Projects

Regional Geology

In northeast Nevada, all Paleozoic age rock units were deformed by several stages of compressional folding and faulting. Regional folding occurred in the late Devonian to early Mississippian. Extensional deformation in the Tertiary was responsible for igneous activity accompanied by widespread hydrothermal alteration and a wide variety of mineralized settings. The sedimentary and volcanic stratigraphy extending from the Cambrian through Triassic is locally intruded by Tertiary age stocks and dikes. The Medicine Property is underlain by a complex sequence of Permian-Triassic carbonate and calcareous clastic rock units interrupted by numerous erosional and angular disconformities. The Permian stratigraphy unconformably overlies upper Mississippian clastic rocks which overlies the Cambrian, Ordovician, Devonian and lower Mississippian stratigraphy. These Paleozoic carbonate and clastic rock units hosts a number of significant precious and base metal deposits localized within a significant northeast trending metallogenic corridor. As illustrated on Figure 4, this corridor is developed over a strike length in excess of 500 kilometers, extending from the Eureka/Ruby Hills silver-gold-base metals district to the Long Canyon gold deposit in the north. The important characteristics of the deposits in the northeast mineral trend include; spatial relationship with Tertiary intrusives, extensive oxidization, widespread jasperoidal and calc-silicate alteration and dominance of silver-base metal mineralization.

Local Geology

The northern part of the Medicine Range is underlain by sedimentary units ranging in age from upper Pennsylvanian to Triassic with an estimated overall thickness up to ~1200 meters. The upper Pennsylvanian stratigraphy comprises three formations dominated by silty to sandy limestone, dolomite and conglomerate. The lower Permian age Gerster Formation which hosts the Medicine Springs silver-lead-zinc-barite oxide mineralization, comprise a lower calcareous siltstone and dolomitic to bioclastic limestone and an upper sandy limestone with intercalated siltstone and cherty nodules. The Thaynes Formation unconformably overlies the Gerster Formation and comprises a thin unit of Triassic age calcareous sandstone, siltstone, sandy limestone and conglomerate. The Permian-Triassic stratigraphy is overlain by Jurassic age rhyolitic pyroclastics of the Humbolt Formation. Cretaceous age granite-diorite stocks and dykes which have been observed on the Medicine property and in other locations in the Medicine Range. These intrusives have intruded and altered the older carbonate lithologies. Structurally, the Medicine Range exhibits a series of northeast imbricated fault blocks bounded by closely-spaced, west dipping high-angle faults with 20% extension.

Two geological models applicable to the Property:

1. Near Surface Vein - High-angle, structurally controlled silver and base metal mineralization hosted by and associated with jasperoids, breccia, and mineralized replacement of the Permian and Triassic carbonate units. It was these near surface veins that were exploited by historic workings on the license area.

2. Carbonate Replacement Deposit - Historic drilling documents a replacement-style mineralization developed within receptive carbonate beds. This combination of structural and stratigraphic control is typical for many precious metal deposits in Nevada including the carbonate replacement type mineralization.

The focus of the exploration plan for the Medicine Springs Project is the identification of high grade carbonate replacement mineralization below the oxide zone.

Geologic Analogue with Hermosa/Taylor deposit

In comparison to other notable carbonate replacement deposits, the Hermosa/Taylor zinc/lead/silver deposit owned by South32 is considered the best analogy for the target for the Medicine Springs Project.

Listed geological and geochemical similarities between Taylor and the Medicine Springs Property including the following features:

• Extremely deep oxidation more than 150 meters. At Taylor the oxidation is primarily due to the weathering process of a high sulfide system while at Medicine Springs, the presence of sulfides has rarely been encountered due to the very shallow nature of the drilling.
• At Taylor, the oxide/sulfide mineralization is selectively hosted by three lower Permian age carbonate formations while at Medicine Springs, the total lower Permian and Upper Mississippian carbonates stratigraphy has yet to be explored.
• At both properties, an early stage of stratiform replacement mineralization is cut by a later stage of high grade veins and breccias.
• Oxidized minerals dominated by smithsonite & cerrusite.
• Intense sericite-silica-carbonate alteration.
• The mineralized footprint at Taylor is of similar size as the surface alteration, geochemical and geophysical footprint at Medicine Springs.
• Pathfinder geochemical signature and alteration of the mineralization are very similar (As, Sb, Ba, Ag, Hg, Mn).
• The geologic comparison of the Medicine Springs Property to the Taylor deposit is preliminary and entirely speculative and can only be tested by extensive phased exploration studies.

Hermosa/Taylor Deposit Longitudinal Section (Source: Arizona Mining, Inc.) Hermosa/ Taylor Deposit Overlay on Medicine Springs Project

Two styles of oxide mineralization are observed at the Medicine Springs Property, high grade silver-lead-zinc-barite veins and breccias controlled by steep northeast structures and shallow west dipping bedding replacement mineralization hosted by permissive Gerster Formation carbonate units. The mineralization exhibits a close spatial relationship with Tertiary dykes identified from the magnetic data. It is important to emphasize that the older stratigraphic calcareous units underlying the Gerster Fm. offer excellent potential for replacement-style silver-base metal mineralization when adequate structural preparation exists. Historical exploration defines a silver-lead-zinc mineralized footprint that is traced along northeast trend for 3,400 meters and is up to 1,400 meters in width.

The Medicine Springs silver-zinc-lead-barite oxide mineralization is localized along 2 subparallel north-northeast trending fault systems that encompass the Golden Pipe and Silver Butte prospects. The mineralization is dominated by breccias, jasperoids and zones of decalcification hosted by carbonates of the Gerster Formation. Intensive oxidization has been observed to depth of approximately 150 meters. It is postulated that oxide silver-zinc-lead-barite mineralization overlies sulfide-rich carbonate replacement mineralization which was not tested by the previous shallow drilling programs.

Alteration observed in outcrop and in drill cuttings is dominated by jasperoidal silicification and argillization observed in the calcareous clastic units. A geological analogue for Medicine Springs silver-lead-zinc mineralization hosted by Permian carbonates is documented at the Lone Mountain property located 150 kilometers to the southwest. Carbonate hosted silver-rich base metal skarns are also observed at Bald Mt, Spruce Mtn and Eureka deposits.

Geological analogues for Medicine Springs oxidized silver-lead-zinc mineralization are observed at the Maverick Springs, Gunman, Lone Mtn, Bald Mtn and Spruce Mtn deposits located within the same northeast trending metallogenic zone hosted by Cambrian to Permian age carbonates with a relationship with Jurassic to Tertiary age intrusives.

• Spruce Mountain (American CuMo Mining)
  PFS, 1.2 Bt, Eocene age porphyry deposit averaging 0.05% Mo, 0.05% Cu, credits in Ag and W. Distal Pb-Zn-Ag, and Cu mantos replace late Pennsylvanian and lower Permian carbonates/dolostones
• Maverick Springs (Silver Standard)
  With Indicated Resource 63 Mt @ 34 g/t Ag and 0.31 g/t Au plus Inferred Resources of 77.6 Mt @ 34 g/t Ag and 0.31 g/t Au, open-pittable, hosted by Permian carbonates and strongly oxidized.
• Bald Mountain (Kinross)
  With Reserves/resources 275 Mt @ 0.6 g/t Au, open pit, heap leach producing 283,000 oz Au; gold hosted by Jurassic intrusives and gold-silver-base metals developed in Devonian Devils Gate carbonates.
• Gunman (Pasinex)
  Exploration, upper oxidized zinc-silver, low lead mineralization hosted by Permian carbonates and a lower sulfide zone hosted by Pennsylvanian age (?) black shale; targets CRD and SEDEX mineralization
• Lone Mountain (Nevada Zinc)
  Nevada Zinc; exploration, shallow dipping oxidized zinc-lead low silver mineralization hosted by Devonian Devils Gate carbonates cut by with late barite/calcite veining.

Production

Historical production from the Medicine property was reported to be 160,000 kilograms of lead, 770 kilograms of zinc and 480 kilograms of silver from the early 1900’s to 1956.

Exploration Summary

Several companies including USMX, USAX and Silver Reserve conducted 3 campaigns of exploration drilling on the Property from the early 1980s until 2008. In total, 125 reverse circulation holes were drilled for 5,442 meters with an average depth 43 meters. Over 85% of this drilling was undertaken on the Golden Pipe deposit.

Cominco completed a CSAMT ground geophysical survey over central part of the property in 1996-1997. The survey identified three resistivity anomalies that are in part coincident with the Gold Pipe oxide mineralization. The resistivity response is possibility related to intense oxidation, decalcification and argillization of the Permian carbonate host rocks. Importantly the CSAMT survey results extend the northern limit of the Golden Pipe oxide silver-lead-zinc zone for an additional 900+ meters to the north-northeast.

A total of 125 reverse circulation holes were drilled on the license area in 3 campaigns dating back to 1986. for 5,442 meters with an average depth 43 meters. A total of 125 RC drill holes for 5,442 meters (average depth 43 meters) was completed on the property in 3 drill campaigns dating back to 1986. Over 85% of this drilling was undertaken on the Golden Pipe deposit. Historical exploration defines a silver-lead-zinc mineralized footprint that extends in a northeastern direction for 3,400 meters and is up to 1,400 meters in width. Past drilling covers less than 10% of the known mineralized footprint. Drill results at Golden Pipe indicate the mineralization is open along strike and below a depth of >180 meters (495 feet). Significant drill intercepts include high silver grades up to 182 g/tonne over 7.6 meters and high combined zinc plus lead grades of over 17% over 4.6 meters. Historical drilling intercepts are summarized in Tables 2 and 3.

*Historical non-NI43-101 compliant and cannot be relied on.
Source: NI 43-101 Geological Report and Summary of Field Examination, Medicine Springs Property, Elko County Nevada, January 15, 2018