Aurizona Project

Reserve Estimate

PROVEN

PROBABLE

TOTAL

Ore Type

Tonnes

(kt)

Grade

(g/t)

Gold

(oz)

Tonnes  

(kt)

Grade

(g/t)

Gold

(oz)

Tonnes

(kt)

Grade

(g/t)

Gold

(oz)

Laterite/Saprolite

721

1.59

37,000

1,852

1.04

62,000

2,573

1.19

99,000

Hard Saprolite/Transition

2,320

1.60

119,000

3,049

1.22

119,000

5,369

1.38

238,000

Fresh Rock

3,328

1.98

212,000

7,372

1.77

420,000

10,700

1.84

632,000

Total

6,369

1.80

368,000

12,273

1.52

601,000

18,642

1.62

969,000


The Mineral Reserve estimate has an effective date of June 21, 2016 and is based on the Mineral Resource estimate effective on April 30, 2016, as reported in the "Pre-feasibility study on Aurizona Mine Project, Maranhao, Brazil, NI 43-101 Technical Report" with an effective date of September 12, 2016. The Mineral Reserve calculation was completed under the supervision of Gordon Zurowski, P.Eng of AGP Mining Consultants Inc., who is a Qualified Person as defined under NI 43-101. Mineral Reserves are stated within the final design pit based on a $1,104 per ounce gold price pit shell with a $1,200 per ounce gold price for revenue. The cutoff grade was 0.38 g/t Au for all pit areas. The mining cost averaged $2.32 per tonne mined, processing averages $11.30 per tonne milled and G&A was $2.84 per tonne milled. The process recovery averaged 90.5%. The exchange rate assumption applied was R$3.50 equal to $1.00. The PFS scope only considers the Piaba and Boa Esperança open pit mineralized zones. The Mineral Resource and Mineral Reserve estimates contained herein may be subject to legal, political, environmental or other risks that could materially affect the potential development of such Mineral Resources. See the Cautionary Notes below and read the latest technical report for the Aurizona project to find additional information with respect to the key assumptions, parameters and risks relating to the mineral reserves estimate.

Aurizona Project

Resource Estimate (Resources are inclusive of Reserves)

Area

Type

Class

Tonnes

(kt)

Grade

(g/t)

Gold

(oz)

 

PIABA

Pit Constrained

Measured

8,910

1.77

508,000

Indicated

20,264

1.64

1,071,700

M&I

29,174

1.68

1,579,700

Inferred

2,584

0.72

60,000

Outside Pit

Inferred

3,721

3.47

415,300

BOA ESPERANÇA

Pit Constrained

Indicated

682

0.90

19,700

Inferred

66

0.75

1,600

TOTAL

Pit Constrained

Measured

8,910

1.77

508,000

Indicated

20,946

1.41

1,091,400

M&I

29,856

1.67

1,599,400

Inferred

2,650

0.72

61,600

Outside Pit

Inferred

3,721

3.47

415,300


Mineral Resources are inclusive of Mineral Reserves. The Mineral Resource estimate has an effective date of April 30, 2016 and was prepared by Mr. Brett R. Marsh, C.P.G. of Phoenix Geoscience, LLC, who is a qualified person under NI 43-101, as reported in the "Pre-feasibility study on Aurizona Mine Project, Maranhao, Brazil, NI 43-101 Technical Report" with an effective date of September 12, 2016. Mineral Resources that are not included within the Mineral Reserves do not have demonstrated economic viability. Mineral Resources are stated at the following cutoff grades for open pit: Piaba: Laterite and Saprolite at 0.30 g/t Au; Hard Saprolite/Transition/Fresh Rock at 0.40 g/t Au. Piaba: Outside open pit at 2.0 g/t Au. Boa Esperança cutoff grade: 0.44 g/t Au. Tonnes are rounded to the nearest 1,000; ounces are rounded to the nearest 100. Small tonnage and grade differences may be found due to rounding. See the Cautionary Notes below and read the latest technical report for the Aurizona project to find additional information with respect to the key assumptions, parameters and risks relating to the mineral resources estimate.

Warintza Project

Resource Estimate

Resource

Tonnes

CuEq%

Cu%

Copper (tonnes)

Copper (M lbs)

Mo%

Mo (tonnes)

Mo (M lbs)

CuEq (M lbs)

Inferred

194,994,000

0.61

0.42

820,000

1,807

0.031

60,000

132

2,072

 

The Mineral Resource estimate has an effective date of December 21, 2012 as reported in the “Technical Report, Warintza Project, Ecuador” completed by Peter Ronning, P.Eng. and Steven Ristorcelli, C.P.G. with an effective date of December 21, 2012 and a completion date of March 27, 2013. The Mineral Resource calculation was completed under the supervision of Peter Ronning, P.Eng. and Steven Ristorcelli, C.P.G., who are Qualified Persons as defined under NI 43-101. The reported resource is at a cut-off of 0.3 CuEq. Copper equivalent calculations were made for reporting purposes. The copper equivalent grade for copper plus molybdenum was calculated as CuEq(%) = Cu(%) = (6*Mo(ppm)/10000). Copper-equivalent calculations reflect gross metal content and have not been adjusted for metallurgical recoveries or relative processing and smelting costs. The copper equivalent grades were used only for establishing cut-off grades for reporting. See the Cautionary Notes below and read the latest technical report for the Warintza Project to find additional information with respect to the key assumptions, parameters and risks relating to the mineral resources estimate.

Elk Gold Project

Resource Estimate

Resource

Tonnes

Grade (g/t)

Gold (oz)

M&I

1,042,600

6.32

211,900

Inferred

1,096,900

5.94

209,600

The Mineral Resource estimate has an effective date of August 22, 2016 as reported in the “Technical Report on Resources of the Elk Gold Project” completed by Robert Wilson, P.Geo., Gary Giroux, P.Eng. and Antonio Loschiavo, P.Eng. with an effective date of August 22, 2016. The Mineral Resource calculation was completed under the supervision of Gary Giroux, P.Eng., who is a Qualified Person as defined under NI 43-101. The potential open pit resources were evaluated using the Maptek Vulcan v9.1.1 Lerchs-Grossman algorithm software. The constrained resource was calculated using a gold price of US$1232/oz. Any blocks within the constrained shell were reported using a 1.0 g/t cut-off and any blocks below the LG shell surface were reported using a 5.0 g/t cut-off. The grade reported is the average grade of the resource both in and below the pit. See the Cautionary Notes below and read the latest technical report for the Elk Gold Project to find additional information with respect to the key assumptions, parameters and risks relating to the mineral resources estimate.

Definitions

Reserve/Resource Definitions

Definitions

The estimated Mineral Reserves and Resources for Trek Mining’s projects have been calculated in accordance with the Canadian Institute of Mining, Metallurgy and Petroleum – Definitions Adopted by the Canadian Institute of Mining, Metallurgy and Petroleum Standards Council on May 10, 2014.

The term “Mineral Resource” describes a concentration or occurrence of solid material of economic interest in or on the Earth’s crust in such form, grade or quality and quantity that there are reasonable prospects for eventual economic extraction.  The location, quantity, grade or quality, continuity and other geological characteristics of a Mineral Resource are known, estimated or interpreted from specific geological evidence and knowledge, including sampling.  Mineral Resources are sub-divided, in order of increasing geological confidence, into Inferred, Indicated and Measured categories.

The term “Inferred Mineral Resource” is that part of a Mineral Resource for which quantity and grade or quality can be estimated on the basis of limited geological evidence and sampling.  Geological evidence is sufficient to imply but not verify geological and grade or quality continuity.  The estimate is based on limited information and sampling gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes.

The term “Indicated Mineral Resource” is that part of a Mineral Resource for which quantity, grade or quality, densities, shape and physical characteristics are estimated with sufficient confidence to allow the application of Modifying Factors in sufficient detail to support a mine planning and evaluation of the economic viability of the deposit.  The estimate is based on detailed and reliable exploration and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes that are spaced closely enough for geological and grade continuity to be reasonably assumed.

The term “Measured Mineral Resource” is that part of a Mineral Resource for which quantity, grade or quality, densities, shape, physical characteristics are estimated with confidence sufficient to allow the application of Modifying Factors, to support detailed mine planning and final evaluation of the economic viability of the deposit.  The estimate is based on detailed and reliable exploration, sampling and testing information gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and drill holes that are spaced closely enough to confirm both geological and grade continuity.

The Term “Modifying Factors” are considerations used to convert Mineral Resources to Mineral Reserves.  These include, but are not restricted to, mining, processing, metallurgical, infrastructure, economic, marketing, legal, environmental, social and governmental factors.

The term “Mineral Reserve” is the economically mineable part of a Measured or Indicated Mineral Resource. It includes diluting materials and allowances for losses, which may occur when the material is mined or extracted and is defined by studies at Pre-Feasibility or Feasibility level as appropriate that include application of Modifying Factors.  Such studies demonstrate that, at the time of reporting, extraction could reasonably be justified.

The term “Probable Mineral Reserve” is the economically mineable part of an Indicated, and in some circumstances a Measured Mineral Resource.  The confidence in the Modifying Factors applying to a Probable Mineral Reserve is lower than that applying to a Proven Mineral Reserve.  A supporting study must include adequate information on mining, processing, metallurgical, economic, and other relevant factors that demonstrate, at the time of reporting, that economic extraction can be justified. 

The term “Proven Mineral Reserve” is the economically mineable part of a Measured Mineral Resource.  A Proven Mineral Reserve implies a high degree of confidence in the Modifying Factors.  A supporting study must include adequate information on mining, processing, metallurgical, economic, and other relevant factors that demonstrate, at the time of reporting, that economic extraction is justified. 

Cautionary Notes

Cautionary Note Concerning Reserve and Resource Estimates

Cautionary Notes

Mineral Reserve and Resource estimates for Trek Mining’s projects have been prepared in accordance with Canadian standards under applicable Canadian securities laws, and may not be comparable to similar information for United States companies.  The terms “Mineral Resource”, “Measured Mineral Resource”, “Indicated Mineral Resource” and “Inferred Mineral Resource” used in this MD&A are Canadian mining terms as defined in accordance with NI 43-101 under guidelines set out in the Canadian Institute of Mining, Metallurgy and Petroleum Standards on Mineral Resources and Mineral Reserves adopted by the Canadian Institute of Mining, Metallurgy and Petroleum Standards Council on May 10, 2014.

While the terms “Mineral Resource”, “Measured Mineral Resource”, “Indicated Mineral Resource” and “Inferred Mineral Resource” are recognized and required by Canadian regulations, they are not defined terms under standards of the United States Securities and Exchange Commission. Under United States standards, mineralization may not be classified as a “reserve” unless the determination has been made that the mineralization could be economically and legally produced or extracted at the time the reserve calculation is made. As such, certain information concerning descriptions of mineralization and resources under Canadian standards is not comparable to similar information made public by United States companies subject to the reporting and disclosure requirements of the United States Securities and Exchange Commission. 

An “Inferred Mineral Resource” has a great amount of uncertainty as to its existence and as to its economic and legal feasibility. It cannot be assumed that all or any part of an “Inferred Mineral Resource” will ever be upgraded to a higher category. Under Canadian rules, estimates of Inferred Mineral Resources may not form the basis of feasibility or other economic studies. Readers are cautioned not to assume that all or any part of Measured or Indicated Resources will ever be converted into Mineral Reserves. Readers are also cautioned not to assume that all or any part of an “Inferred Mineral Resource” exists, or is economically or legally mineable. In addition, the definitions of “Proven Mineral Reserves” and “Probable Mineral Reserves” under Canadian Institute of Mining, Metallurgy and Petroleum standards differ in certain respects from the standards of the United States Securities and Exchange Commission.

National Instrument 43-101 is a rule developed by the Canadian Securities Administrators that established standards for all public disclosure an issuer makes of scientific and technical information concerning mineral projects. Unless otherwise indicated, all Mineral Reserve and Resource estimates for Trek Mining’s projects have been prepared in accordance with National Instrument 43-101 disclosure rules.