Summary

Several silver bearing structures have been discovered within an exhalative horizon on the Konkin Silver property. Structural and mineralogical similarities exist with occurrences mined in the Kitsault River area to the south, and the local setting has some affinities with the precious metal rich, VMS deposits at Eskay Creek.

Location

The Konkin Silver property is located 29 kilometres east of Stewart, British Columbia, about 5 km south of the Del Norte property. Present access is by helicopter.

History and Property Status

Prospecting in 1994-5 uncovered four silver-rich showings as well as a gold-silver breccia zone with similarities to the K zone on Teuton's Del Norte property to the north.

Silver Standard held the property briefly under option in 1995. Eight short holes were drilled from one set-up just below the principal showing. Most of the holes failed to intersect high-grade silver mineralization conformable with that on surface. The following year Silver Standard returned the property to Teuton and Minvita, after which certain claims in the north central portion of the property lapsed and were subsequently staked by a third party. In 2004, a 100% interest subject to a 2% NSR in these claims was re-acquired through a purchase agreement.

Between 1996 and 2004, inclusive, little work was carried out on the claims other than minor prospecting and sampling in order to satisfy assessment requirements. During one of these programs, in 2002, a new zone of low-grade, but extensive, silver mineralization was discovered south of the main Konkin Silver showing.

In 1998, Ross Sherlock, Ph.D., an acknowledged VMS expert, visited the property briefly and characterized the setting of the main Konkin Silver showing as a “white smoker”.

In, September-October of 2005, Aeroquest Surveys of Milton, Ontario flew an AerotemII, helicopter-borne, EM-MAG survey over the Konkin Silver property.

Mineralized Showings

Konkin Silver Showing

A wide zone of carbonate altered rocks is exposed along a nunatak exposed by the retreat of glacial ice over the past fifteen years. The rocks appear to have been originally maroon volcaniclastics and flows. Lenses and pods of predominantly calcite, siderite and quartz occur frequently within the altered zone.

Within this zone, several silver-bearing structures have been discovered by prospecting in 1994-2002. The largest of these, the “Konkin Silver” zone, consists of carbonate, quartz, barite, galena, sphalerite and rare ruby silver and native silver in a bow-shaped structure spanning 35 metres. High silver values are most closely associated with galena which occurs as fine coatings on fractures, as coarse crystalline blebs and as disseminated grains. Maximum thickness of the feature appears to be in excess of 10 metres.

Trenching of the Konkin Silver showing returned values up to 9.0m grading 34.94 oz/ton silver, 2.30% lead and 2.02% zinc.

According to Ross Sherlock, Ph.D., the Konkin silver showing appears to be a precious-metal carbonate-sulfate submarine exhalative-replacement deposit. In a summary report on the property, he states: “Carbonate-sulfate dominated VMS end-members are much less common than typical massive pyrite +/- base metal sulfides, but are reasonably well represented in the geological literature. Exploration for deposits of this style should be based around traditional VMS exploration with a sound understanding of the volcanic stratigraphy and volcanic architecture. The mineralized horizons should be traced laterally along strike and down dip for additional lenses or potential thickening of the lenses.”

Elsewhere in the report, Sherlock writes: “ Analogues of the Konkin Silver showing are seen in the Stewart region, Kitsault Mining District, at Torbrit and Dolly Vardin where about 19 million ounces of silver were produced intermittently between 1920 and 1958. Hazelton Group volcanics are the host strata for the Eskay Creek deposits, to the north. Eskay Creek is a precious metal rich VMS deposit and portions have similar geology to the Konkin showing, with high grade gold and silver in massive baritic zones. Worldwide, baritic massive sulfate lenses are seen at the Wetar deposit in Indonesia . Wetar is a gold-silver rich massive barite deposit that was operated by Billiton in the early 1990's. The deposit was about 5Mt with grades that ranged from 3.5 to 5g/t Au and 100 to 150g/t Ag. Modern day sulfate deposits are common in a sea floor environment and are typically referred to as white smokers. Rarely these are mineralized with gold and precious metals with the best example seen in the Jade hydrothermal field in the Okinawa Trough in the Sea of Japan .”

Niknok Showing

Discovered in a poorly exposed outcrop on the opposite valley slope of the Konkin Silver showing, the Niknok mineralization consists of coarse crystalline galena with lesser sphalerite within quartz-carbonate/minor barite stockworks. The zone is present in an area of abundant intrusive dykes and appears to have a relatively gentle dip into the hillside. A single trench across the widest part of the exposed structure returned 18.98 oz/ton silver over a 9.0 m width.

Other Silver-Bearing Zones (King Kong, Onkkin, Yoggi Bear)

Several other silver-bearing structures have been identified by cursory prospecting, but poor exposure due to overburden and/or talus cover has limited attempts to define the extent of this mineralization.

The number of occurrences discovered in relation to the small amount of time prospecting the property suggests that all of these various zones may represent fingers or tails of replacement material from a much larger occurrence situated at depth. This would conform with the style of occurrence at the formerly-producing Torbrit Silver mine situated in the Kitsault River valley to the south.

Leszek Showing

In 1994, east of the silver-bearing structures, a promising quartz breccia zone mineralized with tetrahedrite was discovered situated along a contact between volcanic and sedimentary rocks. A single chip sample from this zone returned 0.202 oz/ton gold and 16.4 oz/ton silver over 4.0m. Due to the steepness of the location no further work was done.

After the 2002-3 success of exploration programs on the K and LG vein structures located to the north on the Del Norte property, similarities both in mineralogy and setting between the K-LG and the Leszek occurrences prompted a re-examination of the latter showing. A prospecting team was sent in to map and extensively sample the Leszek showing in 2004, but was unable to find the zone due to precipitous terrain.

A comprehensive exploration program along the favourable volcanic-sedimentary contact throughout the Konkin Silver property is planned for 2006 which, it is hoped, will re-locate the Leszek and any strike extensions.

Airborne Anomaly

An AerotemII, helicopter-borne, EM-MAG survey was flown in September and October of 2005 by Aeroquest Surveys over both the Del Norte and Konkin Silver properties. This survey outlined an intense EM anomaly in mudstones lying just east of the LG-K vein occurrences on the Del Norte property, considered to be prospective for exhalative Eskay Creek-style mineralization. The anomaly is to be tested by diamond drilling during the 2006 field season.

A similarly intense, but more extensive anomaly was also detected on the Konkin Silver property, lying along the contact between volcanics to the west and sediments to the east. The source of this anomaly is presently unknown, but will be tested by a detailed ground examination in 2006 to be followed by diamond drilling if warranted. A map of the anomaly will be published when final data is in hand from the survey.