Croteau Est Gold Property

The Croteau Est gold property is a large property situated within one of Québec’s more important and long- standing mining and mineral exploration camps: the Chapais- Chibougamau gold- copper camp1. The property is easily accessible year round from three mining service- based communities: Chapais, Chibougamau and Oujé Bougoumou (Figure 1). The property is also in close proximity to an airport, railway and hydro grid. So far:

1. Northern Superior has discovered a gold- bearing shear zone2 (the Croteau-Bouchard Shear  Zone {CBSZ}; minimum dimensions of 1.1 km long, up to 150 m wide, minimum depth of 575 m) with grades reported as high as 75 g/ t gold over 5 m;

2. An inferred mineral resource and exploration potential/ target determined for the central part of the CBSZ was determined (based on only 64 core holes or 20,643m). Highlights include:

  • Inferred Mineral Resource estimate for the central section (approximately 550m strike by 150m width) of the CBSZ, reported using a gold cut-off of 1.0 g/t Au totaling 11.6 million tonnes grading 1.7ppm Au, yielding 640,000 ounces of gold;
  • The Inferred Mineral Resource estimate is based on 64 core drill holes (20,643 m);
  • An exploration potential/target, ranging from 3.2 to 3.8 million tonnes, for a total of 122,000 to 270,000 ounces of gold, was identified by mineralisation defined by single drill- hole intersections (see cautionary language noted in the discussion below); and
  • Mineralisation occurs at surface, and remains open along strike in both directions (length defined thus far 1.1km) and at depth (only one hole to 575m vertical depth).

3. Northern Superior has determined the structural framework of the property, critical to understanding gold mineralization and therefore defining targets for additional reverse circulation (RC) and core drill programs.

NOTE: Access to the related National Instrument 43-101 Standards of Disclosure for Mineral Projects (“NI 43-101”) Technical Report on the website is provided through a website link (NI-43 101 Croteau-Est – central CBSZ Report), the report is also filed with SEDAR for public disclosure. The associated press release is posted on this web site (January 14th, 2016) and is also filed with SEDAR- a summary is presented in this documented under “Inferred Mineral Resource and Exploration Potential/ Target” section.

Highlights

  • Discovery of gold mineralized boulders by Gilbert Lamothe and Marc Bouchard that eventually lead to the discovery of the CBSZ by Northern Superior Resources (see Northern Superior Resources Inc. press release, July 20th, 2011c); 1
  • Option agreement signed between GL Geoscience Inc., Marc Bouchard and Northern Superior Resources (see Northern Superior Resources Inc. press release, August 24th, 2011b); 2
  • First visible gold identified at the CBSZ, assay results of 1.9 g/t gold over 33.8 m reported (see Northern Superior Resources Inc. press release, September 21st, 2011a);
  • Northern Superior signs option agreement with Murgor Resources Inc. to acquire adjoining Waconichi property (see Northern Superior Resources Inc. press release, July 6th, 2012c);
  • Northern Superior reports intersection of high grade gold zones from a core drill program on the CBSZ (see Northern Superior Resources Inc. press release, September 12th, 2012b);
  • Northern Superior named AEMQ prospector of the year award for its discoveries on the Croteau Est property (see Northern Superior Resources Inc. press release, November 20th, 2012a);
  • Northern Superior acquires 100% rights to adjoining Murgor Resources Waconichi gold property (see Northern Superior Resources Inc. press release, May 27th, 2013b);
  • Northern Superior, the First Nation community of Oujé Bougoumou, the Cree Regional Authority and the Grand Council of the Cree sign a Pre- development Agreement (see Northern Superior Resources Inc. press release, June 11th, 2013a);
  • Northern Superior defines seven new gold and base metal targets (see Northern Superior Resources Inc. press release, May 7th, 2014b);
  • Northern Superior exposes a high grade gold shoot at the CBSZ and expands the Croteau Est gold potential (see Northern Superior Resources Inc. press release, November 3rd, 2014a);
  • Northern Superior signs option agreement with Chalice Gold Mines (see Northern Superior Resources Inc. press release, April 21st, 2015c);
  • Northern Superior initiates and successfully completes core and reverse circulation drill programs (see Northern Superior Resources Inc. press release, May 25th, 2015b);
  • Northern Superior regains 100% control of the Croteau Est property as Chalice Gold Mines Ltd. backs out of option and joint venture agreements citing change to internal strategy decisions (see Northern Superior Resources Inc. press release, December 22nd, 2015a).
  • Northern Superior announces Inferred Mineral Resource Estimates at its Croteau Est Gold Property, West- Central Québec (see Northern Superior Resources Inc. press release, January 14th, 2016).
  • Northern Superior expands its understanding and definition of several key mineral exploration targets on its Croteau Est gold property, west- central Québec (see Northern Superior Resources Inc. press release, January 21, 2016a)

NATIONAL INSTRUMENT 43-101 STANDARD OF DISCLOSURE FOR MINERAL PROJECTS - CENTRAL CBSZ

NI 43-101 Croteau-Est – Central CBSZ Report

On January 14th, 2016, the Company announced that it had received a National Instrument 43-101 – Standards of Disclosure for Mineral Projects (“NI 43-101”) Technical Report (dated September 28, 2015) prepared by Optiro Pty Limited (the “Optiro Report“, 2015), which includes Inferred Mineral Resource estimates (see Table 1) for the central part of the CBSZ.

Table 1.          Croteau Est September 2015 Mineral Resource appropriate for public reporting                                      at 1.0 ppm gold cut-off.

Category Tonnes (Mt) Gold grade (Au g/t) Gold ounces (Koz)
Inferred Mineral Resource 11.6 1.7 640

Due to the inherent sample support issues associated with including channel sample assay data into resource models, previously reported high grade assay values from several trench exposures across the central CBSZ were excluded from the Optiro Report and model (see press releases: October 12, 2011; November 12, 2013; November 3, 2014).

Northern Superior management believes that the Inferred Mineral Resource estimates presented by the Optiro Report represent a great start to understanding the gold potential of the CBSZ specifically, and the Croteau Est property as a whole. Keep in mind that the inferred resource reported here is based only on 64 core drill holes or 20,643 m of core drilling (Figure 2). On the CBSZ alone, a tremendous opportunity exists to expand the number of gold ounces within the CBSZ based on the premise that additional exploration may:

  • upgrade some of the exploration potential/target of the CBSZ Figure 3;
  • convert part of the Inferred Mineral Resource to Indicated Mineral Resource category by infill drilling of core drill holes, from 50m x 50m to 25m x 25m;
  • add additional gold ounces by inclusion of the high grade gold values previously reported from channel samples cut in several trenches at surface within the central part of the CBSZ in future modelling;
  • identify potential high grade rods or shoots within the CBSZ (see Northern Superior Resources press release, November 3, 2014) with tighter collar spacing; and
  • identify additional gold ounces along strike (east and west) of the central CBSZ and at depth, as the system is open in those directions.”

Management at Northern Superior has always maintained that the CBSZ is a small component of a much larger gold mineralized system on the property, based not only on management’s observations but from those recommendations made from several qualified consultants who have worked on the project. Northern Superior hopes to find a partner that will assist the Company to realize the potential at the CBSZ.

Optiro Report Recommendations Include:

  • Infill drilling of the central section of the CBSZ deposit to 25 x 25m drill hole spacing to potentially upgrade the classification of this area to Indicated Mineral Resource category; and
  • Exploration drilling to test along strike extensions of the central CBSZ deposit, in particular on the eastern end of the deposit, where there are three drill holes that have mineralised intervals consistent with the projection of the CBSZ. These intersections may suggest either an isolated zone of mineralisation, or continuation of mineralisation of an unknown extent along the CBSZ.

Inferred Mineral Resource Classification:

  • The Inferred Mineral Resource estimates have been generated from drill hole sample assay results and the interpretation of an integrated 3D geological model that defines the relationships of various geological elements within the CBSZ. The interpreted mineralisation wireframes (using a nominal 0.25 ppm Au cut-off grade) have been used to constrain gold grade estimates.
  • Block grade estimation parameters have been defined on the basis of geology, drill- hole spacing, and through geostatistical analysis of the data. Block grade estimation is by ordinary kriging (OK) into a panel size of 12.5 mE by 2.5 mN on 2.5 mRL, which is considered appropriate for the distribution of sample data and the deposit type.
  • The Inferred Mineral Resource estimates have been classified by their proximity to the sample locations and confidence in the block model grade estimate, and have been reported in accordance with the guidelines of the JORC Code (JORC, 2012). The JORC Code was used because the company’s former partner on the project was an ASX and TSX listed company with an Australian head office. The company’s QP (defined below) is confident there are no material differences between JORC Code guidelines regarding inferred mineral resources and those set forth in Standards on Mineral Resources and Reserves of the Canadian Institute of Mining, Metallurgy and Petroleum (CIM, 2010).
  • A more detailed description on the modelling and statistical parameters used to determine the Inferred Mineral Resource estimates are provided within the Optiro Report.

Exploration Potential/Target:

The Optiro Report also identified additional mineralised material on the CBSZ which lacked sufficient confidence to be classified as an Inferred Mineral Resource but that the uncertainty with this material is such that with further work, this could change and hence, represents an exploration potential/target. Specifically, the Optiro Report indicates an exploration potential range of 3.2 to 3.8 million tonnes, for a total of 122,000 to 270,000 ounces of gold.  To evaluate the exploration potential, the unclassified mineralisation above 1.0 g/t cut-off, was tabulated as being above/below 325 m below surface and by lode. Any mineralisation associated with lode 1 (the main lode) was incorporated into the exploration potential. The lower range for the minor lode was estimated as follows: (i) below 325 m below surface, lodes greater than 2.0 g/t gold were included as exploration potential; and (ii) above 325 m below surface, lodes greater than 1.5g/t golf were included as exploration potential. The maximum range assumed that with further work, up to 100% of the unclassified mineralisation may be upgraded. The Optiro Report further noted that more than 90% of this material is at depths greater than 325 m below surface and that a significant amount of work will be required to improve the confidence for this material.  As such, caution must be exercised as the potential quantity and grade is conceptual in nature, there has been insufficient exploration to define a mineral resource and that it is uncertain if further exploration will result in the target being delineated as a mineral resource.

The Property

The Croteau Est gold property are centered 28 km northeast of Chapais, and 17 km northwest of Chibougamau within Barlow and McKenzie townships in north-central Québec (Figure 1). The Croteau Est property consists of a contiguous block of 502 claims that encompass an area of approximately 22,051 hectares within Barlow, McKenzie, Blaiklock and Richardson Townships, in north- central Québec

(Figure 4); NTS mapsheets: 32G/15, 32G/16, 32J/01, 32J/02).

The Croteau, Waconichi, and Waconichi South properties which comprise the Croteau Est property all currently have substantial excess exploration credits that reduce the overall amount of annual expenditures required on the property. Audited financial statements of exploration costs for the Croteau and Waconichi properties during the period 2011 to 2013 (Croteau) and 2012 to 2013 (Waconichi) indicate exploration expenditures of $7.204 million to the end of 2013.

On April 21, 2015, the Company announced a $4.0 Million option/joint venture agreement on its Croteau Est project in west-central Québec, with Chalice Gold Mines Limited (“Chalice”)(see Northern Superior Resources press release April 21st, 2015c). After fulfilling their first year spending commitment of $500,000, Chalice opted out of the agreement citing internal change in exploration strategy (see Northern Superior Resources press release, December 22nd, 2015a).

The Croteau Est property is 100% Northern Superior Resources.

 

Figures

Figure 1: The Croteau Est gold property, west- central Québec.

Figure 2: Cross section looking west illustrating drill traces and gold grade values intersected (Optiro figure 14.4 b,2015)

Figure 3: Applied Mineral Resource classification - long section view looking north: Inferred Mineral Resource (yellow area); exploration potential/target (red area) (Optiro, figure 14.19,2015) 1

Figure 4: Claim fabric, Croteau-Est gold property 1

Figure 5: Regional geology of the Abitibi subprovince (from Avery 2014) 1

Figure 6: The regional geology of the Chapais - Chibougamau district (from Avery 2014)

Figure 7: Croteau-Est property geology (Avery 2014)

GEOLOGY

Regional Geology

The Chibougamau- Chapais mining camp is located in the northeast corner of the Matagami- Chibougamau Greenstone Belt (MCGB) of the Abitibi Subprovince of the Archean Superior Province. It is bordered either to the north and south by poorly known Archean granite and gneissic terrains, and to the east by the Grenville Province, wherein the east- west stratigraphy of the belt abruptly terminates along the Grenville Front (Figure 5)

The geology of the Chibougamau- Chapais district consists of two Archean age mafic to felsic volcanic cycles (Roy Group) unconformably overlain by the Opémisca Group volcano- sedimentary sequence (Figure 6). The volcanics and associated sediments are intruded by a series of large granitoid plutons and septa of probable basement which influence the prevailing tectonic fabric of the district, typified by alternating greenstone belts and aligned granitic plutons.

During the Archean period, extensional tectonics within the Matagami- Chibougamau Greenstone Belt initially produced an extensive volcanic submarine pile of pillowed basalts and minor felsic pyroclastics surmounted by large shield volcanoes (Obatogamau Formation), upon which a large number of small intrusive felsic eruptive centres developed (Waconichi Formation). These rocks were broadly folded during an initial phase of deformation (D1). During this initial extensional regime a number of early plutons were also emplaced giving rise to local domes in the district. Normal faulting associated with emplacement of the plutons produced a series of flanking grabens which were subsequently filled by sediments. The surrounding volcanic highlands and emerging plutons were eroded, producing graben filling sediments of the Opémisca Group. North- south horizontal shortening (D2 deformation) followed the initial phase of extensional tectonics in the belt resulting in the dominant regional east-west foliation throughout the district.

As the major tectonic event in the Chibougamau- Chapais district, D2 deformation is characterized by a well- developed east- west axial planar schistosity and is responsible for most of the isoclinal folds in the region. The Kenoran age deformation is seen to consist of two distinct events: folding and ductile faulting, either of which, are seen to have evolved progressively over time in the district and is responsible for the development of the Faribault and Gwillim faults that exert regional structural controls on the localization of several zones of east-west shear zones of variable thickness (2- 20 m) accompanied by strong ferrocarbonate alteration on the Croteau Est property.

A third regional deformation event (D3) in the Chibougamau- Chapais district has resulted in two sets of brittle faults: one set oriented northeast, and one set oriented north- northeasterly. These brittle faults demonstrate both oblique dextral and sinistral movement that form secondary dilatant zones with respect to the existing east- west shears in the district.

Property Geology

The current understanding of the property geology is summarized in Figure 7. The geology presented is the culmination of several prospecting, bedrock mapping, geophysical interpretation, reverse circulation drilling, core drilling programs and integration of all publicly available data.

The Croteau and Waconichi properties are underlain by a mafic dominated volcanic package that corresponds to the Bruneau Member of the upper part of the Gilman Formation. On the Waconichi property, the Bruneau Member is separated from volcaniclastic and sedimentary rocks of the Blondeau Formation by the regional east-west trending Faribault Fault.

The Bruneau Member largely consists of massive to pillowed, hyaloclastic and brecciated basalts that have been intruded by co- magmatic gabbroic sills and/or massive flows. Within the mafic volcanic sequence, narrow intervals of intermediate to felsic volcaniclastics also occur locally, as well as several crosscutting quartz- porphyry and quartz- feldspar porphyry dykes. The northwest portion of the Croteau property investigated by trenching and diamond drilling undertaken by Northern Superior Resources since 2011 is also seen to contain a 400 m wide belt of volcano- sedimentary rocks (intermediate tuff, argillite and siltstone) that are seen to be intruded by a series of synvolcanic felsic, intermediate, and quartz- feldspar porphyry dykes. The south dipping, east- west contact between mafic volcanics and volcano- sedimentary rocks provides the locus for shearing and mineralization within the CBSZ on the Croteau property.

Within the CBSZ, strongly developed carbonate- ankerite- sericite alteration accompanied by localized fuchsite alteration is observed across decametre- wide intervals. The alteration zones which vary 20- 120 m in width, are characterized by variable quantities of quartz vein development, of which three sets are recognized in various trench exposures. Pyrite and lesser trace quantities of chalcopyrite are also observed as coarse to fine disseminations spatially associated with quartz veins hosted by strongly ferrocarbonate (ankerite) and sericite altered wallrocks.

Deposit Types

Although gold was first discovered in the Chapais- Chibougamau district as early as 1903, no permanent development took place until 1949 when economic copper deposits were discovered near Chapais. And although having begun as a copper mining camp, the Chibougamau- Chapais district has also been a major past producer of gold. Since its beginning, this camp was produced some 1,050 mt of gold at an average grade of 1.85 g/t Au.

Within the Chapais- Chibougamau camp there is a distinct variation in the average gold, silver and copper grades between various types of deposits in the district which is a product of the various ore generating systems that have evolved over time.

The most important gold mineralizing event in the camp coincides with the onset of the Kenoran Orogeny (ca. 2700 Ma) which resulted in a major series of east- west trending faults and shear zones that acted as a precursor for a major gold mineralizing episode. A number of deposits in the region (e.g. Cooke, Norbeau, Gwillim, Joe Mann) are hosted by such east- west structures. The spatial relationship between east- west trending shear zones and northeast trending fault systems has also been shown to be a possible mechanism for generating added dilatancy during a late Kenoran gold mineralizing phase. These are typically lode gold deposits associated with shear zones showing characteristic advanced argillic (carbonate- ankerite- sericite- pyrite) alteration with the major gold mineralizing episode occurring late in the deformation sequence. The deposits bear a strong resemblance to other Archean lode gold hosted deposits elsewhere in the Abitibi Subprovince. The veins are mostly auriferous with, or without economic grades of copper. Gold occurs as a visible phase or as microscopic grains associated with pyrite and chalcopyrite. Most of these deposits are hosted within mafic sills.

A later, post- Kenoran shear system controlled the emplacement of the last major phase of gold mineralization in the district characterized by stratiform ultramafic intrusions of the Lac Doré Complex. Shear zones associated with the post- Kenoran Grenville Orogeny consist of southwest trending, northerly dipping, left lateral oblique dip slip shears that host numerous copper-gold deposits in the Chapais- Chibougamau district.

Exploration Outlook

There are two very important exploration streams that should be pursued on the Croteau Est gold property. The first centers on the CBSZ, where Management sees a clear opportunity to increase the number of gold ounces on an inferred resource with additional drilling on what is already defined (see previous section National Instrument 43- 101- Standards of Disclosure for Mineral Projects [NI 43-101] Technical Report).

The second involves earlier stage exploration targets already defined on the property and summarized in several press releases (see Northern Superior press releases, May 7th, 2014b; November 3rd, 2014a; January 25th, 2016a).

The discovery of the Croteau Fault at the eastern terminus of the CBSZ represents a second major target on the property with potential to host economic quantities of mineralization. It is recommended that areas of high gold values within the fault be tested either by grid style percussion drilling or diamond drilling in order to better define the alteration characteristics, style(s) of mineralization present, and associated grades in this area. Several other structurally similar settings elsewhere on the property should also be evaluated by means of geological mapping, prospecting, and trenching and stripping during subsequent field work on the property.

Much opportunity exists within the Croteau Est property, with a terrific opportunity to expand the known inferred mineral resource and exploration potential/ target value associated with: 1) the central CBSZ; and 2) several high quality exploration targets that remain untested. Northern Superior is looking for a partner to help the Company move all these opportunities forward.


Avery, R.W. 2014. Technical report on the geology of, and results from, the Croteau Est project, Québec,Barlow, McKenzie, Blaiklock and Richardson Townships, Québec [NTS: 32G/15, 32G/16, 32J/01,32J/02]. Internal Northern Superior Resources report, 132 p.

Northern Superior Resources Inc., 2016a. Northern Superior expands its understanding and definition of several key mineral exploration targets on its Croteau Est property, west- central Québec.Northern Superior press release, 7 p.

Northern Superior Resources Inc., 2016b. Northern Superior announces inferred mineral resource estimates at its Croteau Est gold property, west- central Québec. Northern Superior press release, 5 p.

Northern Superior Resources Inc., 2015a. Northern Superior Resources Inc. informed of Chalice Gold Mines Croteau Est option intentions. Northern Superior press release, 2 p.

Northern Superior Resources Inc., 2015b. Northern Superior announces drill program, Croteau Est property, west- central Québec. Northern Superior press release, 5 p.

Northern Superior Resources Inc., 2015c. Northern Superior and Chalice Gold Mines Limited sign formal option and joint venture agreements with respect to Northern Superior’s Croteau Est gold property, Québec. Northern Superior Resources press release, 3 p.

Northern Superior Resources Inc., 2014a. Northern Superior Resources: Summer exploration program expands gold potential, Croteau Est gold property, Québec. Northern Superior Resources press release, 7 p.

Northern Superior Resources Inc., 2014b. Northern Superior discovers new gold bearing structural zone, identifies seven new gold/ base metal targets, Croteau Est gold property, Québec. Northern Superior Resources press release, 3 p.

Northern Superior Resources Inc., 2013a. Northern Superior signs Pre-development Agreement with the Grand Council of the Crees (Eeyou Istchee), Cree Regional Authority and the Oujé-Bougoumou Cree Nation. Northern Superior Resources press release, 3 p.

Northern Superior Resources Inc., 2013b. Northern Superior Resources Inc. agrees to acquire Waconichi Gold Property, Chibougamau Gold District, Québec. Northern Superior Resources press release,  3 p.

Northern Superior Resources Inc., 2012c. Northern Superior intersects 75.44 g/t gold over 4.80 m and expands the Croteau Est gold discovery, Québec. Northern Superior Resources press release, 5 p.

Northern Superior Resources Inc., 2012b. Northern Superior intersects high grade gold zones and expands Croteau Est Gold Discovery, Québec. Northern Superior Resources press release, 4 p.

Northern Superior Resources Inc., 2012c. Northern Superior Resources Inc. signs option agreement to acquire a 70% interest in Murgor Resources Inc.’s Waconichi Gold Property, Chibougamau Gold District, Québec. Northern Superior Resources press release, 3 p.

Northern Superior Resources Inc., 2011a. Northern Superior Resources Inc. reports visible gold identified in Trench-3 and 1.9 g/t gold over 33.8 meters from Trench-1, Croteau Est Gold Property, Chibougamau Gold District, Québec. Northern Superior Resources press release, 4 p.

Northern Superior Resources Inc., 2011b. Northern Superior Resources Inc. signs formal Option Agreement to acquire a 100% interest in the Croteau Est Gold Property, Chibougamau Gold District, Québec. Northern Superior Resources press release, 3 p.

Northern Superior Resources Inc., 2011c. Northern Superior Resources signs letter of intent to acquire the Croteau Est Gold Property, Chibougamau Gold District. Northern Superior Resources press release, 3 p.

Optiro Pty Limited, 2015. Chalice Gold Mines Ltd. and Northern Superior Resources Inc. Technical Report on the Croteau Est Gold Property. Commissioned report by Chalice Gold Mines Ltd., 158 p.