WORK HISTORY

Cominco's interest in the Finlayson Lake area was heightened in 1992 when soil and silt geochemical sample results from a reconnaissance program confirmed and expanded upon an anomalous silt sample collected during a Geological Survey of Canada regional stream sediment and water geochemical survey for NTS map sheet 105G (Hornbook and Friske, 1988).
 
A follow up program, in 1993, within the anomalous drainage led to the discovery of a mineralized sulphide cobble by A.B. Mawer of Cominco, for whom the deposit is named. The company immediately carried out a reconnaissance ground UTEM geophysical survey over the projected trace of the suspected host stratigraphy, thereby outlining an EM conductor. Staking of the first Tag claims (cl 1-30, (YB46227) over the conductor was accompanied by a ground magnetic survey. Further magnetic and horizontal loop EM and soil surveys were completed later, that fall defining a compelling drill target.
 
In 1994 Cominco flew an airborne magnetic/electric magnetic (EM) survey over the property and followed up identified anomalies with ground magnetics and gravity surveys, regional and detailed mapping and additional soil sampling. The company also collared 53 diamond drill holes (8,500 m) on and around the main ABM zone/deposit, staked more than 1,591 claims and released a preliminary historic mineral reserve estimate for the ABM deposit at the end of the year.

In 1995 Cominco drilled 133 diamond drill holes (16,178 m), and carried out additional soil sampling, ground HLEM, magnetic and gravity geophysical surveys and geological mapping. The company also constructed an all-weather tote road to the property, collected a 40 tonne bulk sample and initiated various engineering, metallurgical, geotechnical, heritage, environmental and archaeological studies. An updated historical mineral resource estimate was released at the end of 1995.
 
In 1996 Cominco carried out regional geological mapping outside the immediate area of the ABM deposit and ground HLEM magnetic and gravity geophysical and soil sampling surveys over the northeast portion of the property. The company also upgraded the tote road, completed minor diamond drilling (99 m) in the southwest corner of the property and continued the various studies initiated the previous year. In 1997, Cominco completed ground UTEM and magnetic geophysical surveys on the Kudz Ze Kayah property and collared 17 diamond drill holes (5,360 m).  

In 1998 Cominco carried out additional soil sampling and ground geophysical surveys and collared 11 diamond drill holes(1,755 m) on and around the GP4F zone (Minfile Occurrence 105G 143), located approximately 5 km to the southeast. In addition the company flew an airborne EM and magnetic survey over the eastern half of the R-15 land claim block (a block of land under interim Land Claim protection and claimed by the Ross River Dena Council) located approximately 5.5 km to the southeast. At the end of the year the company released an initial historical mineral resource estimate for the newly named GP4F deposit.
 
During the 1999 exploration season Cominco carried out ground In-Loop UTEM and HLEM/magnetic geophysical surveys over and around the GP4F deposit. Other than minor environmental monitoring and site remediation, no further physical work was carried out on the property until its sale in 2015.

In Mar/2000 Cominco announced an agreement in principal to sell the Kudz Ze Kayah and the neighboring GP4F deposits and surrounding mineral claims to Expatriate Resources Ltd. During 2000 Expatriate completed a pre-feasibility study (Hatch Associates Ltd, 2000), the emphasis of which was the co-development of both companies’ deposits located within the Finlayson Lake region. A revised resource and mineable reserve for Kudz Ze Kayah was released, based on a mining scenario that included both the Kudz Ze Kayah and the Wolverine deposits.
 
In Jul/2001 Cominco merged with Teck Corp to form Teck Cominco Ltd. In Sep/2001, Expatriate terminated its agreement and returned all mineral properties to Teck Cominco. Despite the termination of the agreement, both companies pushed for the creation of an "area play" to bring the regions various properties into production. In 2004 Cominco signed a Socio-Economic Participation Agreement with the Ross River Dena Council on behalf of the Kaska Nation.
 
In December 2004, Expatriate reorganized and changed its name to Yukon Zinc Corporation.
 
In Apr/2009 Teck Cominco Ltd changed its name to Teck Resources Ltd. 

On January 24, 2015 BMC Minerals (No. 1) Ltd, a private British based company purchased the Kudz Ze Kayah property including the GP4F zone. At the time of purchase the company released a historical mineral resource estimate based on Cominco’s last publicly reported estimate (2009).
 
Prior to commencement of the 2015 field season BMC Minerals rehabilitated the tote road, constructed a new camp, initiated a data compilation program and began re-logging historic diamond drill core. Upon the start of the field program the company carried out an airborne Li-DAR survey and GPS surveyed the position of the tote road and all historic drill collars. BMC Minerals flew an airborne EM and magnetic survey over the property and carried out ground gravity geophysical surveys over the ABM and GP4F deposits and the Rhyolite Peak area. Down-hole EM surveys were completed on seven diamond drill holes in the GP4F area and one exploration hole.
 
BMC Minerals collared 99 diamond drill holes (21,279.7 m) in 2015 considered exploration in nature. Fifty-nine hole targeted the ABM deposit, 30 holes tested targets proximal to the deposit and 10 holes tested the GP4F deposit. The company also drilled 29 diamond drill holes (3,406 m) for metallurgical testing, 9 geotechnical drill holes (955 m) and 11 shallow hydrological holes (325 m). BMC Minerals also restarted hydrological, environmental, heritage other studies previously implemented by Cominco.
 
On January 18, 2016 BMC Minerals released a JORC compliant (Australasian Code for Reporting Results, Mineral Resources and Ore Reserves) updated mineral resource estimate for the ABM and GP4F deposits.
 
During the 2016 exploration season BMC Minerals carried out an additional 19,000 m of diamond drilling. On November 2016 the company released a JORC compliant (Australasian Code for Reporting Results, Mineral Resources and Ore Reserves) updated mineral resource estimate. The new resource estimate will form the basis of a Prefeasibility Study due to be released in late 2016. 

CAPSULE GEOLOGY

The Kudz Ze Kayah property lies within Yukon-Tanana terrane near the center of the Finlayson Lake area. It hosts the ABM and GP4F (Minfile Occurrence 105G 143), volcanogenic massive sulphide (VMS) deposits. Volcanic massive sulphide mineralization is hosted by felsic volcanic and variably carbonaceous sedimentary rocks assigned to the Kudz Ze Kayah Formation, part of the Upper Devonian to Lower Mississippian (?) Grass Lakes Succession. The deposits are hosted by different stratigraphic levels of this formation.
 
The host metavolcanic complex is a thick felsic fragmental and sill/flow sequence with minor mafic sills and flows and rare interlayered metasedimentary rocks (Schultze and Hall, 1997). The metavolcanic sequence has been structurally thickened to about 1000 m and is made up dominantly of felsic tuffs, felsic flows, feldspar + quartz metaintrusive rocks, feldspar augen crystal tuff, and undifferentiated mafic metavolcanic rocks. Felsic metatuffs are most abundant. Metarhyolite flows and associated dikes and sills are thickest, most abundant and best exposed on the ridge west of the deposit. They are typically dense, siliceous and aphanitic and locally contain up to 70%, 5 - 25 mm diameter spherulites. Feldspar augen crystal metatuffs exposed on ridges southeast of the deposit are apparently on strike with the metarhyolite unit. Ribboned, thinly banded siliceous felsic meta-ash tuff rocks are rare in outcrop and appear to be proximal to the deposit.

Presently the ABM deposit consists of the ABM zone and the Krakatoa zone which are separated by the north-northeast striking East Fault. The ABM lens is defined as a massive sulphide and stringer-style sulphide mineralization primarily hosted within a package of felsic volcanic rocks that occurs in the immediate hanging wall to a chlorite altered mafic schist while the Krakatoa zone is primarily hosted at or near the lower contact of the mafic schist.
 
The ABM lens consists of polymetallic massive and stringer type mineralization that measures up to 39 m in true thickness, strikes approximately 290° and has a minimum strike length of 700 m. It consists of a series of stacked lenses that coalesce into a single mineralized horizon at its eastern end. The lens dips at approximately 35° to the north with a 400 m down dip extent, with a flexure occurring around 200 m down dip that flattens the dip to 10 to 15°. Sulphide mineralization is dominated by pyrite, sphalerite, pyrrhotite, galena and chalcopyrite, with gangue minerals consisting of chlorite, magnetite, quartz, iron-carbonate, calcite, sericite, cordierite, albite, celsian and barite. Mineralized lenses typically occur within an envelope of chlorite and muscovite alteration and are subdivided into massive and stringer/disseminated sulphide styles. The mineralization responds well to magnetic and electromagnetic surveys but geochemical response is somewhat erratic due to the glacial till cover.
 
The Krakatoa zone was delineated by the 2015 diamond drilling program and lies south of the ABM deposit, in between the East and Sunda faults. The zone is predominantly hosted within a pre-mineralized mafic sill that intrudes the felsic volcanic package. Mineralization also occurs in the hanging wall to the mafic sill at Krakatoa in what is interpreted to be the equivalent of the ABM mineralized position. Only minor mineralization occurs in the mafic unit stratigraphically beneath the ABM zone. The Krakatoa zone lies under about 30 m of glacial overburden and is up to 22 m in true thickness and remains open to depth. BMC Minerals 2016 updated mineral resource estimate elevated the zone to deposit status.

The UTEM, magnetic and HLEM geophysical and soil surveys completed in 1993 successfully defined a drill target. The target was drilled in Apr/94 and the first hole intersected 22.5 m of sulphides in two zones which returned a weighted average grade of 0.5% copper, 2.8% lead, 10% zinc, 278 g/t silver and 2.9 g/t gold. The company collared an additional 51 diamond drill holes in 1994 the results of which were used to calculate a historical estimate released in Feb/2005.
 
Cominco released annual historical resource estimates covering the years 1995 through 1999 which were slightly less than the historical resource estimate released for 1994. The decrease likely reflects that the 1994 figure included open pit and underground resources while the latter figures reflects an open pit mineable historical resource estimate. In addition the 1994 figure was classified as a “Possible Reserves” while the latter figures were classified as “Measured and Indicated Reserves”. The 1995 Yukon Exploration and Geology volume reports a slightly lower historical resource figure but similar grades to the annual reports. This likely reflects a reporting error. In 1998 Cominco published a historical estimate for the GP4F deposit (see Minfile Occurrence 105G 143), which some mining publications have included within the ABM deposit.
 
The 2000 Hatch Canada report prepared for Expatriate Resources Ltd was published as a Pre-Feasibility study for the Finlayson Project, which envisioned mining the Kudz Ze Kayah and neighboring Wolverine (Minfile Occurrence 105G 072) deposits as one. Various preliminary mining, milling and tailing disposal studies were undertaken to prepare a preliminary cost estimate for the project under the assumption that project costs would be cheaper if both deposits were developed at the same time. The study assumed the Kudz Ze Kayah deposit would be mined as an open pit mine. The study calculated a historical Indicated mineral resource estimate based on overall resources and a lower historical Probable reserve based on a preliminary mining plan. The lower Probable reserve resulted from some of the mineral resources being remove because they existed outside of the mine plan. As this report was completed before the release of National Instrument 43-101 regulations all reserve and resource figure are considered Historical Estimates.

Although the Hatch mineral resource figures were widely published, Cominco continued to publish the 1998 Historical Indicated and Inferred mineral resource figures in their annual reports. In the 2006 annual report Cominco changed all the resource figures to Inferred mineral resources and included the GP4F resource. This change likely resulted from the realization that the co-development of the Kudz Ze Kayah and Wolverine mines would not go forward thus assumptions used by Hatch in 2000 were invalid. It appears that Teck stop publicly reporting a mineral resource for the property after the end of the 2009 fiscal year.
 
In its January 24, 2015 news release announcing the purchase of the Kudz Ze Kayah property from Cominco, BMC Minerals released a Historical estimate of 12,800,000 tonnes of ore. This figure which is not NI 43-101 compliant, copies the 2006 resource estimate published in Teck Cominco’s 2006 annual report and likely includes resources assigned to the GP4F deposit.
 
BMC Minerals spent the late winter and spring of 2015 compiling historical data, re-logging historic drill core interpreting geophysical data and planning for the field season. The diamond drill program focused on increasing reserves and obtaining metallurgical samples and engineering and hydrogeological data.
 
On January 22, 2016, BMC Minerals released a JORC Code compliant (Australasian Code for Reporting Results, Mineral Resources and Ore Reserves) mineral resource estimate for the Kudz Ze Kayah property. JORC Code is derived from the Joint Ore Reporting Committee, an independent mineral industry body from Australian based industry professional associates while NI 43-101 code is derived from Canadian Securities Authorities. 
 
The new resource estimate included the newly identified Krakatoa deposit located immediately adjacent to the existing ABM deposit. The company broke the resource estimate down by zone, Indicated/Inferred and by massive and stockwork mineralization. The new figures do not include a cut-off grade as mineralization was modeled primarily by logged massive, semi and stockwork sulphide lithologies. These zones correlate d to significant grades of copper, lead, zinc, gold and silver. On this basis the company deemed that no cut-off grade was required (see News Release January 22, 2016 for details concerning resource estimate). The company also included an Inferred mineral resource estimate for the GP4F deposit.
 
Metallurgical studies released in July 2016 confirmed that the deposit could be processed using a simple circuit design and conventional flotation processing to produce separate copper, lead and zinc concentrates carrying precious metal credits.  The ore carries low amount of deleterious elements and penalties associated with such elements are considered minimal. Preliminary discussions with metal traders determined the project would produce a marketable concentrate.
 
Upon completion of the 2016 drill program BMC Minerals released an updated JORC Code compliant mineral resource for the Kudz Ze Kayah property. Total tonnes report were slightly less than the figure released in January 2016, however 95% of the resource was classified upwards into the Indicated class. The company also included a separate updated JORC Code compliant mineral resource for the GP4F deposit in which most of the mineral resource was classified upwards into the Indicated class.
 
The ABM Deposit (ABM  and Krakatoa zones) currently hosts (November 2016) a total resource (Indicated and Inferred) of 19,200,000 tonnes. BMC Minerals plans to release a Prefeasibility Study by the end of 2016.