess South/Kemess North Schedule .
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Table 17.10 Major Mine Equipment Fleet
Unit # of Location
Units
Shovels P&H 2800 1 Moves Kemess South to Kemess North 4 th
Qtr 2006
P&H 2300 1 Moves Kemess South to Kemess North
early 2010
Hit 5500 1 Moves Kemess South to Kemess North
start of 2006
Drills P&H XP100 1 Moves Kemess South to Kemess North
start of 2010
IR Viper 1 Moves Kemess South to Kemess North
start of 2006
Haul Trucks Euclid R260 13 Existing Fleet in Kemess South start
of 2004
3 Add 3 new trucks in 2005 for
Kemess South
5 Move 5 trucks to Kemess North start
of 2006
4 Add 4 new trucks start of 2006 for
Kemess North
7 Move 7 trucks to Kemess North 4 th
Qtr 2006
1 Add 1 new trucks start of 2016 for
Kemess North
Table 17.11 Annual ROM Mill Feed

2004 2005 Q123/06 Q4/06 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Total 19,072 19,115 14,949 5,248 29,942 31,003 30,961 28,784 29,489 32,010 36,490 35,510 33,610 30,710
Mill ktonnes
Feed
Cu % 0.217 0.224 0.265 0.195 0.159 0.182 0.169 0.144 0.119 0.120 0.122 0.133 0.162 0.177
Au g/t 0.691 0.669 0.777 0.544 0.440 0.451 0.409 0.280 0.260 0.256 0.256 0.270 0.314 0.333
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18. Interpretation and Conclusions
GR Tech has used the information provided by Northgate and the

work of other Technical Specialists in this evaluation of the Kemess North
Mineral Project to determine the stated Reserves and expected financial
returns. The information can be categorized as:
Kemess Operating cost and performance Information;

Kemess North Geology, Mineralization, and Reserves; and
Future estimates of commodity prices, exchange rates, and energy,
supply, and services costs.
The operating costs and performance information from the current
Kemess operations adds a considerable level of assurance to the
performance and cost estimates used in this evaluation.
This leads to the following list of Conclusions:
Geology The geology of the project is well described based on the

work of previous owners, knowledge of similar mineralized
copper/gold occurrences in the area and the exploration work
Northgate has done since 2000. The knowledge of the deposit
geology has been well integrated with the local mining practice and
plant performance at the current Kemess South operations. GR Tech
confirms that this combined information has been used to an
appropriate Engineering Standard in the Geologic Resource
modelling for Kemess North.
Drill hole data base The Resource and Reserve Statements are
supported by 198 drill holes including 77,210 meters of drilling with
40,237 Copper assays and 39,821 Gold assays. Only drill hole
information has been used in quantifying the Resource and Reserve
base because of the depth of the mineralized zone. The assay work
has been done by reputable Canadian labs and a QA/QC program
has been in place for the majority of the drilling (Since 2000). GR
Tech has verified the assay data base by checking 35 % of the holes
used in the Geologic Model. Down-hole survey discrepancies for 18
holes were reported by Northgate and a calculated hole trend was
used for these holes. GR Tech confirms that the drill hole and assay
data base used in the 3-D Geology Model is to an acceptable industry
standard for use in the Resource and Reserve quantification.
Geology Model The 3 -D Geology Block Model for the Kemess
North Mineralized zone was built by modelling specialists at Mintec
Inc. using the Drill hole and assay database, Geology interpretations
from Northgates Geologists and a Geo-Statistical evaluation. The
Geology interpretation was reviewed by GR Tech and the geo-
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statistics analysis, grade interpolation, and mineral quantity
calculations were done by Abdullah Arik of Mintec a Certified Geo-
Statistician and a Qualified Person. GR Tech confirms that this
method of modelling is appropriate for the Kemess North deposit and
that resultant Resource and Reserve quantities are to an acceptable
industry standard.
Economic Pit Design The ultimate economic pit limit is based on the
Lerchs-Grossman (LG) pit optimization routine with time value
discounting assigned to the blocks. The price, cost, and recovery
inputs to the LG are reasonable and overall slope angles have been
deemed to be adequate by Geotechnical specialists, provided proper
wall control measures are taken during operations. The time
discounting of the blocks is an important aspect since parts of the
mineralized zone are deep. Sensitivity analysis a round the Base
Price parameters for the Project show little upside potential and
considerable downside risk. If prices are dropped to 85% of the target
level the lower parts of the ore body are not economic. The LG pit
optimization algorithm is an industry standard for evaluation of
economic pit limits and the method used to time discount the blocks
adequately addresses the economic impact of the deep
Mineralization.
Detailed Pit Design The Detailed pit design includes a Pre-stripping
phase plus three pus hbacks to mine out to the ultimate pit limit
determined by the LG. These pushbacks have been designed
following the Geo-technical consultants design criteria. The final pit
limit design (P634) has been reviewed by Knight Pisold. A sector of
the South pit wall has been found to have an inappropriate Factor of
Safety and will need to be redesign for the Feasibility Study. The
effect of this redesign will be limited but will increase the waste
mining costs. The magnitude is within the accuracy of the Pre-
Feasibility Study and is not likely to affect the economic viability of the
pit design. This assumption will need to be confirmed in the
Feasibility Study.
Milling Metallurgical test work was performed on drill hole samples
taken from within or in close proximity to the pit limits. The mill feed
from Kemess North will be similar to Kemess South Hypogene. Hatch
has confirmed that the test work on the met samples is representative
and accurate and the resultant process performance design criteria
for gold and copper recovery and plant throughput are reasonable for
project planning purposes.
Production Schedule The production schedule is based on the
detailed pit designs and the specified mining equipment to meet the
ore production targets in the plan. Mining production levels are varied
year to year to defer waste cost into the future. While this makes
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operations management difficult it is possible. GR Tech confirms that
this operating schedule is achievable with the equipment as specified.
Capital and Operati ng Cost estimates The basis of most of the
operating costs are the current operations at Kemess South. The
capital cost of much of the existing equipment types also comes from
Kemess South experience. As such, these estimates have a high
level of assurance. Capital estimates for much of the facilities and
infrastructure for the Kemess North area have been provided by
others to a Feasibility level of accuracy as well. However additional
geo-technical information and condemnation drilling is still needed for
the underground conveyor way. Until these are completed, the costs
are only submitted as Pre-feasibility accuracy. Other aspects of the
mining costs such as truck cycle times, waste dumping details, and
capital and replacement costs for the mining equipment are also only
at Pre-feasibility study level. For these reasons the current Kemess
North project cost estimates are being called a Pre-Feasibility Study
estimate. Design revisions will increase the waste mining costs and
the subsequent cost of releasing ore.
Environmental and Permitting The Environmental planning for the
project is well advanced. The operating criteria and costs to meet
sound environmental operating practices and to meet or exceed
regulatory requirements have been included in the Kemess North
plan. With this the required operating permits should be granted.
The future estimates of metal prices, the US exchange rate, and
future cost for goods and services beyond the control of Northgate are as
stated. Accurate prediction of these future financial parameters is beyond
GR Techs capability. The values used in this evaluation are not un-
reasonable.
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19. Recommendations
The Engineering and Design work should continue on the Kemess

North Mineral Project to upgrade the Revised Pre-Feasibility Study to a
Feasibility Study. After the permits are in hand and a production decision
has been made based on the Feasibility Study, additional Engineering and
design will be needed to bring the design basis up to construction level and
to provide detailed operating information for mining and milling operation for
the first several years of operation.
(a) For Feasibility
Upgrade the estimate for the underground ore conveyor from Kemess
North to the existing mill. This will require drilling for condemnation
and geotechnical analysis.
Run detailed truck haul simulations for the truck haul cycles for ore
and waste hauls.
Obtain vendor budgetary quotes for a wall control drill and for
ongoing maintenance and repair parts and rebuild costs for the
existing mining fleet.
Re-design details of the pre-stripping requirements and seek
contractor budgetary quotes.
If possible re-survey with the Flex-IT tool, as many of the 18 holes
with suspect down hole surveys, as possible.
(b) For Construction and Detailed design
Twin some of the deep holes for detailed variography. If possible

locate some of these holes to test any of the 18 holes with suspect
surveys which could not be re-surveyed.
Re-design the final pit wall to a lower slope height on the South wall
as recommended by Knight Pisold. Because of aggressive slope
angles, the final pit design and the High Wall control techniques will
need a thorough Geotechnical review by the various Technical
experts mentioned in this report.
Re-design the pit phases to include details for pit services such as
power and de-watering, and detailed slope features for the Broken
zone.
Assay existing and future drill holes for Silver.
88 of 138
20. References
Amtel Ltd., Characterisation of Copper and Gold occurrences in Composites

of the Kemess North Deposit, Summer 2002
Amtel Ltd., Gold Deportment in Copper Cleaner Scavenger Tailings,

May 2003.
Amtel Ltd., Kemess North Preliminary Metallurgical Testing, June 2001
Abdullah Arik, Geostatistical analysis and interpolation methodology

Kemess North, March 2004
Blanchflower, J.D., Geological, Geochemical and Geophysical Report on the

Kemess Property, Omineca Mining Division, British Columbia; Private
Report Prepared for El Condor Resources Ltd., 1986
Bray, A.D., Lapeare, B., 2000 Exploration Program Kemess Property:

Diamond Drill and Geophysical Report, Assessment Report, February 2001
Bray, A.D., 2001 Exploration Program Kemess Property: Diamond Drilling

Report, Assessment Report, January 2002
Bowen, B.K., Copeland, D.J., Rebagliati, C.M, Kemess North Project, El

Condor Resources Ltd., 1991 Exploration Report and Delineation Drilling
Program on the Kemess North Property, Assessment Report, May 1992
Cann, R.M., Summary and Review of 1987 and 1988 Exploration Results
Kemess Property; private report for El Condor Resources, November 1988
Copeland, D.J., Geological and Geochemical Assessment Report 1990

Exploration Program Kemess Property, Assessment Report, June 1991
Copeland, D.J., Rebagliati, C.M., Ronning, P.A., Kemess Property Northern

Claims, Summary Report 1990 Exploration Program, Assessment Report,
April 1990
Copeland, D.J., Blanchflower, J.D., Summary Report on the 1989

Exploration Program Kemess North Property, June 1990
Diakow, L.J., Panteleyev, A., Schroeter, T.G., Geology of the Early Jurassic
Toodoggone Formation and Gold Silver Deposits in the Toodoggone River
Map Area, Northern British Columbia, B.C. Geological Survey Branch
Bulletin 86, 1993
Diakow, L.J., Panteleyev, A., Schroeter, T.G., Jurassic Epithermal Deposits

in the Toodoggone River Area, Northern British Columbia, Economic
Geology, Volume 86, pp 529-554, 1991
89 of 138
Diakow, L.J., Geology of the Southern Toodoggone River and Northern
McConnell Creek Map Areas, North-Central British Columbia; BCEM, Map
2001-1, 1:50000 Scale
Edmunds, F.C., LaPeare, B., 2002 Exploration Program Kemess Property:

Kemess North Diamond Drill Program, Assessment Report 27083,
January 2003
Gao Myles J. Kemess North and Nugget Geostatistical Review and

Resource Estimates March 2003
Giroux, G.H., Preliminary Statistical Evaluation of the Kemess North Gold-

Copper Deposit; private report prepared for El Condor Resources Ltd.,
June 1992
Gower, S.C., Geological and Geochemical Report on the Kemess Property,

Omineca Mining Division, British Columbia; private report prepared for El
Condor Resources Ltd., 1988
Hatch, Draft Revised Pre-Feasibility Study, May 2004
Klohn Crippen, Kemess North, Tailings and Waste Rock Management. 2003
Konigsmann, K., Summary Report on Process Development Treatment of

Ores from the Kemess North Deposit. 2003
Lakefield, An Update of Metallurgical Testing of Kemess Ores,

June 10, 2003
Lloyd, J., An Assessment Report on an Induced Polarization Survey on the

Kemess Property Omineca Mining Division British Columbia;
December 1991
Massey, N.D.W., MacIntyre, D.G. and Desjardins, P.J. Digital Map of British
Columbia: Tile NO9 North Central B.C., B.C. Ministry of Energy and Mines,
Geofile 2003-18, - BC Geological Survey
Monger, J.W.H., The Triassic Takla Group in McConnell Creek Map Area,
North Central British Columbia, Geological Survey of Canada Paper,
76-29, 1977
MRDI, Technical Report, Kemess Mine Review, B.C. December 2001
MRDI, Addendum to the Technical Report, Kemess Mine Review, B.C.

February 2002
Norwest, Kemess North Project 2003 Pre-Feasibility Study, May 2003
90 of 138
Northgate Exploration Limited 2003 Annual Report, April 2004
Rebagliati, C.M., Bowen, B.K, Copeland, D.J., Niosi, D.W.A., Kemess South
and North Porphyry Gold-Copper Deposits Northern British Columbia, in
Porphyry Deposits of the Northwestern Cordillera of North America, CIM
Special Volume 46, pp 377-397, 1995
Rebagliati, C.M., Kemess North Project, El Condor Resources Ltd., 1992

Exploration Program on the Kemess North Property, Assessment Report,
March 1993
Rebagliati, C.M., Kemess North Project, An Exploration Proposal to

Increase the Mineable Reserves at the Kemess North Deposit by Diamond
Drilling, March 1993
91 of 138
21. Statement of Qualifications
James H. Gray PEng
As an author of this Technical Report on the Kemess North Project

for Northgate Exploration Limited (the Issuer) dated 4 June 2004, I hereby
make the following statements:
My name is James H Gray and I am a Principal of GR Technical

Services Ltd. My office address is 3 Sunwood Park SE Calgary Alberta T2X
2V8.
I fulfill the requirements of a Qualified Person as specified in National

Instrument 43-101 of the Canadian Securities Administrators. I have
received the following degree in Mining Engineering:
Bachelor of Applied Science from the University of British Columbia,

Vancouver, 1975.
I am a member in good standing of the Association of Professional

Engineers and Geoscientists of the Province of British Columbia (11919).

Engineers, Geologists and Geophysicists of Alberta (M47177).
I am a member of the Canadian Institute of Mining and Metallurgy.
The Technical Report is based on several site visits, my personal

review of technical reports and data provided by the Issuer, on discussions
with the project and operations engineers, and on information available from
public files.
I have been practicing as a Professional Engineer for over 25 years

with relevant experience for the Technical Report including:
1978 to 1989, mine site engineering, operations and management

positions, costing, evaluating new mineral projects and development
properties.
1989 to present, mine engineering consultant work on assessment

and feasibility studies of numerous coal, base metal, industrial mineral, and
precious metal deposits in Canada, United States, Mexico, Chile, Argentina,
Peru, Turkey, Iran, and Australia.
Dated this 4th day of June 2004, in Calgary Alberta.
_____________________
J.H. Gray PEng
92 of 138
93 of 138
Robert J. Morris PGeo

My name is Robert J. Morris and I am an associate of GR Technical

Services Ltd. My office address is 6243 Kubinec Road, Fernie, BC V0B
1M1.

received the following degrees in Geology:
Bachelor of Science from the University of British Columbia,

Vancouver, 1973.
Master of Science, Mineral Exploration, from Queens University,

Kingston, Ontario, 1978.

Engineers and Geoscientists of the Province of British Columbia (18301).

Engineers, Geologists and Geophysicists of Alberta (M75480).
The Technical Report is based on a site visit, my personal review of

technical reports provided by the Issuer, on discussions with the exploration
geologist for the Issuer, and on information available from public files.
I have been practicing as a professional geologist for over 30 years

Since 1992, work on assessment and feasibility studies of numerous

porphyry gold/copper deposits in British Columbia, Chile and Central
America.
Dated this 4th day of June 2004, in Fernie, British Columbia.
_____________________
R.J. Morris, MSc, PGeo
94 of 138
95 of 138
Kenneth W. Major; PEng

My name is Ken Major and I am Manager, Crushing and Milling

Systems for Hatch Associates. My office address Suite 200 1550 Alberni
Street, Vancouver, BC, V6G 1A5.

received the following degree in Metallurgical Engineering:
Bachelor of Engineering from McGill University, Montreal, 1976.

Engineers and Geoscientists o f the Province of British Columbia (13149).
The Technical Report is based on several site visits, my personal

with the project and operations engineers, and on information available from
public files.
I have been practicing as a Professional Engineer for over 25 years

1976 to 1986, mine site engineering, operations and management

positions.
1986 to present, engineering consultant work on metallurgical test

programs, feasibility studies and detailed engineering of numerous base
metal, and precious metal projects in Canada, United States, Mexico, Chile,
Peru, Papua New Guinea, Portugal, Brazil, and Australia.
Dated this 4th day of June 2004, in Vancouver, BC.
_____________________
K.W. Major; PEng
96 of 138
97 of 138
Abdullah Arik

My name is Abdullah Arik and I am an employee of Mintec Inc.

working on contract for GR Technical Services Ltd. My office address is
3544 East Ft. Lowell Road, Tucson, AZ USA 85716-1706.

received the following degrees in Mining:
Bachelor of Science Mining Engineering from the Middle East

Technical University of Ankara, Turkey, 1976.
Master of Science, Mining/Geostatistics, from the University of

Arizona, Tucson Arizona, 1982.
I am a member in good standing of the Australian Institute of Mining

and Metallurgy.
I am a member in good standing of the North American Council of

Geostatisticians.
I am a member of the Society for Mining, Metallurgy, and Exploration

a Division of the AIME.
The Technical Report is not based on a site visit but on my personal

with the exploration geologist, and the Project Geologist (RJ Morris).
I have been practicing as a Geostatistician for over 20 years with

relevant experience for the Technical Report including:
Since 1982, work on mine evaluations and feasibility studies of

numerous mineral projects and development properties in North America,
South America, Central America, and Australia.
Dated this 4th day of June 2004, in Tucson, Arizona, USA.
_____________________
Abdullah Arik
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22. Additional Information
(a) Current Kemess Mining Operations
The Kemess Mine currently operates from one open pit. The pit is
mined on 15 m benches and is split into three phases. The final wall is
designed with a combined single - and double -bench configuration. The wall
angles range from 40-51 degrees and the pit ramp widths are 35 m and
exceed the design width as defined by the Health, Safety and Reclamation
Code for Mines in British Columbia for the equipment utilized at the
operation. All roads have been designed for a maximum grade of 10%.
Major mining equipment includes the following:
13 Euclid R260 haulage trucks;
1 P&H 2800XPB rope shovel;
1 P&H 2300XPB rope shovel;
1 Hitachi EX5500 hydraulic mining shovel;
1 LeTourneau-L-1400 front-end loader;
Ingersol Rand 351 Pit Viper blasthole drill; and
I P&H XP 100 electric blasthole drill.
The ore is hauled directly to a gyratory crusher and coarse ore

stockpile area south of the pit. The crushed ore is fed to two semi-
autogenous (SAG) grinding mills, followed by two ball mills and one regrind
mill. Flotation circuits are then used to produce a gold-copper-silver
concentrate; a process mill flow sheet is included in Appendix B.
Mill tailings are pumped through two 7,500 m long, 66 cm diameter

lines to a tailings sand plant which extracts a clean coarse sand fraction
from the tailings for use in the construction of the tailings dam. The
remaining tailings are deposited behind the dam. Tailings dam construction
is an ongoing project over the life of the mine, with monitoring and design
work being performed by AMEC E&E from Burnaby, BC.
The mines final product is a clean gold-copper concentrate

containing approximately 24% copper 60 grams per tonne of gold and 90
grams per tonne of silver. This concentrate is trucked in bulk approximately
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380 km via gravel road to a trans-loading facility located in Mackenzie, BC
next to a rail spur. The concentrate is then loaded into covered gondola
railcars and transported to Norandas Horne smelter in Rouyn-Noranda,
Quebec.
Engineers at the Kemess South mine prepared a life of mine

production and mill operating plan that is designed to maximize the value of
the remaining ore reserves in the Kemess South pit. An economic cut-off
grade (Net smelter return cost to extract a block of ore = positive profit) is
used to establish the mineable reserves using a block model of the deposit
and mine equipment scheduling programs are used to schedule ore and
waste production d uring each year. Mill throughput is determined based on
ore hardness models and historic grade recovery curves are applied to
determine gold, copper and silver production in concentrate for each year.
At January 1, 2004 there were sufficient proven reserves at the

Kemess South deposit to sustain mining and milling activities until the end of
2008. During this period mill throughput will average approximately 19.25
million tonnes per annum and annual gold and copper production in
concentrate will average 300,000 ounces and 75 million pounds
respectively. 52 million tonnes of resources also exist at Kemess South and
the productive life of the pit may be extended depending on metal prices. A
summary of reserves and resources at Kemess South as if December 31,
2003 is shown in Table 22.1 .
Table 22.1: Kemess South Reserves and Resources
Category Quantity Gold Copper Gold Copper

(tonnes) (gr/mt) (%) (Ounces) (000s lbs)
Proven 91,715,448 0.699 0.227 2,061,000 459,000

Reserve
Indicated 52,210,624 0.491 0.167 824,000 192,000

Resource
A management structure and personnel organizational chart is

attached as Appendix C.
(b) Kemess North Development
The Kemess North Mineral Project can be considered as an

extension of the existing Kemess Operations into a new mining area. As
such, it will use the existing plant, infrastructure, and mining equipment for
the future Kemess North operation. The additional reserves from the
Kemess North mineral project will extend the mine life to 2020, an extension
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of 12 years beyond the current life-of-mine plan for the current Kemess
operations.
The current mining and milling levels will continue through mid 2006
with all ore being produced from the Kemess South pit to feed the plant. To
meet the future needs of the Kemess South pit, three more haul trucks will
be added to the fleet in 2005. As the Strip ratio declines in Kemess South
mining equipment will be released and will be transferred to Kemess North.
Kemess North pre-stripping will begin in the second half of 2005 with small
scale contract development equipment preparing large enough initial
working areas to accommodate the large mining equipment from Kemess
South .The first shovel will be transferred at the start of 2006 along with a
blast hole drill and 5 trucks from the existing fleet. Initial mine waste will be
used for construction of pads for the crusher stockpile site and infrastructure
required for the Kemess North operations. This initial material will be NAG
material from the northern pit limit on Douglas Ridge. Mine waste will also
be used to fill a haul road to the waste dump site at Duncan Lake.
To meet the pre-stripping requirements an additional 4 trucks will

need to be added to the combined fleet for 2006. The first crusher at the
North pit rim will begin in Kemess in the fourth quarter of 2006. At this time a
second mining shovel and 7 more trucks will be transferred from Kemess
South to Kemess North.
Concurrent operation of both mining areas will continue until the

depletion of ore in Kemess South in 2010. At that time the remaining shovel,
blast hole drill and 4 haul trucks will be transferred to Kemess North.
During 2005 and 2006 the following infrastructure will be constructed

at Kemess North to facilitate the mining operation and link it to the milling
and flotation infrastructure at Kemess South:
A 3 km tunnel and 11 km conveyer linking the Kemess North

crusher and the Kemess south mill stockpile;
A truck maintenance complex;
An ore crusher and feeders; and
Power line and road link from Kemess North to Kemess South.
At the end of 2005, construction of a third milling circuit will begin at

Kemess South adjacent to the existing mill building which houses the other
two milling circuits and the flotation circuit. The new circuit will consist of a
SAG mill and ball mill in series similar to the existing circuits and will be tied
into the existing live ore stockpile and the existing flotation circuit. The third
circuit will be commissioned in the third quarter of 2006.
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The waste rock and tailings impoundment facilities at Duncan Lake
will be developed during 2005 and 2006 and a tailings pipeline will be
constructed to connect the expanded Kemess South mill to the facility.
In the fourth quarter of 2006 the first ore from Kemess North will be
delivered to the Kemess South mill and ore production from the Kemess
South pit will be reduced to 11 million tonnes per year until reserves are
exhausted in early 2010 at which point Kemess North production will be
ramped up to fill the additional mill capacity.
(c) Integrated Production
In order to optimize the net present value of the Kemess North

project, the Hatch draft revised pre-feasibility study dated May 2004
integrates the development of the Kemess North pit with continued
production from the Kemess South pit for a period of approximately 5 years
between 2005 and 2009. Table 22.2 shows the average annual production
from Kemess South and Kemess North during the period of combined
operation (2004-2009) and the period of Kemess stand alone North
operation from 2010 through 2020
Table 22.2: Production Summary
2004-2009 2010-2020
KS KN Total KN
Ore & Waste Mined (MM tonnes) 27.5 30.3 57.9 57.1
Mill Throughput (MM tonnes) 14.8 15.4 30.2 32.2
Gold Production (ounces) 243,750 55,858 299,608 208,960
Copper Production (MM lbs) 62 28 90 105
Silver Production (ounces) 335,156 167,574 502,731 621,088
(d) Recoverability Metallurgy and Mineral Processing
Average metal recoveries for evaluating future Kemess milling

performance on ores from Kemess South and Kemess North are
summarized in Table 22.3. For additional detail on Metallurgy and Mineral
Processing refer to Section 15.
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Table 22.3: Metal Recovery Summary
Recovery (%) Flotation Concentrate

Ore Type Grade
Copper Gold (% Cu) Moisture (%)
Kemess South Ores:
Hypogene 85 73.5 24 7.5-8
Supergene/Leach Cap 67 63.5 20.5 8-9
Transition 79 70 23 8-9
Kemess North Ores: 90 63.5 23 8
(e) Markets Transportation and Smelting
Kemess concentrate is a clean, lower grade copper-gold concentrate

which is readily marketable to smelters around the world. Northgate
currently sells the full production of Kemess concentrate to Noranda Inc.
under a long term contract. 2004 annual concentrate smelting and copper
refining charges settled at $43/mt of concentrate and $0.043/accountable
pound of copper respectively in 2004. Over the past 5 years annual smelting
and refining charges have averaged $62/mt and $0.062 per accountable
pound of copper.
Continued shipments to Norandas Horne smelter in Rouyn Noranda

Quebec are envisioned throughout the minelife of Kemess North but
shipments to smelters in Asia through the port of Vancouver are possible at
equivalent realizations. By 2006 it is assumed that a road will be built
connecting the Kemess mining complex to the coastal town of Stewart
giving Kemess additional shipping options for concentrate and reducing road
maintenance costs that are currently borne exclusively by Kemess.
Kemess contracts with third parties who supply transportation

services for its concentrate. CN Rail and Lomak Bulk Carriers currently
provide rail and trucking services to Kemess under multiyear contracts.
(f) Contracts
Northgate Exploration and its wholly owned subsidiary Kemess Mines

Ltd. are party to a variety of long-term contracts for various products and
services. It is assumed that these contracts would be extended to include
production from Kemess North under similar terms. The following is a
summary of the Corporations material long-term contracts.
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Concentrate Treatment
Kemess is in the last year of a three year contract with Noranda Inc. for the
sale of its full production of copper concentrate. Negotiations for a contract
extension have begun and the company is also looking at other destinations
for the Kemess concentrate.
Electricity
Kemess purchases its electricity from British Columbia Hydro under

Schedule 1821 tariff used by large industrial users in the province. British
Columbia generates most of its power from hydro electric generating
stations and power rates have remained relatively stable over the past
decade. The BC government has been reviewing electricity pricing in the
province for the past 2 years and in April 2004 increased rates by
approximately 7%. This is the first increase in 7 years. As part of the new
pricing system that is currently being discussed large industrial users will be
entitled to continue to purchase their current power requirements at the low
Heritage power rate while additional power requirements will be purchased
at a higher rate consistent with the cost of adding new generating capacity.
Concentrate Trucking
Kemess has a long term contract with Lomak Bulk Carriers who
provide truck transportation services to the mine. Concentrate is trucked to
the MacKenzie trans-loading facility and mill grinding media, diesel fuel and
other supplies are backhauled to the mine.
Explosives
Kemess has a long-term supply with BXL Explosives who supply explosives
and related products to the Kemess mine.
Tires
Kemess has a long-term agreement with Fountain Tire who supply tires for
Kemess fleet of 13 haul trucks as well as various other vehicles.
Air Transportation Services
Kemess has a long-term agreement with NT Air who provide air

transportation to and from the Kemess mine for Kemess employees on
Beachcraft 1900 airplanes.
Collective Agreement
Kemess Mines Ltd. and The International Union of Operating Engineers

Local 115 have a collective agreement which govern the relationship
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between the company and its employees. The current three year agreement
expires on December 31, 2004.
Closure Bonding
Kemess Mines Ltd. has posted a Cdn$13 million dollar closure bond
with the Province of British Columbia to fund the eventual closure of the
Kemess South mine. The agreement with the province calls for Northgate to
add $1 million dollars to the bond on December 31st of each year until the
estimated $19 million dollar cost of closing the mine has accrued. For the
purposes of the Kemess North development it has been assumed that the
full amount of this bond will remain in place until the conclusion of the
Kemess North mine life.
(g) Environmental Considerations
Kemess South
The current reclamation bond for the Kemess Mine has been set at
Cdn $12 million and is in good standing. Reclamation and remediation are
ongoing at the mine site and are budgeted items.
The mine staff produces an annual reclamation report, as required

under BC law. This report documents areas of disturbance, future
development and reclaimed ground. The mine staff also prepares an annual
spreadsheet documenting liabilities at the end of each year, which is
submitted to the government. The latest filed reclamation report was for year
2000.
Kemess North
The environmental considerations, and corresponding civil

engineering works and costs have been undertaken by independent
technical specialists in these fields. The results have been incorporated into
the Hatch Revised Draft Pre-Feasibility Study, dated May 2004. Klohn
Crippen Consultants Ltd. have been retained for the mine waste
management aspects, including mine waste rock, tailings and water
management, for this proposed open pit gold/copper mine in northern British
Columbia. Klohn Crippen have also been retained to prepare the
Environmental Impact Assessment for the project. The following is a
summary of Klohn Crippens work to date.
Mine Waste Management
The Kemess North deposit will generate approximately 414 million

tonnes of tailings (sand and silt sizes) and 335 million tonnes of mine waste
rock. All of the tailings and most of the mine waste rock have the potential to
oxidize and generate acid drainage and metal leaching if they are not stored
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under water in a saturated environment. Over sixteen alternative tailings and
waste rock disposal options were assessed by Klohn Crippen. The
recommended alternative is to store all of the tailings and potentially acid
generating waste rock below water in Duncan Lake, with construction of a
90 m high dam at the north end of the lake, a 35 m high dam at the
southwest end and 10 m high dam at the southeast end.
Geotechnical drilling and site investigations were carried out for the
Duncan Lake option and design studies have been carried out to the
feasibility study level. A corresponding Bill of Quantities and Engineers Cost
Estimate have been prepared for the study and submitted to Kemess.
Water Management
During operations, the Duncan Lake disposal facility will be operated

as a closed system with no discharge of water. The impoundment water
quality will be influenced by the tailings process water, natural runoff and
submergence of mine waste rock. The impoundment water quality will be
monitored and controlled to stay within water quality criteria. This is
recommended to mitigate for any potential seepage through the low
permeability earth fill dams. Mine water will be collected and, if necessary,
treated and recycled through the tailings impoundment.
Environmental Considerations
Acid rock drainage will be controlled by placement of all potentially

acid generating waste rock and soils into Duncan Lake. The main impact of
the project, therefore, is the loss of aquatic habitat in Duncan Lake and
temporary reduction of water flows in Duncan Creek and Attycelley Creek.
Duncan Lake is classed as a low productivity sub-alpine lake supporting
Dolly Varden, rainbow trout and mountain whitefish species. Compensation
for lost habitat will be carried out by a combination of new habitat
restoration projects that replace productive capacity of the aquatic habitat.
Flow reductions in Attycelley Creek and Duncan Creek will be compensated
with enhancement works within the Attycelley Creek drainage.
Closure
After mining, Duncan Lake aquatic habitat will be restored with a

program that includes creation of both shoal (shallow) and deep water
habitat. A new outlet channel, Duncan Creek, will be created to reconnect
the new lake with Attycelley Creek. A post-closure period of at least five
years is expected to include fertilization of Duncan Lake and earthworks to
build up the organic matter on the base of the lake and restore shoreline,
wetland and terrestrial vegetation.
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The earth fill dams are designed to maintain the free water pond
(Duncan Lake) at least 300 m upstream of the dam. The dams are also
designed with low gradient core zones and robust fill sections to reduce long
term dam safety and erosion concerns.
The open pit will infill with water over a period of up to 100 years. The
water could become acidic due to oxidation of rock in the remaining pit
walls. If the acidity and metal loading exceeds the pre-mining conditions (the
area currently generates acid drainage and metal loadings) it will be
necessary to treat the water in the open pit lake with a lime dosage system.
(h) Permitting Current Status
The Kemess North Copper Gold Project entered the regulatory

review process for mine development approval in October, 2003. The review
process will involve 3 levels of government: Province of British Columbia,
First Nations (4 Bands) and the Government of Canada. The project review
process will be concurrent with the applications for Project Permitting. The
provincial permits will establish the guidelines for environmental protection
during the construction and operating phases of the Kemess North Project.
The formal project review was initiated with the submission of the
Kemess North Project Description to the BC Environmental Assessment
Office (EAO) in October, 2003. The EAO has the responsibility to notify all
stakeholders and disseminate relevant project information during the review
process. The primary government agencies involved are as follows:
Province of BC: Environmental Assessment Office, Mi nistry of

Water, Land & Air, Ministry of Energy & Mines, and Ministry of Sustainable
Resources;
Government of Canada: Canadian Environmental Assessment

Office, Department of Fisheries & Oceans, Environment Canada, and
Natural Resources Canada; and
First Nations: Kwadacha FN, Gitxsan FN, Takla Lake FN, and Tsay
Keh Dene FN.
The Kemess North Project consists of the following key components

and the Development Approval and Provincial Permits are based upon this
information:
Mining methodology, scale and mining rates;
Options for disposal of waste rock and tailings;
Social and Economic impacts;
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The Reclamation & Closure Plan, and
Compensation Plans for identified loss or displacement of

ecological values.
Table 22.4 Environmental & Engineering Assessment Review Schedule
Programs Initiation Completion

Date Date
Environmental Baseline Information July, 2002 September, 2004

Collection
Environmental Impact Assessment July, 2003 September, 2004
Geological & Engineering Evaluation of July, 2001 May, 2004

Ore Body Economics
Engineering of Mine Development Plan February, 2003 May, 2004
Stakeholder Consultation July, 2003 September, 2004
Final Project Application Document September, 2004 March, 2005

Submitted for Government Review
Environmental Assessment Certificate May, 2005

Granted
(i) Taxes
The Kemess operation is currently subject to the following taxes:
British Columbia mineral tax (2% on resource income).
Property Taxes
Federal and Provincial Income Taxes
Federal Capital Tax
Federal Goods and Services Tax.
During the mining of Kemess South and Kemess North under the metal
price and foreign exchange rate assumptions used in this report, Kemess
Mines Ltd. will not pay federal or provincial income taxes due to the large
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quantity of tax shields currently available to the Corporation and the shields
that will result from future capital expenditures.
(j) Capital and Operating Cost Estimates
The revised pre-feasibility study for the development of Kemess

North dated April 2004 provides the capital and operating costs used in the
financial model in Section 22(k) of this report.
Mining and milling costs for the Kemess North and Kemess South
operations have been estimated using actual 2003 costs incurred at the
Kemess South complex as well as a detailed analysis from first pri nciples of
the activities that will take place in each year of the pre-feasibility study mine
plan from 2004 through 2020. Site G&A costs are fixed costs that have been
estimated based on 2004 budget projections and adjusted in each year for
the tonnes of mill throughput. Table 22.5 summarizes the mine operating
costs during the period of combined operation and the period during which
the Kemess North pit is the only source of ore for the mill.
Table 22.5: Projected Operating Costs
Operation Cost (Cdn$)
Actual Kemess Kemess

Kemess South Combined Ops North
South 2003 2004-2006 2007-2009 2010-2020
Mining ($/mt mined) 0.91 1.03 1.05 1.00
Mining ($/mt milled) 2.63 2.48 1.57 1.85
Milling ($/mt milled) 3.06 2.63 2.41 2.2
G & A ($/mt milled) 1.09 1.20 0.76 0.73
Total 6.78 6.31 4.74 4.78
During the period of combined operation of Kemess North and

Kemess South the average cash cost per ounce of accountable gold at a
$1.00 per pound copper price is forecast to be US$140 per ounce. Between
2010 and 2020 when only the Kemess North pit is in operation the cash cost
is forecast to be $195 per ounce.
110 of 138
Project capital to develop Kemess North totals US$165 million dollars
and sustaining capital over the combined Kemess North/Kemess South
mine life totals US$88 million dollars. Project capital will be spent in 2005
and 2006 and sustaining capital for replacement and rebuilding of capital
equipment and construction of tailings and waste rock impoundment
facilities will be spent over the combined 17 year life of the mine.
(k) Economic Analysis
Northgate has completed an after-tax economic analysis for the

development of Kemess North using the revised Kemess North Pre-
Feasibility Study dated April 2004. The model compares the annual cash
flow generated from the Kemess South Mine to the annual cash flow
generated by a combined Kemess North/South Operation and calculates the
NPV and IRR of the differential cash flows. The major commercial
assumptions incorporated within the model are as follows:
Exchange Rate
Cdn$/US$1.45
Metal Prices
Gold US $375/oz
Copper US $1.00/lb
Silver US $5.00/oz
Concentrate Treatment and Refining Charges
$62/tonne concentrate and $0.062/pound accountable copper
These assumptions represent Northgates estimates of the average metal

price, exchange rate and concentrate treatment and refining charges over
the 2004-2020 period.
Under these assumptions the Kemess North project has a Net

Present Value (NPV) at a 5% cost of capital of US$75 million and an IRR of
8.9%.
The economic analysis used to evaluate the Kemess North project

generates different results depending on the assumptions employed. Table
22.6 shows the project IRR at different prices for gold and copper and
sensitivities of the project IRR to all major variables is shown in Table 22.7.
111 of 138
Table 22.6: IRR Sensitivity to Metal Prices
Copper Price
8.6% $0.90 $0.95 $1.00 $1.05 $1.10
$350 3.2% 5.1% 6.8% 8.4% 9.9%

Gold
5.2% 7.0% 8.6% 10.1% 11.5%
Price $375
$400 7.1% 8.8% 10.3% 11.7% 13.1%
$425 8.9% 10.4% 11.9% 13.3% 14.6%
$450 10.6% 12.0% 13.4% 14.7% 16.0%
Table 22.7: IRR Sensitivities
Factor Unit change IRR Change

Gold Price $25/ounce 1.7%
Copper Price $0.05/pound 1.5%
Foreign Exchange Rate Cdn$/US$0.05 1.8%
Concentrate Treatment $5/mt concentrate & 0.05%
& Refining Charge $0.005/lb Cu
(l) Regional Potential
The 35,312 ha of exploration claims surrounding the Kemess

Complex and the properties surrounding these claims that are held by
various exploration companies are known to contain a variety of different
types of mineralization including gold-copper porphyry mineralization
(Kemess North and Kemess South), epithermal gold mineralization and
base and precious metal skarn mineralization. Prior to the construction of
the Kemess South mine and its related infrastructure in the Toodoggone
region of British Columbia, the economic hurdle for development of any
deposit discovered was quite high. However with the Kemess infrastructure
in place and Kemess South and Kemess North providing a large base load
for the infrastructure, the probability of finding an additional deposit within an
economic shipping distance of Kemess has increased dramatically. Such a
deposit could provide additional low cost mill feed to be blended with
existing ore and increase the Kemess metal production at a very small
incremental cost.
Two specific areas within the Kemess claims that have already
showed promise are the Nugget Zone and the area to the southwest to the
112 of 138
existing Kemess South pit. At the Nugget Zone, one drill hole, only 0.5
kilometers from the proposed Kemess North pit boundary, contained 420
metres of porphyry mineralization at 0.13% copper and 0.38 gr/mt gold
starting at a depth of 25 meters. To the southwest of the current Kemess
South pit there are over 25 million tonnes of indicated resources grading
0.49 gr/mt gold and 0.16% copper and a geologic setting that has the
potential to host additional higher grade porphyry mineralization. Both these
areas have the potential to add ore to the Kemess operation in the future.
113 of 138

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REVISED

OMENICA MINING DIVISION

UTM (NAD 83, Zone 9)

LATITUDE: 5700 North

J.H. Gray, PEng

Property Description Location, Ownership and Current operations

Preproduction stripping and construction of the Kemess North field service

Andesite Volcanics (Takla Group-T3)

The property is predominantly underlain by a thick (>1,000 m) succession of

On surface, exposed in the cirque headwalls and some upper intersections of

Dacitic Polylithic Fragmental (Hazelton Group - H3:Toodoggone Formation)

Quartz Monzonite/Quartz Diorite

Gold-copper mineralization forms an inclined tabular zone that is centred on the

Overall, sulphide mineralization throughout the deposit consists of 2-3% pyrite,

Modelling Resources and Reserves

Kemess North is a large copper-gold porphyry deposit and is typical of porphyry

A summary of information from the database and geostatistical resource estimate

198 drill holes.

40,237 copper assays.

39,821 gold assays.

Copper and gold show a correlation factor of 0.80.

5 m and 15 m fixed length composites were generated for comparison of the

A background interpolation was done using the inverse distance weighting

The methodology employed for the grade interpolation of the model

The reserves Class codes were assigned based on the Geostatistical

Summary of Measured Resources

Ordinary Kriging Inverse Distance

Ordinary Kriging Inverse Distance

Summary of Inferred Resources

Ordinary Kriging Inverse Distance

The Ultimate Economic pit limit is based on a Lerchs-Grossman pit optimization

Impurity elements occur in extremely low concentrations.

Concentrates will be free of deleterious impurities.

Province of BC: Environmental Assessment Office, Ministry of Water, Land &

Government of Canada: Canadian Environmental Assessment Office,

These assumptions represent Northgates estimates of the average metal price,

1. INTRODUCTION AND TERMS OF REFERENCE..................................................... 1

1. Kemess Property Location Map 5

2. General Claim Outline 6

3. Detailed Kemess Area with Infrastructure Kemess South & Kemess 10

4. Regional Geology after Massey et al 2003. 22

5. Shows General Property Geology in Area Around Kemess North 23

6. Kemess North Geology - Diakow (2001) 24

7. Location map for 2003 Condemnation holes. Note area between 30

8. Drill Hole Locations 32

9. Kemess Claim and Surrounding Properties 43

10. Pit 634 with Met Sample Drill Holes 46

11. Ultimate Pit Limit (P634) 59

12. Ultimate Pit Limits - Undiscounted 65

13. Ultimate Pit Limits - Discounted 66

14. Ultimate Pits Section View 67

15. Lerchs-Grossman Sensitivities 68

16. Lerchs-Grossman Pit Low Prices 70

17. Lerchs-Grossman Pit Split Final Stage 71

18. Lerchs-Grossman Pit Base Price 72

19. Pre-Strip Phase (P601) 75

20. Pit Phase 1 (P614) 76

21. Pit Phase 2 (P624) 77

22. Pit Phase 3 (P634) 78