Kamloops, BC, Canada

Ajax Copper/Gold Project - Feasibility Study, February 19, 2016

Mineral Resources

The Mineral Resource Estimate was generated using drill hole sample assay results and an interpretation of the geologic model. The mineral resource database is a sub-set of the Ajax database and consists of 208,050 metres of drilling in 665 drill holes. The spatial distribution of Au-Ag in relation to Cu shows a reasonably strong correlation among the three metals, allowing Cu-Au-Ag to be grouped in mineralized domains. The Mineral Resource Estimate is summarized as follows: 

Mineral Resource Summary - NSR Cut-off of US $7.10/t Ajax Project

Classification Tonnage (Mt) Cu (%) Au (g/t) Ag (g/t)
Measured (M) 148 0.28 0.18 0.37
Indicated (I) 420 0.25 0.18 0.35
M + I 568 0.26 0.18 0.35
Inferred 29 0.13 0.09 0.17

Notes: 1. CIM Definitions were followed for Mineral Resources. 2. Mineral resources are estimated at an NSR cut-off of $7.10. 3.Mineral resources are estimated at US$4.00/lb Cu, US$1800/oz Au, and US$26/oz Ag. 4. Inferred blocks were included in generating pit shell. 5. Mineral resources are reported inclusive of mineral reserves. 6. Tonnages and grades are rounded to reflect the accuracy of the estimate, and numbers may not add due to rounding. 7. Mineral resources that are not mineral reserves do not have demonstrated economic viability.

Mineral Reserves

To estimate the mineral reserves, mining and milling parameters along with modifying factors such as mining dilution and mining losses were used. Pit slope design and pit wall depressurization recommendations for the proposed Ajax open pit were incorporated. Mining and processing costs per tonne were estimated and process recoveries were included in the NSR calculation for each of the six common metallurgical zones. The Mineral Reserve Estimate is summarized as follows:

Ajax Project Mineral Reserves Estimate - NSR Cut-off of US$7.10/t

Average ROM Grades Contained Metal
Proven Mineral Reserves 130 0.30 0.19 0.40 875 791 1,677
Probable Mineral Reserves 296 0.28 0.19 0.38 1,818 1,813 3,615
Proven & Probable Mineral Reserves 426 0.29 0.19 0.39 2,693 2,605 5,292

Notes: 1. CIM Definitions were followed for Mineral Reserves. 2. Mineral Reserves are estimated at an NSR cut-off of $7.10. 3. Mineral Reserves are estimated based on long term metal prices of US$3.21/lb Cu, US$1200/oz. Au, and US$17/oz. Ag. 4. Inferred blocks were included as waste blocks in generating the economic pit shell. 5. Process recoveries for the six common metallurgical zones are included in the NSR estimation. 6. Tonnages and grades are rounded to reflect the accuracy of the estimate, and numbers may not add correctly due to rounding.

In the opinion of the Qualified Persons mentioned in the press releases of January 13, 2016 and February 23, 2016, estimations of mineral resources for the Project conform to industry best practices and meet the requirements of CIM (2010). An economic Lerchs-Grossman (LG) pit shell was used to constrain the estimate and develop a mine design, and appropriate modifying factors were applied to convert Measured and Indicated Mineral Resources to Proven and Probable Mineral Reserves. As well, knowledge of the deposit settings, lithologies, and structural and alteration controls on mineralization is sufficient to support Mineral Resource and Mineral Reserve estimates. The exploration programs completed to date are appropriate to the style of the deposits and prospects within the Project. 

In addition, sample collection, preparation, analytical and QA/QC data from the Abacus and KGHM Ajax drilling programs were appropriate and meet industry standards. The QPs consider that a reasonable level of verification has been completed during the audits undertaken in 2008-2009, 2010, 2011 and 2014 by MDA, and that no material issues would have been left unidentified from the audit programs undertaken. The data verification programs undertaken on the data collected from the Project adequately support the geological interpretations, the analytical and database quality, and therefore support the use of the data in mineral resource estimation.

Mr. Keith Dagel, P.E. of M3 Engineering & Technology Corp. reviewed and approved the scientific, technical, and economic information contained in the news releases. For further details on the Ajax Project, NI 43-101 Feasibility Study Update Technical Report, including the list of Qualified Persons involved in its preparation, please refer to the technical report available on this website and the Company's filings on Sedar (www.sedar.com).