Del Norte Property

Introduction

The Del Norte-Midas property is one of Teuton’s original claim holdings dating back to 1983. It was staked to cover three gold-bearing streams (Nelson, Del Norte and Willoughby Creeks) which flow west-east from the Cambria Icefield into the White River. Placer streams are relatively rare in the Stewart region but when they occur they are generally associated with major mineral deposits. As an example, Sulphurets Creek is a known placer stream and drains the area hosting the major KSM, Snowfield and Brucejack gold deposits of Seabridge Gold and Pretium Resources (over 70 million ounces of gold in reserves/resources to date).

The property spans a 12km long, north-south trending expanse covering a northerly-trending contact zone between volcanic and sedimentary rocks related to multiple zones of gold-silver mineralization. Portions of the property are underlain by rocks broadly similar to those hosting the rich, silver-gold Eskay Creek mine 50 miles to the northwest.

Sabina Silver completed a $3.5million option agreement in 2007 earning a 50% interest in the property. Teuton owns the remaining 50% interest, except for the Midas portion of the claims which are owned 25% Teuton, 25% Silver Grail.

In the northern portion of the property, the LG-vein breccia system has been tested by 67 drill holes from 2002 to 2006. Drilling during this period has encountered several promising intersections, including 51 feet grading 0.363 oz/ton gold equivalent) with a core of bonanza grade gold and silver values (2.8 feet grading 110.3 oz/ton silver and 2.08 oz/ton gold). An intense, broad EM conductor detected just east and parallel to the LG vein exposures and situated within laminated mudstones has only been cursorily explored to date. The setting is considered prospective for exhalative Eskay Creek-style mineralization in the wall of the main vein system.

Sabina and Teuton have decided to wait for a small icefield to melt back in the vicinity of the EM conductor before resuming exploration on the property. Alternatively, the property is available for option to interested third parties.

Location

The Del Norte property is located approximately 17 miles east of Stewart, British Columbia, in the upper drainage area of the White River system. Nearest road access is about five miles to the east, at the western end of a network of logging roads connecting to Highway 37.

History and Property Status

Gold and gold-copper showings were first discovered along Del Norte Creek in the 1930's, but little development work was carried out due to the remoteness of the area at the time. Nelson Creek , in the northern portion of the property, was reportedly the subject of a placer mining operation by Cominco during the same period, but there are no public records regarding production. The LG Vein and Kosciuszko Zone are on slopes overlooking Nelson Creek and may be one of the sources of the gold in that stream.

Teuton staked the Del Norte property in 1983. After Hole #109 triggered a claim staking rush around Eskay Creek in 1989, companies in the Prime Equities stable optioned the Del Norte along with several other Teuton properties thought to have potential for Eskay Creek type deposits. Goodgold Resources Ltd., a Prime Equities company managed by Murray Pezim and Chet Idziszek, spent approximately $600,000 on the Del Norte from 1990-92. During this period the Humdinger, O, Grizzly, NMG and Crackle showings were located, among others. After the property was returned to Teuton, small programs were carried out from time to time resulting in the discovery of more showings. Due to low gold prices, the property was dormant for most of the late 1990's.

The property became active again in 2002 after the discovery of the Kosziuszko Zone, and was optioned the following year to Lateegra Resources Corp. Lateegra financed two years of exploration on the property from 2003-2004, most of this work involving drilling of the LG-K zones. However, Lateegra was unable to meet its commitments for the 2005 field season and the property reverted to Teuton.

In late September, 2005, while a ten hole program was under way (funded by Teuton), Sabina Silver Corp. ("SBB"-TSXV) ("Sabina") took over the Lateegra option and was granted the right to earn a 50% interest in the property by spending an additional $2.5 million on the property prior to Dec. 31, 2008. It also agreed to refund the money to Teuton for the cost of the 2005 program already in progress (to be credited against Sabina's work commitments). Teuton also received $90,000 on signing and a further $150,000 over the course of the option. In 2007 Sabina earned a 50% interest in the property (cf. http://www.sabinasilver.com

Mineralized Showings

LG Vein and K Zones

The K ("Kosciuszko") Zone was discovered in 2002 at the edge of a wasting icefield. The discovery chip sample across the northern end of the zone returned the following excellent results:

Interval
(metres)
Width
(metres)
Gold
(oz/ton)
Silver
(oz/ton)
Gold Equiv. *
(oz/ton)
0-2 2.0 0.176 16.5 0.412
2-Apr 2.0 0.052 1.2 0.069
4-Jun 2.0 0.124 2.4 0.158
6-Aug 2.0 0.277 45.1 0.921
8-Oct 2.0 0.266 26.9 0.650
0-10 10.0 0.179 18.4 0.442
*Based on 70-1 ratio between current gold and silver prices.

Three holes drilled from a single station about 12m south of the chip sample, returned the following:

Drill
Hole
Interval
(metres)
Length
(metres)
Length
(feet)
Gold
(oz/ton)
Silver
(oz/ton)
Gold Equiv. *
(oz/ton)
2002-1 11.9-43.0 31.1 101.8 0.104 5.61 0.185
including 36.0-43.0 7.0 23.0 0.133 15.96 0.361
2002-2 19.8-52.7 32.9 107.9 0.134 5.22 0.208
including 33.0-40.0 7.0 23.0 0.210 13.18 0.398
2002-3 1.3-24.7 23.4 76.8 0.223 8.09 0.339
including 16.0-24.7 8.7 28.5 0.219 14.82 0.431
*Based on 70-1 ratio between current gold and silver prices.

The K Zone is a quartz-carbonate-sulfide cemented breccia hosted in argillite at the base of the Salmon River Formation. A felsite dike marks the eastern edge of the zone. Mineralization includes pyrite, sphalerite, galena, tetrahedrite along with traces of arsenopyrite and realgar. Electrum (native gold-silver) has been observed in petrographic samples, forming mostly rounded grains ranging in size from 0.01 to 0.1mm in diameter.

Following the discovery of the K zone in 2002, the focus of work switched to the LG vein, a parallel structure first observed outcropping 1,000 feet further to the north (across a small icefield), and lying directly within the contact between volcanics (to the west) and mudstones (to the east). This work was funded by then optioneeLateegra Resources Corp., and concentrated on drill testing the LG structure further along strike to the north.

Drilling in 2005 by optionee Sabina Silver on the LG-K structures returned the focus of work to the south in the direction of the K zone, and in particular was aimed at determining what lay beneath the 1000 foot long icefield lying between the first outcrop of the LG vein and the K zone. Results of this work have been highlighted in the summary section above. For full details, please refer to the Corporate News section (see Nov.21, 2005 News Release ).

3 Ounce Zone

Prospecting in the 3 ounce area near the border of the Del Norte/Midas claims resulted in the 2003 discovery of quartz float boulders grading up to 3 oz/ton gold, near the same volcanic-sediment contact which hosts the LG mineralization some 6 miles to the north. One day of trenching in 2004 partially exposed a quartz vein mineralized with tetrahedrite.

In 2006, optionee Sabina Silver tested the structure on one section with three holes and intersected broad widths of gold mineralization in all holes. In 2006, optionee Sabina Silver drilled three holes into the 3 Oz showing on the Midas property, encountering promising intercepts of bulk tonnage-type gold mineralization spatially related to a gold-rich vein. The best result was in Hole SDN-06-02 which returned a wide interval of gold mineralization grading 2.52 g/t gold (0.07 oz/ton) over 32.4 meters. True width is estimated at 29.2 meters or 96 feet . Within this intersection, a sub-interval ran 26.77 g/t gold (0.78 oz per ton) over 0.7 meters. For detailed results refer to the Company news release dated Dec. 18, 2006.

Follow-up drilling in 2007 both to the north and south of the section drilled in 2006 returned similar widths but grades were not as high.

Bullion/Hardpan Creek Area

A number of other zones have been previously explored in the Bullion and Hardpan Creek areas, from half a mile to a mile south of the Kosciuszko zone. One of these, the "O" zone is exposed over 400 feet and has been partially tested by 11 trenches and four core holes. Values in trenches range to 16.4 feet grading 0.307 oz/t gold and 0.23% copper; values in holes to 50 feet grading 0.107 oz/t and 0.410% copper.

Trench results from the Humdinger zone have returned values up to 0.388 oz/t gold and 2.05 oz/t silver across 19.7 ft. Two holes tested the Humdinger zone at shallow depths but did not intersect economic mineralization. A reviewing geologist has stated these holes were probably incorrectly sited to intersect the zone.

The Hardpan Creek portion of the Del Norte property also hosts lead-zinc mineralization in structures oriented at right angles to the gold-silver-copper zones. Trenching in the Grizzly zone exposed a 49.2 foot width of galena-sphalerite mineralization assaying 3.74% lead and 4.35% zinc.

Approximately 0.6 mile to the south of the Hardpan Creek area, Teuton prospectors discovered an area with massive sulfide float boulders ranging in size to 5 feet and carrying gold values up to 2.0 oz/ton. The source of these boulders has not yet been found.

Horatio Zone

In 2003, a zone of massive sulphide float boulders was found on the eastern side of the upper reaches of the Nelson glacier. The boulders carried pyrite, sphalerite and galena and carried gold values up to 2+ oz/ton. Prospecting discovered lenticular zones of similar mineralization uphill from the boulders, none of which showed appreciable size or continuity. A grab sample taken from a small vein taken further uphill ran 5.0 oz/ton gold. Drilling of one hole with a portable drill collared south of the showings did not return appreciable values.