CHISHOLM LAKE COAL PR3PERTY+

SHELL CANADA RESOURCES LTD.

OPERATOR: SROW NEST RESOURCES LTD.

C.L.# 51854190

SMTHERS AREA 93 L/3

Work done: iuly t0 AUgUSt 1981

Authors: D. Handy S. Cameron

Submitted: December 15 1981

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The Smithers Area Coal Prospects are contained within 58 B.C. Coal

Licences which cover 14,236 hectares. In addition Shell/CNRL hold 3,886

hectares under option agreements. The licences are held by Shell Canada

Resources Limited and are operated by its wholly-owned subsidiary, Crows

Nest Resources Limited.

The area in general, and the Telkwa licences in particular, lie in

proximity to the Canada National Railway, 360 km east of the port of

Prince Rupert. Existing infrastructure, the proximity of a coal

handling port and the good quality of the coal make some of these

prospects attractive.

The Chisholm Lake and Thautil River prospects are approximately 10 km

from an existing good logging road on the south side of the Morice River

which runs east for 50 km to the town of Houston.

The primary objective of the exploration program was to locate and

delineate areas of large reserves amenable to mining.

Based on the 1981 exploration the Thautil River and Chisholm Lake

licences have been surrendered.

N.Lat.54’14’

N.Long.127"13'

N.Lat.54"16' along the Thautil River north of ./

its confluence with the Morice

River

December 8, 1981

Ministry of Energy, Mines and Petroleum Resources British Columbia

Enclosed please find our report on the Smithers Area Coal Prospects.

This report has been prepared by Mr. D. Handy and Mr. S. Cameron, both of whom are employed by Crows Nest Resources Limited as geologists.

Mr. D. Handy, Honours B.Sc., graduated in Geology from the University of Waterloo in 1977. Prior to his graduation, Mr. Handy worked as an assistant for two geotechnical companies and after graduation as a geologist for a major exploration company in Saskatchewan. Mr. Handy has been employed by Crows Nest Resources Limited as a Project Geologist since 1979.

Mr. S. Cameron, B.Sc., in Geology graduated from the University of Calgary in 1981. Prior,to graduation Mr. Cameron worked as an assistant for a major exploration company in the North West Territories. He also worked for Crows Nest Resources Limited as a geological assistant in 1980. Mr. Cameron has been employed by Crows Nest Resources Limited as a Geologist since May 1981.

Their work was carried out under the supervision of our District Manager, British Columbia, Mr. Frank Martonhegyi.

In my opinion, all of these personnel are fully qualified, by training and experience to prepare this report and this account of work done under their direct~supervision.

Yours very ly,

$tYbJL=4L T

H.G. Rushton, P. Geol. Vice-President - Exploration.

(i)

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8.0 Chisholm Lake

8.1 Summary of previous Work

During the 1979 field season the following exploration work was

performed.

0 l:lO,OOO scale geological mapping

No exploration work was performed during 1980.

8.2 Work done in 1981

The 1981 field operations were supervised by Dave Handy of Crows

Nest Resoures Limted. The following exploration work was

performed.

0 l:lO,OOO scale geological mapping

0 diamond drilling

0 drill site reclamation

Field mapping on the Chisholm Lake property in 1981 was limited to

the Chisholm Creek area.

2jBYa.45

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One diamond drill hole was completed to a depth of 193.5 metres.

The total cost of the 1981 exploration work was $72,165.

8.3 Chisholm Lake Stratigraphy

General

The basement rocks of the Chisholm Lake property consist of upper

Jurassic/lower Cretaceous volcanics of the Hazelton Group. These

volcanics consist mainly of basalt, andesite, trachyte, rhyolite and

agglomerate.

The volcanics are unconformably overlain by upper Jurassic/lower

Cretaceous sediments also of the Hazelton Group. These sediments are

composed of conglomerate, sandstone, mudstone, shale and minor coal.

The sedimentary section at Chisholm Lake ranges from 0 to over 200

metres.

Younger intrusives in the form of dykes and sills are sometimes

Present.

2jBYa.46

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Coal Stratigraphy

One coal seam of approximately 1.5 metres thickness is seen in outcrop

along Chisholm Creek. This seam was not present in drill hole

CL-81D-101, which was drilled down dip from the coal outcrop.

Chisholm Structure

On the Chisholm Lake area one reverse fault was found which forms a

fault contact between the volcanic basement and the sediment. The

strata generally dip to the east at 20“ to 50“.

On the basis of the results of the 1979 and 1981 exploration programs

the Chisholm Lake licences have been surrendered.

2fBYa.47

CROWS I RESOURCES LIMITED

CORE & COAL CORE DESCRIPTION HOLE P*IRTIC”LARS

LOCATION Northing 6.009.849

1 Eastina 615.469

ELEVATION 839 metres HOLE BEARING(M~ _

TOTAL DEPTH 193.51 HOLE ANGLE (‘1’ -900

END 1 06/17/81 1 COAL CORlNG PE”FORMANCE

, , !

CROWS NEST RESOURCES LlMlTED

CORE & COAL CORE DESCRIPTION PROJECT CrlIsHm IAKE AREA SMIIIWS, B.C.

CROWS NEST RESOURCES LIMITED

CORE & COAL CORE DESCRIPTION PROJECT MI= I..wE AREA SMIm, B.C.

or&critic. PrcbablY a dyke I I

CROWS rJEST RESOURCES LIMITED

CORE & COAL CORE DESCRIPTION PROJECT

~Li%mmra L?w AREA -, B.C.

I I , R4 , I I I I I I I / I Ilcite fill& fractures. I I

Pyrite rich. ! ! ! ! ! I I ! ! I I I I I I I I I I I I I I I I 182.20 182.50 I .301

I I 1 -veIymthered siltstone

I I I I

I IRl) 1 I

I 32.83 I

I I / I I I I I I I .95. sm. - Greenish-wav fine qmimd sandstcne In2 I I

bemna lIEaim, srainea at bottml of inteIv a1 I 193.78

I I I I I I I. 12 verv brittle I I

CROWS NEST RESOURCES LIMITED

CORE & COAL CORE DESCRIPTION PROJECT

AREA

I I I

I I I I I I I I I IM4lvms RUWKRY I

! I ! I 98 - 101 & - 91.3% ! 1 I I I

! I ! I I ! ! I

I I I I -j I I 104 - 107 3.0 100% I I I I I I I I I I I I I I

I I I I I I I 101 1100.68~

I I I 1 I I I I I - smeaswrev~ interval. Iast 9anl

I I I I 1 12.641

1103.321 IR? I I

141 I -thered, verq cartims, dark L

I I I m Il.891 9.31 I I I I I I I

*IIs

HOLE No. a 101

CROWS dEST RESOURCES LIMITED

CORE & COAL CORE DESCRIPTION PROJECT

AREA

1124.261 11.731 I I

18 WC I- Liqhtqr a-9 .._ -,

calcite filled cracks -- rylL~-ly-cp 125.99 1 throutit. Broken swfaoes slicks&~&n. I I I

I

CROWS NEST RESOURCES LIMITED

CORE & COAL CORE DESCRIPTION PRrIKCT

AREA

I i 1126.22 1 10.54 I I (126.76 1 I

, , 1131.94 1 I .4Ol t-Frxturedbrokenup darkmey,-

, I I I

I ite rich

1132.34 1 I I I I shalewith siltsbmehr@.

1 I

I I I I I I 1 I I I ! 1 I /.31/

I I-143issharobutirregularmntactWithabweI

I I I I 1 1 I I I I I I

I interval. IP.3 I I

132.71 I It is liqht prey calcite rich I I I I I I I I I I

WlcaniC rock. I I

d

CROW5 NEST RESOURCES LIMITED

CORE &COAL CORE DESCRIPTION PROJECT

AREA

I I I 1137.14 I I .49 I

I I - MDst1v fine crrained 1iqht colcmr& San

I I I 1137.63 1

CROWS NEST RESOURCES LIMITED

CORE & COAL CORE DESCRIPTION PROJECT ~alIsFmMLAKE

AREA -. B.C.

, “V” , , , .-_.

201 I I 1

I lt.!imms %RExyNERy I I [ 139 - 142

I I I r I I I I I I I I 1 142 - 145

(3.13/3) -104% 12.98/3) - 99% I I I I

I I I I I

I I I I 211 1140.731 11.56l~W I-AS last part of previous intenr~~, larqe

I I I I I I I I I ,

I I 1142.29 I SIST I CalCite bands, szalvz wt?dhered le.3 I

I I I I I I I I I I I

CROWS NEST RESOURCES LIMITED

CORE & COAL CORE DESCRIPTION PROJECT CHIsHorn IAKE

AREA 53mmP”s, B.C.

CROW5 NEST RESOURCE5 LIMITED

CORE &COAL CORE DESCRIPTION PROJECT .MIfliOIM r&E

AREA EMITIIERS, B.C.

I I I - Clean, ucentsh smlstane very &.inv

I I I I I I I I I I I 157.34 .75 FT.3

i ~rdsddv &e to hish & z mnwt. I I I 24 I I .sdiGmW~.

I I I I I I I I

, 158.09.

I 1

1 I I I I Ilss.as I

1 I I I I Il.08 1 I - Altenatirn sardstare ard siltstone as

I I I I I I I I

161 I 1159.171 I 161’ lR3 1 I I

I described previcudv. ! I ! I .71 I 43 I I ! I I I I I I A I I I I I I I I I I I I I I I

l%mcEm %REcovERI I I I I 1 161 - 167 6.06nl - 101% I I I j I

.- i I I I I I I

I I 1 I I h63.E4 h63.961.12 i I-weathered~tcme.

I I I I I I I I I I I I

I I I lR2 I 1 I

1 I h63.96 I

I I I 1 I 1.45

I I I -Altematinq sandstom and silt&one as Fz.3

I I descrW previcuslv. Write rich, bard 167 I P65.41.

I I I I I I I I Of dark clacite and "udstmw at 164.21.

1 I 1.65117.61

CROWS NiST RESOURCES LIMITED

CORE & COAL CORE DESCRIPTION PRO.lECT (HIS- LAKE

AREA mm, B.C.

- -.

CROWS NEST RESOURCES LIMITED

CORE &COAL CORE DESCRIPTION PROJECT cHIsHolNw(E PAGd?...

AREA mm, B.C. or...u....