Bonsai Property

Introduction

The Bonsai property adjoins to the west of Barrick Gold's Eskay Creek property, about 6 km from the mine site, itself. Previous exploration on the Bonsai has targeted Eskay Creek type stratigraphy in the west-central portion of the property. In this area, surface sampling and subsequent drilling has returned anomalous gold-arsenic values near a felsic volcanic-mudstone contact.  Another target is on the west side of the property where an airborne geophysical survey disclosed a sharp EM anomaly.

In late 2009 Teuton farmed out  the property to Copper Creek Gold Corp. (“CPV”) Under the terms of the letter agreement, Copper Creek can earn a 60% interest over five years by spending a total of $3 million on the property, paying a total of $125,000 and issuing 500,000 shares to Teuton. Upon signing Teuton will receive $25,000 and an additional 100,000 shares after regulatory approval. Copper Creek may earn an additional 10% interest in the property by spending another $2 million.

Location

The Bonsai property is accessible by road from Highway 37, thereafter west along the Eskay Creek mine road to, and beyond, the mine site. One of the Eskay Creek tailings ponds is situated on the eastern portion of the Bonsai property. The deep sea port of Stewart is situated 80 km to the south-southeast.

History and Property Status

Teuton Resources Corp. staked the original Bonsai claims in 1988 to cover a north-south trending belt of felsic volcanics on the east side of Harrymel Creek. The property was optioned to Cassandra Resources in 1989. Cassandra carried out a limited program of prospecting, geochemical sampling and EM-VLF surveys the same year. Prominent gossans in felsic volcanics east of the toe of Melville Glacier carried pyrite mineralization anomalous in gold and arsenic. Magnetometer and EM-16 anomalies were detected in the same area. Despite these encouraging results, Cassandra relinquished the option in 1991 citing inability to raise venture capital to carry on work. A brief follow-up program in 1992 by Teuton personnel, consisting of prospecting and trenching, confirmed and extended the Cassandra program results.

From 1995 to 1996 the property was under option to Prime Resources Group and Homestake Canada, owners of the Eskay Creek mine. Five short holes were drilled to the test the gold-arsenic anomalous area in 1995, and one deep hole was drilled in 1996 (collared several hundred metres to the east) to test for Eskay Creek type stratigraphy at depth. The option was relinquished in 1996 and no further work was carried out.

In 2002 the property was optioned to Glenfred Holdings, a private company later wholly acquired by TSX-Venture listed Heritage Explorations Ltd. (which latter company has now been amalgamated with St. Andrew Goldfields). From 2002-2005 Heritage targeted two areas by drilling: the previously mentioned anomalous gold-arsenic showing and a distinct EM anomaly detected on the west side of the property by an airborne geophysical survey. The property was returned to Teuton in 2006.

Currently the property is under option to Copper Creek Gold Corp.

Mineralized Showings

Mapping has shown that a discontinuous but laterally persistent series of rhyolite domes trends north and south of the principal Bonsai showing. The rhyolite domes intrude sedimentary rocks consisting of mudstones and siltstones interpreted to be part of the Aelenian to Bajocian Salmon River Formation sedimentary rocks which are host to the Eskay Creek deposit.

Surface work in 1992 uncovered several gold-arsenic-mercury sample sites around the principal showing. A 1.5m sample from a felsic tuff ran 2,540 ppb gold, 1,180 ppm arsenic and 8,900 ppb mercury. Float samples in the vicinity ran to 1,800 ppb gold, 2,125 ppm arsenic and 27,000 ppb mercury. However, five holes totalling 1,180m put down in 1995 did not intersect similar mineralization, leaving the surface results unexplained. A deep hole collared several hundred meters to the east in 1996 did not encounter Eskay Creek stratigraphy at depth.

Work by optionee Heritage Explorations from 2002-2005 began with a compilation of all previous property exploration using the proprietary Geoinformatics modeling program (also compiling disparate data sets from scores of exploration programs carried out in and around Eskay Creek). This led to a drill program of the principal Bonsai prospect discussed above. A geological report by Heritage's qualified person, G. E. Bidwell, and A. W. Worth, stated: "Drilling at Bonsai in 2003 has intersected significant low grade gold/silver mineralization in pyritic rhyolite breccia, beneath the main gossan outcrop. The mineralized zone is open at depth and to the south and represents an excellent target for future exploration". The hole referred to returned a 64 meter intersection of brecciated rhyolite containing 0.38 g/t gold and 27.08 g/t silver.

In 2004 Heritage drilled an additional hole to test the strike extension of this zone. On Nov. 5, 2004 Heritage reported results from this hole: a 10m interval from 92 to 102 m returned 0.24 g/t gold and 14.24 g/t silver; a further 18.0 interval from 122 to 140 m returned 0.17 g/t gold and 15.31 g/t silver.

During the 2005 field season, after an airborne survey commissioned by Heritage had detected a major geophysical EM anomaly in the western part of the Bonsai property, a drill was again mobilized to the property. Two holes were drilled into the anomaly and two into the main showings area to the east. In a Dec. 12, 2005 press release, St. Andrew Goldfields (successor company to Heritage) reported that none of these holes had intersected significant gold mineralization.

In the 2010 season, Copper Creek Gold undertook a second drill test of the EM anomalous area. This was preceded by surface geophysical programs and MMI geochemical sampling, which identified a number of targets. Eleven holes at a total cost exceeding $1 million were drilled along the anomalous conductor, but assay results did not live up to expectations.