Regional Geological Setting

The central Newfoundland preserves Cambrian to Middle Ordovician rocks of ophiolitic, island-arc and back-arc affinity forming Dunnage Zone. It is part of Paleozoic Appalachian-Caledonian Orogenic Belt that records the formation and destruction of the late Precambrian - early Paleozoic Iapetus Ocean.

Dunnage Zone is divided, by an extensive fault system referred to as the Red Indian Line, into Notre Dame and Exploits subzones, which are interpreted to have formed on opposing sides of Iapetus Ocean.

The Victoria Property is situated at a point where the Exploits Subzone narrows to a width of approximately 3 km. It is comprised of volcanic and volcaniclastic rocks trending northeasterly and that are bound to the southeast by Noel Paul’s Line – a tectonic contact separating this volcanic terrane from sedimentary sequences of Gander Zone formed at the continental margin.

The full contact between the Dunnage and Gander Zones is characterized by the Cape Ray Fault Zone (CRFZ) which continues to the northeast as Noel Paul’s that consists of numerous secondary structures and splays off of the main structure. The structural corridor is marked along its entirety by the trace of the Rogerson Lake Conglomerate and equivalents. In the northeast, the Rogerson Lake Conglomerate parallels the Noel Paul’s Line, and in the southwest, the Windsor Point Group (Rogerson Lake equivalent) runs along the CRFZ.

The CRFZ is a steeply eastward-dipping, oblique reverse high-strain zone that is approximately 100 km long and several metres wide and that splits into Red Indian Line in the west and Victoria Lake and Valentine Lake Shear Zones.

Gold Deposits in the Area

The Victoria Property is located only 3 km west of the Valentine Lake Project licences operated by Marathon Gold Corporation (“Marathon”). The Valentine Lake Project contains four significant deposits – Leprechaun, Sprite, Marathon and Victory, along with five smaller zones, over 20 km long exposure of the Valentine Lake Thrust Fault.

The Marathon deposits are described as structurally controlled mesothermal (i.e. “orogenic”) auriferous quartz vein type. In detail, the gold-bearing quartz veins are located along, and proximal to, the boundary between the Valentine Lake Intrusive Complex and the unconformably overlying Silurian Rogerson Lake Conglomerate. These regionally extensive faults/terrane-bounding structures tapped deep fluid systems during the Silurian Salinic Orogeny. They extend northeast bisecting central Newfoundland and are associated with a significant number of structurally-controlled orogenic style gold occurrences including: Canterra’s Wilding Lake gold project; Matador’s Cape Ray gold deposits; and Sokoman’s Moosehead project.

Marathon’s Valentine Lake Project is the most significant with four near-surface gold deposits. The deposits are nearing open-pit development with nearly five million ounces of resources. A feasibility-level study has been completed and the project demonstrated resource growth potential beyond that. Total measured mineral resources (inclusive of the mineral reserves) comprise 1.92 million ounces (32.59 million tonnes at 1.83 g/t Au) with indicated mineral resources (inclusive of the mineral reserves) of 1.22 million ounces (24.07 million tonnes at 1.57 g/t Au). Additional inferred mineral resources are 1.64 million ounces (29.59 million tonnes at 1.72 g/t Au).

Orogenic gold mineralization in the region is hosted within dominantly reverse sinistral shear vein systems characterized by fault-fill and extensional vein sets that cut Late Silurian to Early

Devonian Rogerson Lake Conglomerate, Late Silurian volcanic rocks, and underlying Neoproterozoic basement granitoid rocks.