NASH CREEK PROJECT


Highlights

  • A sizeable VMS deposit that hosts a near-surface Indicated resources of 9.0 Mt grading 3.6% Zn Eq. containing 712 Mlb of Zn Eq. along with 1.1 Mt of Inferred resources grading 3.6%  Zn Eq. containing 88 Mlb of Zn Eq.;
  • The current 43-101 mineral resource estimate is based on only two of five known zones, which are open for expansion
  • Preliminary metallurgical testing indicated amenability to Dense Media Separation, a technology designed to significantly increase grade by reducing waste rock
  • Located approximately 90km by road to an operating processing facility

 

Overview

Callinex owns a 100% interest in the Nash Project subject to a sliding scale 1%-1.5 NSR, of which 0.5% can be repurchased for $500,000 and would also include a 0.5% buy-back of the 1% NSR on the Superjack Project. The project is accessible by following Highway 11 for 70km from the city of Bathurst and the port of Belledune, which includes a lead smelting facility, is located 20km by road to the east.

The first significant drilling programs at Southern Hayes Zone was conducted by Falconbridge between 1988 and 1991. Subsequent to work by Falconbridge in 1991, Slam Exploration completed 216 drill holes to define the current mineral resource from 2004 to 2008. The Southern Hayes Zone is open for expansion to the south where increased grades have been encountered.

Preliminary metallurgical testing at a coarse grind size has indicated a 91% recover for zinc and 82% recovery for lead after considering open circuit losses to tailings. Additional testing has also indicated amenability to Dense Media Separation (“DMS”) and results below demonstrate an ability to significantly increase the potential mill feed grade.

Original Sample Grade Resultant Mill-Feed Grade Upgrade
Sample Lead % Zinc % Silver g/t Lead % Zinc % Silver g/t Factor
3 1.19 6.64 10.6 1.7 9.05 15 140%
4 0.85 4.27 23.8 2.33 11.95 63 273%
5 0.8 4.9 12.5 1.22 7.25 19.3 152%
6 0.23 1.53 12.8 0.39 2.5 24.4 175%

 

Mineral Resources

2009 Indicated and Inferred Resource Summary for the Nash Creek Deposits using a 2.0% ZnEq cut-off

Resource Type Tonnes Zinc Equivalency           (%) Zn          (%) Pb              (%) Ag                  (g/t)
Hickey Deposit      
Indicated 3,174,000 3.09 2.38 0.53 15.8
Inferred 177,000 3.09 2.24 0.68 16.7
Hayes Zone      
Indicated 5,859,000 3.84 3.01 0.59 19.4
Inferred 936,000 3.67 2.95 0.55 15.3
Total          
Indicated 9,033,000 3.58 2.79 0.57 18.2
Inferred 1,113,000 3.58 2.83 0.57 15.5

Notes:

  1. Estimation and reporting of the mineral resource estimate adheres to NI 43-101 guidelines and CIM Definition Standards.
  2. Eq. is calculated using three-year trailing metal prices of $0.90/lb Zn, $0.87/lb Pb and $17.73/oz Ag, and recoveries of 90.5% Zn, 81.5% Pb and 50% Ag based on preliminary results from metallurgical testing.
  3. Mineralization was constrained using a 2.00% Zn. Eq. wireframe, and segmented in 16 domains in the Hickey Zone, and 5 domains in the Hayes Zone. The cut-off grade for the mineral resource estimate is 2.00% Zn. Eq. which is considered suitable for reporting mineral resources for a potential open pit project and depth of mineralization.  The estimate is not constrained by a conceptual pit.
  4. Densities vary by grade and rock type with an average specific gravity of 2.84 for the Hayes Deposit and of 2.82 for the Hickey Deposit.
  5. The mineral resource estimate was calculated using an ordinary kriging (OK) methodology. The block model was constructed with block dimensions of 5 x 5 x 5 meters.
  6. Mineral resources that are not mineral reserves and have not been demonstrated to have economic viability for extraction. The quantity and grade of reported inferred resources in this estimation are uncertain in nature and there has been insufficient exploration to define these Inferred resources as an indicated or measured mineral resource.It is uncertain if further exploration will result in upgrading them to an indicated or measured mineral resource category.
  7. Numbers may not add exactly due to rounding.

 

The technical content of this page has been reviewed and approved by James Pickell, P.Geo, a Consultant to the Callinex, and a Qualified Person as defined by National Instrument 43-101. Mr. Pickell has also reviewed the Technical Report and Resource Estimate prepared by Tetra Tech.

Figures:

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Figure 2: Nash Creek Plan Map with Drill Collars

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