asbury 43-101 final dec 2012

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Technical Report on the Asbury Graphite property, In accordance with National Instrument 43-101,

McGill Township, Quebec, Canada

Submitted to

Canada Carbon Inc.

Rémi Charbonneau

Ph.D., P. Geo #290

Inlandsis Consultants senc

November 7th 2012

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Signature Page and Qualification

I, Rémi Charbonneau, P.Geo., Ph.D., do hereby certify that:

I reside at the 7667 Chateaubriand Street, Montreal, Quebec, Canada H2R 2M2 and I am currently

Associate of Inlandsis Consultants s.e.n.c., located at the same address.

This certificate accompanies the report entitled “Technical Report on the Asbury Graphite Property,

In accordance with National Instrument 43-101, McGill Township, Quebec, Canada” dated, November

7th, 2012.

I received a B.Sc. in Geology from the University of Montreal in 1986 and a Ph.D. degree in Glacial

Geology in 1995 from the same institution. I have been working as a contract geologist in mineral

exploration since 1995. I am an active Professional Geologist presently inscribed to the board of the

Ordre des Géologues du Québec, permit # 290. I am a qualified person with respect to the Asbury

Graphite Property.

Although I was not implied in any exploration program specifically dedicated to graphite during the

past, I still had to describe various graphite occurrences of meta sedimentary and hydrothermal

origin. I recently intersected graphitic sediments while drilling an airborne EM conductor in early

2012 which well explained the geophysical target. I consider these fragmentary experiences with

graphite as sufficient with regard to the Asbury Property which is at an exploration stage since

historical graphite resources were exploited from an open pit production from 1974 to 1988.

I visited the Property on October 23th 2012 to directly observe the geological context and the local

infrastructure.

I am responsible for items 1 to 28 of the present Technical Report on the Asbury Graphite Property.

For that purpose I was assisted by Mr Steven Lauzier for the preparation of Items 2 to 24, 27 and 28

as well as the figures.

I fulfill the requirements set out in section 1.5 of the National Instrument 43-101 for an

« independent qualified person » relative to the issuer.

I have no prior involvement with the Asbury Graphite Property which is the subject of this technical

report.

I read and used National Instrument 43-101 and Form 43-101F1 (April 8, 2011 version) to make the

present report in accordance with its specifications and terminology.

As of the date of this technical report, to the best of my knowledge, information and belief, the

technical report contains all scientific and technical information that is required to be disclosed to

make the technical report not misleading.

November 7th, 2012

<<Remi Charbonneau>>

Rémi Charbonneau

Ph.D. P.Geo, OGQ #290

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Assistant’s curriculum vitae I received a B.Sc. in Geology from the University of Quebec in 2010. I have been working as a

contract geologist in mineral exploration since 2010 being involved in several gold projects, base

metal projects and industrial minerals projects. I am an active Stage Geologist presently inscribed to

the board of the Ordre des Géologues du Québec, permit # 1430. I am not a qualified person with

respect to the Asbury Graphite Property since I’m a stage geologist.

I visited the Property in early May 2012 to take grab samples for a Graphite Express presentation and

another visit at the end of May to show the project to potential buyers while working for Uragold Bay

Resources Inc. Another visit took place at the end of September with Bolero Resources Corp (Bolero

Resources) to take samples for metallurgical testing. I visited the Property on October 23th for a

Property tour to see the general geological aspect of the Property and the local infrastructure.

I assisted the qualified person for items 2 to 24, 27 and 28 of the present Technical Report on the

Asbury Graphite Property under the supervision of the author: Remi Charbonneau.

I have no prior involvement with the Asbury Graphite Property which is the subject of this technical

report.

I read and used National Instrument 43-101 and Form 43-101F1 (April 8, 2011 version) to prepare

the present report in accordance with its specifications and terminology.

<<Steven Lauzier>>

Steven Lauzier,

Stage Geo, OGQ #1430

November, 7th, 2012

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Table of Contents

Signature Page and Qualification ........................................................................................................................................... 2

Assistant’s curriculum vitae ..................................................................................................................................................... 3

Table of Contents ..................................................................................................................................................................... 4

List of Tables : ............................................................................................................................................................................ 5

List of Figures : .......................................................................................................................................................................... 5

List of Appendices : ................................................................................................................................................................. 6

Item 1: Summary ........................................................................................................................................................................... 7

Item 2: Introduction ..................................................................................................................................................................... 8

Item 3: Reliance on Other Experts ......................................................................................................................................... 8

Item 4: Property Description and Location ....................................................................................................................... 8

Item 4.1 Exploration Restrictions ..................................................................................................................................... 9

Item 5: Accessibility, Climate, Local Resources, Infrastructure and Physiography ....................................... 10

Item 6: History .............................................................................................................................................................................. 11

Item 6.1. New York and Honduras Rosario Mining Corporation ...................................................................... 11

6.2 Canastota Mines Ltd ...................................................................................................................................................... 13

6.3 Asbury Carbons Inc, Asbury Graphite Quebec Inc ........................................................................................... 20

Item 7: Geological Setting ........................................................................................................................................................ 29

Item 7.1: Mineralization ...................................................................................................................................................... 29

Item 8: Deposit Types ................................................................................................................................................................ 30

Item 9: Exploration ..................................................................................................................................................................... 30

Item 10: Drilling ........................................................................................................................................................................... 30

Item 11: Sample Preparation, Analyses and Security ................................................................................................. 30

Item 12: Data Verification........................................................................................................................................................ 30

Item 13: Mineral Processing and Metallurgical testing .............................................................................................. 30

Item 14: Mineral Resource Estimates ................................................................................................................................ 31

Item 15: Mineral Reserve Estimates ................................................................................................................................... 31

Item 16: Mining Methods ......................................................................................................................................................... 31

Item 17: Recovery Methods .................................................................................................................................................... 31

Item 18: Project Infrastructure ............................................................................................................................................. 31

Item 19: Market Studies and Contracts ............................................................................................................................. 31

Item 20: Environmental Studies, Permitting and Social or Community ............................................................. 31

Item 21: Capital and Operating Costs ................................................................................................................................. 31

Item 22: Economic Analysis .................................................................................................................................................... 32

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Item 23: Adjacent Properties ................................................................................................................................................. 32

Item 24: Other Relevant Data and Information ............................................................................................................. 32

Item 25: Interpretation and Conclusions .......................................................................................................................... 32

Item 26: Recommendations and Budget ........................................................................................................................... 32

Item 26.1 Budget .................................................................................................................................................................... 34

Item 27: References .................................................................................................................................................................... 35

Item 28: Figures ........................................................................................................................................................................... 37

Appendice 1 – Pictures of the infrastructures on the property .............................................................................. 41

List of Tables :

Table 1. Claims location……………………………………………………………….……………………………….………….…….9

Table 2. 1956 DDH program by New York and Honduras Rosario Mining Corporation…....……………..12

Table 3. 1966 DDH program by Canastota Mines Inc……………………………..….…………….……………………..14

Table 4. Tonnage and grade, pre 43-101………………..……………………………...……………….……………………..15

Table 5. 1967 DDH program by Canastota Mines Inc……………………….………………...…..……………………...16

Table 6. 1968 DDH program by Canastota Mines Inc…………………………………….….…..…………….………….18

Table 7. 1968 Tonnage and grade, pre 43-101…..…………………………………………….….…………….…………..19

Table 8. 1970 Tonnage and grade, pre 43-101…..…………………………………….………….…………….…………..20

Table 9. 1974 DDH program by Asbury Graphex…………………………………….…………….………….…………...22

Table 10. 1980 DDH program by Asbury Graphex……………………………………….….…..…………….…………..24

Table 11. 1983 DDH program by Asbury Carbons…………………………………………….…………….…................26

Table 12. Geophysical compilation and survey budget………………………….…………….…………………………34

Table 13. Drilling budget……………………………..……………………………….…………….…………….…………………..35

List of Figures :

Figure 1. Asbury Graphite Property Location………………………………….………………….……………...................37

Figure 2. Claims on the Property…………………………………………….…………….……………..……..………………...38

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Figure 3. Exploration Restrictions on the Property……………………………..….…………….……………..……..….39

Figure 4. Past exploration on the property and other features of the property………..…...………………..40

List of Appendices :

Appendix I. Pictures of the infrastructure present on the property……...…………….………………………….41

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Item 1: Summary This report describes the exploration potential related to the Asbury Graphite Property of Canada

Carbon Inc. The data is mostly obtained from historical assessment exploration reports. This report

is prepared to support the qualified transaction by which Canada Carbon Inc acquires the Asbury

Graphite Property.

The property is made up of 2 claims for a total of 119 ha. It is located 8.1km northeast of Notre-

Dame-Du-Laus in the Laurentides Region of southern Quebec. The northern part of the property is

subjected to a restriction with regard to wildlife habitat while the southeastern quarter is affected by

recent law 14, being classified as recreational use by the municipality of Notre-Dame-du-Laus.

Historical exploration by various companies and subsequent resource evaluations lead to an

historical production by Asbury Graphex form 1974 to 1988. Open pit mining allowed the extraction

of 875 000 metric tons of graphite ore at a cut off grade of 6%, on the current property. After closing,

the processing plant of Asbury was leased to Stratmin Graphite Inc.

Historical geophysics (EM) reveals large conductive bodies that are entirely or partly hosted on the

current property, some of which having been confirmed as graphitic rock units by drilling. These

include a part of an EM anomaly historically delineated by Les Mines de Manganèse du Québec Inc.

and two large conductive zones revealed by an EM survey in 1982 on the southern half of the

property. A drilling campaign carried out by Asbury Graphex in 1980 confirmed that some of these

conductors contained graphitic rocks. Thus the graphite potential resides on these EM conductors

axes that are present on the Asbury Property.

It is recommended that an extensive compilation of available data be performed, and that the

conductive anomaly will be confirmed by an electromagnetic survey. The survey’s objectives would

to better define the known anomalies and to detect new anomalies on the property. The integration

of past geophysical reviews with new data will enable the identification of drill targets. The total

budget for this phase is of $12,640 CAN.

A subsequent drilling phase of 12 drill holes totalling 1220m will test the resulting electromagnetic

targets and evaluate the mineralization. The total budget planned for this phase is $240,000 CAN.

Both phases could be carried at any time during the year.

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Item 2: Introduction Canada Carbon Inc. is a Canadian registered company listed on the TSX Venture Exchange under CCB

ticker and Frankfurt Stock Exchange (FSE) under U7N1 ticker. This company was formerly Bolero

Resources Corp before October 5th 2012 trading on the TSX Venture Exchange under BRU. The

present report is prepared in compliance with the National Instrument 43-101 Policy guidelines to

be used for a qualified transaction whereby the issuer (Canada Carbon) will acquire the property

from Uragold Bay Resources Inc.

Historical data presented in this report were obtained from the “EXAMINE” database of the Québec

Ministère des Ressources Naturelles et de la Faune, except otherwise specified. Some information is

from the Notre-Dame-Du-Laus municipality or personal communication with Mr.Stephen A. Riddle of

Asbury Carbons.

Steven Lauzier first visited the property in early May 2012 during which grab samples were collected

for a presentation to Graphite Express. A second visit was made at the end of May to show the

project to potential buyers while working for Uragold Bay Resources Inc. Another visit took place at

the end of September with Bolero Resources Corp (Bolero Resources) to collect samples for

metallurgical testing. Finally, both authors visited the property on October 23rd, 2012 for the

purpose of preparing the present technical report.

Item 3: Reliance on Other Experts Most historical data are based on assessment files maintained by the Ministère des Ressources

Naturelles et Faune (MRNF). Although the authors of these past exploration reports and maps have

made every possible attempt to accurately present the contained information, the present author

cannot guarantee their accuracy, validity or completeness. Though the authors of these files might

not all be qualified persons, according to actual National Policy 43-101, they are considered by the

authors of this current report to have reported results in good faith and in accordance with the rules

of the profession prevailing at that time. Land tenure information on mining claims was obtained

from the GESTIM web site maintained by the MRNF and accessed on October 21st, 2012.

Item 4: Property Description and Location The Asbury Graphite Property is located in southern Québec, 8.1 km NE of Notre-Dame-Du-Laus

(Figure 1). The area is depicted on the NTS map sheet 31J04 at 1:50 000 scale. The property is made

up of 2 claims with a total surface 119.19ha (Table 1) of regular shape (Figure 2). Bolero Resources

(now Canada Carbon) optioned these claims from Uragold Bay Resources (Uragold) for an initial

contribution of $30,000 CDN to Uragold and a second cash payment of $70,000 CDN within thirty

days of the signed term sheet. Upon closing of the transaction Bolero will make a further payment of

$200,000 CDN and pay a yearly royalty of 0.75% on the net production cost for a period of 10 years

after the start of production. The first two cash payments of $30,000 CDN and $70,000 CDN were

paid and the amount of $200,000 CDN is still left to pay to complete the acquisition. Uragold

acquired these claims from a prospector company, 9228-6202 Quebec Inc, in 2012. The property lay

on public and private land. Land underlying the infrastructure on part of Lot 19 of Range 5 is private

and is owned by the municipality of Notre-Dame-du-Laus. Lots 15 and 16 of Range 6 are private land

owned by Michel Lavoie as well as Lots 17 and 18 of Range 6 which are owned by Nicole Levert. The

remaining portion of land covered by the property resides on public land.

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The past mine has been restored by the ministry of natural resources in 2000 and is now considered

a restored mine site. The site is now in a follow up and maintenance stage by the ministry of natural

resources (Ministry of natural resources, 2012). No environmental liabilities is applicable to claim

holders if he’s not responsible for the mining activity. Future land acquisition for mining purpose

should verify the impact on the Company’s environmental liabilities.

The proposed geophysical program will require permission from the municipality of Notre-Dame-

Du-Laus because of a recreational zone mining restriction presented below under item 4.1, for works

done in the restricted area. This area cover electromagnetic anomaly K presented below in the

document under item 6. The proposed drilling program could also require permission from the

municipality of Notre-Dame-Du-Laus if drilling has to occur over the restricted area. Any work in

this area of the property would also require the permission from private land owners. Over most of

the property, drilling would also require the authorisation by the Ministry of Natural Resources for

drilling carried over the Virginia deer restriction presented in detail under item 4.1.

There are no other known significant factors and risks besides noted in the technical report that may

affect access, title, or the right or ability to perform the recommended exploration program.

Table 1. Claim List

Claim number Ownership Expiry date Area (ha)

CDC2315749 100% Uragold Bay Resources inc. 2013/10/04 59.59

CDC2315748 100% Uragold Bay Resources inc. 2013/10/04 59.60

Item 4.1 Exploration Restrictions

Two categories of restrictions on exploration activity affect the property, as depicted on Figure 3. The

first exploration restriction overlaps approximately 50% of the south claim CDC2315748 on its

eastern portion and a small portion of claim CDC2315749 (<5%). The restriction concerns the

decision of the municipality of Notre-Dame-Du-Laus to dedicate a specific area to recreational use.

This restriction is part of Law Project #14 that was retroactively applied by the Quebec government

before its adoption. Under the restriction, exploration is prohibited unless permission is given by the

local municipality. The municipality can also request a modification of the recreational use status for

these lands (Ministry of Natural Resources, 2012). Long term permission should be requested to the

municipality of Notre-Dame-Du-Laus since the current administration seems favorable to exploration

and mining activities on the Asbury property.

The second restriction identified as #16616 corresponds to a protection zone for Virginia deer or

white-tailed deer (Odocoileus virginianus) and was established by statutory order 905-93. This

restriction covers about 60% of the northern claim CDC2315749 and 80% of the southern claim

CDC2315748. Under this restriction, the activities that can modify a biological, physical or chemical

element corresponding to the wildlife habitat are forbidden unless there is an exception. The

restriction does not concern private lands and is only applicable to public land. Half of the southern

claim is private land and the private land geography corresponds to the restriction of dedicated

vacationing area. The Virginia deer restriction does not apply to geological, geochemical and

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geophysical works carried out for mining exploration (except for of seismic geophysical methods).

For the Virginia deer restriction, procedures must be followed before drilling, stripping, trenching,

excavating or road construction: (1) a written letter which describes the planned work must be sent

to the Ministry of Natural Resources and Wildlife, (2) the activity must take place between May 1st

and December 1st, (3) the working zone must be limited to 5ha and a distance of 100m is required for

trenching, stripping, excavating and drilling, (4) the total of the working zone in restricted forest

area should not exceed 2% and (5) trenching and excavation must be backfilled once activity is

completed. (Ministry of Natural Resources, 2012).

The authors believe that this restriction is not a major concern since the rules are clear and that part

of the property is on private land that is not affected by the restriction. The pit zone and the

infrastructure are not subjected to any of these restrictions.

Item 5: Accessibility, Climate, Local Resources,

Infrastructure and Physiography Access to the property is easy due to its location in developed areas of southern Quebec. From the

nearby village of Notre-Dame-Du-Laus, the Chemin du Serpent road passes south of the property.

From this point, the Chemin de la Mine, a four wheel track trail allows access to the north part of the

property, up to the mine site and to the associated infrastructure. During winter, the access of this

four wheel road is conditional to the removal of the snow by a private contractor.

The Laurentides region is characterized by a humid continental climate. Access to the property for

sampling was done during the spring and summer on sunny days. The proposed work program can

be done through all year, except for drilling which must occur between May 1st and December 1st for

restriction purpose presented under item 4.1. Other exploration work can occur all year round

except for specific exploration activities specified under item 4.1 for the Virginia deer restriction

which must be performed between May 1st and December 1st.

Local resources are available at the nearby cities of Notre-Dame-Du-Laus, Buckingham and Mont-

Laurier, located respectively at 11km, 85km and 74km along good road from the Property. The

elevation on the property ranges between 259 and 320m above sea level.

An open pit is present on the Property. The remains of the past mining plant are still present and

include the structural components of a concentrator plant, two desk office and a workshop (Bray,

1974). A large parking area is available and tailings are also present. Photographs showing the

infrastructure are provided in Appendix 1. Surface rights are not necessary at this exploration stage

of the property. However, authorization by the owner is necessary to access and to execute work on

private lands.

Water is abundant both from springs on the property and from the tributary to the Serpent River.

This tributary flows within about 30m of the main graphite zone (Labrèque, 1980). Power,

transportation and housing are available nearby and a local work force should be suitable to support

a mining operation. The nearest railroad station is at Buckingham, some 85km south of the property.

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Item 6: History

In 1954, Steel and Graphite Company initiated some exploration work on the property with stripping

and drilling of 6 or 7 holes which revealed the presence of graphite mineralization (Archibald,

1970). No reliable records of this work are available. Most of the stripping was done between 1954

and 1956 and allowed the exposure of mineralization over important widths. Trenching was used to

reveal lithological contacts but diamond drilling proved to be a more efficient method for this

purpose (Bergmann, 1969). Aubert De La Rüe also mapped the geology of the McGill Township in

1956. Most of his observations are presented under section 7.

Item 6.1. New York and Honduras Rosario Mining Corporation

In 1956, the property was taken over by New York and Honduras Rosario Mining Corporation. The

company carried out stripping and diamond drilling. This initial program was confined to the

known graphite bearing zones to delineate the zones and block out tonnage (Bergmann, 1969).

Although Bergmann (1969) reports that 11 diamond drill holes were sunk, only 10 holes are

described in the documents. The most interesting results are 19.8% C over 5.64m in hole 4, 18.5% C

over 2.59m in hole 6-A and 13% C over 2.50m in hole 7. Table 2 summarizes the drill hole

characteristics and results.

Metallurgical tests were carried out by Denver Equipment Company of Denver, Colorado. The tested

material was a 907kg (2,000lb) sample with a head assay of 12% carbon. This work was successful

in producing concentrate averaging 83.97% carbon with a recovery of 82.3%. Concentrates were

sent to potential buyers and it was concluded that the concentrate would meet the required quality

(Bergmann, 1969).

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Table 2. 1956 (New York and Honduras Rosario Mining Corporation) Diamond Drill holes borehole characteristics.

Hole Easting*

(m)

Northing *

(m)

Depth

(m)

Direction/plungee Best results : Carbon Content (%) / length

(metres)

Location

2 457262 5110088 n/a N135/45

Pit Area

3 457299 5110081 n/a N135/45 13.2/2.4

4 457299 5110110 n/a N360/90 19.8/2.6

5 457342 5110124 n/a N113/45 13.3/0.5 ; 13.8/1.3 and 7.2/1.2

6 457320 5110234 n/a N360/90 17/0.5

6-A 457319 5110232 n/a N090/50 18.5/2.6

7 457327 5110158 n/a N125/45 13/2.5 ; 13.2/1.4

8 457316 5110202 n/a N125/25

9 457303 5110107 n/a N125/25

10 457301 5110217 n/a N135/45

*coordinates are Universal Transverse Mercator, zone 18, North American Datum 1983.

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6.2 Canastota Mines Ltd

In 1965, the claims were optioned to Canastota Copper Mines Inc. and a road was built on the

property. A drilling program was executed on the property in 1966. This program was confined to

the known graphite-bearing zones to delineate the zones and block out tonnage. Eleven (11)

diamond drill holes named C-1 to C-11 were sunk (Bergmann, 1969). Only 9 holes can be found in

the ministry’s document. The most interesting results were 22.3% C over 2.1m in hole C-4 and

20.9% C over 2.29m in hole C-5 (Lacombe, 1967). Holes C-1, C-2, C-3, C-4 and C-5 contained graphite

and were drilled in the pit area. Holes C-6, C-7, C-9 and C-11 contain no graphite and are also in the

pit area. Drill hole characteristics and results are summarized in Table 3.

A self-potential survey was carried out between July and August 1967 on a new cut line grid

(Lacombe, 1967). The objective was to find extensions to the known graphite zones and to find new

potential zones in the vicinity. Three potential graphite zones were located by correlating known

zones with geophysics (Bergmann, 1969). The zones were named 1, 2 and 3 (Lacombe, 1967). Zone

1 is over the actual mine pit. It was suggested to place five drill holes over Zone 1 and two over Zone

2. No drill hole was planned for Zone 3.

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Table 3. 1966 (Canastota Copper Mines Inc.) Diamond Drill holes borehole characteristics.

Hole Easting*

(m)

Northing *

(m)

Depth

(m)


(metres)

Location

C-1 457339 5110117 15.5 N138/45 23.1/0.8

Pit area

C-2 457361 5110105 18.6 N099/60 23.6/1

C-3 457341 5110104 20.4 N245/45 22.9/1

C-4 457358 5110081 23.2 N262/50 22.3/2.1

C-5 457338 5110101 14 N235/45 20.9/2.3

C-6 457352 5110065 24.7 N239/50

C-8 457355 5110195 6.4 N071/50

C-9 457326 5110338 15.2 N093/50

C-11 457301 5110275 14.9 N102/45


15

A drilling program followed the self-potential survey in 1967 and provided considerable additional

information for tonnage calculations on the known zones. It also tested one additional self-potential

zone but results were inconclusive. Bergmann (1969) and Archibald (1970) reported that 11

diamond drill holes were sunk on the property but the self-potential study Lacombe (1967) shows

that only 5 holes identified CC-12 to CC-16 were placed over anomalies. No analytical results were

reported and only these five holes are available for examination. Drill holes CC-12 to CC-16 were

placed on the self potential anomaly zone 1 (Lacombe, 1967). Graphite formations are reported in

the logs of holes CC-12, CC-13, CC-14 and CC-16 which are all on the mine pit area (Lacombe, 1967).

Drill holes characteristics and results are summarized in Table 5.

A tonnage and grade calculation (pre NI 43-101) was then made with the available information using

both horizontal and vertical sections through the ore zones. These were estimated to a depth of only

34m which refer to ore available for open pit operation only. A 12.5ft3 Tonnage Factor was used and

only minor extensions beyond drill intersections (Bergmann, 1969). The used classification is not

corresponding with mineral resources or mineral reserves. According to the pre-NI 43-101

classification of Bergmann (1969) the reasonably assured ore is referred to ore between drill

intersections while probable ore correspond to normal extensions beyond the drill intersections

(9.1m below and 7.6 to 12.2m horizontally).

The author believe the historical estimate is reliable since it correspond with other estimates

presented under Item 6 of the present report and is coherent with the historic drill program

intersections used for the calculations. The tonnage presented below is part of the historical

production by Asbury Carbons between 1974 and 1988 and no work could reproduce the historical

estimate. The qualified person has not done sufficient work to classify the historical estimate as

current mineral resources or mineral reserves. The issuer is not treating these historical estimates

as current mineral resources or mineral reserves.

Table 4. Tonnage and grade calculation estimate, February 1968 (Pre NI 43-101)

Classification Tons Grade (% graphite)

Reasonably Assured Ore 154,560 13.92

117,545 5.3

Total : 272,105 10.1

Probable Ore 46,500 14.05

22,000 5.3

Total : 68,500 11.2

Total, Reasonably assured and

Probable ore :

340,605 10.33

16


Hole Easting*

(m)

Northing *

(m)

Depth

(m)

Direction/plungee Results Target Location

CC-12 457310 5110091 61 N130/45 Graphite formations Self potential anomaly

zone 1

Pit Area

CC-13 457298 5110191 61 N095/45 Graphite formations

Self potential anomaly

zone 1

CC-14 457362 5110258 30.5 N057/45 Graphite formations

CC-15 457401 5110243 61 N080/50

CC-16 457416 5110295 30.5 N095/45 Graphite formations


17

A metallurgical test was made by the Quebec Department of Natural Resources at their pilot plant in

April 1967. The purpose of the test was to produce an 85%C concentrate with a maximum recovery

while preserving the original flake size over 48 mesh. Four samples (4,510lb at 23.24% C ; 14,724lb

at 13.78% C ; 468lb and 17,000lb at 14.81% C graphite) were sent for concentration tests which

resulted in 85% graphite and above concentration grade. There was still high carbon content in the

tailings and additional regrinding and flotation would be required to lower the carbon content of the

tailings (Castonguay, 1967).

A final drilling program was carried out by Canastota Copper Mines Ltd in September and October

1968 for further information on the deposit and accurate tonnage calculations. Canadian Bechtel Ltd

supervised the program and then calculated the tonnage and grade (Bergmann, 1969). Twelve (12)

holes identified as CC-18 to CC-34 were drilled and were all located in the pit area. Best results

returned 21.4% graphite over 0.8m and 15.9% graphite over 0.98m (McKeon, 1968). Drill hole

characteristics and results are summarized in Table 6.

18


Hole Easting*

(m)

Northing *

(m)

Depth

(m)


(metres)

Location

CC-18 457286 5110074 59.4 N128/45

Pit area

CC-24 457257 5110115 84.3 N096/46 18.8/0.6

CC-25 457272 5110128 87.7 N096/45 18.4/0.7

CC-26 457270 5110166 89.3 N096/44 15.9/1

CC-27 457320 5110130 45.7 N096/45 12.6/1.1

CC-28 457296 5110105 45.4 N096/46 21.4/0.9

CC-29 457303 5110200 23.5 N029/41

CC-30 457303 5110199 44.5 N029/63

CC-31 457327 5110160 45.7 N096/44 12.7/0.9

CC-32 457305 5110134 50.9 N096/47 14.8/0.7

CC-33 457355 5110201 13.6 N199/46

CC-34 457356 5110202 17.5 N199/76


19

A topographic survey was also carried out along with a new tonnage and grade estimate by Canadian

Bechtel Ltd in 1968. The calculations were made using both horizontal and vertical sections through

the ore zones and are only for a depth of 38.1m and refer to ore available for an open pit operation. A

Tonnage Factor of 12.5ft3 was used and only minor extensions beyond drill intersections. The results

of the estimate are presented in Table 7 (Bergmann, 1969). Extractable ore refers to all ore between

drill holes with normal extensions of 7.92m beyond drill intersections. No vein material or horses

were included in the extractable ore (Bergmann, 1969).

The used classification is not corresponding with mineral resources or mineral reserves. The author

believe the historical estimate is reliable since it correspond with other estimates presented under

Item 6 of the present report and is coherent with the historic drill program intersections used for the

calculations. This tonnage is parts of the historical production by Asbury Carbons between 1974 and

1988 and no work could reproduce the historical estimate. A qualified person has not done sufficient

work to classify the historical estimate as current mineral resources or mineral reserves. The issuer

is not treating the historical estimate as current mineral resources or mineral reserves.

Table 7. Tonnage and grade calculation estimate, November 1968 (Pre NI 43-101)

Classification Tons Grade (%)

Extractable ore 358,790 12.66

126,390 5.35

Total : 485,180 10.75

Bergmann reports in 1969 that the ore has a true width in excess of 30.49m and thus ore to a depth

of 38.1m can be extracted by open mining. The waste to ore ratio would be 1.56:1. He also reports

that the ore is still open at depth and there are other potential zones indicated by the self-potential

survey which have not been tested yet.

Canastota Mines Ltd also carried out a market study in Canada and the United States. After the

market study, it was planned that the company would sell a bulk dry concentrate F.O.B. the mine site

and the buyer would handle all screening and marketing. On the basis of 125 tons per day, the mine

would have a minimum life of 17.3 years with an operating profit of $90,000 to $180,000 annually

(Bergmann, 1969).

Archibald was contracted in January 1970 to make a study of the potential and economics of the

deposit. The tonnage and grade were re-estimated and cost calculations were made. The study

concluded that over the life of the open pit, an average gross profit of $146,685 per year can be

realized before amortization, interest and taxes. The life of the open pit would be of 9.6 years with a

production of 3,500 tons of concentrate per year. The tonnage and grade calculation is shown in

Table 8. These calculations were made prior to the NI 43-101 and the used classification is not

corresponding with mineral resources or mineral reserves. No explanation is given to describe the

ore categories used (probable and possible ore). The author believe the historical estimate is reliable

since it correspond with other estimates presented under Item 6 of the present report and is

coherent with the historic drill program intersections used for the calculations. The tonnage

20

presented is part of the production by Asbury Carbons between 1974 and 1988 and no work could

reproduce the historical estimate. A qualified person has not done sufficient work to classify the

historical estimate as current mineral resources or mineral reserves. The issuer is not treating the

historical estimate as current mineral resources or mineral reserves.

A waste to ore ratio of 1:1.77 is also calculated (Archibald,1970). Sections and plans of the deposit

were also made. The sections frequently show the mineralization continuing under the proposed

open pit mine. Archibald also suggests mine plant installation for open pit mine entry, the mill

location and a tailings disposal. For operations below the open pit an inclined shaft is recommended

with trackless mining.

Table 8. Tonnage and grade calculation estimate, January 1970 (Pre NI 43-101)

Classification Tons Grade (%)

Probable ore 269,228 13.12

Probable low grade ore 71,559 5.46

Possible ore 43,782 12.22

Possible low grade ore 3,384 7.63

Total : 387,953 11.56

Overburden is 77,633 cubic yards

Waste rock in pit area 440,264 tons

6.3 Asbury Carbons Inc, Asbury Graphite Quebec Inc

A discussion in October 2012 with Stephen A. Riddle of Asbury Carbons revealed more history about

the property. Mr. Riddle is the president of Asbury Carbons since the 1990’s. No verification was

made about the details of the communication. Between 1974 and 1980, Asbury Carbons contracted a

loan for development of the mine and the construction of the graphite processing factory. The

financing stopped in 1975 and Asbury was granted 100% ownership around 1980 of the property

since the buildings and mines was used as collateral on the loan.

A feasibility study on the mining operation was done in April 1974. This study included a new

tonnage and grade calculation to a depth of 68.58m and calculated 578,021 tons averaging 10.04%

carbon with no discontinuity at depth and a potential higher tonnage. A production rate of 100,000

tons of ore per year would allow a minimum mine life of over 5.5 years. To a depth of 45.72m, the

tonnage is calculated at 314,074 tons averaging 9.79% carbon. These calculations were made prior

to the NI 43-101 and the used classification is not corresponding with mineral resources or mineral

reserves. No explanation is given to describe the ore categories used. The author believe the

21

historical estimates are reliable since it correspond with other estimates presented under Item 6 of

the present report and is coherent with the historic drill program intersections used for the

calculations. The tonnages presented are part of the production by Asbury Carbons between 1974

and 1988 and no work could reproduce the historical estimate. A qualified person has not done

sufficient work to classify the historical estimate as current mineral resources or mineral reserves.

The issuer is not treating the historical estimate as current mineral resources or mineral reserves.

An open pit operation would mine the first 45.72m while the ore left in the pit walls and below the

pit floor would be mined from stopes opened from the open-pit. The operating profit before

depreciation, taxes and interests is calculated at $11.27 per ton of ore treated in the mill for the first

five years of operation. The planned waste to ore ratio is 1.31:1 (Baril and Bechard, 1974).

Another phase of drilling was carried out in May 1974 by Asbury Graphex. The program consisted of

5 holes (G-1 to G-5) in the pit area. Interesting results are 11.3% carbon total over 5.4m and 17.2%

carbon total over 3m. Hole G-6 was placed over a conductor axis west of the deposit (Bray, 1974).

Table 9 shows the drill hole characteristics and results.

Through 1974, Asbury Graphex did 30,600 cubic metres of stripping and 10,000 to 15,000 tons of

waste rock removal (Lamarche, 1975). Mining lease BM662 was released to Asbury Carbon Inc on

the 12th of December 1974. This mining lease was valid until December 12th, 2000 (Ministry of

Natural Resources, 2012). No reports about the mining operations are found. Today, an open pit is

present over the known deposit. A discussion with Stephen A. Riddle provides some facts about the

operation, which were not verified. The cut off rate is reported to be about 6%. It is assumed that

70,000 metric tons of graphite concentrate was produced during the 9 to 10 years of production,

with a total mined ore of about 875,000 metric tons and a total mine production estimated to

2,625,000 metric tons.

22

Table 9. 1974 (Asbury Graphex) Diamond Drill holes borehole characteristics.

Hole Easting*

(m)

Northing *

(m)

Depth

(m)

Direction/plungee Best results : Carbon tot (%) / length (metres) Location

G-1 457360 5110215 20.6 N090/45 9.3/2.1 Pit area

G-2 457358 5110215 15.4 N360/90 11.2/2.3

G-3 457344 5110143 26 N090/45 11.3/5.4

G-4 457328 5110145 35.7 N360/90 17.2/3

G-5 457323 5110228 31.4 N090/45 9.4/2.9

G-6 457097 5110210 31.3 N360/90 Conductor axis west

of deposit


23

Asbury Carbons Inc. acquired the adjacent claims on an unknown date after August 1979 and kept

them until July 1997.

In September 1980, P.Labrecque, working for Les Mines de Manganèse du Québec Inc, presented a

petrographic study of the various lithologies around the property since Mines de Manganèse was the

neighbour of the producing mine at the time. The information he provided is reported in Section 7. A

small EM survey was carried out on the northern limit of the property over 4 E-W lines, designated

from south to north as A, B, C and D. Line A and B are partially, in their central part, on the property.

Line A resulted in two interesting cross-overs while line B had only weak anomalies.

Asbury Carbons Inc performed an exploration drilling program between June and July 1980. The

contractor was Forage Moderne and a total of 466m over 13 holes (identified MG-08 to MG-19) were

drilled in the pit area. Table 10 summarizes the drill holes characteristics and results (Rancourt,

1980). Best intersections are 11.29% C over 7.32m, 10.26% C over 10.36m, 6.81% C over 18.29m,

8.14% C over 17.07m, 11.6% C over 11.43m and 9.57% C over 4.88m.

24

Table 10. 1980 (Asbury Carbons) Diamond Drill holes borehole characteristics.

Hole Easting*

(m)

Northing

* (m)

Depth

(m)

Direction/plungee Average of results : Carbon Content (%) /

length (metres)

Location

MG-08 457337 5110164 15.2 N095/45 11.29/7.3

Pit area

MG-09 457325 5110163 30.5 N095/45 10.26/10.4

MG-10 457351 5110202 25.3 N095/45 11.6/11.4

MG-11 457332 5110205 32.3 N095/45 3.34/31.1

MG-12 457361 5110212 23.8 N095/45 2.08/21.8

MG-13 457339 5110249 30.5 N095/45 3.62/29 Including

8.78/4.4

MG-14B 457291 5110258 25.9 N095/45 7.13/15.2 Including 10.73/7.7

MG-14 457291 5110258 6.1 N095/45

MG-15 457336 5110266 28 N095/45 6.81/18.3 Including 11.58/4 and 16.39/1.2

MG-16 457306 5110269 23.6 N095/45 8.14/17.1 Including 13.94/6.1

MG-17 457308 5110199 43.3 N095/45 7.62/5.9 and 6.3/11

MG-18 457274 5110119 94.5 N095/45 1.73/6.1

MG-19 457274 5110118 86.9 N135/25 9.57/4.9


25

H. Ferderber Geophysics LTD carried an electromagnetic survey on the property of Asbury Graphite

Quebec Inc in late October 1982. The survey consisted of a horizontal-loop electromagnetic (HLEM)

survey and was intended to trace the known graphitic zones onto newly acquired claims. The survey

was in the immediate surroundings of the mine pit and extended 2.3km to the northwest of the

current property and 1.2km south of the property over pre-cut lines at 122m (400ft) intervals. The

equipment used was a Geonics EM-17 horizontal loop unit and readings were taken at 30.5m (100ft)

intervals at a frequency of 1600 Hz. The coil separation used was 92m (300ft) (Ross, 1982).

Several conductive zones were outlined that strike north-south which conforms generally to the

bedding of the sedimentary rocks (Figure 4). The conductive zones were designated A to N (Ross,

1982)

Anomalies B and C are entirely included on the property whereas anomaly A has only its

southernmost tip (110m) outside from the property limit (Figure 4). Anomaly B is 530m long and

35m wide and is located 280m southwest of the mine pit. Anomaly C is 230m long and 10m wide and

is in the mine pit, with 95m of the anomaly extending north of the pit zone. Anomaly A is 825m long

and 30m wide and is on the western part of the property, 650m southwest of the mine pit. 100m of

anomaly extend outside of the property to the south. Anomalies D, E and K are close to the property

but their extensions seem to go in the direction opposed to the property. 50m of anomaly K is at the

southeast part of the property. Four less important conductor axes are present on the property

northwest of the mine pit.

Asbury Graphite Quebec Inc did an exploration drilling program between November and December

1983. The contractor was Modern Drilling and a total of 914m over 12 holes (Named M-21 to M-32)

were drilled. The drill holes were placed on various lines of a grid used for geophysics in 1982 and

tested part of the various electromagnetic anomalies reported by Ross in 1982 on the claims. Table

11 summarizes the drill holes characteristics and results (Rancourt, 1983).

26

Table 11. 1983 (Asbury Carbons) Diamond Drill holes borehole characteristics.

Hole Easting*

(m)

Northing *

(m)

Depth

(m)

Direction/plungee Target Best results : Carbon Content (%) / length

(metres)

Location

M-20 458173 5111211 137.2 N100/45 Anomaly J 0.87/4.9 700m NW out of the

property M-21 458026 5111225 137.2 N100/45 Anomaly I 4.99/2.1

M-22 458036 5111143 137.2 N100/45 Anomaly I 1.40/11

1.65/5.5

3.36/1.8

M-23 458169 5111207 30.5 N100/45 Anomaly J 2.06/2.7

M-24 457422 5111845 121.9 N280/45 Anomaly E 5.95/2

10.98/0.6

On the north limit of

property

M-25 457088 5111655 152.4 N190/45 Anomaly B 2.30/40.5 Including

4.03/11.7

On the south claim,

600m SouthWest of

pit

M-26 457295 5111255 45.7 N095/45 Pit drilling 4,52/45.1 Including 9.75/4.7, 3.65/14.5 and

7.10/9.8

On the pit area,

numbered from North

to South. M-27 457289 5111240 51.8 N095/45 9.56/46.2 Including 12.17/14.3 and

12.63/15.5

M-28 457323 5111236 21.3 N095/45 3.44/18.4 Including 10.11/7.3

M-29 457328 5111221 21.6 N095/45 7.2/19.4 Including 11.1/3.7

27

M-30 457284 5111208 15.2 N095/45 8.68/13.6 Including 15.1/1.5 and 13.57/6.4

M-31 457323 5111204 22.9 N095/45 1.68/8.7 and 7.01/12.6 Including 7.68/10.1

M-32 457325 5111175 19.8 N095/45 2.29/5.2 and 4.81/10.5 Including 6.65/4.9


28

Holes identified M-21 to M-23 tested anomaly J and I located 700m northwest outside of the

property. Interesting results include 0.87% C over 4.89m and 1.65% C over 5.49m on anomaly J and

4.99% C over 2.13m and 1.4% C over 10.97m on anomaly I. M-24 and M-25 are on the property and

respectively tested anomaly E 500 m north of the pit, at the claim limit of the property, and anomaly

B 700m southwest of the mine pit inside the property. M-24 returned 5.95% C over 1.98m including

10.98% C over 0.6m. M-25 returned 2.30% C over 40.5m including 4.03% C over 11.7m (R.C., 1983)

Drill holes M-26 to M-32 are located in the mine pit from north to south. Best intersections are

9.56% C over 46.2m including 12.63% C over 15.5m and 12.17% C over 14.3m in hole M-27, 7.2% C

over 19.3m in hole M-29 and 8.68 % C over 13.5m in hole M-30. (R.C., 1983)

Stephen A. Riddle reported in a discussion the following information which was not verified by the

present authors. The Asbury mine was closed in 1988. A 5 year lease of the processing plant with

the Lac Des Iles graphite deposit owners was signed and the past owner operated the flotation plant

and built a new tailings pond. Once Stratmin completed the construction of their flotation plant, the

Asbury plant was finally closed down. Asbury Carbons sold all the equipment and subsequently sold

the plant site to the local town.

After 1988, no other work is reported on the property. Adjacent claims went through more

geophysical work and this is reviewed in item 23. Figure 4 shows the historic work location of

drilling, geophysics and geology.

29

Item 7: Geological Setting The studied area belongs to the Grenville Province which is of Precambrian age. It was geologically

mapped by E.Aubert de la Rüe in 1947 at a scale of 1:63,360 (Ross, 1982). These various lithological

units went through different degrees of metamorphism and underwent many granitisation

processes. Later, the Grenville rock suites were intruded by different intrusions ranging in from

diorite to granodiorite compositions. The Grenville rock suites include migmatites, crystalline

limestones, paragneiss, amphibolites and pyroxenites. Precambrian intrusions consist of diabase,

aplitic pink granite, granite and granodiorite gneisses. Other intrusions contain hyperstene and are

made of granites, granodiorites, monsonites, syenites, diorites, anorthosites and gabbros (Leduc,

1988). This unit is met at the extreme northwest of the property. Quaternary geology consists of

diamict, gravel, sand, silt and clay of glacial, glacio-fluvial or glacio-lacustrine origin (Leduc, 1988).

In the east portion of the property, a member of the Grenville suite is composed of crystalline

limestone, quartzite and paragneiss. On most of the property, a band of graphitic Grenville limestone

within a country rock of blue grey biotitic quartzite is exposed. The graphitic limestone strikes north

and dips 40 to 70° west. The apparent width of the band varies from 7.6 to 30.5m. (Ross, 1982)

Another marble, paragneiss and quartzite formation is found at the southeast portion of the

property. No major geological structures are present. The general foliations are N045/70 (Labrèque,

1980)

An andesite intrusive crosses the deposit in an east-west direction and would correspond to a dyke

dipping north at about 63° (C.W., 1970). This intrusion appears to have occurred after the

graphitization (Bergmann, 1969).

The quartzite is grey and impure. It went through important metamorphism and contains few

graphite flakes, phlogopite and red garnets. Some bluish quartz, sulphides and diopside may also be

present (Labrèque, 1980).

The crystalline limestone is massive and porphyroblastic. Diopside is characteristic of this rock that

can also contain pyrite and pyrrhotite (Labrèque, 1980).

Item 7.1: Mineralization

The graphitic limestone has a dark appearance with visible graphite flakes. Diopside is evident and

carbonates can be detected with diluted acid. This rock which contains some sulphides and iron

oxides presents a rusty alteration surface (Labrèque, 1980). The graphite bearing zone consists of

disseminated graphite flakes and bands of high grade graphite in a gneissic formation. The bands can

reach in width a little more than 15m. The graphite-bearing zone strikes approximately north-south

and dips from 35 to 50° to the west. The graphite horizons appear to be flattening with depth as one

moves west and they may reverse dip, still farther west thus forming a synclinal fold. The width of

the graphite orebody varies from a few metres at the southern end to about 37m toward the north

(Archibald, 1970). Horses and veins of barren rock occur throughout the orebody but more

noticeably near the surface and on the footwall side (Bergmann, 1969).

The graphite generally occurs as crystalline flakes of various sizes and in some places, as fibrous

elongated scales. Grab samples of well mineralized graphitic limestone have been reported to assay

over 20% graphite (Ross, 1982) Grades or percentage of graphite appears to decrease with depth

30

(Archibald, 1970). Stephen A. Riddle report that the graphite ore is exactly the same as the Stratmin

ore and can be processed by similar methods. This was reported in a personal discussion and was

not verified by the authors.

Item 8: Deposit Types It is believed that the origin of carbon on the graphite deposit is from carbonate that went through

regional metamorphism. The Asbury deposit is recognized as a skarn type deposit (Labrèque, 1980).

The formation of skarns implies CO2 expulsion from carbonates by silica brought by hydrothermal

fluids. The expulsed CO2 then accumulates in some levels of the sediment sequence and forms

graphitic horizons by replacement in a geological trap that can be structural, lithological or both

(Longuépée, 2008).

Item 9: Exploration No exploration has been carried to date on the property by the issuer.

Item 10: Drilling No drilling has been carried on the property by the issuer.

Item 11: Sample Preparation, Analyses and Security Although no sampling was carried out at this time, the issuer will develop a proper sampling protocol

and a proper sample preparation and analysis applied to graphite mineralization which will have to

be used on future samples.

Item 12: Data Verification The data was obtained from an assessment report file and cannot be verified. However, the field

visits carried out by the authors on the property allowed inspection of the geological context and the

local infrastructure discussed under Item 5 and the lithological descriptions presented in Item 7. No

samples were taken for analysis since a visual inspection allowed seeing graphite on the side of the

open pit and that no historical comparison could be made because the past studied outcrops and drill

area make part of the historical production from open pit mining by Asbury Graphex between 1974

and 1988.

Item 13: Mineral Processing and Metallurgical testing No mineral processing and metallurgical testing has been carried by the issuer. The report present

historical mineral processing and metallurgical testing under item 6.

31

Item 14: Mineral Resource Estimates No mineral resource estimates has been carried by the issuer.

Item 15: Mineral Reserve Estimates No mineral reserve estimates has been carried by the issuer.

Item 16: Mining Methods No mining methods analysis has been carried by the issuer.

Item 17: Recovery Methods No recovery methods tests have been carried by the issuer. Historical recovery tests are discussed

under item 6.

Item 18: Project Infrastructure No project infrastructure has been planned by the issuer at this time. The report discussed available

infrastructures under Items 4, 5, and6.

Item 19: Market Studies and Contracts No market studies and contracts have been carried by the issuer.

Item 20: Environmental Studies, Permitting and Social or

Community No environmental studies, permitting and social or community impact studies has been carried by

the issuer.

Item 21: Capital and Operating Costs No capital and operating cost estimates have been carried by the issuer.

32

Item 22: Economic Analysis No economic analysis has been carried by the issuer.

Item 23: Adjacent Properties Adjacent claim holders are Focus Graphite and a group of prospectors. No recent exploration work

has been reported over their property by them so far.

These adjacent properties contain drill holes and geophysical anomalies that were discussed in Item

6.

Historical work that had been carried out on adjacent property is summarized below:

An HEM survey was carried out by Stratmin Inc in July and August 1987 on claims 2.7km northeast of

the property. This survey located very good conductors corresponding to graphitic layers. The data

was obtained with a 50m cable and 100m spaced lines (Fortin, 1988).

Stratmin Inc performed a horizontal loop EM survey (HEM, Maxmin II instrument) exploration 2.7km

northeast outside of the property. Following the previous survey of 1987, 25m cable and 50m line

spacing were used to gain a better definition. A total of 24.2 linear km were surveyed and readings

were taken every 12.5m. Frequency of 444 Hz and 1777 Hz were used. Five conductor axes were

detected in the area and a better definition of the previous anomalies was obtained. The anomalies

ranged from 50m to over 350m in length and from sub-cropping to 10m in depth (Fortin, 1988).

Item 24: Other Relevant Data and Information No other relevant data or information is reported here with respect to the Asbury Graphite Property.

Item 25: Interpretation and Conclusions The Asbury Graphite Property, which was the site of an historical graphite production (875 000

metric tons of graphite ore at a cut off grade of 6%) from open pit mining between 1973 and 1988,

still hosts several conductive (EM) anomaly where significant graphite mineralisation was revealed

from historical drilling. These electromagnetic anomalies present considerable extent of hundreds of

metres in length and one of them (Anomaly B) returned a drill intersection of 2.3% C over 40.5m

(hole M-25 of Asbury Carbons in 1983). The presence of distinct graphitic rock units is compatible

with the skarn deposit model which may imply several mineralized lenses of comparable quality. In

addition, significant graphite mineralisation can also be present along the extensions to the south

and at depth from the open pit.

Item 26: Recommendations and Budget It is recommended to perform an exhaustive map compilation of historic data, for past drilling and

geophysical survey on the property. In addition, it is recommended to commission a detailed

geophysical survey to confirm and complete historical data. The proposed geophysical survey must

consist of an electromagnetic Max-Min survey on 7 lines, each with 2km in length. The spacing

33

between lines will be of 100m with readings at every 25m. These activities will take into account the

exploration restriction stated in Item 4.1.

A drilling program of 1220m (4000ft) should verify the best targets revealed by the geophysical

compilation and the geophysical survey. Particular attention should also be applied to the immediate

area of the mine pit to test the southern and downward extension of this graphite-rich body. The

drilling program is contingent on positive results of the data compilation and geophysical EM survey

in confirming the presence of significant conductive anomaly.

34

Item 26.1 Budget

Table 12. Compilation and geophysical survey (Phase I) budget.

Quantity Cost per unit Total cost

Senior Geophysicist 2 days 650$ 1,300$

Junior Geologist 4 days 450$ 1,800$

Documents 1 100$ 100$

Mobilization/demobilization 1 1,500$ 1,500$

Field work 3 days 1,500$ 4,500$

Food and lodging 3 days 480$ 1,440$

Report 1 2,000 2,000

Total 12,640$

35

Table 13. Drilling (phase II) budget, contingent on phase I results.

Quantity Cost per unit Total cost

Drilling 1,220 metres 98,36$ 120,000$

Mobilization/demobilization 1 2,500$ 2,500$

Food and Lodging 30 days, 4-5 men 1,040$ 31,200$

Samples analysis 400 samples 80$ 32,000$

Core shack, Splitting

machine

4 month 1,100$ 4,400$

Technician 30 days 300$ 9,000$

Junior Geologist 30 days 450$ 13,500$

Senior Geologist 10 days 650$ 6,500$

Report 1 3,500$ 3,500$

Other (+/- 7.25%) 17,400$

Total 240,000$

Item 27: References Baril, F. and Bechard, J. 1974. Mining Operation of the Graphite Property Located at Notre-Dame-Du-Laus,

Province of Quebec. GM36039. 34 pages

Bergmann, H.J. 1969. Report on the Graphite Deposit of Canastota Mines (Canada) LTD, McGill Township.

GM36042. 24 pages.

Bray, D. 1974. Diamond Drill Log, Graphex Project for Graphex Mines Inc, GM30070. 22 pages, 1 plan.

Castonguay, G. 1967. Project #516-1,2,3,4,5, Graphite ore from Notre-Dame-Du-Laus and Sainte-Therese,

Graphite Concentration Tests. By Quebec Department of Natural Resources. GM21110. 45 pages.

Archibald, C.W., 1970. Graphite Property in Notre-Dame-Du-Laus, Qc, for Canastota Copper Mines

Incorporated. GM36041. 39 pages, 16 plans.

De La Rüe, E.A. 1956. Geological Report 68, McGill Area. RG068(A). 30 pages,1 plan.

36

Fortin, G. 1988. Horizontal Loop EM Survey (Max-Min), Notre-Dame-du-Laus property, by Ageos Sciences Inc

for Stratmin Inc. GM47628. 15 pages, 3 plans.

Labrèque, P.C. 1980. Projet Graphite, Canton Mcgill, by Geo-Auscultex International Ltée for Les Mines de

Manganèse du Québec Inc. GM36373. 17 pages, 5 plans.

Lacombe, Pierre G. 1967. Report on A Self-Potential Survey, on Development Licence 56,636, by P.G.

Lacombe & Associées. GM21108. 5 pages 1, plan.

Lacombe, Pierre G. 1967. Drill log, for Canastota Copper Mines Inc. GM18770. 9 pages, 1 plan.

Lacombe, Pierre G. 1967. Drill log, for Canastota Copper Mines Inc. GM21109. 5 pages, 1 plan.

Lamarche, R.Y. 1975. Rapport des Géologues Résidents. DPV346. Pages 1-36

Leduc, M.J. 1988. Reconnaissance géologique sur la propriété du Lac Long, Notre-Dame-Du-Laus (Rapport

sommaire), by Ageos Sciences Inc, for Stratmin Inc. GM47574. 13 pages, 1 plan.

Longuépée, H. 2008. Nouveaux modèles d’exploration dans le Grenville : Opportunités de gisements de type

skarn, for Groupe Consorem. 28 pages.

McKeon, B. and Boileau, H. 1968. Diamond Drill Record, for Canastota copper Mines Inc. GM25384. 21 pages,

2 plans.

Ministry of Natural Resources, 2012. GESTIM, Mining Rights Management. https://gestim.mines.gouv.qc.ca.

Quebec claim maps.

Ministry of Natural Resources, 2012. Liste des sites miniers abandonnés.

http://www.mrn.gouv.qc.ca/mines/restauration/restauration-sites-miniers-abandonnes.jsp.

Ministry of Natural Resources, 2012. SIGEOM, Geomining information system.

http://sigeom.mrnf.gouv.qc.ca. Drilling, geophysical and geologic data.

Ministry of Natural Resources, 2012. Wildlife habitat exploration restrictons.

http://www.mrn.gouv.qc.ca/faune/habitats-fauniques.

Rancourt, C. 1980. Drill Log Project G.A.Q.Inc, By Forage Moderne for Graphite Asbury Quebec Inc. GM37584.

20 pages, 1 plan.

Rancourt,C. 1983. Drill log, Asbury (Explo) Project, by Modern Drilling for Asbury Quebec. GM41533. 23

pages, 1 plan.

Ross, David M. 1982. Report on Eletromagnetic Survey on the Property of Asbury Graphite Quebec Inc. By

H. Ferderber Geophysics LTD for Graphite Asbury Quebec Inc. GM40380. 8 pages, 3 plans

37

Item 28: Figures

Figure 1. Asbury Graphite Property Location

38

Figure 2. Claims on the Property (UTM NAD83 Zone 18)

39

Figure 3. Exploration Restrictions on the Property

40

Figure 4. Past exploration works on the property and other features of the property

41

Appendice 1 – Pictures of the infrastructures on the property