Blue Moon, USA

Blue Moon, USA

Overview

The Company is focused on the advanced stage 100% owned Blue Moon zinc project. The Blue Moon project is subject to a NI 43-101 resource assessment with approximately 2.62 million tons with a grade of 6.01% zinc in the Indicated category and 2.68 million tons with a grade of 5.98% zinc in the Inferred category plus significant bi-products of copper, silver and gold. The resource is open at depth and along strike and has favourable metallurgy. A report detailing the resource is available here and filed on SEDAR on February 21, 2008. The Company plans to advance the project to feasibility and permitting.

Location/Access

The Blue Moon Deposit is wholly-owned by the Company and is located in east central California within Mariposa County in the Foothills. The property is accessible by gravel roads off nearby paved highway. There are active mines in the region and was part of the original California gold rush.

Infrastructure

The main transmission lines and a hydroelectric power generation facility are both within one mile of the property. Sea ports, rail and trucking routes are all accessible.

History

Mining by Hecla Mining Company during 1943-1945 produced 55,656 tons grading 12.3% zinc, 0.36% copper, 0.48% lead, 3.75 oz/ton silver and 0.062 oz/ton gold. The property was actively explored by Colony Pacific Explorations Ltd. (now Imperial Metals), Westmin Resources Limited (Now Boliden) and Lac Minerals (now Barrick) in the 1980s and 1990s.

Resource

Review, verification and analysis of the historical data has provided a preliminary NI 43-101 compliant resource estimate of the poly metallic massive sulphide deposit at its Blue Moon project. The technical report was co-authored by Moose Mountain Technical Services and Giroux Consultants Ltd. (“GCL”). The resource estimate estimated by GCL at Blue Moon has been classified as indicated and inferred.

For resource calculations purposes, it has been assumed that the Blue Moon Deposit would likely be mined by underground methods. The results of the resource estimate are as follows:

BLUE MOON MINERALIZED PORTION OF BLOCKS – CLASSED INDICATED
Cutoff Tons > Cutoff Grade > Cutoff Contained Metal
GRV (tons) Zn Cu Ag Au Pb Mlbs Mlbs Mlbs Mozs Mozs
US$ (%) (%) (oz/t) (oz/t) (%) Zn CU Pb Ag Au
$75 3,020,000 5.63 0.64 1.36 0.04 0.26 339.93 38.41 15.52 4.11 0.109
$85 2,620,000 6.01 0.67 1.41 0.04 0.27 314.77 35.21 14.10 3.69 0.100
$95 2,270,000 6.38 0.71 1.42 0.04 0.28 289.79 32.05 12.62 3.23 0.089

BLUE MOON MINERALIZED PORTION OF BLOCKS – CLASSED INFERRED
Cutoff Tons > Cutoff Grade > Cutoff Contained Metal
GRV (tons) Zn Cu Ag Au Pb Mlbs Mlbs Mlbs Mozs Mozs
US$ (%) (%) (oz/t) (oz/t) (%) Zn CU Pb Ag Au
$75 3,120,000 5.58 0.39 1.56 0.04 0.39 348.00 24.15 24.21 4.85 0.122
$85 2,680,000 5.98 0.41 1.63 0.04 0.40 320.37 21.71 21.65 4.37 0.107
$95 2,190,000 6.47 0.43 1.75 0.04 0.42 283.25 18.79 18.57 3.83 0.090

Exploration Upside

Remodelling of the deposit using the digitized data shows the deposit is open both to depth and to the south. The potential to expand the current resources is considered excellent.

Metal Prices and Estimated Recoveries (Metallurgy)

As the Blue Moon is a multi-variable deposit with all variables contributing to the economic value a method of combining the grades into one variable was required. A gross recoverable value “GRV” was chosen making use of reasonable metal prices and estimated recoveries. The parameters used were as follows:

Zinc            $0.75/pound               95% Recovery
Copper      $2.00/pound               93% Recovery
Lead          $0.78/pound                95% Recovery
Silver         $8.50/ounce                 65% Recovery
Gold          $600 /ounce                 70% Recovery

The equation to calculate GRV was as follows:
GRV (US$) = Zn% * 14.25 + Cu % * 37.20 + Pb% * 14.82 + Ag(oz/t) * 5.525 + Au(oz/t) * 420.0

Recoveries used in the calculation are based on metallurgical testing of drill core undertaken by Lakefield Research on samples of mineralization.

The NI 43-101 report was produced by Gary Giroux, P.Eng. MASc and Robert J. Morris, MSc. P.Geo. who are Qualified Persons as defined by NI-43-101 and are responsible for the technical material related to the resource calculation. The NI 43-101 report is available here and on SEDAR (February 21, 2008)

Jack McClintock, P. Eng, is a qualified person as defined by NI 43-101, has reviewed the scientific and technical information that forms the basis for our website. Mr. McClintock is not independent of the Company.

Cautionary Statement on Forward-Looking Statements

Information set forth in this summary contains forward-looking statements that are based on assumptions as of the date of this summary. These statements reflect management’s current estimates, beliefs, intentions and expectations. They are not guarantees of future performance. The Company cautions that all forward looking statements are inherently uncertain and that actual performance may be affected by a number of material factors, many of which are beyond their respective control. Such factors include, among other things: risks and uncertainties relating to each of the Company’s limited operating history and the need to comply with environmental and governmental regulations. Accordingly, actual and future events, conditions and results may differ materially from the estimates, beliefs, intentions and expectations expressed or implied in the forward looking information. Except as required under applicable securities legislation, Blue Moon undertakes no obligation to publicly update or revise forward-looking information.