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Mineralization & Geological Model

Project Overview

The Ladner Gold Project is a large 100% owned district-scale land package (approx. 144 sq. kms), located 150kms east of Vancouver, BC & 18kms from Hope, BC. The vast majority of the claims have not been explored using modern techniques, let alone drilled.  Nevertheless, to date, 5 historic mines have operated and at least 24 other gold occurrences have been discovered and most of those were as a result of exploration activities undertaken almost 100 years ago.

Today, in addition to its highly prospective character, the Ladner Gold Project has

  • Significant existing mineral resources
  • Extensive underground development
  • Existing mine permit (M-138), covering tailings impoundment, mine site and mill site
  • 5 year underground exploration permit received April 2017
  • Permitted tailings facility with excess capacity
  • Available power and water
  • Easy 12 month road access from the Coquihalla Highway

It is also located in a mining-friendly jurisdiction and enjoys a positive response from the local community.

In 2018, as part of an effort to launch a more effective exploration campaign, the Company carried out a 13 hole drill program primarily to confirm key geological information in the historic database.  In addition to defining future underground drill targets intended to expand the Company’s mineral resources at the Carolin Mine, the drilling resulted in the discovery of a new offset mineralized zone (the Hozameen Zone) when drill hole 18NC10 intersected 93m averaging 1.39 g/t gold, including 7m of 5.75 g/t gold.

In 2019, the Company’s goal is to pursue those underground targets, together with additional surface targets being developed near or beneath several of the other historic mines and the more prominent gold occurrences.

Tailings & Storage Facility

The Carolin Mine was commissioned in late 1981 at a development cost of $40 million. Milling began in early 1982 and continued to late 1984, processing some 900,000 tons of ore to recover approximately 45,000 oz of gold. Gold recoveries were generally well below expectations, but did improve with time and experience. Mine records indicate that nearly half the millhead gold was not recovered but was sent to the tailings deposition area.

  • G. Giroux has calculated a modern computerized resource estimate for the drilled portion of the tailings, using the data base from 1995 to complete a block model of the deposit. This Mineral Resource is considered compliant to NI43-101 reporting standards and is reported in detail in Section 16.0 of this technical report.
  • The Carolin Mine property is a past producing mine with considerable unexplored potential to add additional Mineral Resources.
  • The three years of past production (1982-1984) were characterized by mining and milling shortcomings, resulting in poor recoveries in the Mill. Nearly half of the gold mined and delivered as mill feed was not recovered but went to the tailings pond.
  • The tailings deposit so formed, with it‟s contained gold, remains intact and is easily accessed.
  • A portion of the tailings deposit was drilled in 1995, using a Vibracore drill. This drilling tested about 40% of the depositional area and about 60% of the tailings deposited. The drilling did concentrate on the thicker sections of the deposit with drillholes up to 89 feet deep. The work is judged to have been professionally done and the database is considered valid. The data, from 60 holes drilled, was used in several historical resource calculations which reported significant contained gold in the tailings (Table 6.2).
  • The remainder of the tailings deposit was not tested at the time as it remained water covered. Contained gold content of that portion has not been quantified.
  • In 2009, Module Resources completed a nine hole drill program, from a floating drill rig, over a small part of the tailings deposit. The purpose of this program was to confirm that there was significant gold in the tailings and to recover sufficient sample to start metallurgical test work. The program was successful on both counts.

Resources

New Carolin Gold Corp. has now completed two NI 43-101 gold resource estimate studies with a combined total of 691,540 inferred ounces of gold at its Ladner Gold Property in southwestern British Columbia (see gold resource table below).

  • Past producing Carolin Mine Inferred Mineral Resource estimate is 607,000 oz gold (1.5 g/t) in 12,352,124 tonnes at a cutoff grade of 0.5 g/t gold.
  • McMaster Zone Inferred Mineral Resource estimate of 79,540 oz gold (0.69 g/t) in 3,375,000 tonnes at a cutoff grade of 0.5 g/t gold.
  • The Carolin Mine and McMaster mineralized zones are open for exploration and development in all directions.
  • The Inferred Mineral Resource estimate takes into account only gold, as silver was not included in the historical database.
  • Pipestem Mine: Historic intersections from underground drilling of 0.90 g/t gold over 41 metres and 3.00 g/t gold over 5 metres. Historic surface intersections include 4.45 g/t over 5 metres.
  • Emancipation Mine: Historic intersection of 20.5 g/t gold over 1.5 metres. Historic surface intersections include 12.7 g/t over 1.4 metres.
  • Mine Permit: the Carolin Mine, McMaster Zone, Pipestem Mine and Emancipation Mine all occur within the current mine permit area.
  • Idaho Trenches: chip sampling in 1996 identified an area covering 3,750 square metres with gold values ranging up to 19 g/t. This area, which occurs above the 1000 portal was the focus of a limited drill program in November, 2012 in order to confirm the gold mineralization and test new areas.
  • Montana Showing: Historical recovery of 15 ounces gold per ton, which has never been drill tested.
  • Access and Economies: past producing mines and McMaster Zone are road accessible via 2-hour drive from Vancouver with low expected future infrastructure, drilling and development costs. Ongoing logging of the property over many years has resulted in excellent access to all targeted development areas of the property.
  • Results of a recently completed airborne geophysical survey indicate a major magnetic linear structure that can be traced for over 18 km within the Company’s claims. The aforementioned gold prospects and numerous gold showings all occur along this magnetic trend. The linear structure is attributable to the presence of serpentinite, which is associated with gold mineralization.

Selected composite intervals representing typical grade and width using > 2 g/t gold cutoff grade for averaging.
Width represents downhole width and does not reflect true width.

View Map

Hole From (m) To (m) Au (g/t) Width (m)
11000-71 247.32 262.50 4.00 15.18
11050-60 276.76 314.65 2.50 37.89
11050-63 98.26 119.00 3.51 20.74
562-3 0.10 22.42 4.64 22.32
562-4 3.96 37.00 2.38 33.04
575-4 1.00 26.80 4.12 25.80
587-4 40.03 83.80 3.11 43.77
600-3 6.70 28.10 10.85 21.40
600-3 6.70 9.80 57.28 3.10
612-2 5.00 65.53 2.79 60.53
716-1 18.29 22.89 4.68 4.60
716-2 18.96 31.10 3.84 12.14
716-4 6.02 34.00 5.89 27.98
716-5 1.35 20.80 4.82 19.45
716-6 15.10 25.10 17.05 10.00
IU-106 37.50 106.40 2.26 68.90
IU-32 7.45 46.00 5.58 38.55
IU-33 24.25 30.50 9.83 6.25
IU-37 16.65 78.95 4.97 62.30
U-220 0.00 71.25 3.26 71.25
637-9 18.09 25.15 2.59 7.06
U-255 24.70 45.50 2.77 20.80

NI 43-101 Gold Resources for the Ladner Gold Property

Source Cut Off Tonnes Tonnes Grade Gold Gold
g/t Indicated Inferred g/t grams ounces
Tailings 1.00 445,378 1.83 815,000 23,700
1.00 93,304 1.85 172,600 5,000
Mcmaster Zone 2.00 548,000 2.24 1,255,000 39,370
0.50 3,575,000 0.69 2,474,000 79,540
Carolin Mine 2.00 2,588,376 3.34 8,649,000 278,000
0.50 12,352,124 1.53 18,866,000 607,000

Numbers are generally rounded off.
CIM definitions were followed for Mineral Resources.
Mineral Resources are undiluted.
Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.
There is no certainty that all or any part of the Mineral Resource will be converted into Mineral Reserves.

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Technical Reports

Geology

  • Coquihalla Gold Belt represents a deep seated crustal break along an accretionary terrane boundary – important to hosting orogenic type gold deposits.
  • Area has geological similarities to the Mother Lode district of California where over 7 million oz gold have been produced and to the Bridge River district of southwestern BC which produced 4.1 million oz gold.
  • Gold Belt comprised of northwesterly trending sub-parallel east and west linears of the Hozameen Fault system and transected by northeasterly trending faults. Tectonics have resulted in numerous shear and dilatant zones amenable to mineralization.
  • Gold mineralization is both lithologically and structurally controlled.
  • Host rocks of the Jurassic Ladner Group comprise wackes, siltstones and conglomerates and in areas associated with serpentinite.
  • Several stacked mineralized zones ranging up to 30 metres in width.
  • Long intervals of continuous gold mineralization indicating porphyry gold system.
  • Alteration and mineral paragenesis suggests zoning and more than one period of gold mineralization.
  • Mineralization is generally comprised of a network of variably deformed quartz-carbonate veins with intense albitic alteration and disseminated sulphides. Sulphides consist mainly of pyrrhotite, arsenopyrite and pyrite with accessory magnetite and can be found in concentrations of up to 15%, with gold found as inclusions in the sulphides and as discrete grains, plates and smears.

Coquihalla Gold Belt contains several historic gold producers including the Carolin Mine, a former underground gold producer from 1982 – 84 (47,000 oz gold); the Emancipation Mine, an intermittent small gold producer from 1916 – 41 (2,900 oz gold); the Pipestem Mine, an intermittent small gold producer from 1935 – 37 (257 oz gold); Montana prospect (1925 – 30 oz gold from two tons of material), Georgia No. 2 prospect (1925 – 33 oz gold from one ton of material) and numerous other gold prospects situated along the under-explored gold belt.

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Metallurgy

Recent metallurgical test results at SGS Canada Ltd. have demonstrated that high gold recoveries are possible using a combination of conventional flotation and cyanidation.

A metallurgical sample, with head grade of the composite assaying 3.70 g/t gold, 1.59% S, 0.052% As and 0.55 g/t silver was provided to SGS Canada Ltd. for gold recovery testing. The sample was core from the McMaster Zone which assayed 3.96 g/t gold over 27.6 metres [DDH 32 — 09, from 32.4 to 60.0 metres].

This test work was conducted to support the development of a preliminary economic assessment for the former producing Carolin Mine and the McMaster Zone. Mineralization of the McMaster Zone is similar to that of the Carolin Mine. There is no core available from the historical drilling of the Carolin Mine.

A variety of metallurgical tests were conducted to characterize the sample response. The key results were;

  • Gravity gold recovery of 8.5% at 106 micron (P80) using Knelson MD-3 separator.
  • Direct cyanidation gold extraction of 69.4% after grinding sample to 62 micron (P80) and leaching in a cyanide-in-leach mode for 48 hours. Cyanide and lime consumptions were 0.58 and 0.59 kg/t respectively.
  • Heap Leach simulated test yielded 14.9% gold extraction at -1 inch crush size and 192hours of bottle roll leaching. Cyanide and lime consumptions were 0.46 and 0.17 kg/t, respectively.
  • Flotation gold recovery of 91.3% into a rougher concentrate containing 39.7 g/t Au, 7.21 g/t Ag and 16.7% S.
  • Direct cyanidation of the flotation concentrate yielded a gold recovery of 59.7% indicating that the concentrate is modestly refractory.
  • Direct cyanidation of the flotation tailing yielded a gold recovery of 75.7%.
  • The flotation concentrate is currently undergoing testwork to demonstrate that autoclave oxidation — cyanide-in-leach (CIL) provides a viable route for gold recovery from the concentrate. These results will be reported when complete.
  • The Standard Rod Mill Work Index was determined to be 16.3 kWh/tone and is considered medium hard.
  • Standard acid-base accounting test indicates that the tailings are acid consuming.
  • SUMMARY
    The results to date indicate that it is possible to concentrate most of the gold values in a small mass of material for further treatment. The combination of flotation yields 91.3% gold recovery and cyanidation of the flotation tailings yields 75.7% gold recovery. In combination, flotation plus cyanidation of the float tail yielded (91.3 + 75.7 x (100-91.3)/100 = 97.9% recovery. The recovery of gold by pressure oxidation and CIL of the autoclave residue is currently being tested.

Metallurgical Testing & Results

Gravity

A single two stage gravity separation test was completed on the master composite ground to 80% passing 106 µm and processed through a Knelson MD-3 concentrator. The Knelson concentrate was upgraded further by treatment on a Mozley mineral separator. The Mozley concentrate was assayed to extinction for Au while the Mozley and Knelson tailings were blended, sampled and assayed for Au. The combined gravity tailings were used in downstream flotation tests. The summary of the gravity test procedures is presented in the following table.

The results indicate that only 8.5% of gold were recovered from the master composite by gravity separation and the concentrate assayed 211 g/t Au. These results indicate that gravity may be used as part of the metallurgical treatment process, but that additional processing is required to achieve a high overall gold recovery.

Wt Wt% Assay – g/t Distribution – %
Mozely Streams Au Au
Mozely Conc 8.91 0.15 211 8.5
Combined Tail Sample 5991 99.9 3.38 91.5
Knelson Calc. Feed 6000 100 3.69 100
Direct Head Grade 3.70

Direct Cyanidation Test on Whole Ore

A standard bottle roll test was conducted on whole ore at 80% passing 62 micron. The pH during the leach was maintained between 10.5 and 11. The leach duration was 48 hours and 4 intermediate kinetics samples were collected at 2 hours, 5 hours, 8 hours and 24 hours. The cyanide leach tests produced ~69.4% gold recovery. The leaching kinetics of gold recovery are average by reaching maximum recovery plateau within 20-24 hours. The cyanide and lime consumption is considered as moderate at 0.58 kg/t and 0.59kg/t. The gold recovery by cyanide leaching of the master composite is considered as moderately amenable. Further test work is recommended to determine the optimized leach conditions, grind effect and special variability.

Heap Leach Amenability Test

The amenability of this sample to heap leaching was evaluated in an eight day coarse bottle roll test conducted at the selected crush size of -1″. Test conditions applied included 40% solids, pH 10.5 and 1.0 g/L of NaCN. The amenability for heap leaching was low at 14.9% gold recovery. The cyanide and lime consumption is low at 0.46 kg/t and 0.17 kg/t ,respectively. The sample does not appear to be amenable to heap leaching.

Flotation

The goal of flotation testing was to concentrate the sulfides and the gold in the metallurgical sample into a concentrate for pre-treatment and cyanidation. The results indicate that the material can easily be floated to produce a pyrite-pyrrhotite-arsenopyrite gold concentrate.
Results of the small scale batch flotation test are as follows:

  • Gold recovery of 91.3% at grind size of ~ 53 micron
  • Sulfur recovery of 88%
  • Mass recovery of 8.6% of the flotation feed weight
  • Flotation concentrate grade of 39.7 g/t Au and 16.7% sulfide sulfur.

Bond Rod Mill Work Index (RWi)

The Bond rod mill work index (RWi) test was conducted according to the standard Bond procedure. The tested Bond rod mill work index is 16.3 kWh/tonne and is considered medium hard.

Environmental Tests

The Acid Base Accounting (ABA) and Net Acid Generating (NAG) tests were conducted on flotation tailings (53 micron). The net neutralization potential is 140.6 kg H2SO4/t, which indicates that the tailings are acid consuming. This is in agreement with historical test work conducted by Lakefield Research Ltd. in 1996 (now SGS Canada Ltd.).

Historical Metallurgy

1982 - 1984

The Carolin Mill was constructed in the early 1980s and operated from 1982-1984. Operations ceased due to a combination of low gold prices and poor gold recovery. Gold recoveries did improve each year of operation, but not enough to keep with up with dropping gold prices. Original metallurgical studies had predicted a gold recovery of over 80%. Monthly gold recovery fluctuated widely but averaged only 53.4% for the life of the mine and only 65.6% in the best year (1984).o.

1996

Metallurgical and environmental test work was conducted (1996) by Lakefield Research (now called SGS Lakefield Research) on Carolin Mine ore samples to provide data for metallurgical, economic and environmental evaluation. The metallurgical test work mainly included flotation and ore and flotation concentrate cyanidation.
The best results from a combined technical and economic standpoint were obtained using the following two approaches:

  • Production of a “medium” grade rougher flotation concentrate (i.e. – about 350 g/t Au) for sale. This concentrate would contain about 2.5-4.0% arsenic. The gold recovery would be about 83-84%.
  • Sale of a high grade-low arsenic (i.e.- >700 g/t Au, <1% As) concentrate containing about 65% of the gold. An additional 20% of the gold would be recovered by cyanidation.

Production of the split circuit flotation concentrates also had the advantage of eliminating graphitic carbon from the cyanidation circuit, resulting in elimination of the need for Carbon-in-Leach. Option to ship concentrate directly to refineries in Canada and US and Pacific Rim.

The following table shows how gold recovery can be increased from the low recoveries during the poorly managed operations at the Carolin Mine in 1982 to 1984, to the recoveries that can be achieved in well designed and executed testwork. The testwork results provide a measure of confidence that potential future operations should not become uneconomic for purely technical reasons in the processing plant, as happened in 1984.

Year % Gold Recovery Comments
1982 53 First year of operation
1984 66 Best recovery in shut down year
1997 83 Lakefield Research work for Athabaska
2011 88 UBC Student Project
2012 91 SGS Canada flotation (only) testwork

Environmental & Sustainability

New Carolin Gold adheres to the principles as outlined in the Sustainable Mining section of the Mining Association of Canada (www.mining.ca). There are worldwide requirements to reduce greenhouse gas (GHG) emissions. New Carolin Gold will review all operations and create potential innovative ways of reducing GHG. This can be accomplished by improving energy efficiency of exploration and mine operations.

The mill building was dismantled in 2006 as part of an environmental clean-up program. New Carolin Gold has maintained the tailings storage facility through clean-up and yearly inspections.

Other environmental aspects within the Ladner Project Area include:

  • Not within any designated or proposed park or environmentally sensitive area.
  • No other designated commercial interest other than logging and mining .
  • Approximately 65% of claim area has been logged.
  • Some current logging .
  • Numerous logging roads comprising > 30 kms throughout the claim area.
  • The claim area does not include any lakes.
  • No known environmental liabilities on site.
  • No potential acid rock drainage and metal leaching liability (acid-base accounting results indicate potential acid consuming material).
  •  LC50 fish mortality test of flotation tailings conducted by Lakefield Research in 1996 indicate fish mortality level was 0%.
  • Annual water sampling since 2009 of tailings outlet, portals and creeks indicate no hazardous levels of elements of concern including Fe, Cu, Zn, Pb, As.
  • Company has retained services of environmental consultants regarding fish habitat study.
  • Company submits annual reclamation report to BC government since 2008.
  • Company submits annual tailings storage facility inspection report to BC government since 2009.

Photos