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Johnson Canyon

Overview

The Johnson Canyon project comprises 105 claims in two contiguous blocks, located in Lander County, Nevada, approximately 16 km south of Austin. The northern portion of the Company's former Porter Canyon project has been merged with the Johnson Canyon claims and will be referred to as the Johnson Canyon project going forward. Geologically, the claims cover the north-west corner of the Quito lower-plate window. This corner is also coincident with the projected intersection of two major crustal structures; the Northern Nevada Rift central and the northern flank of the Eastgate Trough. The Quito window hosted the formerly producing Quito Mine, a Carlin deposit from which approximately 175,000 ounces of gold were recovered. The majority of the Quito window lies within US Forest Service lands rendering it very difficult to permit for exploration. The Company's property is largely on BLM land which is much easier to permit.

Subsequent to staking the Johnson Canyon claims, the Company executed geophysical surveys which entailed gravity, magnetics and CSAMT. In 2011 and 2016, the Company undertook initial drilling in an area of highly anomalous (to 5.2 g/t Au) gold mineralized float. Two drill holes intersected gold enriched intervals in the basal gravels of the pediment that may represent the fringe of an auriferous lag deposit related to a proximal bedrock source to the north. The bottom 47.2 m of hole PC-6 averaged over 70 ppb Au with the bottom 1.5 m assaying 160 ppb Au, at a depth of 404 m

The detailed surface geology of the Quito Window, 2 km to the north of this lag occurrence, shows striking similarities to the northwest corner of the Cortez window, with a broad flat-lying bedrock bench suggested to extend under shallow pediment cover for 2 km west of the Toiyabe Range.

Given that similar levels of gold in alluvium are proximal to several major known Carlin-type gold deposits in Nevada, management considers that these results warrant aggressive follow-up drilling.