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Gossan Hill

Summary

The Gossan Hill property consists of 3,679 hectares of mining claims near the town of Cranberry Portage, Manitoba. The claims are the host of a historically producing mine, as well as a shear zone that hosts gold bearing mineralization.

A diamond drill program in the winter of 2010-2011 was conducted to test the down-dip and strike extension of a zone of mineralization established by historic surface trenching. The drill program successfully extended the mineralization, encountering gold and silver mineralization in 31 of 32 holes (one hole having been abandoned). Highlights of the program included grades of 4.6 g/t gold and 15.13 g/t silver over 23.81 meters of core width. Full results are in the table below.

Through the examination of reports filed by previous operators and records of the former producing mine, as well as information collected through our own prospecting and diamond drilling, Callinex has designed an exploration program for Gossan Hill that will target more than 6 kilometers of strike length that is thought to host the same sheared diorite/volcanic contact that hosts the formerly producing mine.

Additional sampling and surveying was conducted in the summer of 2011 ahead of a 2012 drilling campaign. The company's second drill program finished in March of 2012, successfully completing another 32 diamond drill holes, and further expanding the gold bearing structure at Gossan Hill.

Previous Operators

Reports from previous operators, accessed through records at the Manitoba Department of Energy and Mines, show that the Gurney Gold Mine's two years of production, from 1937-1939, produced a total of 25,164 ounces of gold and 71,953 ounces of silver from 90,500 tonnes of ore milled. These reports further show gold bearing diamond drill intersections wider than 20 meters. Highlights from the assessment files include diamond drill intersections grading 0.25 ounces of gold per ton over 5 meters, 0.5 ounces of gold per tonne over 1.5 meters, and 0.118 ounces of gold per tonne and 1.25 ounces of silver per tonne over 40.94 meters.

The Company cautions that work done by previous operators was conducted before the implementation of National Instrument 43-101. Quality control methods by the previous operator are unknown, and the accuracy of the information cannot and should not be relied upon.

Work Conducted to Date

An exploration program in 2010 established numerous widths of gold and silver mineralization in quartz veins. The drilling program will continue along strike to determine the extent of this material along the 2 kilometer shear zone.



Hole From
(m)
To
(m)
Length
(m)
Gold
(g/mt)
Silver
(g/mt)
GOS-01 49.82 55.25 5.43 3.71 33.33
GOS-02 61.93 64.02 2.09 2.69 39.64
GOS-02 70.90 91.15 20.25 1.96 6.76
incl 74.76 75.70 0.94 10.70 23.18
83.70 90.70 7.00 3.11 6.03
87.45 90.70 3.25 4.33 4.20
GOS-03 54.88 71.10 16.22 3.10 19.35
incl 58.90 60.14 1.24 13.77 57.68
58.90 70.33 11.43 3.56 16.00
GOS-04 40.73 44.94 4.21 2.06 6.30
GOS-05 79.70 82.32 2.62 1.67 8.69
GOS-05 96.65 110.30 13.65 3.65 10.05
incl 99.10 102.00 2.90 7.92 20.21
103.66 106.71 3.05 3.69 10.34
GOS-06 56.22 65.12 8.90 1.54 6.11
incl 61.25 65.12 3.87 2.24 14.05
GOS-07 59.60 65.52 5.92 1.62 2.61
incl 63.86 65.52 1.66 3.31 4.70
GOS-08 103.66 109.90 6.24 2.03 39.83
incl 107.00 109.90 2.90 2.86 80.48
GOS-09 100.30 106.85 6.55 2.71 6.08
incl 102.30 105.68 3.38 3.61 8.46
GOS-10 137.64 144.50 6.86 1.54 7.77
incl 141.30 144.10 2.80 2.10 10.69
GOS-11 178.80 183.50 4.70 9.47 16.52
incl 179.75 182.46 2.71 13.64 22.73
GOS-11 190.45 199.22 8.77 3.24 2.48
incl 195.75 196.80 1.05 14.83 7.14
GOS-12 183.10 191.90 8.80 3.79 3.90
incl 184.54 187.55 3.01 7.22 4.60
GOS-13 200.25 200.77 0.52 14.53 513.35
GOS-13 211.95 215.00 3.05 7.22 12.87
GOS-14 148.25 162.00 13.75 3.36 15.45
incl 148.25 152.96 4.71 5.82 37.69
Gos015 213.20 215.1 1.9 2.42 1.95
Gos015 229.30 233.83 4.53 4.06 4.10
incl. 231.85 233.83 1.98 5.37 4.09
Gos016 227.00 240.85 13.85 1.72 3.59
incl. 227.00 235.75 8.75 2.11 4.48
Gos016 243.60 246.12 2.52 2.38 3.58
Gos017 126.35 128.75 2.40 2.32 3.44
Gos018 69.52 71.50 1.98 5.33 6.25
incl. 70.70 71.50 0.80 10.32 13.00
Gos019 77.55 85.10 7.55 4.61 7.97
incl. 79.50 81.75 2.25 9.81 22.04
Gos020 48.25 48.52 0.27 8.68 16.00
Gos021 42.25 44.16 1.91 2.14 10.37
incl. 42.60 43.66 1.06 2.95 14.81
Gos022 119.10 121.35 2.25 4.12 3.98
incl. 119.50 121.35 1.85 4.61 4.19
Gos023 168.70 170.00 1.30 0.63 1.66
Gos024 133.49 134.80 1.31 1.10 6.72
incl. 133.49 134.38 0.89 1.33 6.58
Gos025 218.30 224.05 5.75 9.73 6.91
incl. 218.30 221.65 3.35 15.80 10.87
incl. 219.30 221.30 2.00 24.60 16.00
incl. 219.30 220.80 1.50 30.30 18.67
Gos026 176.75 179.88 3.13 8.26 8.52
incl. 176.75 178.30 1.55 13.53 16.19
Gos026 188.53 192.31 3.78 2.27 3.84
GOS028 267.99 272.20 4.21 3.42 5.84
GOS028 277.03 291.80 14.77 5.94 22.00
Incl. 287.50 291.80 4.30 13.26 54.46
GOS028 267.99 291.8 23.81 4.60 15.13
incl. 287.5 291.8 4.3 13.26 54.46
GOS029 282.88 285.5 2.62 4.65 4.17
and 297.9 303.03 5.13 1.55 2.58
GOS030 309.5 325.41 15.91 4.21 12.69
incl. 321.57 325.41 3.84 7.43 28.52
GOS031 251.42 252.13 0.71 1.03 3.00
GOS032 365.77 367.03 1.26 1.15 0.97
GOS032 375.7 381.8 6.10 0.82 1.22
incl. 375.7 377.12 1.42 1.35 3.83
GOS043 116.10 125.00 8.90 3.02 8.88
incl. 116.10 118.07 1.97 5.24 9.14
incl. 122.12 123.39 1.27 9.98 30.66
GOS046 109.40 113.42 4.02 1.46 2.14
GOS049 144.34 147.00 2.66 1.46 0.96
GOS051 77.82 80.36 2.54 3.23 31.57
GOS052 145.62 148.24 2.62 0.93 7.69
incl 145.62 146.00 0.38 2.62 53.00
GOS055 298.58 301.39 2.81 2.78 7.09
incl 299.00 301.39 2.39 3.23 8.33

Assays received from last winter's program are as follows:

  From To Width Au g/t Ag g/t
GOS 33 316.60 319.05 2.45 19.88 5.15
incl. 317.47 319.05 1.58 30.37 7.98
incl. 317.47 318.6 1.13 40.75 11.16
GOS 34 394.40 397.30 2.90 1.77 4.97
  473.82 476.21 2.39 3.77 1.27
GOS035 163.15 163.7 0.55 0.96 4.00
GOS 36 152.81 156.78 3.97 2.21 15.94
incl 152.81 155.78 2.97 2.57 21.31
GOS037 Traces        
GOS038 Traces        
GOS039 Traces        
GOS040 Traces        
GOS 41 138.54 139.21 0.67 3.26 0.00
  142.00 144.70 2.70 1.71 0.00
GOS042 Traces        
GOS043 116.10 125.00 8.90 3.02 8.88
 Incl. 116.10 118.07 1.97 5.24 9.14
 Incl. 122.12 123.39 1.27 9.98 30.66
GOS044 Traces        
GOS045 Traces        
GOS046 109.40 113.42 4.02 1.46 2.14
GOS047 (abandoned)        
GOS048 Traces        
GOS049 144.34 147.00 2.66 1.46 0.96
GOS050 Traces        
GOS051 77.82 80.36 2.54 3.23 31.57
GOS052 145.62 148.24 2.62 0.93 7.69
incl 145.62 146.00 0.38 2.62 53.00
incl. 147.00 148.24 1.24 1.14 0.00
GOS053 285.65 288.63 2.98 3.17 76.51
incl 286.85 287.96 1.11 8.35 197.84
GOS053 362.87 371.84 8.97 1.31 8.75
incl 366.32 369.85 3.53 2.15 2.92
GOS054 242.60 244.72 2.12 1.19 7.56
GOS054 268.31 273.44 5.13 1.78 6.18
incl 268.92 272.20 3.28 2.22 4.02
GOS055 298.58 301.39 2.81 2.78 7.09
incl 299.00 301.39 2.39 3.23 8.33
GOS056 Traces        
GOS057 131.30 146.60 15.30 0.21 9.70
 incl 138.33 140.70 2.37 0.62 16.39
GOS058 Traces        
GOS059 369.89 373.54 3.65 0.42 40.36
GOS059 412.57 486.84 74.27 0.89 2.69
incl 450.70 483.87 33.17 1.65 2.16
incl 453.65 459.70 6.05 2.43 3.39
incl 478.12 482.37 4.25 3.88 3.33
GOS060 154.77 155.47 0.70 0.50 0.00
GOS061 256.84 263.35 6.51 1.31 1.45
incl 261.46 263.35 1.89 2.56 4.99
GOS062 268.08 268.88 0.80 1.04 5.00
GOS063 326.60 327.19 0.59 1.07 3.00
GOS064 518.40 521.36 2.96 1.04 0.91
GOS064 544.44 550.84 6.40 1.44 2.85
GOS065 395.00 397.90 2.90 1.07 1.00
GOS065 407.55 409.41 1.86 0.98 0.97