INVESTNET INC
SB-2/A, EX-10.3, 2000-10-18
GOLD AND SILVER ORES
Previous: INVESTNET INC, SB-2/A, EX-10.2, 2000-10-18
Next: INVESTNET INC, SB-2/A, EX-23.1, 2000-10-18





Exhibit 10(iii)





                               BOW MINES PROPERTY

                                 SUMMARY REPORT



                                   NTS 82E/2E


                            Lat: 49(degree)03' 40" N
                           Long: 118(degree)40' 20" W

                                       for

                                 InvestNet Inc.
                             938 Howe St., Suite 713
                                 Vancouver, B.C.
                                     V62 1N9







         Author:           Linda Caron, P. Eng.
                           Consulting Geologist
                           Box 2493
                           Grand Forks, B.C.
                           V0H 1H0

         Date:             June 23, 2000
         Amended:          October 11, 2000


                                       76

<PAGE>



                                TABLE OF CONTENTS


                                                                            Page

1.0      SUMMARY...............................................................1

2.0      INTRODUCTION..........................................................3
         2.1      Location, Access and Terrain.................................3
         2.2      Property and Ownership.......................................3

3.0      HISTORY OF EXPLORATION................................................5
         3.1      Regional History.............................................5
         3.2      Property History.............................................7

4.0      GEOLOGY, STRUCTURE and MINERALIZATION................................10
         4.1      Regional Geology and Structure..............................10
         4.2      Property Geology............................................11
         4.3      Mineralization and Exploration Targets......................12

5.0      RECOMMENDATIONS......................................................16

6.0      REFERENCES...........................................................22


                                                  LIST OF FIGURES

                                                                            Page

Figure 1 -        Location Map...........................................aft p.3
Figure 2 -        Claim Map..............................................aft p.4
Figure 3 -        General Geology Map...................................aft p.11
Figure 4 -        Detailed Geology - Skomac Vein area...................aft p.11
Figure 5 -        Geological Plan and Londitudinal
                  Section - Upper Veinin pocket........................in pocket
Figure 6 -        Proposed Underground Exploration and Development......aft p.13




                               LIST OF APPENDICES

APPENDIX 1 - Statement of Qualifications


                                       77

<PAGE>



1.0      SUMMARY

The Bow Mines  property is a gold-silver  vein  prospect  with good  exploration
potential.  The property is located near  Greenwood,  B.C. with  excellent  road
access to the claims. It consists of 3 Mining Leases, two Reverted Crown Grants,
four  2-post  mineral  claims  and one  4-post  mineral  claims.  The claims are
registered  in the  name of Karl  Schindler  and  held in  trust  for Bow  Mines
Limited.  They are  currently  under  option to InvestNet  Inc.  This report was
prepared at the request of InvestNet Inc.

The author is familiar  with the geology and  mineralization  in the area having
worked  extensively  in the Greenwood  Camp since 1989. The report is based on a
review of available  literature on the Bow Mines  property and on an examination
of surface exposures on the property.

The Greenwood District is a highly mineralized district which ranks as the sixth
largest gold producing camp in B.C.,  with a total  production of over 1 million
ounces  of gold.  The  majority  of this  gold  production  is from the  Phoenix
copper-gold  'skarn',  located  about 9 km northeast of the Bow Mines  property.
Approximately  40 km to the  south,  in excess of 2.5  million  ounces Au, at an
average  grade of better than 17 g/t Au (0.5 oz/t Au),  has been  produced  from
epithermal veins in the Republic District of northern  Washington.  Furthermore,
recent exploration in the area between Republic and the International Border has
resulted in the discovery of nine new deposits  within the past 10-15 years with
a total contained gold content in excess of 4 million ounces. Deposits include:

     Crown Jewel 7.2 million tonnes @ 6 g/t Au (8 million tons @ 0.18 oz/t Au)
     Lamefoot 2 million tonnes @ 7 g/t Au (2.2 million tons @ 0.2 oz/t Au)
     Golden Eagle 10 million tonnes@ 3.4 g/t Au (11 million tons @ 0.1 oz/t Au)

The total gold  (produced + known  reserves),  in an area  measuring  50 x 40 km
which includes the Greenwood and Republic Districts,  exceeds 7.4 million ounces
Au.  The  ability  of this  area to  continue  to  produce  attractive  deposits
justifies  acquisition  and  exploration  of  properties  such as the Bow  Mines
property, with good exploration models and targets.

The majority of the previous work on the Bow Mines property has been directed at
two parallel,  southeast striking  gold-silver vein systems, the Upper and Lower
Skomac veins.  Total  production  from the Bow Mines  property from discovery to
present is reported at 3,574 tonnes averaging 5.2 g/t Au (0.15 oz/t Au), 238 g/t
Ag (6.9 oz/t Ag), 1.6% Pb and 1% Zn.

The Skomac veins,  which are hosted in a thinly bedded  carbonaceous  argillite,
are emplaced along shear zones on close spaced  en-echelon  fractures,  striking
about  310-320o,  and  dipping  from  40-60o to the  northeast.  The shear zones
average about 3 to 4 metres in width, within which white quartz veins occur. The
veins varying from 0.5 to 3 metres in width,  with an average width of about 0.9
metres.  Mineralization  in the veins consists of wisps and lenses of pyrite and
galena,  with  associated  gold and silver  mineralization.  Lesser  sphalerite,
chalcopyrite, tetrahedrite and native silver also occur.

A considerable  amount of underground  exploration and development work was done
on the Upper Skomac vein in the 1970's and 1980's.  Drilling showed the presence
of a mineralized quartz vein of good grade and width, situated below the 6 Level
which,  when  projected to the 7 Level (61 m below the 6 Level),  appears to lie
about 30 metres north of the 7 Level drift. Paxton (1994) suggests:


                                       78

<PAGE>



     "It would appear that the drift got off the main vein and that there may be
     up to 500  feet of  unexplored  vein in the 7 Level.  If this is the  case,
     there is in the  author's  opinion a fair  chance of an orebody  similar in
     size and grade to the A or AA zones above the 6 Level, being discovered."

Paxton goes on to  recommend a program of  underground  drifting  and raising to
test this vein.  The  estimated  cost of this  proposed  underground  program is
$300,000.

There is limited  information  available regarding the Lower vein, and no modern
exploration  or  development.  The  historic  records  (Minister of Mines Annual
Report 1904)  document a small  shipment of ore (35 tonnes) which graded 318 g/t
Au (9.3 oz/t Au) from these  workings and  sampling by Robert's  Mine during the
1970's reportedly  returned grades of over 34 g/t Au (1 oz/t Au) for the first 9
metres of the adit.

One sample of  mineralized  argillite  footwall to the Lower vein  returned very
high  grade  gold (82 g/t Au (2.4 oz/t Au) and 169 g/t Ag (4.93 oz/t Ag)) over a
narrow width. This was the only sample of footwall material collected.  from the
Lower vein.  Furthermore,  available  information  suggests that sampling of the
wall rock in the Upper Level  workings and in drill core was  essentially  never
done. Given that a new style of gold mineralization has recently been discovered
in the Wells area by  International  Wayside in the  mineralized  footwall  to a
quartz vein system, follow-up of this target is strongly recommended.

Two  veins are  known to occur on the  southern  portion  of the  property  (the
Boundary Falls area veins),  although very little  exploration or development of
these  veins  or the  surrounding  area  has  been  done.  Gold  grades  and the
gold:silver  ratios are generally higher in samples from the Boundary Falls area
veins than in those  from the  Skomac  veins (to 14 g/t Au (0.42 oz/t Au) and 32
g/t Ag (0.93 oz/t Ag) over a 1.2 metre width from the Glory Hole vein).

A significant gold soil anomaly was discovered about 450 metres southeast of the
Lower  Skomac  vein.  The anomaly is poorly  defined by the very  coarse  sample
spacing,  but  appears to be  northeast  trending,  exceeds 200 metres in strike
length,  and has a maximum  value of 230 ppb Au. No  follow-up  has been done in
this area. Several other geochemical and geophysical  anomalies exist which also
require follow-up.

None of the  previous  grids  remain on the  ground  and  locating  the  precise
position of the  anomalies  will be  difficult if not  impossible.  Furthermore,
sampling  on  both  the  grids  was  done on a very  wide  spacing,  so  anomaly
definition was poor in the first place. For these reasons it is recommended that
a tight  spaced  grid  be  established  over  the  entire  property  and  that a
multi-element  soil  survey  be  run  over  the  grid.  Geological  mapping  and
geophysical surveys (mag, VLF-EM) are also recommended.

A three phase exploration program is recommended for the Bow Mines property. The
first  phase  will  consist  of  surface  exploration  (geological  mapping  and
geophysics),  with a budget  of  $60,000.  Phase 2 will  consist  of  additional
surface exploration (geochemical sampling) as well as underground development on
the Upper Skomac vein following the  recommendations of Paxton (1994). The total
Phase 2 budget is  $360,000.  Phase 3 will be  contingent  on the results of the
Phase 1 and 2 programs,  and will  consist of further  target  definition,  plus
drill and  trench  follow-up  to targets  identified  during  the  earlier  work
programs. The proposed Phase 3 budget is $200,000.





                                       79

<PAGE>



2.0      INTRODUCTION

2.1      Location, Access and Terrain

The Bow Mines property is located about 5.5 km southwest of Greenwood,  B.C., as
shown on Figure 1.  There is  excellent  road  access to the  claims,  which are
reached from Greenwood by following  Highway 3 south for 5 km to Boundary Falls,
then  turning  northwest  (right) onto Boltz Road for a further 3 km to the mine
site.

The northern portion of the property is situated on a sparsely treed, moderately
steep, east facing slope overlooking Boundary Creek. The mill site and main mine
workings  are located just south of the base of a prominent  diorite  cliff with
over  300  metres  of  vertical  relief.  To the  south of the  mine  area,  the
topography is subdued,  with undulating grassy hills sloping south and east into
the  Boundary  Creek  Valley.  Elevations  range  from  about 700  metres in the
Boundary  Creek valley in the southeast  portion of the property,  to about 1100
metres at the top of the diorite cliffs to the northwest.  Rock exposure is good
in the northern part of the property.  A thick layer of glacial till covers much
of the southern portion of the property, with only minimal outcrop exposed.

The climate is typically dry, with hot summers and little rainfall.  Snowfall is
light,  generally less than 1 metre,  and the property is usually snow free from
March or April to early November each year.

2.2      Property and Ownership

The Bow Mines Property  consists of 3 Mineral Leases  (comprising 6 former crown
grants),  one 4-post  mineral  claim,  two reverted crown grants and four 2-post
mineral claims  covering an area of 961 acres.  The claims are shown in Figure 2
and summarized  below.  The claims and leases are registered in the name of Karl
Schindler,  in trust for Bow Mines Limited.  They are currently  under option to
InvestNet Inc.

The claim map does show a possible  fraction existing between the south boundary
of the May Mac  claim  and the  northern  boundaries  of the A No. 3 and A No. 4
claims.  This could be easily  remedied by staking two additional 2 post mineral
claims.


Claim Name                  Tenure Number      Units        Expiry Date
----------                  -------------      -----        -----------

May Mac                         214189           12         08/17/2001
A No. 1                         216570           1          10/31/2001
A No. 2                         216571           1          10/31/2001
A No. 3                         216572           1          10/31/2001
A No. 4                         216573           1          10/31/2001
Tunnel RCG (L 888)              216644           1          08/08/2001
Boundary Falls RCG (L889)       216647           1          08/16/2002











Mineral Leases                Tenure Number            Anniversary Date
--------------                -------------            ----------------

ML 423                            216298                 08/08/2000
Nonsuch L389
Republic L426
Hidden Treasure L1019
Cosmopolitan L 1680

ML 430                            216301                 11/15/2000
Last Chance L644

ML 431                            216302                 11/17/2000
Don't Know  L 2374


                                       80

<PAGE>


The above Mineral  Leases are 30 year leases with annual  payments  necessary on
the anniversary date listed. The leases come up for renewal in 2023.

3.0      HISTORY OF EXPLORATION

3.1      Regional History

The Greenwood  camp,  and  particularly  the Phoenix area, has a long history of
exploration and mining activity.  Excellent  historical  accounts of the general
area are provided by Peatfield (1978) and Church (1986).  The following is taken
in part from these  sources  and the  reader is  referred  to these for  further
detail.

Exploration dates back to the early 1880's, with this first phase of exploration
and development  concentrating on high grade gold and silver veins,  such as the
Skylark,  Providence,  City of  Paris,  and  Jewel  (Dentonia)  Mines.  With the
discovery and development of the Phoenix area in the 1890's, exploration shifted
largely to a copper focus,  although work continued  sporadically on the various
precious  metal  vein  properties  over the  next 50  years.  In 1919,  Granby's
(Phoenix) mine and smelter closed due to low copper prices, lower ore grades and
a shortage of coking coal for the smelter furnaces.

The 1930's and 1940's  saw a revival of mining  activity  in the camp,  with the
reopening  of the Jewel and  Providence  Mines and  then,  in 1956,  the  Granby
Company  re-evaluated the Phoenix property with the intent of mining by open pit
trackless mining methods. Open pit production at Phoenix began in 1960 at a rate
of 900  tons per day and was  increased  to 3000  tons  per day by 1972.  Granby
terminated  mining operations at Phoenix in 1976, and later dismantled and moved
the Phoenix mill. For a 20 year period while the mine was operating, exploration
in the camp was booming,  although dominated by the work of Granby and virtually
controlled  by the Phoenix  "copper  skarn" model.  Total  production at Phoenix
during the period 1900 - 1976 is reported at of 27 million  tonnes @ 0.9% Cu and
1.12  g/t Au,  from a  number  of  different  ore  bodies  (Church,  1986).  The
Motherlode copper skarn deposit,  situated 3 km north of the Bow Mines property,
follows  a  similar  history  to the  Phoenix,  with  production  until  1918 by
underground  methods,  and  then  reopening  as an open pit  operation  in 1956.
Production  from the  Motherlode is reported at 4.2 million tonnes at a grade of
0.8% Cu and 1.27 g/t Au.



                                       81

<PAGE>



Exploration  in the camp was rekindled in the early 1980's with the discovery of
the Sylvester K gold bearing sulfide zone just north of Phoenix. The zone ranges
up to 12  metres  in width,  with  grades  in the order of 10 g/t Au,  from both
massive pyrite and from underlying pyritic volcanic siltstones.  The Sylvester K
is  contained  within a very  characteristic,  repeatable  sequence  of Brooklyn
sediments and volcanics (the upper portion of the regionally  mapped  sharpstone
unit),  sitting  just  below  massive  Brooklyn  limestone.  The  deposit  shows
characteristics of both structurally  controlled replacement  mineralization and
volcanogenic   massive  sulfide   mineralization.   Complex   faulting   offsets
mineralization and has hampered exploration.

The discovery of numerous gold mines in the late 1980's and early 1990's, nearby
in Washington State, has many implications to the Greenwood area,  although they
have not resulted in the  resurgence in  exploration  in the camp that one might
have expected.  Crown Resources/Battle  Mountain's Crown Jewel deposit at Chesaw
is a gold skarn deposit with reserves of in the order of 7.2 million  tonnes @ 6
g/t Au.  The  deposit  occurs  in  probable  Triassic  rocks  near a  Cretaceous
intrusion (Hickey,  1992),  similar to the geological setting of the major skarn
deposits in the Greenwood area.

Crown  Resources/Echo  Bay's  success  in the late  1980's  and early  1990's at
discovering a new style of gold deposit in the Belcher  District,  in the Curlew
Lake area just south of the border, has opened the door to a new type of deposit
in the Greenwood  camp.  Rasmussen  (1993)  describes  this type of deposit as a
gold-bearing,   magnetite-pyrrhotite-pyrite   syngenetic  volcanogenic  deposit.
Mineralization  is hosted within the Triassic Brooklyn  Formation,  and at least
part of the gold  mineralization is attributed to a late stage epigenetic event.
The gold bearing massive magnetite and sulfides at the Overlook, Lamefoot (about
2  million  tonnes  @ 7 g/t Au) and Key  West  deposits  all  occur  at the same
stratigraphic  horizon, with a stratigraphic  footwall of felsic volcaniclastics
and a massive  limestone  hangingwall,  and with auriferous  quartz-sulfide  and
sulfide veinlets in the footwall of the deposits.

The Republic district is located about 35 km south of the Bow Mines property and
has produced  close to 2.5 million ounces of gold, at an average grade of better
than 17 g/t Au (0.5 oz/t Au) (Tschauder,  1986) from Eocene  epithermal veins. A
number of new  epithermal  deposits have been  discovered in recent years in the
Curlew areas (ie.  Kettle,  K2) which  further  support the  importance  of this
Tertiary period for gold mineralization.  In the Greenwood Camp, high grade gold
mineralization  is known to occur along Tertiary  structures,  although  further
exploration is needed to evaluate the extent of this mineralization.

On the Lexington - Lonestar property,  which straddles the International  Border
about 9 km  southeast  of the Bow  Mines  property,  a zone of  massive  sulfide
mineralization at the contact of serpentine and altered volcanics was the target
of  considerable  exploration  in the  early to mid  1990's.  The Main Zone is a
sinuous body of  mineralization  measuring 25-70 metres in width, 2-24 metres in
thickness  and over 375 metres in length  which is hosted  along the No. 7 fault
zone. A proven mineable reserve of 132,000 tonnes at an average grade of 9.6 g/t
Au and 1.48% Cu  (145,000  tons @ 0.28 oz/t Au and 1.48% Cu) has been quoted for
the zone which is open on strike in both  directions.  To the  southeast  of the
Main Zone, a copper-gold porphyry system occurs at the Lone Star and NW Zones in
a Jurassic  quartz-feldspar porphyry intrusion which is spatially related to No.
7 thrust  fault.  Drill  indicated  reserves are quoted at 17.6  million  tonnes
averaging  0.52%  Cu and 0.3 g/t Au for the Lone  Star  Zone,  and 0.95  million
tonnes at 1.04% Cu and 1 g/t Au for the NW Zone (Eibish,  1991;  Seraphim et al,
1995).

Recent exploration at the Golden Crown property,  just south of the Phoenix mine
and some 10 km east of the Bow  Mines  property  has  identified  a new style of
mineralization  for the  Greenwood  Camp.  At least 10 discrete,  close  spaced,
parallel,  en-echelon  massive  pyrrhotite (with lesser pyrite and chalcopyrite)
and  quartz-sulfide  veins are  recognized  on the Golden Crown  property,  with
grades in the order of 17 g/t Au (0.5 oz/t Au).

                                       82

<PAGE>



Locally,  spectacular gold grades, exceeding 2400 g/t Au (70 oz/t Au), have been
obtained.  The  overall  setting,  host  rocks,  related  intrusive  rocks,  and
character  of  mineralization  at the Golden  Crown are similar to the  Rossland
camp. The Rossland model for  mineralization  has not previously been recognized
for the Greenwood Camp. A second example of this style of  mineralization is the
Wildrose property, just northwest of the Bow Mines property.

Recent exploration  successes in the area between Republic and the International
Border (nine new deposits within the past 10-15 years and a total contained gold
content of > 4 million oz) combined with new  discoveries  and newly  discovered
styles of mineralization in the Greenwood Camp, show the excellent potential for
this district.

3.2      Property History

The Bow Mines property  consists of two discrete  areas,  the Skomac property in
the north, and the Boundary Falls property to the south which together are known
as Smith's Camp.  Historically  these two areas have always been under different
ownership and up until the present have been worked by different companies.  For
simplicity,  this  discussion  of the  history of  exploration  and  development
maintains these historic boundaries.  The following has been taken from accounts
given  in the  Minister  of Mines  Annual  Reports,  from  Minfile  082ESE045  &
082ESE171 and from Paxton (1984, 1987, 1994) and Tully (1978).

The  majority of the previous  work on the Bow Mines  property was directed at a
gold-silver  quartz vein  system  situated on the  Republic,  Non-Such  and Last
Chance Crown Grants in the northern portion of the property. The vein system has
been  explored and  developed  by 7 adits over a vertical  distance of about 150
metres  and for a strike  length of about 400  metres.  Only minor work has been
done on the remainder of the Bow Mines property.

Skomac Property (northern portion of the Bow Mines Property)

Mineralization  was first discovered on the Skomac property in 1894 and the main
crown  grants were  issued  between  1894 and 1898.  By 1900 the claims had been
acquired by Republic Gold Mines Ltd.

Republic  Gold Mines Ltd.  developed the No. 1, No. 2 and No 3 adits (on what is
now  referred to as the Lower  vein).  During the period  1903-1904 35 tonnes of
ore,  grading  318 g/t Au  (9.3  oz/t  Au) was  produced  from  these  workings.
Intermittent  work is reported on the Skomac  property from 1904 to 1937, with a
total  production  of about 810 tonnes at an  average  grade of 3435 g/t Ag (100
oz/t Ag). Work during this period included development of the No. 4 adit, on the
Upper vein.

In 1961 the present Mineral Leases were granted.  Skomac Mines Ltd. operated the
property  until 1965,  developing the No. 5 adit and drilling the 5-1 cross-cut.
During this period,  a further 670 tonnes of ore averaging 1.4 g/t Au (0.04 oz/t
Au) and 185 g/t Ag (5.41 oz/t Ag) was produced and shipped to the Trail smelter.
From 1964 - 1969 there was additional small production under lease arrangements.

Robert's Mines  acquired the Mineral  Leases in 1973 and staked the  surrounding
ground  as  the  May  Mac  claim.  A  considerable  amount  of  exploration  and
development work was done on the Skomac property by Robert's Mines from 1973-83,
as detailed below. The No. 6 adit was developed in 1974, and stoping above the 6
Level (the A and AA zones)  resulted in 435 tonnes of  production  averaging 4.8
g/t Au (0.14  oz/t Au) and 695 g/t Ag (20.3  oz/t  Ag).  In 1976 a  further  550
tonnes  was  produced  from the B and C zones and the No. 7 adit was  started 61
metres (200 feet) below the 6 Level.


                                       83

<PAGE>



Work continued in 1977 and 1978.  Three diamond drill holes were drilled to test
for parallel vein structures, and two barren veins were discovered. Surface work
included a grid to the south of the mine workings,  with soil samples  collected
and analyzed for lead and silver. Several anomalies were identified. Also during
1977, B.N. Church of the B.C.  Geological  Survey Branch,  completed  geological
mapping of the Bow Mines property and the area surrounding the property (Church,
1982).  A pulse EM survey  completed  in 1978  revealed a long,  north  trending
conductor.  The conductor was partially  tested by drilling,  with  inconclusive
results.  An Accelerated  Mineral  Development Grant for $50,000 was obtained in
1978, an a major  development  program was  initiated.  Underground  development
included  driving the 6-1 and 6-2 cross-cuts,  and drilling 3 underground  drill
holes to test the downward extension of the AA zone.

In 1980, a raise was driven from the 7 Level to the 6 Level,  below the AA zone,
and a sublevel was driven on the vein. From 1980 - 82,  construction and testing
of a 100 ton per day mill was completed.  Prior to this point,  all ore produced
was direct shipping ore.

Mining  continued in 1983,  primarily  from the AA zone,  with about 1730 tonnes
mined and milled on site,  returning  an average  grade of 0.7 g/t Au (0.02 oz/t
Au) and 115 g/t Ag (3.4 oz/t Ag). No further exploration or development was done
until 1985,  although a summary report on the property was prepared during 1984,
and the mill continued to run as a custom milling  operation during this period.
Total  production  from the Bow Mines  property  from  discovery  to  present is
reported at 3,574  tonnes  averaging  5.2 g/t Au (0.15 oz/t Au), 238 g/t Ag (6.9
oz/t Ag), 1.6% Pb and 1% Zn.

In 1985, Empire Gold Resources entered into an agreement to explore the property
in return  for a 42% NPI in the mine and  mill.  In 1987,  work by  Empire  Gold
included driving the 6-3 cross-cut and drilling below the 6-2 and 6-3 cross-cuts
to  test  the  downwards  extension  of the  vein.  Fifteen  underground  holes,
totalling  450  metres,  were  drilled  and  showed  that the vein  dipped  more
shallowly than previously believed. This explained why the No. 7 adit had failed
to intersect the vein.

Underground  mapping and sampling of the lower vein in the No. 1 and No. 2 adits
was also  completed.  Of  interest  is the fact  that a  narrow  section  of the
mineralized  argillite footwall of the vein in the No. 2 adit returned 82 g/t Au
(2.4 oz/t Au) and 168 g/t Ag (4.9 oz/t Ag) from one  sample.  A small  amount of
trenching was done near the No. 2 adit.

Surface work was also completed during 1987,  including  geological  mapping and
soil  sampling  (for gold and silver).  Soil samples were  collected at 50 metre
intervals on 100 metre spaced  lines.  A gold  anomaly was  discovered  some 400
metres  southeast  of the No.  1, 2 and 3 adits,  with  values to 230 ppb Au. No
follow-up of this area has been done.  The agreement  with Empire Gold Resources
has terminated with no retained interest in the claims or in the mill.

There has been no  exploration  on the  property  since  1987,  although  custom
milling has been intermittent from 1987 to the present. The recommendations made
in 1987 have not been  carried  out. A report was  prepared in 1994,  for 593749
Alberta Limited.  The work recommended in the 1994 report has similarly not been
completed.

Boundary Falls Property (southern portion of the Bow Mines Property)

Mineralization  on the Boundary  Falls and Tunnel claims was discovered in 1894,
and the claims (owned at this time by Boundary  Falls Gold Mining  Company) were
crown granted in 1898. There is evidence of early work,  including  several test
pits and shafts on these claims but little record of this activity.

                                       84

<PAGE>



The Boundary Falls property was acquired by Amigo Silver Mines Ltd. in 1973. The
only  significant  work on this portion of the Bow Mines property was during the
period  1975-78.  During 1975, a 45 metre long cross-cut was driven to intersect
the No. 1 Vein,  but stopped short of hitting the vein.  Small EM and SP surveys
were also completed.  A limited amount of diamond  drilling was done to test the
Glory Hole vein and several of the  geophysical  anomalies.  In 1978, a Pulse EM
survey was done,  and the cross-cut on the No. 1 vein was extended for 18 metres
to intersect the vein. Samples of the vein from this point returned up to 14 g/t
Au (0.42 oz/t Au) and 31 g/t Ag (0.91 oz/t Ag) over 0.2  metres,  and 4.8 g/t Au
(0.14 oz/t Au) and 137 g/t Ag (4 oz/t Ag) over 0.6 metres.

No work has been done on this portion of the property since this time.

4.0      GEOLOGY, STRUCTURE and MINERALIZATION

4.1      Regional Geology and Structure

The  Greenwood  area has been mapped on a regional  basis by Fyles  (1990),  and
prior to this, by Little (1983) and Church (1986).  The distribution of rocks in
the Greenwood area is controlled by a series of faults,  including both Jurassic
thrust faults and Tertiary  extensional  and  detachment  faults.  The reader is
referred to Fyles (1990) for an in-depth description of the regional geology and
structure.   The  Jurassic  and  Tertiary   faulting  post  dates  some  of  the
mineralizing  events in the area. In other cases  mineralizaton is controlled by
these structures. A firm understanding of the geology and structure is essential
for well directed exploration in this camp.

Fyles'  mapping  shows the  pre-Tertiary  rocks form a series of thrust  slices,
which lie above a basement high grade metamorphic  complex.  The thrusting event
is felt to be an effect of the development of the Okanagan  gneiss domes,  which
also results in the regional northward dip of rock units (Fyles,  1990). A total
of at least five thrust slices are recognized,  all dipping gently to the north,
and  marked in many  places by bodies of  serpentine.  Fyles'  interprets  these
serpentinite  bodies  as  representing  part  of a  disrupted  ophiolite  suite,
belonging  to the  Knob  Hill  Group  of late  Paleozoic  age.  Commonly,  these
serpentinite bodies have undergone Fe-carbonate  alteration to listwanite,  as a
result of the thrusting event.

The oldest  rocks in the camp  belong to the late  Paleozoic  Knob Hill Group of
dominantly  volcanic  affinity,  and  consist  mainly of chert,  greenstone  and
related intrusives,  and serpentine.  The intrusive rocks of the Knob Hill Group
include  the Old  Diorite  which  forms  the  prominent  cliffs on the Bow Mines
property northwest of the mine workings.
On a regional scale, the Knob Hill rocks are unconformably overlain by sediments
and volcanics (largely argillite, siltstone, limestone and andesite) of the late
Paleozoic  Attwood Group.  Rocks of both the Knob Hill and Attwood Groups are in
turn  unconformably  overlain by the Triassic  Brooklyn  Formation,  represented
largely by limestone,  clastic sediments and pyroclastics.  In many cases in the
Greenwood  area,  evidence  for  thrusting  is seen by the older Knob Hill Group
rocks resting over the younger Attwood Group or Brooklyn  Formation  rocks.  The
historically  important skarn deposits in the Greenwood area (i.e. Phoenix,  Oro
Denoro, Motherlode-Greyhound) area hosted within the Triassic rocks.

Three separate  intrusive events are known regionally to cut the above sequence.
Intrusive  rocks in the Lexington area have been dated as Jurassic  (Sinemurian)
by Church (1992) and bear  similarities to the Jurassic aged Rossland  monzonite
(which is related to gold-copper veins in the Rossland Camp). Recent work in the
Greenwood  camp has  identified a multiple  phase  intrusive in the Phoenix area
which also bears many  similarities to the Rossland  monzonite and is associated
with Rossland-type Au-Cu veins.

                                       85

<PAGE>



Cretaceous Nelson-type intrusives are common in the Greenwood area, particularly
in the north  -central  part of the map area.  Eocene  Coryell  dykes and stocks
commonly cut older rocks,  with the intensity of dyking again  increasing to the
north.

Tertiary sediments and volcanics  unconformably overlie the older rocks with the
distribution  of these Tertiary rocks largely  controlled by a series of faults.
Regionally,  three  Tertiary  fault sets are  recognized,  an early  gently east
dipping set, a second set of low angle west dipping,  listric normal  detachment
type faults, and a late, steep dipping, north to northeast trending set of right
lateral or west side down normal faults (Fyles, 1990). Detailed property mapping
in the  Greenwood  area has  shown  that in many  cases  the  regionally  mapped
Tertiary  detachment and steep late north trending  faults are  accompanied by a
series of less  significant  sympathetic  faults,  with lesser amounts of offset
than the regionally mapped structure.  A major gold event is associated with the
period of Tertiary activity, with greater than 2.5 million ounces of gold in the
Republic District (some 50 km to the south of the Bow Mines property) attributed
to this event.

4.2      Property Geology

The  geology of the Bow Mines  property  is  described  in some detail by Church
(1982) and by Paxton (1987,  1994).  The  following  discussion is taken largely
from these  sources.  Figure 3 shows the general  geology of the property  area.
More detail of the northern  portion of the property,  in the area of the Skomac
veins, is included as Figure 4.

On a regional  scale,  the Bow Mines property is situated  within a structurally
complex area (Fyles, 1990). Two major east-west trending, moderate north dipping
thrust faults are located in the vicinity of the Skomac  veins.  As is common in
the  Greenwood  area,  these  thrust  faults  are  marked  by  linear  bands  of
serpentine.  The Skomac veins are situated in a fault bounded block of primarily
metasedimentary  rocks  situated  between these  thrusts,  with the Mount Wright
fault forming the southern  boundary to the fault block and the Lind Creek fault
the northern boundary (see Figure 4).

A large diorite  intrusive  occurs north of the Lind Creek fault,  as well as in
the immediate  footwall of the thrust. The diorite is part of the Paleozoic Knob
Hill Group, and is known locally as the "Old Diorite" (Church,  1982, 1986). The
intrusion is typically medium to coarse grained,  mottled  green-grey in colour,
with numerous criss- crossing felsic veinlets.

The  metasedimentary  rocks in the  footwall  of the Lind Creek  fault have been
named the Skomac  Formation,  and are part of the Paleozoic  Attwood Group.  The
Skomac veins are hosted within this unit. Thinly bedded  carbonaceous  argillite
is  common,   locally   interbedded  with  cherty  sandstone  and  chert  pebble
conglomerate.  Bedding  is  typically  northwest  trending  and  moderate  north
dipping,

Rocks in the footwall of the Mount Wright fault consist of chert and  quartzite,
quartz mica schists and gneisses and minor  limestone  and dolomite  which Fyles
(1990)  interprets as belonging to the Paleozoic  Knob Hill Group.  The Boundary
Falls veins (No. 1 and Glory Hole) occur  within these  rocks.  In general,  the
foliation  within  the  metamorphic  rocks  trends  west and  northwest,  with a
moderate north dip.

The entire sequence is cut by a series of granodiorite and microdiorite dykes of
Cretaceous  and Tertiary age. The Cretaceous  granodiorite  dykes are related to
the  large  areas  of  Nelson   intrusives  in  the  Greenwood  area.   Tertiary
microdiorite dykes are common throughout the property. These dykes cut the Upper
Skomac vein,  and are also known to occur in workings on the Boundary  Falls and
Tunnel claims.

                                       86

<PAGE>



The Mount  Wright and Lind Creek  thrust  faults  (and the fault  bounded  block
between the fault zones) are truncated to the west by a complex zone of Tertiary
faulting.  The Tertiary faults include the north trending Greyhound and Deadwood
faults which form the eastern boundary of the Toroda Graben. A number of smaller
north trending Tertiary faults are also known to occur on the property.

4.3      Mineralization and Exploration Targets

Skomac Veins

The  majority  of the work on the Bow Mines  property  has been  directed at two
parallel, southeast striking vein systems, the Upper and Lower Skomac veins (see
Figures 3 and 4). A number of smaller  branching veins are also known.  Detailed
descriptions of the veins are provided by Paxton (1984, 1986, 1987 and 1994) and
by  Church   (1982).   As  described   above,   the  veins  are  hosted   within
metasedimentary rocks (primarly argillites) in a block bounded by the Lind Creek
fault on the north (top) and the Mount  Wright  fault to the south  (base).  The
Upper  vein is  situated  about 50 metres  below the upper  contact of the fault
block, while the Lower vein is somewhat closer, perhaps only 20 metres below the
Lind Creek fault.

The veins are emplaced along shear zones on close spaced  en-echelon  fractures,
striking about  310-320o,  and dipping from 40-60o to the  northeast.  The shear
zones  average  about 3 to 4 metres in width,  within  which white  quartz veins
occur. The veins varying from 0.5 to 3 metres in width, with an average width of
about 0.9 metres.  Mineralization  in the veins  consists of wisps and lenses of
pyrite  and  galena,  with  associated  gold and silver  mineralization.  Lesser
sphalerite,  chalcopyrite,  tetrahedrite and native silver also occur. Argentite
and polybasite have also been identified.

Upper Vein

The majority of the exploration and production on the property has been from the
Upper vein. The Main workings (4, 5, 6 and 7 Levels) are developed on this vein.
A geological  plan and  longitudinal  section from Paxton  (1986) is included as
Figure 5 which shows the Upper vein in detail.

The Upper vein is exposed  underground over a strike length of about 220 metres,
and has an  average  dip of about 50o to the  northeast.  Four  known ore shoots
occur within the exposed strike length,  and are referred to as the AA, A, B and
C zones. The shoots range from 15 to 35 metres in strike length, and consists of
thickened  mineralized quartz lenses, which may reach widths of 6 metres. Church
(1982)  indicates  that the shoots  appear to be aligned on gash  structures  at
almost  right  angles  to the main  shear  direction,  striking  about  015o and
plunging  about 40o to the north.  The shoots are separated by a combination  of
zones of pinching, small fault offsets and by crosscutting dykes.

The vein is hosted in thinly bedded  carbonaceous  argillite,  and vein contacts
are generally slickensided. Slip planes within the vein and parallel to the vein
walls are also common.  Also common are tension  fractures in the vein walls, at
high  angles to the vein.  These  tension  fractures  may be the locus for large
masses of barren white quartz.

A large post-ore  microdiorite dyke cuts the vein between the A and B zones. The
dyke strikes at 060o,  dips 40- 45o  northwest  and averages  about 10 metres in
width.   Contacts  are  indistinct,   and  the  dyke  margins  are  altered  but
unmineralized.  Post-ore  faults are  typically  steeply  dipping,  with strikes
ranging  from 020 - 040o.  These  faults  represent  part of a major  episode of
regional extensional tectonism during the Tertiary.

                                       87

<PAGE>



Drilling  in 1987  from the 6-2 and 6-3  cross-cuts  showed  the  presence  of a
mineralized  quartz  vein of good grade and width,  situated  below the 6 Level.
Results  include  11.7 g/t Au (0.343 oz/t Au) and 122 g/t Ag (3.56 oz/t Ag) over
0.58  metres  (1.9 feet)  from hole  U-87-12.  Detailed  sections  showing  this
drilling are included in Paxton (1994).

When  projected  to the 7 Level (61 metres  (200 feet)  below the 6 Level),  the
mineralized  vein  appears  to lie about 30 metres  north of the 7 Level  drift.
Paxton (1994) suggests:

     "It would appear that the drift got off the main vein and that there may be
     up to 500  feet of  unexplored  vein in the 7 Level.  If this is the  case,
     there is in the  author's  opinion a fair  chance of an orebody  similar in
     size and grade to the A or AA zones above the 6 Level, being discovered."

Paxton (1994) goes on to recommend a program of underground drifting and raising
to test this  vein,  as  discussed  below  and  shown in Figure 6. This  program
remains  to be  carried  out.  In  order  to test the  vein,  Paxton  recommends
extending  the northern  branch of the 7 Level drift for 49 metres (160 feet) at
an azimuth of 347o, to intersect the (projected)  mineralized vein discovered by
drilling.  At this point,  Paxton recommends  driving a raise on the vein for 79
metres (260 feet) to break through to the 6 Level. He also  recommends  drifting
along the vein on the 7 Level,  for a further 79 metres  (260 feet) to the west.
The estimated  cost of this proposed  underground  program is $300,000  (Paxton,
1994).

A preliminary  review of limited  sampling  results from the Upper vein seems to
suggest a zonation  within the vein,  with an  increase in gold grade and in the
gold:silver  ratio to the southeast.  It is recommended  that the possibility of
zonation in the vein be further  studied in subsequent  work  programs  since an
understanding of this may help direct exploration.

Lower Vein

The Lower vein is situated to the  southeast of the Upper vein (about 250 metres
southeast of the AA zone on the 6 Level).  As with the Upper vein,  it is hosted
within the fault bounded block of metasedimentary rocks, but situated only about
20 metres or so from the hanging wall of the fault block.  Serpentine related to
this upper fault contact is exposed in the vicinity of the lower adits (No. 1, 2
and 3 adits).

There is limited  information  available regarding the Lower vein, and no modern
exploration  or  development.  The  historic  records  (Minister of Mines Annual
Report 1904)  document a small  shipment of ore (35 tonnes) which graded 318 g/t
Au (9.3 oz/t Au) from these  workings.  Sampling  by  Robert's  Mine  during the
1970's reportedly  returned grades of over 34 g/t Au (1 oz/t Au) for the first 9
metres  (30 feet) of the adit  (Paxton,  1986).  Subsequent  sampling  by Paxton
(1987) in the No. 1 and No. 2 adits did not confirm these  grades.  The vein was
narrow and discontinuous where observed and samples collected from vein material
were consistently low in both gold and silver grade.

What is  extremely  interesting  however,  is that  one  sample  of  mineralized
argillite  footwall  to the vein  collected  from adit No. 2 returned  very high
grade gold and  silver  vales (82 g/t Au (2.4 oz/t Au) and 169 g/t Ag (4.93 oz/t
Ag) over a width of 0.15 m (0.5  feet)).  This was the only  sample of  footwall
material  collected  from the Lower  vein.  Furthermore,  available  information
suggests that sampling of the wall rock in the Upper Level workings and in drill
core was essentially  never done. Given that a new style of gold  mineralization
has recently been discovered in the Wells area by  International  Wayside in the
mineralized  footwall  to a quartz  vein  system,  follow- up of this  target is
strongly recommended.

                                       88

<PAGE>



As a first step, the sample location in the No. 2 adit should be re-examined and
re-sampled.  An  effort  should  be made to  obtain  any  available  information
regarding the Wells  discovery to see what  similarities  may exist with the Bow
Mines area. All available drill core should be re-examined and mineralized  wall
rock sampled where ever it occurs.  Similarly,  available  underground exposures
should be mapped and sampled,  paying  particular  attention to  alteration  and
mineralization  in the wall rock of the veins.  Trenching may be a viable option
to test the Lower vein and it's footwall,  should this be warranted by the above
work.

Boundary Falls Veins

Two veins are known on the southern  portion of the property (the Boundary Falls
property),  although very little  exploration  or development of these veins has
been done, and little  exploration been done in the surrounding area. Work which
has tested this area is described by Tully  (1978).  The veins are hosted within
Knob Hill Group metamorphic rocks in the footwall of the Mount Wright fault.

One of the Boundary Falls area veins,  the Glory Hole vein, has a similar strike
to the Skomac veins,  but a much different dip. The second vein, the No. 1 vein,
is north-northeast  trending and steeply west dipping, similar in orientation to
Tertiary  faulting and dyking in the Skomac area. A major period of  extensional
tectonism  in the  Tertiary  is  known  to occur  regionally.  Significant  gold
mineralization  is associated  with this event in the Curlew and Republic areas,
as well as in the Phoenix area. Gold grades and the gold:silver  ratios are much
higher in  samples  from the  Boundary  Falls  area veins than in those from the
Skomac veins.

Glory Hole Vein

The Glory Hole vein is exposed on surface in an old working and is  described as
being  comprised of  porcelaneous,  highly  shattered  quartz.  The vein strikes
southeast,  dips  steeply to the west and  ranges up to 1.2 metres in width.  As
with the Skomac  veins,  slips  within the vein  parallel  to the vein walls are
common.   Mineralization   within  the  vein  consists  of  pyrite,  galena  and
tetrahedrite,  with very minor chalcopyrite.  Values to 14 g/t Au (0.42 oz/t Au)
and 32 g/t Ag (0.93 oz/t Ag) over a 1.2 metre width are reported  from the Glory
Hole.  Attempts  to test the vein at depth  with two  diamond  drill  holes were
unsuccessful and it was assumed that the vein has been offset by faulting.

No. 1 Vein

The No. 1 vein is exposed on surface,  and trends at approximately 020o, dipping
at about 70o to the west. A 63 metre cross-cut was driven to intersect this vein
at a  vertical  depth of about 25  metres  below  surface.  Three  samples  were
collected from the vein, near the face of the cross-cut:


Sample width (m)            Gold g/t                    Silver (g/t)
----------------            --------                    ------------
0.2 m  (  8 inches)  14.4 g/t Au (0.42  oz/t Au)   31.2 g/t Ag (0.91 oz/t Ag)
0.3 m  (12 inches)    6.6 g/t Au (0.194 oz/t Au)   13.7 g/t Ag (0.4  oz/t Ag)
0.6 m  (24 inches)    4.8 g/t Au (0.14  oz/t Au)   137  g/t Ag (4.0  oz/t Ag)

A further  sample of the vein from  surface  returned 3.9 g/t Au (0.114 oz/t Au)
and 21.9 g/t Ag (0.64 oz/t Ag) over a 0.6 metre vein width. One drill hole which
tested the vein  returned  7.9 g/t Au (0.23 oz/t Au) and 582 g/t Ag (17 oz/t Ag)
over a 1.5 metre intercept (true width ~ 1.1 metres).


                                       89

<PAGE>



The  north-northwest  trend to this vein and the  higher  Au:Ag  ratio seen here
suggest  that this vein may belong to a  Tertiary  mineralizing  event.  Further
testing of this vein is warranted given the regional significance of this event.

Other exploration targets

A significant gold soil anomaly was discovered about 450 metres southeast of the
Lower Skomac vein. The anomaly is apparently  underlain by metamorphic  rocks in
the footwall of the Mount Wright fault.  It is poorly defined by the very coarse
sample  spacing,  but appears to be  northeast  trending,  exceeds 200 metres in
strike length, and has a maximum value of 230 ppb Au. No follow-up has been done
in this area. Further mapping and sampling in this area is strongly recommended.

A 1977 soil  survey  was  completed  for lead and  silver  over a portion of the
property and several silver  anomalies were apparently  defined.  Once again, no
follow-up  to these  targets  has been done.  Neither the 1977 nor the 1986 grid
remains on the ground and locating the precise position of the anomalies will be
difficult, if not impossible. Furthermore, sampling on both these grids was done
on a very wide spacing,  so anomaly  definition was poor in the first place. For
these reasons it is recommended that a tight spaced grid be established over the
entire property and that a multi-element soil survey be run over the grid.

During the mid-late  1970's,  various  geophysical  surveys were  completed over
parts of the Bow Mines  property  revealing a number of  anomalies  which remain
untested  or only  partially  tested.  None  of the  surveys  provided  complete
coverage of the property,  and the precise  location of the anomalies  resulting
from  these  surveys  is  not  known.  It is  recommended  that a  basic  ground
magnetometer  and VLF-EM  survey be run over the  property,  on the same grid as
used for  soil  sampling.  Depending  on the  results  of this  work,  different
follow-up geophysical techniques may be recommended (ie. SP or Pulse EM).

5.0      RECOMMENDATIONS

A three phase exploration program is recommended for the Bow Mines property. The
first  phase of work will be  completed  in Year 1 and will  consist  of surface
exploration (geological mapping and geophysics).  Phase 2 will include follow-up
surface  exploration,  as well as  underground  development  on the Upper Skomac
vein,  following the recommendations of Paxton (1994). Phase 2 will be completed
in  Year 2.  Phase 3 will be  contingent  on the  results  of the  Phase 1 and 2
programs,  and will consist of further target definition,  plus drill and trench
follow-up to targets identified during the earlier work programs.

Phase 1                    Phase 1 Budget:           $60,000

The Phase 1 exploration  program is a surface  exploration  program  designed to
assess other known veins and  anomalies on the Bow Mines  property,  and to test
unexplored areas for the possibility of additional zones of  mineralization.  It
is expected that the Phase 1  exploration  program could be completed in a 4 - 5
month field  season in Year 1. It will not be  possible to complete  the Phase 2
program  during  the same  field  season,  and Phase 2 will be  carried  out the
following year. The Phase 1 program will consist of:

1.   Staking  two 2 post  claims  to cover a  possible  fraction  between  the A
     No.3and A No. 4 claims and the May Mac claim.

2.   Establishing  a detailed flag and picket grid over the entire  property.  A
     base line  should be run south of the mine and mill site at an  azimuth  of
     315o.  Lines,  oriented at 045o, should be run off the baseline at 50 metre
     spaced intervals with stations established along the lines every 20 metres.
     Approximately  80 line  kilometres  of grid will be  required  to cover the
     claims.  It may  not  be  possible  to  run  some  lines  due to the  steep
     topography in the area north and west of the mine workings.

                                       90

<PAGE>




3.   Completing  geological  mapping and rock chip sampling over the entire grid
     (80  line  kilometres  of  mapping,  with  approximately  75  rock  samples
     collected).

4.   Completing ground  magnetometer and VLF-EM surveys over the entire grid (80
     line kilometres).

5.   Re-examining  and re-sampling  the mineralized  footwall to the vein in the
     No. 2 adit.  Similarly,  re- examining and re-sampling available drill core
     and   underground   exposures  to  test  for  other  areas  of  potentially
     mineralized  wall  rock to the  veins  (75  rock and  core  samples,  to be
     submitted for Au + 30 element ICP analysis).

                                                     SCHEDULES

A - Manning Schedule
Cost rate includes salary, benefits, food, W.C.B., accommodation.

1.   Geologist.  At  least 5 years  experience  in  exploration  geology  and in
     diamond drill core logging. University graduate. Responsible for management
     of surface exploration, supervision of surface exploration crew, geological
     mapping and rock sampling, record keeping, reporting. Cost @ $450.00/day.

2.   Geological  Assistant (2).  Experienced in surface  exploration,  including
     running grid lines,  rock chip sampling.  Responsible for establishing grid
     over property,  staking claims, and assisting with collecting rock samples.
     Cost @ $350.00/day each.

3.   Geophysical  Technician  (1).  Experienced  in collecting  and  preliminary
     processing of ground mag and VLF-EM data.  Responsible  for  collecting and
     preliminary processing of geophysical data. Cost @ $400.00/day.

4.   Geophysical  Consultant  (1).  Experienced in processing  and  interpreting
     geophysical  data.  Responsible for plotting and  interpreting  geophysical
     results, and reporting on such. Cost @ $600.00/day.

B - Time and Activity Schedule
Times allocated below will allow for some down time due to inclement  weather or
other lost work days.

0 - 30 days         Geological  Assistants  establish grid over claims and stake
                    additional mineral claims. Geologist begins to examine drill
                    core and underground workings and collect rock samples.

30 - 60 days        Geophysical  Technician  completes  ground  mag  and  VLF-EM
                    surveys over the grid area. Geologist begins mapping grid.

60 - 75 days        Geologist  completes  geological  mapping  of grid  and rock
                    sample   collection.    Geophysical   Consultant   processes
                    geophysical data and prepares maps.

                    ~ 20 day break to await geochemical  results and geophysical
                    report.

95 - 120 days       Geologist compiles  geochemical,  geological and geophysical
                    data into a comprehensive  report, and makes recommendations
                    for follow-up exploration during Phase 2.

                                       91

<PAGE>




C - Cost Schedule

   Personnel                  0 - 30 days                        $  15,450
                              30 - 60 days                          15,500
                              60 - 75 days                           7,500
                              95 - 120 days                          4,500
   Consumables                Fuel, field supplies                   1,200
   Rentals                    Vehicles, geophysical equipment, etc.  7,000
   Geochemistry               150 rock samples @ $25.00              3,750

   Contingency (~ 10%)                                               5,100
                                                                 -----------
   Total:                                                        $  60,000

Phase 2      Phase 2 Budget:            Surface Exploration          $ 60,000
                                        Underground Exploration      $300,000
                                                                     --------
                                        Total Phase 2 Budget:        $360,000

The Phase 2 exploration  program will consist of follow-up surface  exploration,
specifically soil sampling of certain portions of the grid, as identified by the
mapping  program,  as well as  underground  exploration to test the Upper Skomac
vein.  The program is  expected  to take about 4 months to complete  and will be
done in Year 2.

Surface Exploration        ($60,000)

Complete a  multi-element  soil  sample  survey over the entire  grid,  with the
exception of areas of very thick  glacial till cover or large rock outcrops with
no soil cover, as defined by the mapping program (approximately 2000 samples, to
be submitted for Au + 30 element ICP analysis).

                                                     SCHEDULES

A - Manning Schedule
Cost rate includes salary, benefits, food, W.C.B., accommodation.

1.   Geologist.  At  least 5 years  experience  in  exploration  geology  and in
     diamond drill core logging. University graduate. Responsible for management
     of  surface   exploration,   supervision  of  surface   exploration   crew,
     compilation of data and reporting. Cost @ $450.00/day.

2.   Geological  Assistant (2).  Experienced in surface  exploration,  including
     soil sampling . Responsible for collecting soil samples. Cost @ $300.00/day
     each.

B - Time and Activity Schedule

0 - 25 days         Geological  Assistants complete soil sampling of the grid.
                    ~     20 day break to await geochemical results.

45 - 55 days        Geologist   compiles  data  and  prepares   report,   making
                    recommendations for Phase 3.


                                       92

<PAGE>



C - Cost Schedule

         Personnel                  0-25 days                       $  12,000
                                    45 - 55 days                        3,000
         Consumables                Fuel, field supplies                  450
         Rentals                    Vehicles                            1,400
         Geochemistry               2000 soil samples @ $20.00         40,000
         Contingency (~ 5 %)                                            3,150
                                                                  -----------
         Total:                                                     $  60,000

Underground Exploration and Development              ($300,000)

Paxton  (1994)  makes  specific  recommendations  for a program  of  underground
drifting and raising to test the Upper Skomac vein on the 7 Level which involves
a total of 128 metres of drifting  and 79 metres of raising,  with  accompanying
detailed  mapping and sampling of the vein and wall rock. The northern branch of
the 7 Level drift would be extended for 49 metres to intersect  the  (projected)
mineralized  vein.  At this  point,  a raise  would be driven on the vein for 79
metres to break through to the 6 Level.  Drifting  along the vein on the 7 Level
would also be completed for a further 79 metres to the west.

The technical details needed to carry out this work and a detailed  breakdown as
to expected  costs and  scheduling  for this  proposed  program are described in
detail by Paxton (1994) and the following is taken directly from that report.

         "It is  proposed  that the  north  branch of the  drift be  advanced  a
         minimum of 160 feet at Az. 347o.  If the vein is  encountered,  a short
         stub  cross-cut  can be driven north from the drift into the vein and a
         raise  started.  At the same time the drift can  continue to follow the
         vein westward.  The raise should be driven 260 feet to  breakthrough on
         the 6 Level and the drift  should also be driven a minimum of 260 feet.
         If the vein is not  encountered  in the drift the raise should still be
         driven to check the geology and provide ventilation."

The following  schedules  are based on the  assumption of the vein being located
and the following minimum mining being completed.

         160 feet of track drift to the vein 260 feet of track  drift  following
         the vein on 7 Level 260 feet of raise following the vein to 6 Level

                                                     SCHEDULES

A - Manning Schedule
Cost   rate   includes   salary,   benefits,   food,   W.C.B.,    accommodation,
transportation.

1.   Project Manager (1). At least ten years  experience in mining  supervision.
     Holds valid B.C. Shift Boss Certificate,  blasting, mine rescue, first aide
     certificates.  Responsible  for hiring  and  firing.  Food,  accommodation,
     transportation, explosive hadling, purchasing and rental decisions. Reports
     to company. Cost @ $500.00 per day.

2.   Geologist/Engineer  (1). At least 5 years experience in underground  mining
     geology and diamond drill core logging.  University  graduate.  Responsible
     for surveying,  sampling,  geologic mapping,  record keeping,  guiding mine
     development. Cost @ $400.00 per day.

                                       93

<PAGE>




3.   Mine  Mechanic  (1).  At least 10 years  experience  on  mining  equipment.
     Responsible  for  maintaining  air and water supply,  drills,  compressors,
     pumps, mining machinery, mine lights. Cost @ $350.00 per day.

4.   Office  Manager  (1).  Versatile,  with  knowledge  of  office  procedures.
     Responsible for ordering,  communications,  supply inventories,  first aid,
     accounting, warehouse, payroll. Cost @ $350.00 per day.

5.   Shift Boss (2). Experienced,  versatile and adaptable supervisors. At least
     10 years experience in underground mining. Cost @ $400.00 per day each.

6.   Miners (2).  Experienced,  versatile and adaptable miners. At least 5 years
     experience in underground  mining  including raise work. Cost @ $500.00 per
     day each.

7.   Mine Helpers (2). Energetic, intelligent and compatible. Cost @ $300.00 per
     day each.

B - Time and Activity Schedule

0 - 14 days         Project    Manager   and   Office   Manager    arrange   for
                    accommodation,  vehicles,  rentals, set up files, first aid,
                    explosive magazine, supplies, storage.

14 - 21 days        The  above  are  joined  by  the  Mine   Mechanic   and  the
                    Geologist/Engineer  who respectively check out mine machines
                    and do a check survey of 6 and 7 Levels.

21 - 30 days        The above are joined by 2 miners and one Shift  Boss.  Seven
                    Level is cleaned up. Water supply system is completed.  Pipe
                    and track on No. 7 Level brought up to standard.

30 - 40 days        The above are  joined by 2 mine  helpers  and one more Shift
                    Boss.   Full   crew  on  site  and  160  ft  drift  to  vein
                    intersection  started on two shift  basis.  Completed  in 10
                    days.

40 - 75 days        Drifting  and raising  proceed  together,  each on a 1 shift
                    basis. Completed in 35 days.

75 - 80 days        If results are negative - 5 days to demobilize.

C - Cost Schedule

Costs are based on the author's (Paxton)  personal  experience plus inquiries to
Nelson Machinery and Mr. K. Schindler.

         Personnel         0- 14 days                         $   11,900
                           14 - 21 days                           11,200
                           21 - 30 days                           27,000
                           30 - 40 days                           40,000
                           40 - 75 days                          140,000
                           75 - 80 days                           20,000




                                       94

<PAGE>



         Consumables       Explosives                               5,000
                           Fuel                                     5,000
                           Pipe                                     5,000
                           Rail                                     5,000
                           Ties                                     1,000
                           Drill Steel                              2,000
         Rentals - Vehicles, machines, etc                         10,000
         Assaying - 500 samples @ $10.00                            5,000
         Allowance for Mobilization, Demobilization                10,000
                                                               ----------
         Total:                                                  $298,100

                                            Budget for:          $300,000

Phase 3                    Phase 3 Budget:  $200,000

A Phase 3 program is anticipated to follow-up targets defined by the Phase 1 and
Phase 2  programs.  Phase 3 will be  contingent  on the  results of the  earlier
programs and is expected to include follow-up  geophysics  (possibly SP or Pulse
EM),  plus surface  diamond  drilling and  trenching of veins or other  targets.
Detailed  recommendations for the Phase 3 program will be provided in the report
summarizing the results of the Phase 2 program.

6.0      REFERENCES

BC MEMPR Minister of Mines Annual Reports 1894 p. 755; 1896 p. 577, 582; 1897 p.
576, 587; 1898 p. 306, 1125,  1195; 1900 p. 990; 1901 p. 1057; 1902 p. 180; 1903
p. 170; 1904 p. 213-14,  219; 1905 p. 183; 1910 p. 120; 1913 p. 150-51;  1914 p.
334; 1915 p. 201, 446; 1921 p. 185; 1922 p. 175-76; 1933 p.162; 1934 p.A25, D35;
1937 p. A. 36, D35; 1962 p. A48, 69; 1963 p. A48; 1964 p. A53,  110-11;  1965 p.
167-68;  1969 p. A53; 1975 p. A93; 1976 p. A102,  1975 p. E14; 1978 p. E18; 1979
p. 15.

Church, B.N., 1982.
1977- Geology of the Skomac Mine and Boundary Falls Area (82E/2),  in Geology in
B.C. 1977- 1981, p. 1-12.

Church, B.N., 1986.
Geological Setting and Mineralization in the Mount  Attwood-Phoenix  area of the
Greenwood Mining Camp. BCDM Paper 1986-2.

Church, B.N.,  1997.
Metallogeny  of the  Greenwood  Mining Camp,  for CIM  presentation,  Vancouver,
Spring 1997.

Eibish, 1991.
Lone Star Project, Ferry County, Washington. Unpublished company report and map,
U.W. Borax, Northwest Exploration.

Fyles, J.T., 1990.
Geology of the Greenwood-Grand  Forks Area, British Columbia,  NTS 82E/1,2. B.C.
Geological Survey Branch Open File 1990-25.

Hickey, R.J., 1992.
The  Buckhorn  Mountain  (Crown  Jewel)  Gold Skarn  Deposit,  Okanogan  County,
Washington. Economic Geology v. 87, p. 125 - 141.

                                       95

<PAGE>




Little, H.W., 1983.
Geology of the Greenwood Map area, British Columbia.  GSC paper 79-29.

Minfile 082ESE045 - Skomac; 082ESE171 - Boundary Falls

Paxton, J., 1984.
Report to Silver Hoarde  Resources Inc. on the Robert Mine Property,  Greenwood,
B.C., April 15, 1984.

Paxton, J., 1986.
Report and  Recommendations  Made on the Robert Mines Property,  for Empire Gold
Resources Ltd, 1986. Company Report for Empire Gold Resources.  (incomplete copy
of this report available for review).

Paxton, J., 1987.
Results of the 1987 Work  Program on the Robert Mine  Property,  for Empire Gold
Resources Ltd., May 30, 1987.

Paxton, J., 1994.
Geological Report on the Bow Mines Limited Property (Also known as Robert Mines,
Skomac, Last Chance, May Mac), for 593749 Alberta Ltd., October 1, 1994.

Peatfield, G.R., 1978.
Geologic  History and Metallogeny of the 'Boundary  District',  Southern British
Columbia and Northern Washington. PhD Thesis, Queen's University.

Rasmussen, M., 1993.
The Geology and Origin of the Overlook Gold Deposit,  Ferry County,  Washington.
Ph.D. Thesis, University of Washington.

Schroeter, T.G., C. Lund and G. Carter, 1989.
Gold Production and Reserves in British Columbia.  BC MEMPR Open File 1989-22.

Seraphim, R.H., B.N. Church, and J.T. Shearer, 1995.
The  Lexington - Lone Star  copper-gold  porphyry:  An Early  Jurassic  cratonic
linear  system,   southern  British  Columbia.  In:  Porphyry  Deposits  of  the
Northwestern  Cordillera of North America, CIM Special Volume 46, Edited by T.G.
Schroeter, p. 851 - 854.

Tully, D., 1978.
Report on the Boundary Falls Claim Group, for Amigo Silver Mines Ltd.  September
26, 1978.

Tschauder, R., 1986.
The Golden Promise:  A Recent Discovery in the Republic Mining  District,  Ferry
County,   WA.  Presented  at  the  92nd  Annual  Northwest  Mining   Association
Convention, Spokane, Dec 1986.

                                       96

<PAGE>



                                   APPENDIX 1
                           Statement of Qualifications

I, Linda J. Caron, certify that:

1.   I am an  independent  exploration  geologist  residing at 717 75th Ave (Box
     2493), Grand Forks Creek, B.C.

2.   I obtained a B.A.Sc.  in  Geological  Engineering  (Honors)  in the Mineral
     Exploration Option, from the University of British Columbia (1985).

3.   I graduated with a M.Sc. in Geology and  Geophysics  from the University of
     Calgary (1988).

4.   I have  practised my  profession  since 1987 and have worked in the mineral
     exploration industry since 1980.

5.   I am a  member  in good  standing  with  the  Association  of  Professional
     Engineers and Geoscientists of B.C. with professional engineer status.

6.   I  have  worked  extensively  in  the  Greenwood  area  since  1989.  I was
     contracted  by the  property  owners to prepare  this  report,  based on an
     examination  of the Bow Mines  property  and on a review  of all  available
     data.  I have no direct or  indirect  interest  in the  property  described
     herein.


/s/ Linda Caron
-------------------------
Linda Caron, P. Eng.
                                       97

<PAGE>


© 2022 IncJournal is not affiliated with or endorsed by the U.S. Securities and Exchange Commission